Brown orders ministers to give up pay rises - and he wants MPs to have limited increases too

The Prime Minister told the Cabinet they should make the gesture to underline the 'importance of public sector pay restraint at a time of economic uncertainty'.

Yesterday's decree echoed his insistence at Labour's first Cabinet meeting in 1997 that ministers should not take a 26 per cent pay rise  -  a decision which infuriated Tony Blair's wife Cherie at the time.

Prime Minister Gordon Brown, pictured with Chancellor Alistair Darling, said MPs' pay should be limited to around 2 per cent this year

Yesterday David Cameron promptly followed Mr Brown's lead, saying he and senior Conservatives on the ministerial payroll would also forgo 1.5 per cent pay rises.

Downing Street also announced that  MPs are to be stripped of the right to vote on their own pay.

In future, an independent review body will decide for them. But despite the calls for restraint, all three party leaders are facing demands from their own MPs for huge salary increases.

Three senior MPs who sit on Speaker Michael Martin's review into pay and allowances  -  Labour's Sir Stuart Bell, the Tories' David Maclean and the Lib Dems' Nick Harvey  -  were revealed to be asking for a 21 per cent pay rise.

Liberal Democrat MP Norman Baker says that increasing MPs salaries would be like pouring petrol on flames

MPs currently get £61,820 but the three MPs said that should increase to £75,000 after the next General Election, expected in 2010.

Other unnamed MPs have urged Sir John Baker, head of the Senior Salaries Review Body, to recommend a pay rise to £100,000.

Liberal Democrat MP Norman Baker said: 'This is like pouring petrol on  flames. I cannot believe that MPs could seriously suggest unilaterally a big increase in their own salary.'

But Sir John said it was clear MPs were now paid less than a range of public sector workers in jobs of comparable importance.

He said there had been controversy over 'some inflation of allowances to try to make up for restrictions on pay'.

A series of scandals has seen MPs accused of misusing Commons expense allowances.

Downing Street rejected Sir John's recommendation that MPs receive an additional £650 'catch-up' payment on top of their annual pay rises for each of the next three years.

It said MPs' pay should rise in line with the mid-point of a range of public sector settlements. With some settlements yet to be negotiated, it is not clear exactly what rise this will produce for MPs this year, but it is likely to be in the order of 2 per cent.

Commons Leader Harriet Harman said MPs would vote on a series of options next month.

The pay restraint for ministers applies only to the portion of salaries related to their front bench jobs. They will receive the same rise as other MPs for being a constituency MP.

A 1.5 per cent rise next year would have meant approximately £1,900 more for Mr Brown, £1,200 for Cabinet ministers and £600 for lower-ranking ministers.

Matthew Elliott, chief executive of the TaxPayers' Alliance campaign group, said: 'Freezing the pay of ministers and MPs shows that the Government recognises the pain that ordinary families are suffering in these rough economic times.

'With millions of people having to tighten their belts, it's only right that Westminster follows suit and tries to save taxpayers' money.'