Historic public service pay deal signed, with Canberra workers among biggest beneficiaries

The Australian Public Service Commission has finalised enterprise agreements covering 170,000 APS employees, delivering real wage increases for the first time since the APS bargaining framework was constrained by the former government's efficiency dividend policy. The agreements, which will be in force for three years, include base pay increases of between 11 and 15 per cent over the term for the majority of classification levels.

Canberra, where an estimated 80,000 APS employees work — representing approximately one in four of the working-age population — is the primary economic beneficiary of the pay improvement. Economists from the ANU estimated the total additional wage bill flowing into the Canberra economy over three years at approximately $3.2 billion, with the majority recycled through local retail, hospitality, and housing markets.

CPSU national secretary Melissa Donnelly said the agreement represented a watershed in APS industrial relations, moving from a decade of real wage cuts that had eroded APS remuneration relative to the labour market and damaged the public service's ability to attract and retain talent. "Public servants in Canberra and across the country have been subsidising fiscal restraint with their own wages for too long. This deal ends that," she said.

Employer organisations in the ACT, including the Canberra Business Chamber, cautiously welcomed the agreement. While acknowledging the positive economic impact of higher APS wages, the chamber noted that private sector employers in Canberra faced competition for workers from a better-paid public service and would need to respond with improved remuneration and conditions of their own.

The agreement also includes improved flexible working entitlements and a new APS-wide wellbeing framework that will be implemented from the agreement's commencement date.

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