The Chancellor, in yesterday's Autumn Budget Statement, announced that public sector pay rises would be capped at 1 per cent for two years when the current pay freeze ends in 2014. With inflation likely to exceed 1 per cent the pay cap means a pay cut in real terms for public servants, including members of the armed forces.

Unlike earlier announcements by the Coalition government and by their predecessors, there is no mention this time of measures to protect the pay of junior personnel.

While there are unique characteristics of military service which must always be reflected in a fair remuneration package, the armed forces are clearly not exempt from the current public spending situation. The real-terms pay cut should, however, be viewed in the context of ever-increasing charges and diminishing opportunities to save money from allowances.

On the face of it, the Armed Forces Pay Review Body would seem to have little room for manoeuvre regarding their recommendations for FY 2012-2013.

More information may emerge from the MoD. BAFF will stay in touch with this issue.