Reserve Bank staff reject 10.5 per cent payrise offer, say it doesn't address cost of living

Staff at the Reserve Bank of Australia have rejected a 10.5 per cent pay offer from management, saying it fails to deal with the rising cost of living. 

The RBA had offered the pay increase over three years to junior and mid-level staff.

Under the proposal, staff would get a 4 per cent pay rise at the start of the new agreement, 3.5 per cent from September 2024, and 3 per cent from September 2025.

But the ballot closed this week, and 57 per cent of staff rejected the offer.

The Finance Sector Union had recommended its members vote no to the offer, saying it failed to deal with cost of living pressures and fell below industry standards.

Headline inflation is currently running at an annual pace of 6 per cent, down from a peak of 7.8 per cent in December.

The RBA is forecasting inflation to fall slowly over the next few years, to hit 3 per cent in mid-2025. 

We need to boost productivity

Earlier this month, RBA governor Philip Lowe and his soon-to-be replacement, deputy governor Michele Bullock, were asked about the state of the RBA's ongoing pay negotiations with staff during a parliamentary hearing in Canberra.

Dr Lowe said they were up to their eighth round and he hoped they would be settled soon.

"We're now at a point where that bargaining has come to an end," he told MPs.

"We believe that the offer that we're making to our staff is fair and reasonable ... Our hope is that it will be passed, and that would allow us to pay the four per cent pay rise in early September."

He said the RBA had reached a point where the Finance Sector Union (FSU) had indicated that it wouldn't support the proposal, so RBA management were keen to put the agreement to a vote to see what happened.

"We want people to get pay rises and we want our staff to get pay rises as soon as possible, so rather than have the process continue to be drawn out we think it's better to have a vote of our staff and see what they think," he said.

Earlier in the conversation, Dr Lowe had said productivity growth was zero in Australia's economy in trend terms, and we would run into problems over the next few years if unit labour costs grew consistently at 4 per cent a year without productivity growth picking up. 

"The best way to avoid that is not through lower nominal wages growth but through faster productivity," he told MPs.

"If we don't have faster productivity, we have to confront the reality that wages will have to grow at a slower pace and so will profits and so will national income," he said.

Jason Hall, the FSU's national assistant secretary, on Thursday said RBA staff had sent a clear message to management by rejecting their pay offer.

"We hope the RBA now understands that it must deal with the expectations of its workforce and substantially increase this pay offer," he said.

"And we welcome the comments by the RBA in the wake of this vote that it is willing to return to the negotiating table."

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