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Most businesses are planning pay freezes this year, abandoning the practice of giving automatic annual increases in the face of dwindling inflation and a brutal cash squeeze. No fewer than 58 per cent of businesses in a British Chambers of Commerce (BCC) poll were planning to freeze pay this year and 12 per cent said that they intended to cut wages.Unveiling its bleak snapshot of British industry, the BCC will today press the Government for more help for recession-hit companies. A number of big businesses have enforced 0 per cent pay settlements recently. Royal Mail risked a showdown with unions when it said last week that none of its 181,000 staff would get an increase because of the impact of the economic downturn and its loss of business to electronic mail. The Communication Workers Union warned that the pay freeze made industrial conflict inevitable. Royal Mail’s move follows similar action by BT, which has 100,000 employees. At British Airways, unions have agreed to a pay freeze for cabin crew. In the car industry, Jaguar Land Rover has frozen pay and Toyota has cut wages by 10 per cent because it has shortened its working week. Inflation, as measured by the retail prices index, turned negative this month, hitting -0.4 per cent. But the measure favoured by the Bank of England, the consumer prices index, which excludes mortgage interest costs, still registered 2.9 per cent. The BCC’s survey reveals the potential spread of pay freezes throughout the economy. It also has a bleak forecast for employment prospects, with 50 per cent of companies saying that they are considering or are certain to make redundancies this year. At the organisation’s annual conference today, David Frost, its director-general, will tell ministers that businesses are not getting enough support from the Government. He will say: “It is the private sector that has faced all the pain of this recession. The results of our most recent poll show just how hard times are, with half of firms considering making redundancies. “The Government must realise that the private sector cannot bear all of the pain. There was some support in the Budget, but more is needed to help Britain’s embattled businesses.” Baroness Vadera, the Business Minister, will face the BCC in Birmingham as the employers’ group also presses for a three-year moratorium on employment regulation. Unions and other employers’ groups, such as EEF, the manufacturers’ organisation, have called for wage support from the Government for employees facing short-time working, as provided in some other European countries. Brendan Barber, the TUC General Secretary, said: “Of course unions have agreed to limit pay when their employer is in real difficulties, but it is neither in the interests of workers, business nor the wider economy for there to be a general freeze on wages.” Much of industry blames its plight on the banks, according to the BCC’s survey. Half of the businesses polled said that the banks were most responsible for the crisis, with 37 per cent seeing the Government as most culpable. The financial regulator, the Financial Services Authority, was blamed by only 6 per cent. Businesses were gloomy about the prospects for the economy, with 62 per cent expecting it to deteriorate. A recent CBI industrial trends survey painted a grim picture but also suggested that the worst may now be over because the rate of decline in business confidence had slowed for the fir