Canberra Times Article by Markus Mannheim, Public Service Editor 14th November 2014
The Abbott government’s tough May budget set aside enough money to offer public servants a 3.2 per cent annual pay rise.
The wage-spending plans contrast with Treasurer Joe Hockey’s comment that the government could not afford to pay troops more than a 1.5 per cent a year raise.
The size of the potential pay increase for public servants only became apparent last week after the Defence Force Remuneration Tribunal set the salaries for soldiers, sailors, airmen and airwomen for the next three years.
The May budget outlined the loss of 16,500 full-time-equivalent public service jobs and was seen as the most parsimonious in 18 years. But it was still calculated on the basis of funding an above-inflation pay rise across government.
Its wage-spending forecasts, prepared by the Finance Department, suggest the government will spend $19.9 billion on salaries in 2016-17, when it will employ 80,397 full-time-equivalent military personnel and 162,053 civilian staff.
If the government wanted military and civilian staff to receive the same pay rise, it could use its wage budget to fund a 2.8 per cent annual increase over the next three years.
Alternatively, if it stuck with the defence tribunal’s decision to give troops a 1.5 per cent raise, the leftover budget could fund a 3.2 per cent increase for civilian staff.
However, Finance Minister Mathias Cormann said it was wrong to say the budget could fund any pay rise because it remained in deficit.
“As a result of Labor’s waste and mismanagement over six years in government, there is no spare money in the budget for additional public sector salary increases and no such allocation has been made by the government in the budget,” Senator Cormann said.
Opposition Leader Bill Shorten said on the weekend the government had funded a bigger pay rise for defence personnel but was instead using the military to push through a “shameful” policy to suppress public service salaries.
Mr Hockey had said earlier he would like to pay soldiers more but “if you want to pay people more, you’ve got to have more income”.
A pay rise of 3.2 per cent is not far below the Community and Public Sector Union’s initial demand of 4 per cent a year. Employment Minister Eric Abetz described that claim last week as “neither responsible nor realistic”, saying it “cruelly raises expectations”.
The federal bureaucracy is negotiating more than 100 separate wage deals for public servants but is struggling to make progress. Some agencies have even proposed giving no pay rises at all over the next three years.
Under the government’s strict pay-bargaining policy, agencies can only increase staff salaries if they prove to the Public Service Commission they can pay for them with productivity savings.
About 22.5 per cent of the federal government’s wages budget last financial year was spent on defence personnel, though that is forecast to rise to 24.2 per cent by 2016-17 as the military expands and the public service shrinks.
The average spending on an ADF member’s salary, excluding superannuation and other on-costs, was $57,314 while a civilian government employee received, on average, $84,804.
NOTE: If you want to change the values in the image Wages Budget above, go here