To ask the Chancellor of the Exchequer what the Government's policy on public sector pay increases in the 2008 round is; what the maximum permissible increase is; and if he will make a statement. (210361)

The Government's policy is that public sector pay settlements should reflect the individual labour market position of work forces, be consistent with achievement of the Government's CPI inflation target of 2 per cent., be affordable and represent value for money for taxpayers.