Education Secretary Michael Gove has defended budget measures to freeze thousands of public sector workers’ salaries across Oxfordshire.

The measures, announced in Tuesday’s Budget, sparked an angry reaction from unions and a protest rally in Cornmarket.

Mr Gove said he understood people’s anger but reiterated the message “we are all in this together”.

Mr Gove said: “I completely understand the anger and frustration public sector workers will feel as a recession they played no part in causing is hitting them this way.

“The previous Government was so spendthrift in the way it wasted public money that the recession caused in America hit us longer and deeper than anywhere else.

“As the Chancellor said, we are all in this together.”

He also responded to criticism that the VAT rise, to 20 per cent in January 2011, would leave those on low or fixed incomes out of pocket.

“Pensioners and those on fixed incomes say one of the most dreaded taxes is council tax, and that is being kept down.

“We are raising the threshold for income tax, and public sector workers earning under £21,000 will get £250 pay increases.

He added: “I don’t think anyone in Government wanted to raise taxes, let alone VAT, but the situation we were left with left us no option. If different taxes had been raised there would be different concerns.

“I am sure there will be people who express concern about the decisions that have been taken.

“The difficulties this Government inherited are not of its making. More broadly, you have to ask the question of those people criticising: ‘what would you do?’.”

He confirmed the budgets of Government departments would be cut by an average of 25 per cent unless progress was made in bringing down benefits payments.

Mr Gove was speaking as more than 60 people attended a protest rally in Cornmarket Street, organised by the Right to Work campaign. Union leaders in the city responded angrily to the Budget , in particular the review of public sector pensions.

Mark Fysh, Unison representative at Oxfordshire County Council, said: “We didn’t have a pay rise this year, so you are talking a three-year pay freeze. Three years without a pay rise means a ten or 12 per cent pay cut just based on the cost of living.

“It is the worst I can remember in my working lifetime.”

He said the union accepted measures had to be taken but said a pension review could prove a step too far for union members.

“If they come after our pensions, we will strike. They are not free, we all pay into them for 20 or 30 years come hell or high water.”