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Government's Expectations for Pay and Employment Conditions in the State Sector May 2011

Government's Expectations for Pay and Employment Conditions in the State Sector May 2011. SSC Overview - Trends. Settlements: Most settlements where rem is included are tending to the 1 – 2% pa range. Increasing # of settlements with no rem included, - ie CE discretion.

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Government's Expectations for Pay and Employment Conditions in the State Sector May 2011

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  1. Government's Expectations for Pay and Employment Conditions in the State SectorMay 2011

  2. SSC Overview - Trends • Settlements: • Most settlements where rem is included are tending to the 1 – 2% pa range. • Increasing # of settlements with no rem included, - ie CE discretion. • Claims for remuneration to be included in CA’s being successfully resisted.

  3. LCI trends • All sectors year to 31 March – 1.9% • Private sector – 2.0% • Total public sector - 1.4% • Core public service – 0.9% • Health - 1.8% • Education - 1.1%

  4. LCI - movement

  5. Public & private wage rates

  6. Comparative rate movements

  7. Government’s Expectations: • Originally agreed by Cabinet in 2009 and refreshed in May 2010 • Economy is still in recovery mode • Pressures and expectations likely to increase • Review by SSC confirms GE are still valid, so likely to recommend • No fundamental change, but reinforcing ...

  8. Key ER & Rem Messages • ER outcomes must support agency business objectives (medium and longer term) • Chief Executive accountability • The critical link between: • pay and conditions, productivity & fiscal restraint & improved service delivery • Affordability, now and in medium term & sustainability of organisation over time.

  9. Key ER and Rem Messages • Focus on what’s right for organisation rather than “market movement” • Targeting performance and genuine recruitment and retention • Consider all aspects of staff costs, look at total rem & factor indirect staff benefits

  10. Key ER and Rem Messages • Align actions around remuneration strategies with the 4 year Budget capability plans • “Fairness” means fair to taxpayers and employees • Aim is to restrict Public sector LCI to a level below private sector

  11. Government’s Expectations: Public Service, Crown Entities, Non Public Service Departments Remuneration Employment conditions Collective bargaining Application of Expectations

  12. SSC Approach • Looking for ways to add value • Focus efforts on biggest payback/risks • Likely to move to more differentiated approach using risk/scale/profile to guide effort/engagement • Yet to be finalised & agreed

  13. Information requirements Most likely call for: • Brief rationale • % & $’s around total rem broken down; committed & proposed • Staff numbers etc • Assurance as to expectations eg flow-on • Affirmation from CE around affordability & sustainability We’ll issue more detail post-budget

  14. SSC work programme • Update on work programme

  15. Next steps • Finalise approach • Agree info requirements • Consider Expectations – Cabinet ? • Communication

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