An increasing number of public sector workers are turning to payday loan companies to make ends meet, as the government’s ongoing pay cap continues to squeeze living standards.
Former Prime Minister David Cameron has described calls for an end to the public sector pay cap “selfish”, but public sector workers are struggling to stay afloat after suffering a real-terms pay cut every years since 2010. People on lower incomes are increasingly turning to food banks and payday loan companies to help with their mortgage, rent, or bills. Millions of people struggling with under £100 in savings, unable to handle unexpected expenses.
A report from comparison service Readies has revealed that 27 percent of those that have searched for a payday loan in the last year work within the public sector in jobs such as nursing, teaching, and local councils. Moreover, 43 percent of those looking to obtain a loan have already taken out five or more loans in the last 12 months.
The figures highlight increasing pressure on family finances as the squeeze on wages has intensified in the wake of the collapse in the price of Sterling after the Brexit vote, which saw the cost of imports soaring.
Overall wage growth fell to 2.1 percent in April, which is now significantly outpaced by inflation, which rose to 2.9 percent in May, with official Office for National Statistics (ONS) showing that average pay was higher in 2006 than it is now.
After Theresa May’s disastrous general election campaign, Labour leader Jeremy Corbyn has increased pressure on the government to end the public sector pay cap, and tabled an amendment to the Queen’s speech to end the policy. He has found support for the idea from union leaders and back-benchers across the aisle.
Heather Wakefield, Unison’s head of local government, said:
“Theresa May needs to show the country she’s listening to the concerns of ordinary people by coming up with the cash to give dedicated public service workers a long overdue, decent pay rise.”