NHS staff in England were expecting to receive a higher pay rise than the 1% proposed by the Government, the head of the health service has confirmed.

Sir Simon Stevens, chief executive of the NHS in England, confirmed that plans set out previously had budgeted for NHS pay to increase by 2.1% this year.

It comes as the Government has defended its proposal to give some NHS staff in England a 1% pay rise.

Labour has accused the Government of “breaking their promise” to health workers.

Sir Simon said that proper recognition for what staff have been through over the course of the pandemic is “entirely right”.

But he called for the independent pay review body to be allowed to do its work without “fear or favour”.

Giving evidence to the House of Commons Health and Social Care Committee, Sir Simon said: “At the time that we published the Long-Term Plan, and then shortly thereafter in 2019, we laid out the underpinning financial assumptions.

“Obviously that was approaching two years ago, so things have changed, but at the time the working assumption was that there would be available 2.1% for the costs of the Agenda for Change pay group in 2021/22 together with the overhang from the 2021 elements of the Agenda for Change pay deal.

“Ultimately in a publicly funded, democratically accountable health service, the government of the day gets to decide what NHS pay should be, but you would expect the head of the health service to want to see properly rewarded NHS staff, particularly given everything that the service has been through – they have been through – over the course of the last year.

“And so I think the right way to resolve this is the path the Government has actually set out which is to ask the independent pay review bodies to look at all of the evidence… and be able to independently make a fair recommendation so that NHS staff get the pay and reward that they deserve.”

He added: “Ultimately, of course, government gets to decide whether to accept those recommendations but we are in the review process where the review body needs to be able to do its work without fear or favour and then put forward that recommendation and its justification for so doing.”

Asked by Labour MP Barbara Keeley whether there has been consideration for a bonus to be paid to NHS staff, Sir Simon said: “That needs to be seen in the context of the overall judgments that the Government will make on NHS pay in the round.

“And I agree with you that coming out of the past year and everything that NHS staff have been through, proper recognition for that is entirely right.

“And that goes with the grain of what the public want to see, none of which is to ignore the broader economic context facing the country.

“As the head of the NHS, I’m wanting to make sure that staff get proper reward and not only support through that mechanism, but also fundamentally what staff want to see are a broader range of measures including further increases in the workforce to deal with some of the intense workforce pressures.”

Commenting on the remarks, shadow health secretary Jonathan Ashworth said: “The head of the NHS has confirmed what we already knew: the Conservatives have broken their promise to the NHS and are cutting nurses’ pay.”

Ministers have argued that the 1% increase was all that could be afforded following the massive hit to the public finances caused by the pandemic at a time when most public sector workers were facing a pay freeze.

However, Justice Secretary Robert Buckland appeared to strike a more conciliatory note, saying that the submission to the pay review body was only the “beginning of a process”.

“The final recommendations have not yet been made,” he told BBC Breakfast.

“We have got to remember that in large other swathes of the public sector there will be a pay freeze save for the lowest paid. I don’t think at the moment we are at the end of this process.

“I think that we need to see what the recommendations are, and I very much hope that the outcome – whilst it might not be an outcome in these difficult circumstances that will result in pay rises that everybody would want to see – that the work that has been done by NHS workers will be recognised in a way that is appropriate, bearing in mind the constraints we are all under.

“It is not for me to start to prejudge what the outcome of the negotiations is. I am simply pointing out that we are at the beginning of that process and we will have to see what the recommendations are.”