Budget 2012: Millions of public sector workers to have pay frozenm Chancellor confirms Figures published by the Treasury show that in some areas public sector workers are paid 18 per cent more than people doing the same job for private firms. In the South East of England this "private sector premium" is just 0.5 per cent. Some Government departments will start talks about local pay next month, with more following next year. The plans will initially affect 160,000 civil servants working in Job Centres, the Driver and Vehicle Licensing Agency and border guards at ports and airports across the country. Mr Osborne would like to roll out the plans to all six million public sector workers - including teachers and hospital staff - from next year. Unions immediately attacked the announcement, warning it would drive down wages in the poorest areas of the country. TUC general secretary Brendan Barber said: "Pay rates for teachers and nurses should be based on their skills and the jobs that they do, not on the areas in which they happen to live and work. Picking the pockets of public servants outside London and the South East by localising pay will simply widen the North-South divide, and cause more businesses to fail by taking even more money out of local economies, at a time when they need all the help they can get. Dai Hudd, deputy general secretary of the Prospect union, added: "This ill-thought through policy advocates holding down pay in certain areas of the country, based on the flawed economic logic that it will encourage local enterprise. The Cabinet Office should be ashamed to have produced such poor quality evidence in support of a policy that has devastating implications for large parts of the UK and their local economies.