21 March 2023

Tell 'em they're dreamin'! Minister rejects CPSU's 20 per cent wage bid

| Chris Johnson
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CPSU National Secretary Melissa Donnelly. Photo: Supplied.

Finance and Public Service Minister Katy Gallagher has outright rejected the Community and Public Sector Union’s bid for a 20 per cent pay hike over three years for all employees of the Australian Public Service.

You think?

The CPSU’s ambit claim is so extravagant that it’s hard to take the union seriously.

It has asked for a 9 per cent pay rise service-wide in the first year of the next APS enterprise agreement for wages and conditions.

That would be followed by a further 6 per cent pay rise in the second year of the agreement, then a 5 per cent top up in the third year.

Oh, and throw in a cost-of-living adjustment payment for any year when the Consumer Price Index exceeds the pay increase.

‘Ambitious’ has been the word bandied about since the CPSU made the bid last week.

READ MORE APS pay talks: Government releases ‘common conditions’, union seeks a lot more money

The union’s national secretary Melissa Donnelly used the word herself when talking about the claim.

‘Ridiculous’ would be a more accurate description.

The CPSU’s members would now be more than justified in asking exactly what their dues are being spent on if this is the best their union can come up with.

As non-starters go, this one shouldn’t have even bothered turning up to the game.

Ambit claims play a valid role in negotiations – but not laughable ambit claims.

We’d all like a 20 per cent pay rise.

We’d all like a 20-hour working week, 12 weeks of annual leave and a chauffeured ride to the office each day on the company tab.

But most people live (and work) in the real world.

In what reality is this union residing?

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Senator Gallagher has deemed the demand as being out of the question.

“We go in, both, with eyes open,” she said.

“It would be impossible to deliver that in terms of the budget we are facing.

“But we do want reasonable, affordable pay rises … They are doing what they need to do on behalf of their members, I understand that. We’ve got a job to do too, which is to make sure the budget is sustainable.

“We are coming from different standpoints. Hopefully, we can meet in the middle.”

The Minister was being diplomatically kind.

The CPSU has just handed the government enough ammunition to meet anywhere but in the middle.

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Senator Gallagher has signalled that the government doesn’t want a protracted bargaining process but that it does want to reach a decent wages and conditions outcome.

“We know people want good pay. We know they want their conditions signed off,” the Minister said.

“We’d like to get through it without too much conflict. But like all bargaining, I expect there will be some.”

The Australian Public Service Commission has issued a list of almost 50 proposed ‘common conditions’ it thinks discussions should canvass with employees, their unions and other representatives.

It’s a long list, yes. Some might say ambitious, even.

That’s probably an ambit claim too, but it’s certainly not a silly one.

For these negotiations to be productive, there need to be more serious players in the room – for the sake of a good outcome for all of the APS workforce.

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Good old Katy the people politician

Hahahaha bureaucrats think they deserve a pay increase when ChatGPT can easily do their job!

HiddenDragon6:35 pm 21 Mar 23

Even if it’s not the higher of 20 per cent or CPI, APS employees can probably be fairly confident that the outcome will be generous enough to ensure that the ACT does not elect two independents/Teals to the Senate at the next federal election.

Quite a few agencies, particularly the more technical ones, are starting to really struggle to recruit and retain people. Frankly a decent payrise is overdue given the competition.

Pete Butters3:50 pm 21 Mar 23

Was ‘ambit’ on wordle recently?

Used four times in the article. Also when used in conjunction with ‘extravagant’ it’s a tautology.

It is not unreasonable at all. Pay scales have fallen so far behind for many public servants they are now almost on the poverty line. Some contractors and exec staff are getting huge incomes. There is a lot of catching up to do.

@boydb
“Pay scales have fallen so far behind for many public servants …” Compared to whom?

I’m a public servant, a CPSU member and delegate who is about to walk into a meeting of members to discuss this claim. If you think public servants who didn’t get pay rises for five years before covid hit think they deserve less, let me know. I’ll make sure your name is quoted to them all. BTW, when was the last time you were at a bargaining table as an employee representative and how did that go? Nice commentary but way out of your depth here. Attacking the CPSU leadership is a pretty poor way to run a story, but did you think the claim wasn’t voted on by members before it went out to the media?
We know what we do and what we deserve when so many others took a dime on the back of the pandemic, tried to sell off government services or sacked their workforces.
Just give that some thought.

@Glen Hyde
“If you think public servants who didn’t get pay rises for five years … ”
You are acting as if public servants have been the only workers not to get a payrise. Every worker has suffered.
ABS figures for the quarter to Dec 22 show that public servants were only marginally worse off then the private sector (0.7% rise compared to 0.8%).
So following your logic, perhaps every worker should get 20% pay rise over the next 3 years.(given the 0.1% differential, perhaps private sector only gets 19.5%)?
If so, how do you propose to fund these pay rises? Perhaps we should just kick off a vicious pay rise / price rise cycle?
Perhaps they could part-fund the public service pay rises by dropping the employer (i.e. govt.) contributions for super from the current 15% to the standard 10.5% (eventually increasing to 12% by 2028) – or is that something that just gets overlooked?

Just Saying,
it’s a negotiation, what should they do? Argue for less?

Inflation last year was nearly 8%, is predicted to drop to near 5%, this year and hopefully down to near 3% next year.

That’s 16% in 3 years, so really 20% over 3 years is only just above inflation over the recent period and coming year(s).

Whilst there is no way that they’ll get that number considering economic conditions, it isn’t that ridiculous. In the end it will really be a negotiation of how much of a real pay cut they will sustain. And the unions obviously want to test out the new government and their claims about wanting higher pay for workers.

Also, with your claims around Superannuation contributions, they aren’t paid for by the government or any other employer being generous, it’s a forced withholding of your own benefits which have been negotiated as part of your employment package. Anyone is free to negotiate a higher Superannuation percentage than the government mandated minimum.

@chewy14
As you’ve chosen to answer for Glen Hyde, perhaps you can answer the question I posed: “how do you propose to fund these pay rises?”

“they aren’t paid for by the government or any other employer being generous, it’s a forced withholding of your own benefits”
How so? Unlike the private sector, public service salaries do not include employer super contributions as part of the ‘salary package’ … it’s paid by the employer (govt) above and beyond the salary.

“how do you propose to fund these pay rises?”

The same way their current salaries are paid. How else would it be done? As above, it’s a negotiation.

“Unlike the private sector, public service salaries do not include employer super contributions as part of the ‘salary package’ … it’s paid by the employer (govt) above and beyond the salary.”

Current superannuation arrangements for government employees are identical to those for private sector employees. They have just negotiated a higher % payment as part of their benefits, the same way that many other private sector employees have done. And as anyone is free to do through salary sacrifice.

I’m not sure why you think these arrangements are different? Or are you referring to the old defined benefits schemes?

@chewy14
Sorry should I have capitalised the word “rises” so you would read it. Ok for your benefit:
How do the propose the govt FUNDS these pay RISES?
You do understand that a pay rise means an increase to the government’s current salary bill don’t you – and that increase has to be funded?
“Current superannuation arrangements for government employees are identical to those for private sector employees.”
That’s bs … most private sector employees “fund” the employer super contributions – out of their negotiated salary package – i.e. super is included in the stated salary. Published pay scales for every public service department never include the employer super contribution.

Justsaying,
No I read exactly what you wrote and the answer is still the same, they fund them in the exact same way that they fund their current salaries.

From revenue.

For the third time and perhaps you’ll read it this time,

“it is a negotiation.”

You seem to be of the misunderstanding that all government revenue is currently locked up forever and it’s impossible for the government to pay higher wages because of that, but this completely ignores the fact that the government makes choices every day around how it raises revenue and how it spends it.

The forward projections in the budget show that the government expects to receive 16% more revenue in 4 years time than now. It will have to make decisions on the best use of that additional revenue, some of it no doubt will go to higher wages.

It’s really not that hard to understand and as my first comment says, there is no way that the final agreement will be as big as what’s being asked. But that doesn’t make it as unreasonable as the article or you seem to think.

“That’s bs … most private sector employees “fund” the employer super contributions – out of their negotiated salary package – i.e. super is included in the stated salary. Published pay scales for every public service department never include the employer super contribution.”

Surely this is a joke? You think because they don’t advertise the already agreed and locked in 15.4% Super as being directly part of a “package” that the benefit is somehow functionally different than private sector superannuation? That the money comes from some other payment method on top of normal remuneration?

Just straight up incorrect.

@chewy14
No – I’m under no illiusion about govt revenue but I’m also under no illusion about the size of the current debt … surprisingly pushed to astronomical proportions by the previous conservative govt – the supposed pantheons of economic management. So, yes it can be funded, but the question is should it be to the tune that Glen Hyde argued above.
When I read comments like “If you think public servants who didn’t get pay rises for five years before covid hit think they deserve less, let me know. I’ll make sure your name is quoted to them all.” – that doesn’t sound like someone who is in the mood to negotiate. Nevertheless as always, you are now the spokesperson for everyone.
You have obviously never had to negotiate a package. I did for many years, in different environments, and everytime I factored into my negotiation an additional 9% (at the time) covering the employer super contribution to ensure I got the ‘take home amount’ I was seeking. My point being that the pay rise being sought (nominally 20% over 3 years) is exclusive of super – so the ‘negotiation’ is different from that which would be held in the private sector.
If it was the same, then the per annum rises would be reduced by approx. 5% – which is much more palatable and the public servants would still see a real increase in their take home pays.

Justsaying,
The original comment is replying to an article that basically says the union is off their tree for asking for a 20% increase.

As I’ve shown, they are only really asking for inflation + 1% as a starting point. Which as i’ve said they won’t get anyway.

But your attitude is actually part of the problem as to why wage growth has been so low over recent years. You’re agreeing with the article that it’s somehow totally unreasonable for employees to not want to automatically take a large real pay cut.

I think it’s perfectly reasonable for employees to question that position and negotiate on their own wages.

“You have obviously never had to negotiate a package. I did for many years, in different environments, and everytime I factored into my negotiation an additional 9% (at the time) covering the employer super contribution to ensure I got the ‘take home amount’ I was seeking.”

Done it many times for both myself and others., the calculations are quite straightforward.

But im still unsure why you think the amounts being asked for would be reduced by 5%?

Superannuation exists and is mandated. Many private sector employees have negotiated for higher superannuation % than the minimum as part of their deals. Exactly as public sector employees have for their current 15% deal. I know, I’ve done it myself in the private sector.

If you’re simply saying that the difference from what you’ve done previously and these negotiations is that they already have a locked in Super %, it’s not really different, they are just negotiating from a different base. Sure, it adds a couple of % points to what they are asking for, if that’s what you’re saying.

But the money still ends up as part of their total employment package. Superannuation isn’t a gift from your employer, it’s your own money.

@chewy14
“You’re agreeing with the article that it’s somehow totally unreasonable for employees to not want to automatically take a large real pay cut.”
Seriously? As usual, you choose to interpret what people say to suit your own narrative. It’s not a pay cut – they, along with every other employee, didn’t get as big a pay rise as the cost of living increase which is, unfortunately, water under the bridge (see my comment re the astronomically high current govt debt).
“I think it’s perfectly reasonable for employees to question that position and negotiate on their own wages.”
Fine that’s your opinion.
I think the govt should negotiate a reduction in the their employer super contribution to the mandated rate (hence the 5%) which would result in public servants receiving additional take home pay (after all, that’s what they want), to partially fund the salary increase, and have less impact on the public purse and in turn, the current debt.
As for my “… attitude is actually part of the problem …”? If wanting to see a reduction in the current debt to a manageable level, is a “problem”, then I’m very happy to wear it.

Got cut off.

“I think it’s perfectly reasonable for employees to question that position and negotiate on their own wages.”
Fine that’s your opinion”

You think it’s unreasonable for employees to question whether taking a real pay cut should be automatically accepted as a given? Why?

Because government
debt is high? So employees should suffer because the government has been unable to manage its finances adequately?

“I think the govt should negotiate a reduction in the their employer super contribution to the mandated rate (hence the 5%) which would result in public servants receiving additional take home pay (after all, that’s what they want), to partially fund the salary increase, and have less impact on the public purse and in turn, the current debt. “

Firstly you want an employee to trade Super for cash in hand as if it a win for them? Their overall package remains the same, hardly incentivising. It’s already their money.

And secondly, part of the reason why the public service Super is 15.4% is because of the old defined benefit schemes, which rightly can’t be changed. Under your proposal, only public servants under the new accumulation schemes would be impacted, creating disparate groups of employees which is hardly fair or easy to administer. Which is why no government or union would want to go there.

“If wanting to see a reduction in the current debt to a manageable level, is a “problem”, then I’m very happy to wear it.”

Strange. Here I am thinking the public service is meant to provide essential services and deliver government programs and policy. And that their wages should reflect the benefits provided and the market conditions of their roles. Never knew they were responsible for government debt repair as well.

@chewy14
As generally happens with you, we end up going around in circles – neither accepting the other’s opinion. I’ve reached that stage.

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