I’ve noted over recent months how a wide disconnect has opened up between the pay rises being received by federal politicians and senior bureaucrats compared with the rest of the population.
This disconnect is shown clearly in the most recent wages price data from the ABS, which showed public sector wages growing far more strongly than the private sector:
As well as in the latest wages and salaries data from the ABS, which showed how the ACT (Canberra) – dominated by public servants, bureaucrats and consultants – recorded turbo-charged wages growth while most workers across the rest of the nation stagnated:
Back in June 2017, it was revealed that Australia’s top bureaucrats were awarded large pay rises. Then in July it was revealed that public service wages are growing the fastest at senior levels. And in August, it was revealed that while senior public servants are receiving huge pay rises, those at lower levels are experiencing record low wages growth.
At the same time as senior bureaucrats are making out like bandits, consultants are also cashing in, with billions in taxpayer funds flowing to consultancy firms, especially the Big Four accounting firms (see last week’s post).
Today, The Canberra Times reports that that the Turnbull Government has implemented new bargaining rules for public servants, which will cap rank-and-file pay growth at 2%, while also protecting consultants’ lucrative contracts:
Under a policy released on Wednesday that will cover the next round of bargaining, the government has maintained its [2%] wage growth cap and added a rule stopping enterprise agreements from restricting agencies’ uses of contractors and consultants…
Unions lashed the new policy, saying the Coalition was continuing a “destructive approach” and that public servant salaries would keep falling behind. Many public servants went several years without pay rises in the last round of bargaining.
The Australian Services Union representing tax officials said the policy was worse than its predecessor, while Community and Public Sector Union national secretary Nadine Flood said it barred government workers from genuinely bargaining for decent wages and conditions.
“The Turnbull government’s demand through this policy for ‘wages restraint’ for workers who’ve just endured a three-year wage freeze is obscene,” she said…
Rising costs of living are set to squeeze public servants’ household budgets as wage rises fail to keep pace with growing inflation expected to bite next year…
Unions said the rule was designed to continue growth in spending on contractors and labour hire…
This is another sad reflection on the Australian economy. Senior bureaucrats, politicians, consultants and senior executives in the private sector are receiving strong increases in their already exorbitant pay, whereas ordinary workers’ wages stagnate. And this situation is actually being encouraged by the Turnbull Government, be it via the above or the Coalition’s company tax cut agenda.
