Public sector unions are threatening nationwide strikes after a two-year pay freeze for previously “insulated” public sector workers was announced in the Emergency Budget.

Union leaders said they are now at “war” with minsters, with the chancellor George Osborne signalling that he will also take an axe to public workers’ gold-plated pension, the Daily Mail has reported.

Paul Nowak, of the TUC, told the Mail: “If there are spending cuts of 25%, there are undoubtedly going to be tensions about job losses and the potential for industrial action.”

Unison leader David Prentis accused the government of “slash and burn” and said the chancellor would “be throwing tens of thousands of public sector workers on the dole,” the newspaper reported.

The Public and Commercial Services union threatened “widespread industrial action” over the public sector pay freeze. General secretary Mark Serwotka told the Telegraph: “The only question is when that action will start.”