Jeremy Hunt, UK chancellor, is to pump more money into the NHS to fund a new pay deal for health workers, but hopes of a deal to end strikes by teachers have descended into acrimony.

Health insiders claim that Hunt will put £3bn into the NHS to help back a pay deal that ministers hoped would create a “snowball effect” to encourage an end to the wave of public sector strikes.

The Treasury confirmed that the health department would receive more money but denied that a £3bn cash injection had already been agreed to help cover the £4bn cost of the higher-than-expected two-year pay deal.

Steve Barclay, health secretary, said on Tuesday that the pay deal would be fully funded. “I want to be clear — there will be no impact to frontline services or quality of care as a result of this offer,” he said.

“I’m working with the Treasury to ensure my department has the money it needs to fully fund this pay offer, which will include additional funding and reprioritising existing budgets.”

Hunt’s willingness to inject more cash into health suggests flexibility that could facilitate pay deals in other sectors, but efforts to resolve the teachers’ pay dispute are deadlocked.

Nurses, ambulance crews, physiotherapists and other non-medical NHS staff are beginning to vote in trade union ballots on the government’s pay offer, made last month.

The NHS pay offer consists of two one-off payments for the current financial year of 2022-23, worth up to £3,789 depending on the salary band, as well as a 5 per cent consolidated pay increase for 2023-24.

The Department of Health had funding only for a 3.5 per cent pay rise in 2023-24; the additional cost of the deal to the department is estimated to be about £4bn over the two-year period.

Hunt still expects the NHS to deliver efficiency savings and his allies insist that money for the health pay deal will also be found from reprioritising spending elsewhere in government; it would not require tax rises to fund it.

Meanwhile, the National Education Union has asked teachers to reject a new pay offer, demanding that it should be funded from extra Treasury money, rather than coming from existing school budgets.

The NEU described as “insulting” the government’s “final offer” of an average 4.5 per cent pay rise in the next academic year, plus a £1,000 one-off cash payment this year.

Gillian Keegan, education secretary, warned that if the offer was rejected, there would be no further negotiations and the £1,000 would be lost. A final decision on next year’s pay would go to the independent pay review body. “I think we have gone as far as we can,” she said.

Teaching unions now want Hunt to show the same willingness to fund a classroom pay offer as for the NHS.

Geoff Barton, general secretary of the Association of School and College Leaders, said: “If the Treasury is providing money for NHS pay deals, we cannot see why it would treat the school workforce any differently.”

He said that ASCL analysis showed schools would not be able to afford the pay uplifts without budget cuts that would hurt education provision.

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