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Public servants, MPs face pay freeze

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The State Budget will impose a pay freeze on senior public servants as state MPs also face salary restrictions for at least the next financial year.

Premier Jay Weatherill confirmed this morning that MPs’ salaries would be frozen in 2014-15 – a condition which flows automatically from the federal MPs’ pay freeze.

InDaily understands that a pay freeze will also be imposed on the senior ranks of public servants across the South Australian public sector.

The moves were revealed ahead of Thursday’s state Budget, which will include wide-ranging cuts to health and education, and increases in state taxes and charges.

The Budget is shaping as a political tightrope act by new Treasurer Tom Koutsantonis, who will attempt to show that all of Labor’s election commitments are being met, while shifting blame for cuts and cost-of-living increases to the Federal Government.

To make state Labor’s apportioning of blame completely obvious, Koutsantonis is promising the Budget will include two sets of numbers – one showing reality as it is; the other showing an alternative fiscal world which doesn’t factor in the Federal Budget’s numbers.

Weatherill told FIVEaa this morning that the politicians’ pay freeze was “something that people expect in tough times”.

“There will be a wage freeze for all politicians and it will be extended a bit further than that, but we’ll be saying some things about that in the lead-up to the budget, but certainly MPs will be having a freeze on their pay for the next financial year,” he said.

When questioned about the perks of MPs’ jobs such as President of the Legislative Council, Weatherill said he was “more than happy for there to be a thorough review of Parliamentary salaries”.

“But frankly if they were reviewed against any benchmarks against the private sector, they would all go up rather than down,” he said.

Weatherill repeated that the Budget would keep his pre-election commitments.

On the weekend, the State Government announced it would protect pensioners and other low income earners from $30 million in federal cuts to concessions – at least for the next 12 months.

The Government also announced that a key election promise, an O-Bahn tunnel from Hackney Road to the CBD, would be built at a cost of $160 million, saving four minutes’ in travel time for bus commuters with flow-on affects to other vehicular traffic.

Koutsantonis told ABC radio that his budget would provide “two fiscal outlooks that show what the budget would look like before the Commonwealth cuts and what they look like afterwards”.

“People can compare and contrast the task that we had,” he said. “It’s not me trying to be clever or difficult – I’m just trying to lay out in the budget process exactly what’s in front of us on the day that Joe Hockey handed down his Commonwealth budget.”

He hinted that the numbers may show a slower return to surplus than Labor has predicted.

In last December’s mid-year budget statement, then Treasurer Weatherill said the the forecast return to surplus in 2015-16 had been revised down to $303 million, from $375 million.

When asked whether that prediction still stood, Koutsantonis said: “I’ll be doing all I can to deliver surpluses, but ultimately we’ve been set with some very, very, difficult challenges”.

Shadow Treasurer Rob Lucas told ABC radio that the Government’s numbers on Thursday would not be trustworthy.

“You know this pathway for the surplus that they keep talking about – they’ve been talking about it for six years,” he said.

“They promised a $480 million surplus this year, 13/14 – they’re going to deliver a billion dollar deficit. It’s a $1.5 billion turnaround. They’ll make the same commitments in the coming budget on Thursday.”

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