Frances O’Grady, General Secretary of the Trades Union Congress (TUC), told Sky's Sophy Ridge on Sunday that any UK government plan to freeze public-sector workers’ pay would be “morally obscene”.
"There’s still time for the Government to step back and I would encourage them to think again, this is not smart politics; it’s morally obscene and it’s bad economics too," she said.
O’Grady refused to rule out the possibility of strike action by public-sector workers, saying: "I’m really conscious of the feeling out there that governments only seem to recognise the true value of labour when it’s withdrawn but, of course, there is time to sort this out."
"Nobody can rule anything out at the moment but…this is absolutely the wrong time to be talking about pay cuts."
O’Grady’s comments came as UK Chancellor Rishi Sunak is set to announce a spending review on Wednesday. Some NHS workers will reportedly receive more generous treatment, but almost 5.5 million state workers face a pay freeze, including teachers, police and civil servants.
Sunak, also speaking with Sophy Ridge, said that he could "not comment on future pay policy" but then noted: "When we launched the spending review I did say to departments that when we think about public pay settlements it would be entirely reasonable to think of those in the context of the wider economic climate."
"It would be fair to also think about what is happening with wages, with jobs, with hours, across the economy when we think about what the right thing to do in the public sector is," Sunak said. This appeared to be a reference to private sector pay, which has fallen during the pandemic.
UK government borrowing has reached £215 billion since the start of the financial year in April, £169 billion more than a year ago, increasing the pressure on Sunak to rein in public spending.
Paul Johnson, Director at the think-tank the Institute for Fiscal Studies, said the amount borrowed during the pandemic was "the most ever outside of the first and second world wars" but admitted more might still be needed in the coming years.
He told the BBC’s Andrew Marr Show the UK’s position would eventually become “unsustainable” and that taxes would need to be raised but that this would likely not happen in the short-term.