Treasury set to end 1% public-sector pay cap

Philip Hammond, the chancellor of the exchequer, is expected to announce the end of a seven-year public-sector pay cap in his autumn budget.

Hammond and prime minister Theresa May have agreed to lift the 1 per cent cap, which has been in place since 2010, to meet the rate of inflation over a two-year period, according to an unnamed source, The Sun newspaper reported on 3 September.

It quoted a second source in the Treasury as saying: “Lifting the cap and how we pay for it is the biggest domestic issue for us this autumn. It will dominate the budget.”