Public servant fat cats won’t share Budget pain

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ScreenHunter_23 May. 30 09.38

By Leith van Onselen

The Australian Public Service’s (APS) top brass is sadly starting to look like their private sector brethren, where excessive pay is the norm.

While an axe is taken to rank-and-file public servants and pay rises are being held back, top executives of the APS won’t share the pain or lead by example, enjoying 5%-plus pay rises this year. From the Canberra Times:

Australia’s top public servant will get a $42,000 wage rise in July as industrial strife looms over pay rises for the Commonwealth’s 160,000 rank-and-file bureaucrats.

Ian Watt, secretary of the Prime Minister and Cabinet department, will be on $844,000, plus perks, as he and the Commonwealth’s 17 other top departmental bosses get pay rises of more than 5 per cent…

Mr Watt’s July pay rise will be his third in 12 months, taking his annual wage from $760,000, plus 15 per cent superannuation and a government-provided car, in July 2013 to $844,000 in July 2014...

Unions are predicting conflict this year over the government’s hardline bargaining position on the wages of ordinary public servants, which will see them offered no pay rises that are not tied to ”genuine productivity gains”, such as longer working hours.

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I keep arguing that genuine Budget reform is about shared sacrifice, but with those deriving the greatest benefits and most able to look after themselves bearing the largest cuts. The generous pay rises given to senior APS bureaucrats who are already on very good packages is contradictory to the “war on entitlements”. They should be leading by example, not burying their snouts in the trough as ordinary public servants take the pain.

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About the author
Leith van Onselen is Chief Economist at the MB Fund and MB Super. He is also a co-founder of MacroBusiness. Leith has previously worked at the Australian Treasury, Victorian Treasury and Goldman Sachs.