Speaking at a Downing Street press conference yesterday, Brown said that such an approach would be essential in controlling inflation, while also providing certainty for affected workers. According to Brown: “There is no point in a big salary rise that is wiped out by a big inflation rise.”

However, it remains to be seen just how receptive affected workers will be when faced with the reality of such an arrangement. Some may not be enticed by the prospect of being locked in to long-term deals guided primarily by Brown’s staunch anti-inflationary principles.

Recent IRS research (subscription required) reveals that 2007 saw public sector pay rises running at their lowest level since 1994.

The median increase in the sector was worth 2.5% for year to November 2007. This was one percentage point below the equivalent private sector median increase for the same period (3.5%), and 1.8 percentage points below the cost of living increase (subscription required), as measured by RPI inflation (4.3%).

Last year saw widespread unrest among public sector workers in response to Brown’s hardline stance on pay. Initial reactions from the unions suggest that 2008 could bring more of the same. The GMB union rejected the proposals outright, while the PCS union expressed serious concerns. The latter noted that: “With the economy unpredictable we would […] expect triggers in any multi-year deal which allow for pay settlements to be renegotiated should inflation increase.”

But such a ‘triggered’ arrangement may not sit comfortably with Brown’s overarching commitment to holding inflation down.

We can look forward to a very interesting public sector pay round for 2008.