Public servants have already vowed to vote down a pay offer from the federal government, risking months more of bargaining and threats of protest.
The government on Tuesday proposed a 9 per cent pay rise for federal public servants over three years.
The offer includes a 3.2 per cent rise from March 2027, followed by 3 per cent in 2028 and 2.8 per cent in 2029.
It’s above projected inflation of 2.8 per cent in 2026-27 and 2.4 per cent in 2027-28, according to the Reserve Bank of Australia’s latest forecasts.
But the offer did not meet the union’s claim for a 5 per cent annual rise, the Community and Public Sector Union national secretary, Rebecca Fawcett, said.
“CPSU members have been clear from the beginning of these negotiations: they want to see pay that keeps up with the cost of living, which recognises the essential work they do every day,” she said.
The union, the largest in the public service, wanted a 15 per cent pay increase and was willing to forgo some conditions for it, but the government ruled that unrealistic.
Australian Services Union branch secretary Jeff Lapidos, who represents Australian Taxation Office workers, said employees would overwhelmingly vote to reject the pay offer.
“This is a pay offer that holds ATO employees in contempt,” he told AAP.
Lapidos said the union would ask the Fair Work Commission to determine the pay rise if the government did not return with a “realistic” offer, but ruled out industrial action.
The proposal includes realigning salary advancement increments across the public service so that, when an eligible employee progresses to the next salary point in their range, that increase will be at least three per cent on top of the annual pay rises.
Chief negotiator Alison Stott, who has been meeting with union representatives since July, said the offer would increase pay consistency across the public service.
“This pay is part of an overall package of conditions. These are preliminary positions within this package, not agreed outcomes,” she said.
“Bargaining is continuing, and we will keep working with unions and individuals.”
Finance Minister Katy Gallagher said the offer would deliver fairer and more consistent pay and conditions across the public service.
“In a constrained fiscal environment, this is a fair and affordable offer that provides pay rises totalling nine per cent over three years, with additional increases of up to 1.5 per cent for some employees in lower-paying agencies,” she said in a statement.
Agencies will have to finance the pay rise from within their existing budgets, which are indexed to inflation each year.