The public sector should pioneer a shorter working week with no loss of pay, a think tank has argued.

The report from Autonomy calls for a 32-hour week in the public sector to avoid burn out, poor mental health and a bad work-life balance.

It argues that the policy would create up to 500,000 new full-time jobs in the UK and would benefit regions that have been most affected by austerity.

It suggests the policy would cost around £9bn, which is only 6% of the public sector employment salary bill.

It states: 'By preventing overwork and reducing stress, shorter working hours would reduce the prevalence of mental health problems among public sector workers. This would not only improve the wellbeing of employees but would help institutions retain staff at a time when turnover is incredibly high.

'All of these factors will, in turn, help productivity across public sector organisations.'