Former British PM says ministers calling for public sector pay cap to be lifted wanted to spend money they might need in future

This article is more than 3 years old

This article is more than 3 years old

David Cameron has described critics of austerity as “selfish”, saying their calls to boost spending and raise public sector pay may appear compassionate but would simply saddle future generations with debt.

The comments triggered a furious response from Labour and the Lib Dems, who described the former prime minister as totally out of touch, claiming it was astonishing he could make the argument when nurses were turning to food banks to get by.

Cameron’s remarks could also reopen the wounds of the EU referendum as they were widely interpreted as an attack on the two most significant Vote Leave figures, Boris Johnson and Michael Gove.

The foreign secretary and environment secretary, whose successful Brexit campaign cost Cameron his political career, have both broken ranks in recent days to hint that the 1% public sector pay cap should be lifted.

Their comments, alongside cabinet level interventions by Justine Greening at education and Jeremy Hunt at health, have ramped up the pressure on Theresa May and the chancellor, Philip Hammond.

The pair have faced demands from dozens of MPs to ease the pain for families by raising pay and blocking school cuts after Jeremy Corbyn’s radical, anti-austerity Labour party stance secured gains in the general election.

Many feel action is urgent after a government-commissioned report suggested the average pay of teachers had fallen by £3 an hour in real terms, police officers by £2, while the wages of nurses have stagnated.

But Cameron used a speech in Seoul, South Korea, to come to his successor’s defence by saying it was too soon “to let spending and borrowing rip” because of the danger of future economic shocks.

“The opponents of so-called austerity couch their arguments in a way that make them sound generous and compassionate,” he told the Asia Leadership Conference. “They seek to paint the supporters of sound finances as selfish, or uncaring. The exact reverse is true.

“Giving up on sound finances isn’t being generous, it’s being selfish: spending money today that you may need tomorrow.”

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His comments led to an angry response from opposition politicians who lined up to say that Cameron had no idea how much people were struggling – and suggested it was crass to use a well-paid speech to make the argument.

The shadow chancellor, John McDonnell, accused the senior Conservative figure of living “in a different world from the rest of us”.

“Only David Cameron would say that hard-working people seeing their living standards fall back and their pay suppressed is good for them. It just further shows how out of touch he was then, and still remains today.”

The Lib Dem leader, Tim Farron, described it as a “pretty rich for a multimillionaire to tell our hard-working firefighters, paramedics, nurses and doctors that they don’t deserve a pay rise”.

“But I guess you would think that if you are jetsetting around the world to give highly paid speeches – you don’t really understand how millions of public sector workers have to scrimp each month to get by,” he added, giving examples of nurses visiting foodbanks and asking how Cameron considered them to be “paid enough”.

A spokesman would not say how much the former Tory leader had received for the speaking engagement, but confirmed that he was paid.

The shadow Treasury minister, Jonathan Reynolds, said Cameron was “completely out of touch and has no awareness of the country he used to lead”.

But Cameron is not the only one to urge calm within the Tory party after a public spat at the top of government over the issue of public sector pay.

Sources said that the chief whip, Gavin Williamson, had been speaking to colleagues about the need for “unity and discipline” with a number of one-on-one meetings with cabinet ministers.

The former work and pensions secretary, Stephen Crabb, suggested it was wrong for such senior figures to speak out so publicly against government policy.



Nigel Lawson, a former chancellor under Margaret Thatcher, said it was Hammond’s job to keep control of public spending to avoid “economic disaster”.

“It’s not easy but it is necessary,” he told the BBC. “People understand we need to pay our way on the road to economic success.” He argued that the arguments needed to happen in private. “Stop having this debate in public, it’s ludicrous.”

Hammond also tried to defuse the row by calling on his party to “hold its nerve”, claiming that the only way to free up spending was higher taxes, more borrowing or stronger growth.

Like Cameron, the chancellor has argued that borrowing piles debt on to the next generation and has insisted the Tories are a party of low tax.

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He has said growth was the only sustainable way to boost public spending in the long run, although sources suggest he is ready to talk about ways to raise money to loosen the ties of austerity over the coming months.

One senior Treasury figure said despite that, things would continue to be financially constrained in the run-up to Brexit.

Rises of 1% for dentists, nurses, doctors and the military have already been agreed for this year, and Downing Street said ministers would respond to other pay review recommendations within days. Teachers, police and prison officers are next in line.

It came alongside a call from civil servants to ensure that any lifting of salaries also included them.

Dave Penman, the general secretary of the FDA union that represents senior managers and professionals in public service said his members would welcome “warm words from a number of cabinet ministers over lifting the public sector pay cap.

“But warm words won’t pay the bills. The majority of civil servants are not covered by pay review bodies and so those very same ministers have it within their control to lift the pay cap for civil servants in their department.

“We have today written to those ministers, calling on them to follow up their words with action. If they believe the pay cap should be lifted, then they can begin with the civil servants in their departments who support them as ministers and deliver vital public services.”