Better deal for low paid public servants in New Zealand

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Wellington, September 3, 2018
From today, about 2000 core Public Service employees will be in a better position to make ends meet after receiving a new, 2018 Living Wage, hourly rate of $20.55, Prime Minister Jacinda Ardern and Minister of State Services Chris Hipkins have said.
This follows the Government’s announcement in June that the new hourly rate – or annualised equivalent of $42,744, including full-time, part-time and casual employees, would be implemented as a one-off pay adjustment by September 1, 2018.
Deserved boost
Jacinda Ardern mentioned the following:
About 2000 low paid public servants are now better off as a result of this decision and they deserve this pay boost.
This is about fairness. Everyone deserves to be paid a fair amount for the work they do, and to earn enough to have a decent standard of living.
While we are continuing to lift the minimum wage for all workers, our commitment to pay all public service staff at least the 2018 living wage is about leading from the front.
I want the Government, in its role as employer, to be part of the solution to the imbalance in peoples’ pay.
Benefits of growth
We have a wide programme of work to ensure those on lower and middle incomes start to see some of the benefits of a growing economy.
More than 164,000 people will benefit from an increase to the minimum wage to $16.50 on 1 April 2018 and $20 an hour by 2021.
We have also raised the incomes of 385,000 everyday families by on average $65 a week through the Families Package, approved major pay increases for mental health and education support workers in pay equity deals.
Freezing income
Mr Hopkins said the following:
Our decisions to stop performance pay to state sector CEOs and freezing MP pay this year were also part of our programme to focus on lower and middle income earners rather than those at the top.
In October 2017, some Public Service departments were identified as having employees with a pay rate below the living wage.
Seven agencies implemented the new hourly rate from 1 July, seven will do so from today and three agencies will introduce the new rate this month, back dated to July 1.
Most of the workers are in jobs including clerical and administration workers, welfare workers, contact centre workers and assistant customs officers, and many of these departments have already adapted to this boost.
In following years, the rate will negotiated between government employers and unions such as the New Zealand Public Service Association.
The Cabinet paper is here:

(Pictures of Jacinda Ardern and Chris Hipkins from file)

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