Debate: How do we boost workers’ wages and encourage business growth?

We all need a pay rise, the TUC said today as their annual conference got underway. Not just because we might like it, but because it will boost demand in the economy and reward people after more than a decade of falling living standards.

Business has also been setting out its stall: the CBI has warned the government against higher taxes on business and urged ministers to boost investment.

Business and unions agree on the need for a new economic direction post Covid.

The unions say the average worker would be a massive £5,900 a year better off if wages had continued to grow at pre-financial crash rates since 2008. Catching that up would mean a 23 per cent pay rise for the average worker.

What worries the CBI is government investment is forecast to be 3.4 per cent of national income in this country, lagging well behind many of our industrial rivals.

But the two sides are united by their doubts over the government’s recent decision to raise national insurance to pump more cash into the NHS and social care.

We spoke to Frances O’Grady, the general secretary of the TUC, and Tony Danker, director-general of the CBI, and started by asking him what he feared would be the consequences of putting up national insurance.