British Prime Minister Boris Johnson will offer millions of public sector workers pay rises averaging 5 per cent next week, reports citing unnamed government ministers said.
Annual pay reviews for almost half of public sector workers - including teachers, nurses, police, prison staff, civil servants and the armed forces - are due in the UK shortly.
The Financial Times reported one senior minister as saying the government would accept the recommendation of independent pay review bodies, which are likely to recommend raises of about 5 per cent.
A representative for Mr Johnson's office declined to comment on the report.
British consumer price inflation hit a 40-year high of 9.1 per cent in May and the Bank of England forecasts it will exceed 11 per cent in October.
Meanwhile, pay growth in the public sector has lagged behind that of private sector workers, averaging only 1.5 per cent over the past year compared with 8 per cent in the private sector, where it has been bolstered by one-off bonuses.
Britain's government had planned on public sector pay rises of about 2 per cent, but one senior minister was reported as saying that rejecting the pay review bodies' recommendations would lead to an increased number of strikes.
"If you went below their recommendations, you'd save a bit of money but what would be the net saving?" an unnamed Cabinet minister was quoted as saying.
"You'd end up with a lot of strikes and a big economic hit. You're going to have strikes in any event, but that would make things much worse."
A 5 per cent rise would cost almost £7billion ($8.3bn) more than a 2 per cent rise, but may have to be funded from within existing budgets.