Who would have guessed that caving into union militancy and paying a whacking above-inflation pay rise, with no strings attached, would lead to even bigger pay demands? In one of its first acts after coming to power last July the Starmer government awarded junior doctors a 22 per cent pay rise, which they accepted and ended their run of strikes. Is anyone really surprised the BMA has come back this year demanding 30 per cent, threatening yet more strikes? It is not hard to guess what would happen were the government to cave in again: next year’s demand would come in at 50 per cent.
Who would have guessed that caving into union militancy and paying a whacking above-inflation pay rise, with no strings attached, would lead to even bigger pay demands?
The BMA’s case is that the pay of junior doctors (who now demand to be called ‘resident’ doctors to disguise the fact they are still in training and that their pay will jump considerably when they are qualified) has been eroded, relative to inflation, by 22.3 per cent since 2008, necessitating a 28.7 per cent rise to retore their pay to the levels of that year. But they only arrive at that figure by using the Retail Prices Index (RPI) which is no longer used as a national statistic because it is regarded by most economists as faulty in its methodology (although it lingers on in such guises as index-linked bonds because long-term contracts stipulated that it should be used).
The Office for Budgetary Responsibility (OBR) calculates that over the long term there is a wedge between RPI and the now-favoured Consumer Prices Index (CPI) of 0.9 per cent per year. That might not sound at lot, but it is when compounded year on year. Since April 2008 the RPI has risen by 87 per cent and the CPI by 65 per cent. To put it another way, if your pay had risen with CPI since 2008 it would now be 12.4 per cent lower than it would be had it risen with RPI. In other words, use CPI and a good half of the BMA’s claimed pay erosion for junior doctors disappears.
Naturally, the BMA chooses 2008 as a comparator because it came at the end of a 15-year period when junior doctors enjoyed pay rises very much above inflation. It was also a year when the public finances were heading for disaster: within a couple of years Gordon Brown was running a deficit of £150 billion which Labour continued to blame solely on the global recession, not the fact that he had been running a deficit even during the good times, when the economy was growing strongly.
How does doctors’ pay in Britain compare with that in other countries? According to the OECD a specialist, salaried doctor in England is paid 3.3 times the average wage. In only a handful of countries do they earn more relative to the average: Germany (3.4 times), Ireland (3.4 times), South Korea (4.4 times) and Hungary (4.7 times). There are countries where it is possible to earn more but only because doctors are self-employed, and bear the risks and costs of that status.
So, we can forget about the threat to leave the country. On the contrary, the NHS continues to attract doctors from around the world, who wouldn’t come if the pay was so bad. Should we fear a junior doctor strike for fear many will die? Not according to an analysis of a series of junior doctor strikes in 2016 which found, over a three-week period surrounding each of four strike days, that there were 31,651 fewer hospital admissions, 173,462 fewer outpatients’ appointments, but no meaningful rise in deaths among patients. Somehow, we survived.
There is plenty of ammunition for the government to mount a reasoned resistance to the BMA’s pay demand – which comes, by the way, at a time when the deficit is back to £150 billion – if it is prepared to do so. The only trouble is that Keir Starmer’s party is full of MPs and members who never saw a strike they didn’t agree with, who would never cross a picket line to save their life, and whose political activities in many cases are funded by trade unions. It is little wonder that Labour governments always seem to end with an enormous bill – and unions which are never satisfied.
