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Issue #1636      April 30, 2014

Public service wages – back to the future!

In 1981, the Fraser Liberal government legislated a national wage freeze claiming it would help fight inflation. If that was the intention, it failed. All these years later, Abbott and Employment Minister Eric Abetz are campaigning hard for a similar wages outcome in order to deal with “Labor’s debt”. Not long ago, at the height of the resources “boom”, wage restraint was said to be needed to stop the economy “overheating”. Rain, hail or shine, workers can count on the Libs to go in boots and all to secure the biggest possible share for private profits.

Abetz says Australia’s bosses are too soft. “As shadow minister it was also disappointing to see weak-kneed employers caving in to unreasonable union demands and then visiting me, advocating for change in the system,” he said. He claims there has been something of a wages breakout in recent times. Judging by the size of their pay packets, few workers are aware of it and neither are the experts paid to keep an eye on such things.

Steven Walters, a chief economist with JP Morgan, says wages growth is the lowest it has ever been, which makes sense given how intense the attack on unions has been lately. “We’ve only got comparable series back to about the late 1990s and in fact wages growth [over the past year] is the lowest we’ve ever seen in that period,” Mr Walters said.

Regardless of the facts, Abetz is sticking to the Coalition line and is going to show employers how it’s done. He has dictated that in current enterprise bargaining federal public servants will receive between zero and 2.5 percent pay increases. And the only way to get more than zero is to give away something significant.

The Commonwealth Public Service is still reeling from savage staffing cuts. And, contrary to the “fat cats” propaganda, public sector wages in the ACT (along with those in Tasmania) have had the smallest increase in the country over the past 12 months, according to Wage Price Index data from the Australian Bureau of Statistics. The increase was just 0.3 percent – well below the national trend.

“So despite savings measures and job losses in the public sector that mean people are working harder than ever, you’ve got to get a cut as well on your conditions to get a pay rise,’’ Community and Public Sector Union (CPSU) national secretary Nadine Flood said.

The CPSU has been campaigning for an increase of four percent a year over the next three years of the new agreement. It has made the threat from the Abbott government clear to its members and pointed out what is at stake:

Your conditions: Under the new policy agencies will be forced to cut employees’ conditions and entitlements to offset any pay rise. Suggested measures include reducing leave entitlements, use of leave, forcing work onto lower level employees and cutting managerial staff. Agencies will also be barred from enhancing conditions.

Your job: The policy makes no provision regarding jobs or job security and seeks to drive down the classification level at which work is being conducted.

Your pay: The new policy does not include any pay offer and severely restricts pay outcomes. It ties any improvements in pay directly to employee-related savings, pushing agencies to cut employment conditions. It also severely limits the range of productivity improvements that can be considered in setting pay increases.

Your rights: The new policy seeks to “streamline” or strip rights out of agreements and limit the range of content that can be included which means employees would have less enforceable rights on issues such as dispute resolution, consultation and health and safety.

Your say: The new policy is far more complicated than the one it replaces, with the government seeking to tightly control bargaining outcomes through new and onerous restrictions on making changes.

A clash with the approximately 165,000 workers whose enterprise agreements expire in June appears inevitable. If it were to prevail, the position of the government would mean humiliation and a major loss of rights and living standards for public sector workers. Abetz’ object lesson to employers must be answered with united action from workers.

Next article – Cops target protest over visiting royals

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