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Rachel Reeves MP, Labour's Shadow Chief Secretary to the Treasury, responding to the New Economics Foundation report on regional pay in the public sector, said:

"This report confirms that there is no evidence to support the Conservative-led Government's contention that the reason businesses are struggling in so many parts of the country is because public sector pay is too high. On the contrary, the Chancellor's plans to pay public service workers less in areas of high unemployment could have a devastating impact on regional economies already suffering the worst effects of this recession made in Downing Street.

"George Osborne should abandon these plans that have added to the anxiety and uncertainty felt by struggling businesses and hard-pressed public service workers around the UK, and come up with a real plan to get our economy out of the recession his policies have pushed it into."

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