The consumer price index (CPI) for inflation jumped to 4.4% in July – more than double the government’s target of restricting it to 2%.
Josie Irwin, RCN head of employment relations, and Mike Jackson, Unison senior national officer, negotiated the deal back in March. They said they were adamant it was the right thing to do at the time.
Ms Irwin told NT they had suspected inflation would rise when they struck the deal, which includes the 2.75% recommended by the NHS pay review body for 2008–2009, as well as further increases over the following two years to give an overall total of 7.99%.
‘We could see what was on the horizon,’ she said. ‘When we negotiated it, we had to make a judgement call about whether there was any more money in the [government] pot – and our judgement clearly was that there was not.
‘We have to act in our members’ interests.’
She warned that the autumn was likely to be a difficult time for nurses, with inflation hitting their finances.
‘We are in for a rough time during the autumn,’ she said. ‘Definitely it will be challenging for our members.’
Mr Jackson said: ‘I don’t regret doing the deal and there were other aspects as well. When the deal was struck, independent forecasters were predicting that inflation would be 2.5% by the end of the year, and falling in 2009 – that is not going to happen and the landscape is changing.’
Unions are using a clause in the deal that allows them to approach the NHS pay review body with evidence that inflation is damaging their members’ quality of life. The PRB could then recommend to the government that talks on improving the deal should take place (NT News, 5 August, p2).
Ms Irwin said: ‘We don’t underestimate the challenge that we have on our hands in terms of getting the government to recognise that there is an issue.’
The three-year pay deal, which was accepted in June, was negotiated by Unison and the RCN but was opposed by Unite/CPHVA and other smaller unions.