Public sector pay rises capped

Public sector pay rises will be capped at one per cent for each of the two years after the current freeze ends, the Chancellor has announced.

In today's Autumn Budget Statement, George Osborne said he accepted it was "tough" but insisted the deal is fair for taxpayers.

He added that many in the public sector are helped by pay progression, annual increases in salary grades that they are entitled to even when pay is frozen.

"It is one of the reasons why public sector pay has risen at twice the rate of private sector pay over the last four years," Osborne told the Commons.

All Government departments, with the exception of the NHS, will see budgets controlled but overseas aid will also keep rising, albeit at a slower pace than previously planned.

Osborne also used his statement to repeat calls for unions to call on tomorrow's strikes over public sector pensions. The deal on offer, he said, was still incredibly generous.