New 4.5% public service pay offer in NSW, taskforce to implement removal of wage cap

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The anticipated pay offer for the NSW public service has arrived, amounting to 4.5%.

The one-year pay offer breaks down to 4% towards pay and 0.5% towards superannuation, effective from July 1.

As part of the same announcement, a new taskforce will look at implementing an industrial relations framework to replace the 2.5% public sector wage cap.

NSW treasurer Daniel Mookhey said it was the biggest pay increase for the public service in more than a decade.

“Too many of our essential workers are walking out the door, leaving for other professions and employers,” Mookhey said.

“We’re making progress, and there is more work to do.”

According to the government, the new wages policy would cost $618 million for the next financial year.

Noticeably, the 4.5% pay offer is below the current annual inflation rate of 7%, something unions heavily criticised the previous government for.

At the federal level, the CPSU recently rejected the government’s pay offer of 4% in the first year.

On the NSW taskforce announcement, NSW industrial relations minister Sophie Cotsis said it would build a “modern industrial relations framework” in the state.

“The Liberal-Nationals wages cap eroded trust between essential workers and government and suppressed wages,” Cotsis said.

“This can’t be fixed overnight, but we have begun the repair job and we will finish it.”

Two people will lead the Industrial Relations Taskforce: former Fair Work Commission deputy president Anna Booth and former NSW Industrial Relations Commission president Roger Boland.

The pair have been tasked with looking at adding a new consultative interest-based bargaining stream to the commission, ensuring the independence and resourcing of the Industrial Relations Commission and reviewing the commission’s scope.

The taskforce is due to report back to the state government before the end of this year.

The news comes after last week the government announced a two-year pay freeze for both senior public servants and parliamentarians.