Wednesday, 23 Jun 2021

Claire Trevett: PM steps in, the melting of the pay freeze begins


For almost a week, the Government has insisted that apay freeze on the vast bulk of public sector workers is not a pay freeze at all.

However, a sure sign the Government was feeling under pressure on the issue came when the Prime Minister moved in to front on it, taking over from Finance Minister Grant Robertson and Public Services Minister Chris Hipkins.

That happened after four days of uproar following the Government announcement that it had told public sector bosses to implement what amounts to a three-year freeze on the salary rates of most of those earning more than $60,000 and all of those on more than $100,000.

The Government’s justifications for the move – the financial constraints of Covid-19, saving jobs by keeping the salary burden down, and the need to focus on the 25 per cent earning less than $60,000 – fell on deaf ears.

Apparently convinced that the anger was simply all down to a misunderstanding and bad communication, Ardern started the work of trying to fix things.

Today, after meeting with the PSA, Ardern turned up for the media with Hipkins and Robertson behind her.

Ardern repeated the same things those ministers had actually made clear at the start, despite her belief they had not.

She insisted the freeze was not a freeze because workers ongraduated pay agreements would still get a pay increase by virtue of moving up a step.

She repeated the argument that the focus should be on the lowest earners.

The Prime Minister’s repetition of the arguments of the minister had just as little cut-through with the unions, since the salaries of those steps would not budge.

They moved in to remind the Government what ‘good faith bargaining’ actually meant.

Facing revolt, the pressure on the Government yielded some minor concessions and one more important concession.

The major one – and the only one that can be seen as coming close to a ‘backdown’ – was the assurance given to the Council of Trade Unions that there was scope to consider ‘cost of living’ increases in negotiations.

The others were more a gesture: the first was the PM’s assurance to the Public Services Association union that she was open to allowing more workers to enter step-based agreements.

The second was the promise to review the three-year freeze that isn’t a freeze after one year, rather than 18 months.

Setting theGovernment’s expectations for the pay of public servants is not usually an annual activity: the last time it was done was in March 2018.

That was depicted as a compromise: although it is only an agreement to review it and not to actually change it.

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