Yesterday didn’t ‘budget’ for the looming public-sector pay talks

THE big hoopla wasn’t the Budget yesterday, it will be the public-sector pay talks next year. Politically and fiscally, that is where the real action is.

Add a big plus to yesterday’s numbers and you get the total figure for public spending, and the borrowing required to service it. Of course, we don’t know what the big plus is, but it is the elephant in the room.

Think of those extra teachers and guards — surely welcome — and you have a sense of the upward pressure on public spending. For the first time in many years, there is a planned expansion in public service numbers. More important than modest increases in personnel are the pay increases that will be applied across the board. Another thing we don’t know, for now, besides the extent of any public sector pay increase, is the time line over which it will be applied.