pounds 7,000 rise for Lords ministers

MINISTERS in the House of Lords are set to receive pay rises of almost 13 per cent, five times the rate of inflation, in a move which will put the Cabinet on collision course with both backbench Labour MPs and public sector workers. It will also increase tension among its own ministers, some of whom are also calling for hefty increases.

The independent Senior Salaries Review Board has recommended to Tony Blair that government members who are peers should in future be paid at least pounds 60,000 a year, an increase of nearly pounds 7,000 on their current pounds 53,264.

The Prime Minister is almost certain to accept the recommendation, which comes on the eve of an acrimonious two-day debate on Lords reform this week.

The generous pay rises for Lords ministers will infuriate trades unions representing the million public sector workers, who received average increases of just 4.1 per cent this year. It will also anger left wing Labour MPs who are already calling for an end to the appointment of unelected peers as ministers in a reformed Upper Chamber.

However, Cabinet ministers will seize on the recommendation to make the case that they should be allowed to accept their own pay rises this year. The Cabinet is shortly due to discuss the salary freeze imposed by Gordon Brown for the past two years. Ministers including David Blunkett, the Education Secretary, Robin Cook, the Foreign Secretary, and John Prescott, the Deputy Prime Minister, are determined that they should receive an extra pounds 16,000 - equivalent to 17 per cent - this year.

MPs voted before the last election to increase Commons ministerial salaries after the Senior Salaries Review Body claimed that wages had fallen behind the private sector. However, Lords ministers' pay was not included and the Government referred this issue to the Board last year.

Lords ministers have complained vociferously in recent months that they are paid less than their colleagues in the Commons. A junior minister in the Lords earns pounds 53,264, compared with a total of pounds 77,047 taken home by a minister of the same rank in the Commons. This is because Lords ministers do not receive a Parliamentary salary, worth pounds 45,066 to ministers who are also MPs.

Lord Strathclyde, head of the Tory peers, has already made clear to Baroness Jay, the Lords leader, that the Conservatives would not oppose the introduction of pay rises for ministers in the Upper Chamber to bring them more into line with their Commons colleagues.

The Senior Salaries Review Board has advised Mr Blair that members of the new Scottish and Welsh assemblies should receive less than their Westminster counterparts.