I expect that to be a tactic for reducing pension costs after a cap takes effect - low or flat pay rises for as many years as people will put up with it. Once employee anger has built to a level where this cannot be sustained, there would be a single large adjustment (say, RPI+5%) which takes pay to where it should have been anyway, but which does not bring the pension up with it because that is capped. Repeat.
Even if pay only rises by an average of RPI+0.5%, it's still possible to reduce pensionable pay using this method.
Last edited by rodan; 11th Nov 2008 at 17:18.