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The prospect of a pre-election interest rate cut by the Bank of England has been damaged by official figures showing no progress in bringing down the pace of wage growth.

Data from the Office for National Statistics (ONS) showed basic pay rising at an annual rate of 6% in the three months to April.

That was flat on the figure reported by the ONS for the past two months. Upwards pressure came from the government’s 9.8% rise in the National Living Wage, which took effect in April.

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When the impact of inflation was taken into account, the wage rate stood at its highest level since July 2021 at 2.9%.

The pay measure that includes bonuses actually rose to 5.9% from 5.7%, according to the ONS

While it is good news for voters as it leaves pay growth at way more than double the 2.3% inflation rate, it will not help persuade the Bank of England that the time is right for an interest rate cut when it reveals its latest decision on 20 June.

Rishi Sunak would be keen for the Bank, which is independent of the government, to impose a cut to borrowing costs on that date to bolster his case that the outlook for household and consumer finances is improving.

With the Conservatives far behind Labour in the polls, the employment figures from the ONS are the last before polling day on 4 July.

The data also showed a rise in the unemployment rate to 4.4% from 4.3%, though this figure comes with a big health warning from the ONS due to continuing reliability issues with its labour force survey.

The same caution was applied to the figure covering the number of people of working age judged to be economically inactive.

That stood at 9.4 million and was up on the previous month due to a rise in long term sickness and care demands.

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The ONS said: “This month’s figures continue to show signs that the labour market may be cooling, with the number of vacancies still falling and unemployment rising, though earnings growth remains relatively strong.”

What this all means for the Bank

The big picture is definitely mixed. The jobless rate figure in particular may have some influence in Threadneedle St as it signals further damage to the economy from higher interest rates.

The Bank has hinted that an interest rate cut is likely in the coming months but it remains worried about sticky services inflation and the pace of wage growth fuelling more price rises in the economy.

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Basic pay increases have outpaced the rate of inflation since last June, boosting consumer spending power on the face of it, but household budgets have remained squeezed.

The cost of living crisis, exacerbated by unprecedented raw energy price hikes following Russia’s invasion of Ukraine, has evolved over time to even extend to the Bank’s medicine to supress inflation.

There were 14 consecutive interest rate increases from December 2021 up until last summer aimed at dampening demand to help bring price growth down.

The rate hikes drove up the cost of borrowing, with mortgage holders for example facing additional bills of hundreds of pounds more per month on average as low fixed rate terms expired.

New deals proved eyewatering in comparison.

With the main consumer prices index measure of inflation running at 2.3% – above the Bank’s 2% target – members of the rate-setting committee have acknowledged progress but they are unlikely to follow the European Central Bank in cutting rates this month.

Financial markets saw just a 10% chance of a rate cut from 5.25% to 5% on 20 June.

Most of the money is on September.

However, those predictions could yet shift.

The ONS is also set to release this week the preliminary growth figures for the economy in April. They are predicted by economists to show zero growth for the month, largely due to the impact of poor weather.

The following week sees the publication of the latest inflation figures.

How political parties have reacted

Commenting on the jobs data, shadow Work and Pensions Secretary Liz Kendall said: “Today’s figures confirm that the Tories have no hiding place after 14 years of abject failure.

“On Rishi Sunak’s watch, a record number of people are out of work due to long-term sickness at terrible cost to them, to business and the taxpayer, and we remain the only G7 country whose employment rate still isn’t back to pre-pandemic levels.

“Labour’s plan will get Britain working by cutting NHS waiting lists, introducing a new national jobs and careers service, making work pay and supporting people into good jobs across every part of the country.

“It’s time to stop the chaos, turn the page and start rebuilding Britain.”

Liberal Democrat Treasury spokesperson Sarah Olney said: “This Conservative carousel of chaos has our economy on a rollercoaster ride and the British people are sick and tired of it – it’s time for a change.”

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‘Shameful’ that black boys in London more likely to die than white boys, says Met Police chief

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'Shameful' that black boys in London more likely to die than white boys, says Met Police chief

It is “shameful” that black boys growing up in London are “far more likely” to die than white boys, Metropolitan Police chief Sir Mark Rowley has told Sky News.

The commissioner told Sunday Morning with Trevor Phillips that relations with minority communities “is difficult for us”.

Sir Mark, who came out of retirement to become head of the UK’s largest police force in 2022, said: “We can’t pretend otherwise that we’ve got a history between policing and black communities where policing has got a lot wrong.

“And we get a lot more right today, but we do still make mistakes. That’s not in doubt. I’m being as relentless in that as it can be.”

He said the “vast majority” of the force are “good people”.

However, he added: “But that legacy, combined with the tragedy that some of this crime falls most heavily in black communities, that creates a real problem because the legacy creates concern.”

Sir Mark, who also leads the UK’s counter-terrorism policing, said it is “not right” that black boys growing up in London “are far more likely to be dead by the time they’re 18” than white boys.

“That’s, I think, shameful for the city,” he admitted.

The Met Police chief’s admission comes two years after an official report found the force is institutionally racist, misogynistic and homophobic.

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Police chase suspected phone thief

Baroness Casey was commissioned in 2021 to look into the Met Police after serving police officer Wayne Couzens abducted, raped and murdered Sarah Everard.

She pinned the primary blame for the Met’s culture on its past leadership and found that stop and search and the use of force against black people was excessive.

At the time, Sir Mark, who had been commissioner for six months when the report was published, said he would not use the labels of institutionally racist, institutionally misogynistic and institutionally homophobic, which Casey insisted the Met deserved.

However, London Mayor Sadiq Khan, who helped hire Sir Mark – and could fire him – made it clear the commissioner agreed with Baroness Casey’s verdict.

After the report was released, Sir Mark said “institutional” was political language so he was not going to use it, but he accepted “we have racists, misogynists…systematic failings, management failings, cultural failings”.

A few months after the report, Sir Mark launched a two-year £366m plan to overhaul the Met, including increased emphasis on neighbourhood policing to rebuild public trust and plans to recruit 500 more community support officers and an extra 565 people to work with teams investigating domestic violence, sexual offences and child sexual abuse and exploitation.

Watch the full interview on Sunday Morning with Trevor Phillips from 8.30am on Sunday.

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Unite votes to suspend Angela Rayner over Birmingham bin strike

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Unite votes to suspend Angela Rayner over Birmingham bin strike

Labour’s largest union donor, Unite, has voted to suspend Deputy Prime Minister Angela Rayner over her role in the Birmingham bin strike row.

Members of the trade union, one of the UK’s largest, also “overwhelmingly” voted to “re-examine its relationship” with Labour over the issue.

They said Ms Rayner, who is also housing, communities and local government secretary, Birmingham Council’s leader, John Cotton, and other Labour councillors had been suspended for “bringing the union into disrepute”.

There was confusion over Ms Rayner’s membership of Unite, with her office having said she was no longer a member and resigned months ago and therefore could not be suspended.

But Unite said she was registered as a member. Parliament’s latest register of interests had her down as a member in May.

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The union said an emergency motion was put to members at its policy conference in Brighton on Friday.

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Unite is one of the Labour Party’s largest union donors, donating £414,610 in the first quarter of 2025 – the highest amount in that period by a union, company or individual.

The union condemned Birmingham’s Labour council and the government for “attacking the bin workers”.

Mountains of rubbish have been piling up in the city since January after workers first went on strike over changes to their pay, with all-out strike action starting in March. An agreement has still not been made.

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Rat catcher tackling Birmingham’s bins problem

Ms Rayner and the councillors had their membership suspended for “effectively firing and rehiring the workers, who are striking over pay cuts of up to £8,000”, the union added.

‘Missing in action’

General secretary Sharon Graham told Sky News on Saturday morning: “Angela Rayner, who has the power to solve this dispute, has been missing in action, has not been involved, is refusing to come to the table.”

She had earlier said: “Unite is crystal clear, it will call out bad employers regardless of the colour of their rosette.

“Angela Rayner has had every opportunity to intervene and resolve this dispute but has instead backed a rogue council that has peddled lies and smeared its workers fighting huge pay cuts.

“The disgraceful actions of the government and a so-called Labour council, is essentially fire and rehire and makes a joke of the Employment Relations Act promises.

“People up and down the country are asking whose side is the Labour government on and coming up with the answer not workers.”

SN pics from 10/04/25 Tyseley Lane, Tyseley, Birmingham showing some rubbish piling up because of bin strikes
Image:
Piles of rubbish built up around Birmingham because of the strike over pay

Sir Keir Starmer’s spokesman said the government’s “priority is and always has been the residents of Birmingham”.

He said the decision by Unite workers to go on strike had “caused disruption” to the city.

“We’ve worked to clean up streets and remain in close contact with the council […] as we support its recovery,” he added.

A total of 800 Unite delegates voted on the motion.

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Binance’s CZ threatens to sue Bloomberg over Trump stablecoin report

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Binance’s CZ threatens to sue Bloomberg over Trump stablecoin report

Binance’s CZ threatens to sue Bloomberg over Trump stablecoin report

Binance co-founder CZ has dismissed a Bloomberg report linking him to the Trump-backed USD1 stablecoin, threatening legal action over alleged defamation.

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