A UNION has today warned that if ministers impose a below-inflation pay increase of three per cent on NHS workers, they will deliver ”a hammer blow” to the local economy.

The TUC says this will result in a hit of £335 million to the North East and Yorkshire’s spending power.

In 2021, NHS workers got a three per cent pay settlement and ministers have asked the NHS pay review body to recommend a similar award this year.

But unions warn this will fall well below the cost of living, with inflation running at nine per cent.

The TUC has modelled household spending power in the event of a projected three per cent pay rise for NHS workers, and compared it with household spending power if NHS workers were offered a pay rise that keeps the pace with the cost of living.

As well as a £335 million hit to the North East and Yorkshire’s spending power, England faces a £2.1 billion loss of economic activity as a result of wages failing to keep pace with inflation, according to the body.

The TUC also warns that any decision to hold down NHS workers’ wages will suck demand out of the economy and stunt economic growth.

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