The government needs to rethink its strategy on strikes

Declaring war on the unions by changing the law would make peace even harder to achieve, writes Andrew Grice

Voters know that public sector pay has been held down during the years of austerity (AFP/Getty)

The government’s strategy on the wave of industrial action isn’t working. Ministers express the hope that “the tide is turning” against the strikers but the Royal College of Nursing (RCN) hailed the first strike in its 106-year history as a “turning point”.

The uncompromising line of ministers might have worked if their only battle was against the rail workers, but the nurses are different. Public sympathy for them has persuaded several Tory MPs to call on the government to improve its pay offer. This is significant, as Tory backbenchers have been under strong pressure not to break ranks.

The latest opinion poll, for GB News today, shows that 44 per cent of people support the strikes and 29 per cent oppose them. But Ispos found that public backing for the nurses’ action has fallen. Privately, both government and union insiders admit public opinion is on a knife edge and could tip either way. Next week’s strike by ambulance workers could easily have more severe consequences than the nurses’ action.

The Tories bang on about “Labour’s Christmas nightmare”, but they ignore the lessons of history: as both the Labour prime minister James Callaghan and the Tories’ Edward Heath discovered, the government cannot escape blame for chaos caused by industrial disputes.

Ministers are losing the blame game, and I think they will have to give some ground. They are under growing pressure to ask the nurses’ pay review body to take another look to take account of higher-than-expected inflation this year. The RCN is showing more flexibility than intransigent ministers and would probably accept the 7.5 per cent rise approved by the Scottish government. The deadlock could also be broken by a two-year deal also covering next year or a one-off payment that would not add to public spending permanently.

Ministers hide behind the pay review bodies as if they were holy writ, but have often rejected their recommendations in the past. The bodies are not truly independent since the government sets their parameters: they must take account of departmental budgets and the 2 per cent inflation target, even though the task of hitting that lies with the Bank of England. Although the bodies do consider recruitment and retention, these factors must be given greater weight if our public services are to be sustainable.

After going through the motions of looking “reasonable” and softening the government’s language, Rishi Sunak now brands the unions “unreasonable” to provide cover for “tough laws” in the new year. They will likely ensure a minimum service level during strikes and make strikes harder to call. He is reaching for the Thatcher playbook – often the Tories’ default position – in the hope the public will view him as “strong” and to put pressure on workers.

But we are in a very different era; voters know that public sector pay has been held down during the years of austerity. The unions are winning the argument over who is being reasonable, while the Tories reap what they have sowed since taking power in 2010 and misjudge the resilience of workers who have understandably had enough.

The government’s claim that inflation-matching public sector pay rises would cost £28bn – or £1,000 per household – has been challenged by the Institute for Fiscal Studies, which puts the figure at £18bn.

Similarly, many economists pour scorn on claims the public sector unions could create a wage-price spiral. As Nick Macpherson, the former Treasury permanent secretary who is now a crossbench peer, put it: “Public sector workers don’t cause inflation: their wages lag the private sector’s. The problem for HMG and its workers is that its public finance strategy rests on imposing the biggest real wage cuts in living memory.”

Sunak’s threat to impose new laws could backfire on the government. It might encourage other workers, such as teachers, to take action. There’s tough talk among ministers about banning strikes by ambulance workers and firefighters but I doubt that will come to anything.

Probably the government will move the goalposts so strikes in areas such as transport, health and education require the support of 50 per cent of eligible members, up from the current 40 per cent. Ministers think that might result in fewer stoppages by “moderate” unions like the nurses.

But the move could provoke a backlash, making workers even more determined to get a fair pay deal, and allowing the higher thresholds to be met.

No legislation will remove the need for negotiations to resolve the current disputes. At some point, both sides will have to compromise; that is the kind of “strong” leadership Sunak should display to bring the disruption to a halt. Declaring war on the unions by changing the law would make peace even harder to achieve.