NSW Government slashes 2.5 per cent pay rise for public servants due to coronavirus pandemic
NSW Treasurer Dominic Perrottet has confirmed he will cut public servant wage rises by one per cent in a move described as "economic vandalism".
Public sector wage increases will be cut from 2.5 per cent to 1.5 per cent in the state budget, which Mr Perrottet said was in line with inflation forecasts.
"We think that's fair and reasonable," he said.
"Obviously, we want to make sure that we have a balanced wages policy in our state, we're going through a pandemic, we have an unemployment rate currently at 7.2 per cent.
"We want to keep as many people in work during this period of time and we think this decision strikes a fair balance."
The policy is expected to save $1.8 billion over the next three years and will be outlined in the state budget, which Mr Perrottet will hand down on November 17.
Opposition Leader Jodi McKay hit out at the Treasurer, accusing of him being "sneaky" and "deceptive" as only months ago he said he wanted to freeze public sector wages, not cut them.
"He would argue that this is a stimulus measure, but it's not. He has done this under the cover of COVID-19 and the recession," Ms McKay said.
"And if you pay attention to what many of the economists say, they will tell you that public sector wages do influence what happens in the private sector.
"Whichever way you look at it, this is a wage cut that devalues all those public sector employees who have worked so hard during COVID."
Unions representing public sector workers condemned the move as unfair and said it would ultimately stifle economic recovery.
Stewart Little from the NSW Public Service Association said the wage rise cut was an attack on frontline workers.
"I think it's an absolute insult that the Treasurer would flag this," he said.
"You've got the Federal Government handing down these huge tax cuts and you've got the most prosperous State Government in the country turning around and saying 'we can't afford anything' — it just seems counterintuitive."
"Forty per cent of public sector workers live and work in regional communities, there is nothing more stimulatory than fair and reasonable pay rises for those workers."
Secretary of Unions NSW Mark Morey said the Treasurer's announcement de-valued the role of public servants.
"These are highly skilled people who have ensured NSW has remained open for trading, these are workers who have ensured people in bushfire-affected areas were protected," he said.
"The Treasurer is saying, 'I see you as expendable, I don't see you as an asset, I just see you as a number on a book' — it's very disappointing.
"I think it's just crazy and it's economic vandalism."
NSW Secretary of the Australian Services Union Natalie Lang said the policy would "only deepen the recession that we're currently in".
"We know that we need wage growth in the public sector to be able to deliver wage growth and a recovery in the private sector," she said.
"It’s an absolute betrayal of the essential workers who’ve kept NSW going during this pandemic and during this crisis."
The pay cut comes just months after the State Government announced it was freezing wages for more than 400,000 public sector workers this year due to the economic fallout of the coronavirus pandemic.
At the time NSW Premier Gladys Berejiklian said her state's recovery hinged on tough decisions.
"The only way NSW will come out of this crisis in a strong position is if we all make sacrifices, and that's what we're asking our own workforce to do."
But the decision was challenged in the Industrial Relations Commission, which later ruled public sector workers should get a 0.3 per cent wage increase.