Hmmmmmm.....I think we started down that dark path a long time ago with pay banding.
With respect - and I say that as someone who isn't affected by banding - I know it's an emotive issue. Banding is (agree with it or not) an extension of grading in so far as it is a judgement of what the correct remuneration is for the job that you do.
Annual % pay increases are intended to react to increased cost of living and reward for good company performance. They are a percentage hike in your remuneration but not a judgement on the respective value or importance of different jobs within the company.
The former is divisive by it's very nature and there's no way for it not to be. The latter should never be so.