Members of federal parliament and other public office holders will receive a 4% pay rise, the biggest rise in a decade awarded by the independent remuneration tribunal.
The decision will take the basic salary of a backbench MP from $217,060 to about $225,742, or about two-and-a-third times the average earnings of a full-time worker.
Given the prime minister receives 160% on top of the base salary of an MP, Anthony Albanese’s pay will rise to $586,929; the opposition leader receives an additional 85% so Peter Dutton will get $417,623.
Asked about the pay rise, Albanese said the “remuneration tribunal decides all these things at arm’s length from politicians and that’s as it should be”.
“I have no role in any of these processes,” he told reporters in Adelaide. “And that’s as it should be, you do not want politicians determining their own conditions.”
In a statement following Monday’s decision, the remuneration tribunal said it was aware pay increases it had ordered over the past decade have been “conservative”, including keeping pay frozen with zero rise in 2020 and 2021, and just 2.75% in July 2022.
Given the inflation rate peaked at 7.8% in December and is projected to remain at about 6% in 2023-24, politicians and public office holders like many Australians are still receiving a real pay cut despite the nominal increase in their wages.
Public office holders will receive their pay increase backdated to 1 July, but MPs’ pay bump will only take effect from 1 September.
The tribunal noted that since 2014 it had raised public office holders’ pay by 14.75%, while wages in the public and private sector generally had totalled 23% on average over that period.
The tribunal said it needed to raise pay to “provide competitive and equitable remuneration that is appropriate to the responsibilities and experience required of the roles, and that is sufficient to attract and retain people of calibre”.
Given public office holders “do not accept appointment on the basis that monetary compensation … [will] be set at private sector levels” the tribunal noted pay is lower “in recognition of the public service being provided by the officeholders”.
The Australian Bureau of Statistics seasonally adjusted June 2023 annual wage price index rose 3.1% in the public sector and 3.8% in the private sector.
In June the Fair Work Commission ordered a 5.75% pay increase for minimum wage workers.
