More than 40% of Britain's recession-scarred workers expect to receive a pay freeze or a cut to their wages this year despite George Osborne's claim to have restored living standards, ensuring they would "grow strongly every year for the rest of the decade".

Just one in five of these workers expect their pay to rise by 2% or more in 2015, according to a new survey by information provider Markit, raising doubts about whether economic recovery can be sustained.

More than a third of the 973 households surveyed earlier this month expected a pay freeze this year, while 7.5% are braced for a cut. Expectations of flat or falling wages were most pronounced in the public sector where 45% of workers saw these outcomes as most likely. That compared to 40% in the private sector.