UK pay rate rises above inflation

UK pay deals are running ahead of the inflation rate, with recent settlements worth between 2.5% and 4%, a new report showed today.

A survey of 250 wage agreements showed that pay rises in the second quarter of the year were higher than the same period a year ago.

Deals agreed in recent weeks have continued to keep ahead of headline inflation, which is currently 1.9%.

Pay analysts Incomes Data Services said one in seven recent deals were worth more than 4%.

Among firms agreeing rises this month was supermarket giant Tesco which is giving a 3.6% increase to 172,000 workers.

Staff at the Department of Trade and Industry have been offered average increases of 5% from August, while police are likely to receive a rise of between 3.3% and 3.5% from September under their pay formula, according to the report.