£575,000-a-year Bank of England boss defends ‘wage restraint’ comments

Bank of England boss Andrew Bailey has defended his controversial comments urging workers to show “restraint” when asking for pay rises to cover the soaring cost of living.

The governor, who is paid around £575,000 a year, also said his wage restraint remarks applied to bankers’ bonuses as he faced tough questions from MPs on the Treasury Select Committee.

Committee member Dame Angela Eagle reminded Mr Bailey of a recent request from union bosses to visit a care home with workers in the sector being paid £9.01 an hour on average.

The governor agreed that his salary was “substantially” more than that of care home staff. Mr Bailey’s annual pay is 31 times the average pay of a care worker and 18 times the UK median salary for a full-time worker in the UK of £31,285.

Earlier this month, the Bank boss said he wanted to see “quite clear restraint” in the annual wage-bargaining process between staff and their employers. The GMB union branded Mr Bailey’s comments as a “sick joke”.

Addressing MPs on Wednesday, he argued that his message on wage restraint was aimed at helping prevent temporary inflation from becoming more embedded.

Mr Bailey said it was “quite understandable” that people would seek higher wages in order to keep up with a sharp rise in inflation.

However, he argued that this potentially led to so-called “second-round” effects where workers push for higher wages and this pushed up inflation further.

Jonathan Haskel, an external member of the Bank’s Monetary…

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