Britain is facing its first national strike by civil servants since Margaret Thatcher was Prime Minister more than a decade ago.

Leaders of the biggest Whitehall union are planning action by up to 112,000 staff in 10 departments in protest at the Chancellor of the Exchequer keeping a lid on pay.

Although Gordon Brown insists his department does not impose caps, leaders of the Public and Commercial Services Union (PCS) are convinced the Treasury sets the figure and will warn ministers today of their intention to take action. A letter from Paul Boateng, Chief Secretary to the Treasury, on 7 April, to Margaret Beckett, the Environment Secretary, referred to her department having "breached" its remit on pay last year. It set out criteria under which the Treasury would be prepared to "release" money to fund a pay rise for employees.

The Chancellor is thought to have vetoed a 5.5 per cent increase in the pay bill sought by Andrew Smith, the Work and Pensions Secretary, and offered 3.9 per cent. After Mr Smith protested, Mr Brown lowered that to 3.7 per cent, union sources claimed.

Mr Smith told the Chancellor that the limit imposed by the Treasury would severely limit his ability to honour promises to the union made last year.

In an internal union memorandum, Mark Serwotka, general secretary of PCS, names the 10 departments as the British Museum, Customs & Excise, the Department of Media, Culture and Sport, the Department of Trade and Industry, the Department of Work and Pensions, the Export Credit Guarantee Department, the Health and Safety Executive, the Passport Agency, the Prison Service and the Northern Ireland Courts Service.