Rishi Sunak says public sector pay freeze is not a return to austerity

Chancellor says plans will mean more money for health, education and police, as unions refuse to rule out strikes

Rishi Sunak has rejected accusations that his planned public sector pay freeze amounts to a return of austerity and insisted that spending plans to be announced on Wednesday will result in more money for health, education and the police.

With trade unions demanding that the chancellor do a last-minute U-turn over his clearly signalled intention to clamp down on the state's wage bill and refusing to rule out strikes, Sunak said there would be significant increases in spending on public services next year.

New forecasts showing the economy on course to shrink by more than 10% this year.

A public sector pay freeze for all workers outside the NHS.

An extra 3bn for the NHS to tackle a backlog in operations caused by the Covid-19 crisis.

Confirmation of funding for 50,000 more nurses and 50m additional GP appointments.

A cut in the UK aid budget from 0.7% to 0.5% of national income.

Plans for a new national infrastructure bank and a northern campus for the Treasury.

A warning from the chancellor that the unlimited spending to cope with the twin health and economic emergencies is coming to an end.