David Blunkett told the review body that measures such as the extra money from the comprehensive spending review, the development of advanced skills teachers and a General Teaching Council have boosted the status of teachers.
He said if the review body forced a pay rise that could not be paid in full and entailed another year of phased payment it could have a potentially damaging effect on teacher morale.
The review body has been told it must look at the scope for targeted pay and incentives to attract teachers in shortage subjects, primary headships and deputy headships and London primary posts where there are recruitment problems.
Mr Blunkett said he would send the review body further details on affordability when the local government settlement is announced. The review body will publish its report next January.