'The pay guidance update recognises the current cost of living pressures being felt across the country'
The New Zealand government is easing previously imposed pay restraints on higher-earning public service employees in a bid to attract more talent and support current staff amid the rising costs of living.
In the latest guidelines released by the Public Service Commission, the statement holding the pay rise of employees earning above $100,000 is not present.
Instead, agencies are advised to adopt a remuneration approach that "recognises the current environment is one of pressure on wages in all parts of the economy, and where the public service is facing shortages in key areas for staff."
Departmental secretaries and chief executives in the public service are also told to "ensure a minimum pay rate for staff that provides a liveable wage."
They are also advised to implement the Public Service Pay Gaps Action Plan 2021-24 to reduce pay gaps faced by women, as well as Māori, Pacific, and ethnic employees.
In making these recommendations, the government said it wants to ensure that the public service can "attract talented and skilled staff" who will be rewarded fairly.
"Pay strategies, alongside other interventions, should help the agency address recruitment and retention issues demonstrably impacting service delivery," the guidelines said.
New pay guidelines welcomed
Public Service Minister Andrew Little hailed the release of the latest guidelines, noting that this is an "attempt to give public sector workers an affordable increase."
The government previously introduced the pay freeze in 2020 because of the pandemic, ordering that targeted pay rises were only for those earning under $60,000, Stuff reported.
"Previous guidance in 2020 had a greater emphasis on pay restraint, especially for higher-paid roles, and was fit for purpose in response to COVID," Little said in a statement.
"The pay guidance update recognises the current cost of living pressures being felt across the country and the economy. I am confident this approach strikes the right balance in difficult times."
More collective agreements settled
The statement came as "more than a dozen collective agreements" have been settled in the public service, Crown Agents, and education sectors in line with the public sector pay adjustment (PSPA) agreements.
"Under the agreed terms of the PSPA, workers would receive payments of $4000 in year one, and either $2000 or three per cent of their annual income in year two," Little said.
He added that they are expecting a "significant number of public sector workers" to enter negotiations in the coming year.
"And so following a proposal by the New Zealand Council of Trade Unions, the government agreed to look into a pay adjustment for all workers at the same time," Little said.
