MPs could get pay rises above those of public sector workers from next year, according to plans set out by the independent expenses watchdog.
The news comes in a week that tens of thousands of public sector workers across the country have seen their pay frozen, despite nurses receiving a three per cent rise.
The proposal, from the Independent Parliamentary Standards Authority (Ipsa), suggests it takes new powers "to vary the [annual pay] award below or above" public sector pay.
A four-week consultation will lead to conclusions in the autumn and any announcement would come in the spring. Ipsa could have the new powers to set MPs' pay in the 2022/23 financial year.
For the past five years, MPs' pay has been set by Ipsa and linked to public sector pay every October to avoid MPs being forced into the politically difficult position of having to set their own pay.
MPs are currently paid £81,932 a year.
Ipsa froze pay in the 2021/22 financial year as the country grappled with the Covid pandemic. But it said it was asking for greater discretion about MPs' pay because the virus crisis meant the annual October figure could be a "much less reliable guide to changes in earnings than they are in ordinary times".
Ipsa is proposing either to have the discretion to reduce the pay award or vary it, "which could be either an increase or a reduction". However, a source said it was highly unlikely that the body would decide to say that MPs are paid more than public sector workers.
On Wednesday, the Government announced a three per cent pay rise for NHS workers in England, although police officers and other public servants will be hit with pay freezes.
Those who will benefit from the increase – more than the two per cent average offered to British workers between April and June – include nurses, paramedics, dentists and salaried GPs.
On Thursday, the Police Federation declared that it had "no confidence" in Priti Patel, the Home Secretary, and called the pay freeze for officers "the final straw". The federation, which represents 130,000 rank and file officers in England and Wales, will also withdraw its support for the review body which sets pay.
The only previous Home Secretary to face such a no confidence declaration in recent times was Jacqui Smith in 2007, again over pay.
John Apter, the federation's chairman, acknowledged that Ms Patel had often praised officers but said they were "so angry" with the Government after 18 months on the pandemic front line.
"At the beginning of this pandemic, they endured PPE shortages and were not even prioritised for the vaccination. They continue to be politicised and this pay announcement is the final straw," said Mr Apter.
An Ipsa spokesman told The Telegraph: "As we make clear in the consultation, if current trends continue we think it is more likely that we would be making a downward adjustment rather than an upward adjustment to the figure we use to determine pay for Members of Parliament."