Accord and Unite made much of their 2 year pay deal when it was announced back in 2023. That deal was worth 4% for grades A-E and 3.5% for grades F and G for 2024 and 2025. Accord recently said it had: “Secured pay increases for 2025 at more than twice the current rate of CPI inflation”.
That’s not true. The Bank of England is now predicting that CPI inflation is set to rise to 3.7% over the first half of this year because of increases in energy prices and increases in some regulated prices such as water bills.
The retail price index (RPI), which is the definition of inflation that is used by trade unions when negotiating pay rises, is likely to rise to 5% over the next few months. That means for 2025 most Lloyds staff will get salary increases which are below the rate of RPI inflation. That’s the important one.
In October 2023, we said:
In any event, is a two-year pay deal in the best interests of staff or the Bank? Lloyds get certainty of its cost base over the next two-years of its transformation programme, when it’s got to deliver £1.5 billion of business growth. Interestingly, in seeking to justify the deal, Ms Doherty quotes the Bank of England inflation projections, when it suits her, but she never mentioned inflation was running at 12%.
If the last few years have taught us anything it’s that uncertainty is a fact of life. All the forecasts about inflation and interest rates were wrong in the run up to cost-of-living crisis and there are no guarantees that those headwinds are not going to come back and bite us in the next few years. Equally, the political landscape is changing rapidly and who knows what’s going to happen in 2024, let alone 2025.
The price of certainty for Lloyds staff could be inflation rising again with staff stuck on a two-year pay deal that leaves then significantly worse off.”.
That’s exactly what’s happened.
In the rush to sign a deal, any deal Lloyds staff have been made financially worse off.
Lloyds needs to reconsider its 2025 pay offer considering the new economic circumstances. Staff shouldn’t be financially disadvantaged because of the incompetence of Accord and Unite.
We will be producing a further analysis on pay in the next week including on market movements for 2025 because under the 2-year pay deal those will be determined by Lloyds with no input from Accord or Unite. In the meantime, members with any questions can contact the Union’s Bedford Office on 01234 262868 (Choose Option 1).