Minn.’s government is setting aside $3.6 billion to fund public sector wage growth
“He must be transparent about where this money comes from and what assumptions are made [he] taken into account in determining this figure and how the fund will be managed.”
Because of the coalition’s wage cap, the state budget now has to contend with unknown collective bargaining in the public sector, especially as workers seek redress for years of below-inflation wage increases and unions act tough.
Earlier this month the government secured a one-year deal with the NSW Teachers’ Federation, in line with a broader public sector pay deal, providing a pay rise of at least 4 per cent. Education Minister Prue Car said she had found $1.4 billion in savings over the next four years to fund the deal and future wage increases.
The deal with the state’s nurses, which also included a 4.5 percent pay increase including pension benefits, was also a one-year agreement, with the government and unions due to return to the negotiating table next year.
In June, before final agreements were reached, the government said its offer of a 4.5 percent public sector pay rise would cost $618 million in 2023-2024.
NSW Nurses and Midwives’ Association delegates Nichole Flegg, Nick Howson, Rachal Hughes, Skye Romer and Thom Hoffman at their annual conference last month.Credit: James Brickwood
Shadow treasurer Damien Tudehope accused Labor of misleading voters when it said public sector pay rises would be funded by productivity improvements.
“The Treasurer’s claim that wage increases will be funded through the diversion and reallocation of resources is code for cuts that will hit households and businesses in New South Wales,” Tudehope said.
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“He must be transparent about where this money comes from and what assumptions are made [he] taken into account in determining this figure and how the fund will be managed.”
Tudehope left the door open to reinstating the cap, which was introduced in 2011 by then-Liberal premier Barry O’Farrell.
“The wage cap has been an effective tool to deliver real wage increases and deliver record infrastructure during the Coalition government,” he said. “We cannot know what the fiscal state will be three years from now and would make this assessment at a time when the state’s financial position is clear.”
The government is concerned that key workers are leaving NSW due to high housing costs. Industrial Relations Minister Sophie Cotsis said the reserved funds would help address New South Wales’ “recruitment and retention crisis” among frontline workers.
Separately, the government announced a $224 million social and affordable housing package on Saturday that includes initial land and grounds work, maintenance and a trial of using “modular” or prefabricated homes for public housing.
Housing Minister Rose Jackson said it was a step in the right direction but admitted there was “still a lot of work to do”.
