The changes freeze wages and cut certain benefits such as the jobs bank for laid-off workers.

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Jan Parkinson, managing director of Local Government Employers, said the decision to freeze wages had "not been taken lightly" and councils were "facing extremely tough choices this year".

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However, there has been a freeze on wages for a number of years.

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Bond-market troubles are forcing Greece's government to freeze public-sector wages and raise taxes, and causing Portugal's and Spain's to accelerate budget cuts.

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The lawsuit on behalf of up to 100, 000 borrowers claims lawyers at Mel Harris then used those statements to obtain default judgments against the consumers and threaten to garnish their wages or freeze money in their bank accounts.

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They included a smaller Congress, a threshold of 2% of the vote for parties to win congressional seats and a two-year freeze in public-sector wages and pensions for all but the lowest-paid.

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On June 13, 1973, he signed executive order 11723 that called for a freeze on prices, while he continued to control wages, salaries and rents.

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It is difficult to envisage wages taking off when the public sector is shedding jobs and facing a two-year pay freeze and there are 2.5m people unemployed, close to 8% of the labour force.

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