A potential bill of hundreds of millions for backdated holiday pay will have massive repercussions for public services in Northern Ireland's public services, the chief constable of the PSNI has warned.

George Hamilton said there was not a "bottomless pit" to fund the payout, and there would be a "negative impact" on service delivery.

Rule changes introduced a number of years ago mean that regular overtime worked by civil servants, and other additional payments accrued on top of their basic salary, should be factored in when setting their holiday pay rate.

Last week, the Court of Appeal ruled that PSNI staff were entitled to retrospectively apply the amended rates going back 20 years.

Lawyers estimate the judgment could cost the police £40 million, and potentially pave the way for similar back payment claims across the public and private sector.

A cap limiting the retrospective period in the rest of the UK was not replicated by the last Stormont administration.

Read more: PSNI's £40m pay claim headache could be tip of the iceberg

Mr Hamilton told the Policing Board that he considered the 20-year timeframe unreasonable.

However he said the PSNI was still considering whether to appeal against the judgment to the Supreme Court, noting the deadline for a decision was next Friday.

By that date, the retiring Mr Hamilton will have been replaced by new chief constable, Simon Byrne, with the appeal decision one of the most pressing matters in his in-tray.

Appearing before the board for the last time, Mr Hamilton said an appeal would focus on the technical aspects of the ruling - such as the length of the timeframe and how the amended holiday pay rates are calculated.

He conceded the PSNI would be facing some sort of payout, but questioned the accuracy of the £40 million figure quoted.

"We have these headline figures picked out of the air without any calculation or science behind them I think the £40 million is a guess - for all I know it could be more and I don't think they (lawyers) know," he said.

"It's going to be certainly tens if not hundreds of millions of pounds across the public sector if the current judgment stands.

"So there are massive repercussions from this if it is not challenged. I don't know if we will necessarily appeal, we are still taking advice and giving that consideration."

Mr Hamilton said a working group with representatives from across the public sector was assessing how to deal with the issue.

"That money is going to have to come from somewhere in public service delivery, so it's not as if there is some bottomless pot of money," he said.

"Somewhere there is going to be negative impact in service delivery because we are going to be paying public servants this extra money.

"I have no difficulty paying it from this point on if that's the rules and I have no difficulty in paying it with a reasonable reach back into the past. I don't think personally that 20 years is reasonable. The court has decided otherwise."