Public sector pay rises won’t lead to cuts to services in Wales, says Mark Drakeford

Wales’ new finance secretary insisted inflation-busting pay rises for teachers, doctors and nurses will not lead to a reduction in spending on public services.

Mark Drakeford, who was named finance secretary last week, said the Welsh Government worked through the summer to ensure funding is in place to support pay awards.

He told the Senedd: “As a result of all that work, we are confident we can fund these awards without the need to reduce spending in these or other public services.”

In a statement on September 17, the ex-first minister said teachers will receive 5.5% with an extra £5m to move additional learning needs co-ordinators to a leadership pay range.

He explained that doctors and nurses on ‘Agenda for Change’ terms will also receive 5.5% while NHS-employed doctors and dentists will receive 6%.

‘Difficult decisions’

Prof Drakeford added that ministers have agreed an average 5% increase to the total pay bill for staff in the Welsh Government civil service and arm’s-length bodies.

He said: “Taken together, this means that over 180,000 public sector workers – from hospital cleaners to teachers and civil servants – will receive an above-inflation pay award this year.”

But the finance secretary, who previously held the role from 2016 until 2018 when he became first minister, cautioned that the financial climate remains challenging.

“Difficult decisions will once again shape next year’s budget,” he said.

“However, making this decision now, giving certainty to public sector employers and, crucially, those who work in our public services, means that increases will be reflected in pay packets as soon as possible, and before the end of this year at the latest.”

The Welsh Government will publish its draft 2025-26 spending plans on December 10.

‘Lose control’

Peter Fox, the Conservatives’ shadow finance secretary, welcomed some pay increases, saying they will go some way to improving retention rates in health and education.

But he raised concerns about public pay as a whole in his response to the statement.

Mr Fox, who represents Monmouth, said: “We must be careful that both this government and the one in Westminster do not lose control of public pay.

“The Labour government in Westminster has offered almost £10,000 pay rises to train drivers, who are already on more than £60,000 a year, while taking much-needed fuel payments from our pensioners.

“I’m glad that you are confident that, unlike your colleagues in Westminster, you do not feel as if you have to cut services for this round of pay rises. That’s welcome.

“However, as you indicate, there could be more public sector rises to come.

“With this in mind, what reassurances can you give the people of Wales that these future pay rises are not going to come at the expense of the most vulnerable people in society?”

‘Austerity’

His Plaid Cymru counterpart Heledd Fychan broadly welcomed the pay rises as she called for an update on local government staff who are not part of the latest settlement.

But she warned: “The fact that the Labour government in Westminster is as committed, it would appear, to austerity as their Conservative predecessors is deeply concerning.”

Ms Fychan said anything less than pay restoration to pre-austerity levels would point to empty promises in terms of the benefits of Labour governments at both ends of the M4.

The South Wales Central MS stressed that pay alone will not solve all the problems facing the workforce, nor resolve difficulties recruiting and retaining staff.

She said: “Although pay was a factor in the industrial action we have seen, it is important that we also acknowledge that staff have also decided to take action because of their concerns about working conditions.”

‘Public esteem’

Carolyn Thomas, a Labour backbencher, who represents North Wales, welcomed the uplift in public sector pay, asking about the social care and childcare sectors.

Prof Drakeford pointed to Welsh Government funding to ensure social care workers are paid the real living wage and committed to working closely with councils on childcare.

He said: “There are other groups of workers in the public sector who we know do not get the recognition, both in public esteem and in pay, for the value of the work that they do.”

Plaid Cymru’s Peredur Owen Griffiths asked about people employed by charities, such as nurses in hospices who benchmark against public sector pay awards.

Prof Drakeford told the finance committee chair: “We recognise that deals that are set in the direct public service have knock-on implications for the third sector.

“We have a range of ways in which we are able to navigate that.”

By Chris Haines, ICNN Senedd reporter