Thursday, 30 December 2010

Public Sector Pay in Australia

Ted Baillieu, after defeating John Brumby in the 2010 Victorian State Election, has made it clear that he wants to get to work on fixing the state's problems inherited from the previous government by holding a parliamentary sitting day early on 21 December 2010. During this parliamentary sitting day, the new Treasurer of Victoria Kim Wells MP presented the Budget Update 2010-11.

One of the key messages of this budget update is that the size of the Victorian government has gotten too big and is unsustainable. Because of this, the Liberals will need to implement an austerity measure that will see a minimum $100 million net operating surplus achieved per year in addition to an election promise to find $1.6 billion in savings over the next four years.

Page 2 of the Budget Update states the following: "Growth in the size and cost of government threatens to reduce Victoria’s tax competitiveness, without generating any offsetting improvements in productivity."

Recent statistics show that public sector wages have increase by 6.3 per cent in the three months from May 2010 to Aug 2010, more than private sector wage increases of 4.3 per cent during the same period of time. (Source: Are We Paying the Public Sector Too Much?)

The biggest increases are found among those working in the public sector in finance roles (8.7 per cent increase) and public administration (5.5 per cent increase).

"On average, public sector employees earned just shy of $60K per year — $8k more if you work for the Commonwealth government. Those working in electricity, gas, water and waste averaged more than $82K per year (no wonder the bills keep going up), compared to those in education who managed $51K."

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