The proposed pay increases of 5-6% for public sector workers would add less than 0.1 percentage points to headline inflation, a relatively minor impact according to Bank of England's governor Andrew Bailey.
Rishi Sunak's argument for pay restraint to control inflation didn't hold as the first reduction in borrowing costs since March 2020 was announced under the new government.
Sunak's administration faced trade union disputes and strikes due to its policy on public sector pay, with the expectation that such restraint would lead to lower inflation.
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