NSW public service workers to get 2.5 per cent pay rise

Public service workers will receive a wage increase of up to 2.5 per cent in Tuesday’s budget thanks to the state’s sharp rebound from the pandemic.

NSW paramedics Craig Hall, Corinne Keefe and Amy Neal (right) at the Northmead Ambulance station. Picture: Jonathan Ng

Public service workers in NSW will receive a wage increase of up to 2.5 per cent in Tuesday’s budget thanks to the state’s sharp rebound from the pandemic.

The Berejiklian government last year capped public sector wages at 1.5 per cent until 2024, angering unions, especially over low pay rates for paramedics and hospital workers, widely considered to be heroes of the pandemic.

The increase will apply for all public sector workers due to be renewed from July 1.

The change in the government’s wages policy is forecast to cost about $2.7bn over the four-year forward estimates and is significantly above current private sector wage growth.

In April, the NSW Supreme Court rejected a union bid to overturn a rise of just 0.3 per cent for public service workers, saying the effective pay freeze was justified by the pandemic.

About 1000 paramedics from the Health Services Union went on strike this month over the pay dispute despite Premier Gladys Berejiklian pleading with them to wait for the state’s budget.

The paramedics refused to respond to non-life-threatening calls for 24 hours, but serious callouts were not affected. The HSU said it had not taken the move lightly but supported the strike because the state’s paramedics were underpaid and disrespected.

On Sunday, Ms Berejiklian said the government’s decision to boost pay came on the back of renewed confidence in the NSW economy following a year in which the country experienced its first recession in a generation.

“The pandemic has meant making sacrifices and difficult decisions. This included wage restraint during the worst of the crisis,” Ms Berejiklian said.

“We put all of our financial strength into protecting people, providing economic stimulus and boosting job-creating programs.

“The economy is back growing and we are now able to give a wage increase to government workers and their families.”

Treasurer Dominic Perrottet said while the NSW economy had rebounded, the impact of Covid-19 was still being felt.

“We have committed more than $29bn in support and stimulus measures to support the economy during the pandemic,” he said. “Last year’s reduction in pay rises was a tough decision, but everyone remembers the confronting scenes from last year of people lined up outside Centrelink. By making that decision we were able to protect and boost jobs when needed to.”

The budget is expected to forecast that the NSW unemployment rate, now sitting at 5 per cent, will drop to 4.75 in 2023.

Mr Perrottet said NSW had regained more than the 270,000 jobs lost during the pandemic.

“We know there is still a lot more to do and we will continue to support people and businesses with a strong focus on productivity growth and reform,” Mr Perrottet said.