Public sector pay cap confusion after May's 'double U-turn'

Westminster was thrown into confusion last night when the government appeared to backtrack on suggestions it would review its cap on public sector pay.

A statement from Downing Street early yesterday suggested the one per cent cap could be raised or even scrapped in the Budget this autumn.

"We understand that people are weary after years of hard work to rebuild the economy," a government spokesman said, reports Sky News.

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Added to that, "two cabinet ministers said the five-year cap may be reconsidered", says the BBC.

However, this was quickly followed by what appeared to be a top-level change of heart, with a spokesman for Theresa May saying the cap would remain.

"The policy has not changed," he added.

The reversal, which some journalists described as a "double U-turn", followed a testy exchange between May and Jeremy Corbyn at Prime Minister's Questions, during which the party leaders clashed on spending cuts.

MPs last night also rejected a Labour amendment to the Queen's Speech calling for an end to the pay cap and to cuts in emergency and police services. The party said the amendment was a "test case" for parliament's willingness to oppose further austerity measures.

Some senior Tory MPs have called for a "reconsideration" of the policy, despite a manifesto pledge to maintain it until 2020.

Defence Secretary Sir Michael Fallon yesterday said pay rates were "obviously something we have to consider not just for the army but right across the public sector as a whole".

Downing Street, meanwhile, acknowledged the need for ministers to "listen to the messages that were sent at the election".

Despite losing the vote and the uncertainty about the government's position, Labour is expected to see the willingness of senior Conservatives to reconsider the pay cap as a "significant victory", The Guardian says.

TUC general secretary Frances O'Grady echoed other Labour and union figures by suggesting there was "huge support to scrap the cap right across the political spectrum, including from Tory voters".

She added: "There is no doubt that the world has shifted."

Pay rises for five million public sector employees, including teachers, nurses, police officers and firefighters, have been held at one per cent since 2012 under austerity measures introduced by the coalition government.

MPs will vote today on the government's legislative agenda for the next two years, as laid out in the Queen's Speech. The bill is expected to pass narrowly, with the support of the DUP.