MPs' salaries are to rise from £67,060 to £74,000, a raise backdated to 8 May, the Independent Parliamentary Standards Authority has announced.
The government has formally registered its opposition to a proposed 10 per cent pay rise for MPs.
The Independent Parliamentary Standards Authority (Ipsa) - over which ministers have no control - recommended the £7,000 rise to due an upturn in the economy.
But political leaders - including the Prime Minister - have said it is "unacceptable" and "inappropriate" when other public sector workers are only being given an increase of one per cent.
House of Commons leader Chris Grayling has now written to Ipsa chairman Sir Ian Kennedy, highlighting the government's first unfavourable response to the recommendation two years ago.
Veteran Labour MP Dennis Skinner has criticised a 10% pay rise for MPs.
He told ITV News the move is an "attack" on people who are living on low wages and who themselves have received a 1% or 0% pay increase.
David Cameron has restated his opposition to a 10% salary hike for MPs - but stopped short of blocking the rise.
Here's how British MPs' salaries compare to politicians in Italy, Australia and France:
David Cameron has renewed his opposition to a 10% salary hike for MPs - has stopped short of blocking the rise.
Downing Street said the Independent Parliamentary Standards Authority (Ipsa), which sets pay for MPs, will receive a letter underlining the Prime Minister's opposition to the move.
"We're writing a letter to Ipsa to reiterate we stand by the detailed submission we had already made to them last year saying we think this rise is wrong," a Downing Street source said.
Mr Cameron previously described the £74,000 proposed pay packet, which comes at a time when the rest of the public sector is restricted to 1%, as "unacceptable".
However, No 10 indicated earlier this week that it would not seek to block the increase.
Mr Cameron has come under pressure to take a stand against the salary increase after the frontrunners in the Labour leadership race made clear they will not pocket the cash.
Labour leadership hopeful Andy Burnham has said he will turn down a 10% planned pay rise for MPs bringing their salary to £74,000.
Mr Burnham said if the hike goes ahead he will refuse to accept it or donate the money to local groups.
The shadow health secretary said the proposed rise "cannot be justified".
Writing on Twitter the Leigh MP said:
David Cameron opposed a more than 10% pay rise but said it was ultimately a decision for the Independent Parliamentary Standards Authority (Ipsa).
Downing Steet said the Prime Minister will not seek to block Ipsa's proposal - meaning he will personally get the extra money taking his salary to £149,440.
The Labour party has added its voice to criticism of a decision to award MPs a 10 per cent pay rise.
Despite opposition from senior politicians, including the Prime Minister, the Independent Parliamentary Standards Authority (Ipsa) looks set to introduce the raise, which amounts to £7,000 a year, at the end of the month.
A spokesman for the Labour party said it would "feel wrong" if the recommendation is pushed through by the independent body at a time when "so many people are struggling".
Labour backbencher John Mann, who serves on Treasury Select Committee, also called for the rise to be blocked.
A 10 per cent pay rise for MPs - bringing their salary to £74,000 - looks set to go through at the end of the month, after the increase was not blocked by the Prime Minister.
What do you think of the proposal?
Workers' unions have slammed a £7,000-a-year pay rise for MPs as "hypocritical" amid ongoing public sector cuts.
Paul Kenny, general secretary of the GMB union - which has protested government cuts in the past - argued that the rise should mean MPs give up any additional jobs.
Mark Serwotka, general secretary of the Public and Commercial Services (PCS) union, added: