Tough line on U.K. wages

Press, 3 July 1978, Page 8

Tough line on U.K. wages

The British Prime Minister (Mr Callaghan) has bluntly told the people of Britain that they should expect only tiny pay increases in the next round of wage bargaining.

In a speech to a tradeunion conference, Mr Callaghan hinted that the Government was aiming for increases of about 5 per cent, compared with about 14 per cent in the present year. The new round of bargaining will begin in August. “Do not view it with shocked disbelief and cries of anguish when you hear what the Government has in mind,” the Prime Minister said.

His speech set the stage for a confrontation with the unions and a General Election battle over pay policy with the Conservatives.

The government will publish its new wages policy shortly. Mr Callaghan did not reveal what increases it wanted but left no doubt the figure would be well below 10 per cent. If inflation were to be checked, wage increases had

to be pegged, he said. “I d< not know whether you wit like it, but what I do know is that it is essential policy number one.” The Labour Government would “fight in the country’ to realise its earnings objective. The Leader of the Opposition (Mrs Thatcher) has been talking of a return tc free wage bargaining in th< private sector if the Conservatives win the Genera! Election, expected in October.

Pay loomed as the central argument in the electior campaign.

Meanwhile, a salary review body has recommended big increases for judges, sem ior military officers, and executives of nationalised industries to bring them up to levels in the private sectors.

There was an immediate outcry from I-eft-wing politicians and it appeared doubtful that the government would implement all the increases. The review body advocates rises of more than 100 per cent for some top public servants.