Health minister Jeremy Hunt wants the government to drop a cap on public sector pay rises of a below-inflation 1 percent for nurses, while education minister Justine Greening wants more money for schools, according to the newspaper.
Despite her party's expectations of a landslide victory, May lost her majority in parliament in last month's election, pushing her into a deal with a small eurosceptic Northern Irish Protestant party.
The opposition Labour Party fared better than expected in last month's election with its promises of measures such as the end to a 1 percent cap on public sector pay increases.
May's approval rating is now at minus 20 percentage points against a positive rating of 21 percentage points in April, according to a new Opinium survey for the Observer.
British Agriculture Minister Michael Gove told the Sunday Times newspaper that the government should accept the findings of any future public sector pay reviews.
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