You Be The Judge

Last night (Wednesday, 1th of June) the ABC's 7.30 Report contained a segment on the possibility of a NSW Government/state employees unions conflict.

This post will consist on pieces of the transcript (see here). They are shown in italics, and indentation, so they are easily distinguishable from my comments (not in italics, and either not indented or within square brackets):

CHRIS UHLMANN, PRESENTER: The New South Wales Government is the nation's biggest employer and it's about to revolutionize the way it deals with its 400,000 workers. It's set to cut arbitration rights and fix pay increases. The justification is a blowout in the public sector wages bill, and the changes could become law as early as tonight.

But independent research obtained exclusively by 7.30 questions the assumptions driving one of the country's biggest industrial relations experiments.

Here we'll focus on the calculations the O'Farrell government uses to justify its measures.

BARRY O'FARRELL: Well since 1997, the figures show that public sector wages in NSW have increased by 21.6 per cent. That's outstrips private sector wage increases of 11.1, it outstrips Queensland public sector wages at 14 per cent - 14.3 per cent, I think, and Victorian wages of just over 15 per cent.

CONOR DUFFY [reporter]: The new research obtained by 7.30 challenges the assumptions underpinning the Government's reforms. An independent analysis conducted by Sydney University's Workplace Research Centre concludes NSW public sector workers are paid roughly the same amount as their counterparts in other states and in the private sector.

The research mentioned can be found here. Note one refers to interstate comparisons for three categories of state public employees not at entry level (teachers, senior constables, and registered nurse). Note two refers to an statistical analysis of the difference between public and private sectors pays.

JOHN BUCHANNAN, WORKPLACE RELATIONS CENTRE, UNI. OF SYDNEY: These aren't fat cats who are rolling in clover; these are people [teachers, senior constables, and registered nurse] who are basically getting a little bit above average [wage for both private and public sectors at state level, regardless of experience]. So if you take those kinds of cuts in pay, they're gonna be below average and in some cases quite some way below average weekly earnings.

In some cases, NSW employees are above other states employees, in some cases, below.

CONOR DUFFY: The paper also modelled the effect the policy would've had on wages if it had been introduced 10 years ago. It found teachers would be 14,580 a year worse off, senior constables would be $8,961 a year worse off and nurses would be $12,232 a year worse off.

This is how the segment concludes:

BARRY O'FARRELL: I still make the point that on the 1997 to 2010 figures, public service wages in NSW have outstripped private sector wages and public sector wages in Victoria, in Queensland. That's across the board. I'm sure that, as with any other argument, someone can find an exception to prove the rule, but it doesn't make us back off.

Here it appears Premier O'Farrell is moving the signposts: it's not that NSW state employees' current salaries are higher than those in other states, but that they have increased faster.

CONOR DUFFY [reporter]: Such is the strength of the O'Farrell Government and the loathing for the Labor Opposition, it can politically afford a brawl with the unions, but there are warnings it may come at a cost, particularly in the state's classrooms, hospitals and police stations.

O'BRAY SMITH [registered nurse]: I certainly couldn't live in Sydney. I would have to move elsewhere. I don't think there's many nurses that could afford to live in Sydney with that kind of pay cut.

BARRY O'FARRELL: We want to ensure whether you're a nurse, a teacher, a police officer or some other public servant upon whom we all rely, that you get a fair rate of pay. We think this does guarantee a fair rate of pay.

For an ominous parallel with an episode (totally neglected by Australian media) but that could shed some light on this seemingly looming conflict, please see.