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Spud looks at the BoE accounts:

Average salaries have risen from £68,006 to £69,603, or by 2.3%.

However, on top of salary, the average pension contribution has gone up from £17,112 to £20,317, which is an increase of 18.7% in the year.

Combine the two and costs have risen from £85,118 per person to £89,920 a year, or by 5.6%.

So much for pay constraints.

Also, for the year in question:

Average regular pay growth was 6.9% for the private sector in December 2022 to February 2023, and 5.3% for the public sector (Figure 4).

Oh.

3 thoughts on “Umm, yes”

  1. Costs have risen by £4802+X, where X is Employer’s NI contributions
    Employee receipts have risen by something that Murphy does not know because it is confidential.
    He does NOT do a like-for-like comparison – is composition of the BoE workforce identical in the two years? But, more importantly, he is comparing *pay rises plus pension contributions* with *pay rises excluding pension contributions* – can he *really* be that stupid?!?

  2. His analysis is wrong because he added the total salary to total pension contributions. The pension scheme is a final salary scheme, so the pension payments are not exclusively for current employees, they also pay for former employees claiming their pensions and former employees who have not yet started claiming their pensions. Without knowing the exact distribution of beneficiaries betwen these categories, it’s impossible to tell how much of the pension payments are equivalent to higher salaries.

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