Labour Party’s four-day week to cost ‘at least £17bn’
Labour Party proposals for a four-day week would cost the taxpayer at least £17bn, according to a new report.
Cutting the working week to 32 hours for public sector employers would result in an expansion of the workforce that could cost the Treasury between £17bn and £45bn, the Centre for Policy Studies has warned.
Analysis from the centre-right think tank said that the policy would “require significant tax rises or spending cuts, or see productivity gains go towards cutting hours rather than improving public sector performance”.
Read more: Imperial Brands profit shrinks as regulators knock vaping
“This proposal puts the cart before the horse. We need to raise productivity before we can afford to shorten the working week, not vice versa – and public sector productivity growth over the last couple of decades has been almost static,” said Jethro Elsden, a data analyst at the Centre for Policy Studies.
Labour’s claims that the costs of a four-day week could be covered by wider productivity increases across the economy is “highly unpersuasive”, the think tank concluded.
The research, first shown to The Times, found that in the absence of unprecedented productivity gains, the four-day week in the public sector would either mean delivering signifiant cuts to wider government or tax rises – or a lower standard of public services.
Read more: London Underground has the city’s highest level of air pollution
Robert Colvile, director of the Centre for Policy Studies, added: “Even the paper Labour commissioned on this topic accepts that higher productivity can lead to shorter hours, rather than vice versa.
“And given the terrible productivity record of Britain’s public sector, it is very hard to see how such gains could be made, or why taxpayers should be asked to accept a worse service so that public sector staff can have shorter hours.”