Millions of public sector workers set for pay rise as Tories consider axing cap

Millions of public sector workers in the UK could be set for a pay rise after the Conservative government announced it would review a controversial wage cap for the employees. A Number 10 spokesperson told reporters that voters were "weary" of the measure, which first came into force under the Conservative and Liberal Democrat coalition government in 2012.

Downing Street indicated that any changes to the cap, which covers around 5.1 million public sector workers, would be unveiled in the Autumn Budget.

The Tories had planned to keep public sector salary rises at 1% per year every year until 2019/2020, but Theresa May faced increased pressure on the issue after the Conservatives failed to secure a majority of MPs in the House of Commons at the general election.

Both Labour and the Liberal Democrats had promised to increase public sector pay. "In the long run, public sector pay will need to rise in line with private sector pay for the public sector to attract the skilled individuals needed to administer and deliver public services," the Institute for Fiscal Studies (IFS) said in May.

"Under current government plans, and given current Office for Budget Responsibility (OBR), the difference between public and private wages would fall to a level not seen in (at least) the last 20 years."

The think-tank added: "There are trade-offs in delivering public services. Increasing public sector pay involve large increases in costs for government departments. However, if public sector pay continues to fall compared with pay in the private sector, the public sector will struggle to recruit and retain the workers it needs to deliver public services, and the quality of those services will therefore be at risk."

Labour, meanwhile, has welcomed the news that the government is planning to review the wage cap. Shadow Communities Secretary Andrew Gwynne MP said the Conservatives have no mandate to "carry out their damaging cuts" to public services.

"They have already been forced to drop some of their most damaging policies, such as taking Winter Fuel Payments away from more than 10 million pensioners or removing the Triple Lock guarantee on pensions," he added.

"Now, it appears, the dramatic increase in Labour's vote at the general election and the strength of feeling among the British people may force the Government to U-turn and stop cutting public sector workers' pay."