Pay rises have shown a "modest" increase in recent months with more deals worth more than four per cent.

Around one in four recent settlements was above four per cent, including a 4.4 per cent rise for employees at British Energy and a deal worth more than five per cent for plumbers.

Pay analysts Incomes Data Services said higher inflation was having a knock-on effect on long- term wage deals. Most of the 70 recent pay deals monitored by IDS were between three and four per cent.