21 May 2021

Annual public sector pay rises the lowest in decades

| Ian Bushnell
Join the conversation

The Federal Government froze APS wages for six months in 2020. Photo: File.

Public sector wages have grown at the lowest annual rate since the Australian Bureau of Statistics began measuring the data in 1997, as a result of Federal Government curbs on pay.

In the March quarter the public sector recorded a 0.4 per cent rise and only 1.5 per cent for the year to 31 March.

In April 2020, the Federal Government announced six-month wage deferral as a response to the COVID-19 crisis when thousands of private sector workers lost their jobs, saying the APS should share the economic burden.

The two per cent salary cap was also in place until November when the government scrapped the limit and tied public sector wage rises to the private sector, but wages there have been languishing for years.

Assistant Minister to the Prime Minister and Cabinet Ben Morton said at the time that the new policy ensured that Commonwealth public sector wage rises could no longer exceed wage rises in the private sector but would allow them to follow private sector wage growth when it eventually exceeds two per cent.

Both decisions came under fire from the main public sector union, the CPSU, which said the government did not value frontline workers and was ignoring the problem of stagnating wages and the impact on the economy.

While ACT politicians, public service senior executives and statutory office holders had their pay rates frozen for 2020, along with judges at the Supreme Court and Magistrates Court, Territory public servants did not suffer the fate of their federal cousins.

“We will not be freezing wage increases for the broader ACT public service,” Chief Minister Andrew Barr said at the time.

“The ACT public service is predominately made up of frontline workers like nurses, doctors, allied health professionals, ambulance officers, teachers, police, firefighters and other emergency service members, bus drivers and city services staff.

“These staff will be working incredibly hard during the public health emergency to provide essential services to the Canberra community.”

READ ALSO CPSU survey finds most sexual harassment in the public service goes unreported

The public sector result gave the ACT the lowest annual rise in the nation at 1.3 per cent, while the quarterly increase was 0.4 per cent.

Nationally, wages rose 0.6 per cent in the March quarter for an annual growth rate of 1.5 per cent.

Head of Prices Statistics at the ABS Michelle Marquardt said that after two quarters of minimal growth, wages rose 0.6 per cent for the second successive quarter.

“This quarter saw a return to regular patterns of wage growth for the time of the year, supplemented to some extent by pay rises for the final group of award workers scheduled in the Fair Work Commission’s annual wage review (2019-2020).”

She said improved business conditions allowed employers to revisit wage reviews postponed during the height of the pandemic.

“The phased approach to the delivery of award increases saw jobs in the accommodation and food services, retail trade, arts and recreation, aviation and tourism industries receive rises previously recorded in September quarters,” she said.

The Wage Price Index measures the change in hourly wages and salaries paid. Wage subsidies such as JobKeeper and payroll tax changes are not included.

Join the conversation

All Comments
  • All Comments
  • Website Comments

pretty sure that as soon as wages in the private sector go over 2% the Government will change the policy.

Daily Digest

Want the best Canberra news delivered daily? Every day we package the most popular Riotact stories and send them straight to your inbox. Sign-up now for trusted local news that will never be behind a paywall.

By submitting your email address you are agreeing to Region Group's terms and conditions and privacy policy.