UK may announce public-sector pay cap

Speculation was mounting today that the British Chancellor is set to announce a pay cap on public-sector workers under moves to cut public spending.

Unions were braced for news of the cap later today when Chancellor Alistair Darling delivers his pre-budget report, with officials warning there would be anger if low-paid workers had their pay hit.

Sources said there could be a 1% cap on the pay of public sector workers for two years from 2011.

Brendan Barber, general secretary of the TUC said: “Any centralised pay cap on public sector staff would be unfair, inefficient and would damage long-established independent review systems which already take affordability into account.

“What we need is a fair tax system to make sure that those who did so well out of the boom years make a proper contribution, rather than expecting public sector workers, many of them low paid, to pay the price.”