THE take-home pay of hundreds of thousands of public sector workers in Scotland will be boosted next year by the scrapping of the one per cent cap on wage rises.

First Minister Nicola Sturgeon will this week confirm that NHS staff, civil servants and other employees will receive more generous increases following a prolonged period of pay restraint.

The UK and Scottish Governments have maintained the one per cent cap on pay as a way of keeping a lid on public spending.

Kezia Dugdale: the wasted talent who left her party in the lurch

SNP Ministers have blamed the UK Government’s austerity agenda for the unpopular policy, but they have recently indicated a willingness to go their own way.

On Tuesday, Sturgeon will unveil her Programme for Government for the next Parliamentary session and ditching the pay cap will be a flagship policy.

The SNP is recovering from a bad General Election result which saw the party lose seats to the Conservatives and Labour.

In an attempt to reinvigorate her administration and regain the political initiative Sturgeon will announce a series of bold measures.

A Scottish Government source told the Sunday Herald: “The Programme for Government will make clear that the time has come to ditch the one per cent pay cap for the public sector. The cap will go from next year and future pay policy will take account of the cost of living. We need to ensure that future pay rises are affordable, but we also need to reflect the circumstances people are facing, and recognise the contribution made by workers across the public sector.”

READ MORE: 'Ruth Davidson runs an autocratic party'...Senior Tory claims Conservatives in Scotland like a 'renaissance court'

It is also expected that ending the cap in Scotland will open up a divide with the UK Government, which is itself split on public sector pay.

Some senior Tories believe pay restraint harmed their party at the General Election, arguing that the public has grown weary of austerity.

Ditching the policy may also help the SNP deal with the threat posed by Jeremy Corbyn’s Labour party, which has led calls to give public sector staff a more generous rise.

In May, a Labour move at Holyrood to scrap the pay cap for NHS staff was defeated, but weeks later Finance Secretary Derek Mackay announced a rethink.

It is unclear how the increase will be paid for, but budget talks with opposition parties will inevitably focus on revenue-raising measures.

Sturgeon’s Programme for Government will include 16 bills and is expected to cover policy areas such as education, health and justice.

She said: “This Programme for Government is our plan to shape the kind of Scotland we all seek – an inclusive, fair, prosperous, innovative country, ready and willing to embrace the future.

“It includes major reforms in education, health and justice, new opportunities for our communities and important measures to safeguard the environment and improve the quality of housing."

Kezia Dugdale: the wasted talent who left her party in the lurch

However, the Conservatives claim that the SNP Government is still playing “catch up” on last year’s legislative programme.

Analysis by the Tories revealed that less than a quarter of the bills proposed have been passed.

Party leader Ruth Davidson said: “It’s time to dump the endless debate about independence, and put the focus back on the forgotten issues.

“Scotland cannot afford a repeat of last year’s Programme for Government, when the SNP set out a range of ideas, but delivered on hardly any.

“Even without the upcoming programme, ministers would still be playing catch up on last year. We need to build more homes, recruit more teachers and get our economy back in the fast lane.”