Public Service Perks Don’t Pass The Pub Test

Written by:
17 November 2016
Public Service Perks Don’t Pass The Pub Test - Featured image

Enterprise bargaining is a two-way street. Public sector unions cannot continue to argue that well-paid public servants deserve additional entitlements without considering the trade-offs that could be made. Public servants already enjoy generous conditions and entitlements that would not pass the pub test.

The Commonwealth public services’ enterprise bargaining agreements notionally expired in 2014. To date, 65 agreements have been finalised – despite union opposition to every single agreement – but many of the larger departments’ agreements remain unresolved.

Whether in the private sector or the public sector, bargaining takes negotiation from both the employer and the employees. The Turnbull government’s workplace bargaining policy provides the flexibility for this to occur on the employer side. It puts a cap on remuneration increases at 2 per cent a year, with scope to increase salary beyond this point through the packaging of other benefits or productivity increases. The government’s policy is currently subject to an inquiry by the Senate Education and Employment Committee, chaired by a Labor senator.

The idea that public servants are underpaid is completely unsubstantiated. Over the past decade, federal public servants’ pay has risen by 50.7 per cent, far more than the increase in CPI of 31.8 per cent. According to the Australian Bureau of Statistics, in May 2016, public sector full-time adult average yearly earnings were $87,942.40, compared with the private sector average yearly earnings of $80,204.80.

If public sector unions want to continue with their campaign for pay increases beyond 2 per cent then they need to come to the bargaining table. The Institute of Public Affairs has conducted research into the top 10 Australian Public Service enterprise agreements by agency size – covering 72.4 per cent of public servants – which identified three broad areas where trade-offs could be made.

The first area is the generous allowances that have the effect of increasing salaries by thousands of dollars each year. For example, a Wellbeing Site Representative at the Australian Taxation Office comes with an allowance of $613 a year. The Department of Health agreement provides staff with subsidised eyewear, at $165 for each prescription. The Department of Agriculture agreement allows staff to claim $300 a year for health and fitness activities like gym memberships – whether or not they actually go to the gym is a different matter. These examples are the tip of the iceberg.

The second area is the generous leave provisions that go well beyond the standard entitlements in the private sector. The Department of Social Services Agreement has up to four days’ paid leave a year to conduct volunteer work with a community organisation. The Department of Foreign Affairs and Trade allows paid leave where employees are participating at an international sporting event. Several agencies provide one day of paid leave a year for employees to move house. Most private sector employees would be expected to take annual or unpaid leave for these activities. The Department of Defence has what’s called DECA day. As I explained when I appeared before the Senate committee last week, “it’s not part of your annual leave, it’s not part of your sick leave, and it’s not part of your personal leave. You just take a day off when you feel like it.”

The third area is the exclusive perks that are given to public sector unions. The agreements provide unionists with access to workplace facilities, infrastructure, technology and resources – and paid time. For example, union delegates have the right to paid time to represent the interests of members to the employer and in industrial tribunals, and also get paid leave to attend union training and events. It is unacceptable that taxpayers are subsidising unions’ industrial and political activities.

The current inquiry into the government’s workplace bargaining policy is, of course, simply part of a wider political campaign. Public sector unions are increasingly using the enterprise bargaining system to advance their own political agendas, rather than representing the best interests of their members. There is a weight of evidence to show that potential trade-offs could be made to boost pay for public servants. The government’s policy is flexible; whether the public sector unions’ policy will become flexible remains to be seen.


This article appeared in The Sydeny Morning Herald on the 17th of November, 2016.

Support the IPA

If you liked what you read, consider supporting the IPA. We are entirely funded by individual supporters like you. You can become an IPA member and/or make a tax-deductible donation.