03/04/2009 - 15:17

Salary freeze for top bureaucrats

03/04/2009 - 15:17

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The Salaries and Allowances Tribunal has recommended that salaries of senior public servants be frozen at current levels because of the "critical economic position that the community presently faces".

Salary freeze for top bureaucrats

The Salaries and Allowances Tribunal has recommended that salaries of senior public servants be frozen at current levels because of the "critical economic position that the community presently faces".

"At this time the Tribunal determines to maintain remuneration at existing levels," it said in a statement.

"Until there is some certainty in prospects for prosperity it would, in our view, be folly to determine an increase in the hope that things will improve in the not too distant future,"

The Tribunal added that "as soon as economic circumstances permit, the Tribunal will move to address the issues identified in this determination and adjust salaries in line with principles which the Tribunal applies to each statutory office and judicial position under its jurisdiction".

 

The concluding section of today's SAT announcement is pasted below:

 

When the enquiry was undertaken in April 2008, the Tribunal noted that it was "... in a period of outstanding economic growth in Western Australia, record levels of employment nationally and, more recently, financial instability at a global level". What was optimistically being labelled as a 'market correction' in early 2008 has proven to be the portent of a global recession.

World economic output is now predicted to decline to 1 per cent in 2009; the largest fall in 60 years. The Department of Treasury and Finance's December 2008 mid year financial projection statement for Western Australia has economic growth revised downwards in the 2008/09 budget forecast from 6.25 per cent to 1.5 per cent in 2009/10. The outlook for employment is deteriorating with leading indicators of employment demand such as advertised job vacancies and business surveys pointing to weakening employment growth in 2009. It has been reported that there will be a contraction in Western Australian public sector employment with 500 positions being cut through voluntary redundancies. The underlying rate of unemployment in Western Australia jumped dramatically in January and February 2009. Although Western Australia is still the best placed state in terms of employment, with an increase to 4.2 per cent in the unemployment rate in February against the 5.2 per cent increase for Australia, there are predictions that the national unemployment rate will reach 6 per cent or 7 per cent in 2009.

The Government's wages policy was announced in a statement to the Parliament on 31 March 2009 and this too was considered by the Tribunal.

If export demand and commodity prices for the State's resources fall further in 2009, this will impact on the level of investment in Western Australia and consequently on the State's labour market.

This is the environment in which the Tribunal must now issue this determination.

Within the Western Australian public sector, salary agreements finalised in 2007-08 will result in pay increases for public servants (4.5 per cent, 4 per cent and 4 per cent over three years) and for teachers and TAFE lecturers (6 per cent, 5 per cent and 4 per cent over three years). These adjustments, while eroding relativities with rates under the Tribunal's jurisdiction will not at this time overlap the base rates which presently apply. However, this issue together with the continuing application of ARBs paid in some cases to offices within the Senior Executive Service (SES) may in time be the cause of distortions within salary structures if not adequately addressed.

While these matters impact on consideration of general movements in salaries for officers within the Special Division and for those holding Prescribed Offices, the classification of particular positions is not without some difficulty at this time.

Restructuring of departments and the realignment of some public service entities within the public sector under the Government's current review adds another dimension to the enquiry. Some restructuring within departments has been completed, but the Tribunal is advised that the review is continuing. Revised budgets and project deferments have also affected levels of responsibility of Special Division and Prescribed Office holders. The Tribunal will monitor these developments.

The Tribunal appreciates that the officers, the subject of this enquiry and determination, hold senior positions in public service. It is their commitment to implementing policy and managing services in the public interest that contributes to ensuring the good administration of government in this state. They are leaders in the Public Sector and in the community. While levels of remuneration in Western Australia may be comparable with public sector salaries in other States, the rates determined have historically been in the bottom half of remuneration packages being paid to senior executives generally.

There has never been a propitious time to increase the remuneration of senior public servants, least of all when executive salaries in the public sector are the subject of scrutiny and public debate. However, this is not a factor which should deter us in the exercise of our statutory duty.

The only reason for the Tribunal taking the course it does at this time is the critical economic position that the community presently faces. Until there is some certainty in prospects for prosperity it would, in our view, be folly to determine an increase in the hope that things will improve in the not too distant future.

There are many factors which go to re-establishing economic stability. For Western Australians, the immediate focus is on international financial markets, trade, commodity prices and investment.

The Tribunal assures the officers coming within the scope of this determination that as soon as economic circumstances permit, the Tribunal will move to address the issues identified in this determination and adjust salaries in line with principles which the Tribunal applies to each statutory office and judicial position under its jurisdiction.

At this time the Tribunal determines to maintain remuneration at existing levels.

ends


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