Jordan Williams: Public servants are well paid compared to private sector

Inland Revenue workers took 10.5 sick days on average in 2017, compared to just 4.1 in the private sector. Photo / File

Opinion

COMMENT: It's strike season in the public sector. First it was nurses and teachers, sectors with genuine staffing pressures, but now the Public Service Association – the union for Wellington back-office bureaucrats – wants a cut of the action.

Desk jockeys at Inland Revenue and the Ministry of Business, Innovation and Employment are set to strike in the coming weeks, seeking more pay. The unions are only doing their job in driving a hard bargain. They have a Labour Government that in opposition accused John Key and Bill English of cutting the public sector to the bone. Who could design a more fertile environment for unions to demand higher pay and better working conditions?

It is no secret the trade union movement is the back-office ally of the Labour Party. They give financial support, volunteers, and staff resources at election time. They even vote in determining the Labour Party's leader. If there was a leadership contest while Labour was in Government, unions would likely determine the next Prime Minister.

In short, it's easy to understand why union leaders are expecting a good deal from the Government: they helped to put it in power. The problem is that Labour will be paying its debts to the unions with your taxpayer money.

If public sector unions have their demands met, taxpayers are necessarily made worse off. Significant pay hikes require higher taxes or more government debt.

That could be justified if public sector employees were underpaid compared to their private sector counterparts (a sense of "public service" hardly pays the bills). However, the data shows that simply isn't true.

Last month the Taxpayers' Union released a report showing the average public sector employee earns about a third more than a private sector counterpart. Based on Statistics NZ data, that's true whether earnings are measured hourly or weekly (bureaucrats work fewer hours per week, on average).

You may be concerned that it's comparing apples and oranges – public servants tend to be more educated, for example. This could explain some of the pay gap, but it doesn't explain why the gap has grown. The premium for working for the state has nearly doubled, from 18.9 per cent in 1990 to 34.6 per cent in 2017.

Unless the make up of the public sector has dramatically changed – firing nurses to hire more doctors, for example – this cannot be justified. What has actually happened is that the army of policy and communication advisers has swelled, along with Wellington's pay cheques.

As industrial action kicks into gear, and business surveys show the private sector confidence stalling, the wage gap looks set to grow even bigger.

Public sector employees also take significantly more sick leave than the private sector. Inland Revenue workers, set to strike in the coming weeks, took 10.5 sick days on average in 2017, compared to just 4.1 in the private sector. Across the whole public sector, the average was 8.4.

Public sector unions are pointing to isolated pressures on front-line staff to justify across-the-board pay hikes for workers who are already well-off. They are trying to convince the Government and the public that the past decade was a right-wing nightmare. It's simply not true.

When Inland Revenue and MBIE staff leave their desks in the coming weeks, the Government should simply ignore their demands and bear the disruption. For the rest of us, life will go on much as normal.

• Jordan Williams is the executive director of the NZ Taxpayers' Union. The figures above come from the report, Public Sector Wage Gap: The taxpayer funded premium for working for the government, available at www.taxpayers.org.nz/wage_gap.