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The Tribunal is required to make annual adjustments to the salaries and allowances set in its Members of Parliament (Victoria) Determination No. 01/2019.

Annual Adjustment 2022

On 22 June 2022, the Tribunal made the Members of Parliament (Victoria) Annual Adjustment Determination 2022.

The Determination is effective from 1 July 2022.

The full Determination and Statement of Reasons is available here:

As part of making the Determination, the Tribunal issued a notice of intention on 12 April 2022 which outlined the matters being considered by the Tribunal and invited submissions.

The Tribunal received one submission.

  • What will the Determination cover?

    The Determination will apply to the following elements of the salaries and allowances payable to Members of Parliament:

    • basic salary
    • additional salaries for specified parliamentary office holders
    • electorate allowance
    • any expense allowance
    • motor vehicle allowance
    • travel allowance
    • parliamentary accommodation sitting allowance
    • commercial transport allowance
    • international travel allowance
    • Electorate Office and Communications Budget.

    The Determination will take into account changes to electorates that will take effect from 1 November 2022, as announced by the Electoral Boundaries Commission.

    Submissions

    The Tribunal invites submissions from any person or body, including any affected person or class of affected persons, in relation to the proposed Determination.

    You may wish to consider the following questions in your submission:

    • What level of adjustment to the values of MP salaries and allowances should the Tribunal consider?
    • Which economic and financial indices should the Tribunal consider when adjusting MP salaries and allowances?
    • Are there other matters, in addition to those listed in the VIRTIPS Act, that the Tribunal should consider when making the Determination?

    Please email written submissions to the Tribunal Secretariat at enquiries@remunerationtribunal.vic.gov.au.

    If you require assistance to make a submission, please contact the Tribunal Secretariat at enquiries@remunerationtribunal.vic.gov.au.

    Submissions have now closed.

    Publication of submissions

    The Tribunal may use information provided in submissions in its Determination.

    All submissions will be published in full or in summary form on the Tribunal’s website, unless the person making the submission seeks confidentiality or the submission contains information that is identified as commercially sensitive. In this instance, the submission will be published in a form which protects confidentiality or commercially sensitive information.

    The Tribunal may remove identifying information from submissions if published.

    Submissions that contain offensive or defamatory comments, or that are outside the scope of the Determination, will not be published.

    The Tribunal may receive a request under the Freedom of Information Act 1982 (Vic)External Link . Any such request will be determined in accordance with the Freedom of Information Act 1982 (Vic) which contains provisions designed to protect personal information and information given in confidence. Further information can be found at the Office of the Victorian Information CommissionerExternal Link .

    How will the Tribunal make its Determination

    Current and projected economic conditions and trends

    Data from the Australian Bureau of Statistics (ABS)External Link (March 2022) show that Australia’s Gross Domestic Product (GDP) increased by 3.4 per cent in the December quarter 2021 as Victoria, New South Wales and the Australian Capital Territory came out of extended lockdowns. Over the 12 months to December 2021, GDP increased 4.2 per cent. As at February 2022, national and Victorian unemployment rates were 4.0 per cent and 4.2 per cent, respectively (in seasonally adjusted terms). Participation rates were 66.4 per cent (national) and 67.1 per cent (Victoria) in seasonally adjusted terms.

    The Federal Budget 2022-23External Link (March 2022) highlighted the resilience of the Australian economy, noting that ‘conditions are in place for a sustained economic recovery’. The Federal Budget reported the following outlook for the Australian economy:

    • real GDP is forecast to grow 4.25 per cent in 2021-22 and 3.5 per cent in 2022‑23
    • unemployment rate is expected to reach 3.75 per cent in the September quarter 2022 — the lowest rate in nearly half a century
    • annual growth in the Wage Price Index is expected to be 2.75 per cent over 2021-22 and 3.25 per cent over 2022-23.

    In his StatementExternal Link on 5 April 2022, the Governor of the Reserve Bank of Australia, Dr Philip Lowe, similarly observed that the ‘Australian economy remains resilient’ and that ‘spending is picking up following the Omicron setback’. Dr Lowe acknowledged pressure on household budgets from rising prices, while noting that inflation remains lower in Australia than in many other countries. Dr Lowe also noted that while wages growth has increased, it remains at the relatively low rates seen prior to the COVID-19 pandemic (although larger wage increases are occurring in some areas).

    The Tribunal notes the following movements in prices and wages in the Victorian economy:

    • Consumer Price Index (All Groups) for Melbourne grew by 2.5 per cent between December 2020 and December 2021 — the lowest growth of all capital cities
    • Victorian Wage Price Index grew by 2.5 per cent over the 12 months to September 2021 — the highest growth of all mainland states
    • average weekly ordinary time earnings for full-time adults in Victoria increased by 2.4 per cent over the 12 months to November 2021.

    The 2021/22 Victorian Budget UpdateExternal Link (Budget Update), released in December 2021, reported the following economic outlook for Victoria:

    • real Gross State Product (GSP) forecast to grow by 2.25 per cent in 2021-22 and by 4.5 per cent in 2022-23
    • unemployment rate expected to average 4.5 per cent in 2021-22 and 2022-23
    • annual growth in the Victorian Wage Price Index is expected to gradually increase to 3 per cent in 2024-25 and expected to exceed growth in the Melbourne Consumer Price Index over the next few years.

    Financial position and fiscal strategy of the State of Victoria

    The most recent Victorian Auditor-General’s Office Report on the Annual Financial Report of the State of VictoriaExternal Link (November 2021) stated that ‘the COVID-19 pandemic continues to affect the financial performance and position of the state, with longer term consequences for its financial sustainability’. The report noted that revenue remained below, and expenditure well above, pre‑pandemic expectations, and highlighted emerging risks including operating expediture growth in the general government sector.

    The 2021-22 Mid-Year Financial ReportExternal Link (March 2022) reported that the Victorian general government sector recorded an operating deficit of $10.0 billion for the six months to December 2021. The Report estimates that the operating deficit for 2021-22 will be $19.5 billion.

    As at 31 December 2021, net debt for the general government sector was $89.6 billion (18.1 per cent of GSP). According to the Budget Update, net debt is forecast to increase to $162.7 billion (27.9 per cent of GSP) by 2024‑25.

    The Budget Update reiterated the Victorian Government’s commitment to its four-step fiscal strategy:

    • Step 1: creating jobs, reducing unemployment and restoring economic growth
    • Step 2: returning to an operating cash surplus
    • Step 3: returning to operating surpluses
    • Step 4: stabilising debt levels.

    Wages Policy

    The VIRTIPS Act requires the Tribunal to consider any statement or policy issued by the Government of Victoria which is in force with respect to its Wages Policy (or equivalent) and the remuneration and allowances of any specified occupational group.

    The Victorian Government Wages Policy and Enterprise Bargaining Framework (Wages Policy) which applies to departments and agencies in the Victorian public sector is reproduced below.

    The Victorian Government Wages Policy and Enterprise Bargaining Framework has three pillars:

    • Pillar 1: Wages — increases in wages and conditions will be capped at a rate of growth of 1.5 per cent per annum over the life of the agreement. In practice this means employee wages and conditions will be allowed to grow at this rate.
    • Pillar 2: Best Practice Employment Commitment — all public sector agencies will be required to make a Best Practice Employment Commitment which will outline measures to operationalise elements of the Government’s Public Sector Priorities that reflect good practice within Government and can be implemented operationally or without significant costs.
    • Pillar 3: Additional strategic changes — additional changes to allowances and other conditions (not general wages) will be capped at 0.5 per cent per annum of the salary base and will only be allowed if Government agrees that the changes will address key operational or strategic priorities for the agency, and/or one or more of the Public Sector Priorities.

    A ‘Secondary Pathway’ is also available for public sector agencies whose current enterprise agreement reaches its nominal expiry date between 1 January 2022 and 31 December 2022 which permits one annual wage and allowance increase capped at 2 per cent (instead of at 1.5 per cent).

    Source: Industrial Relations Victoria, Wages Policy 2022 (State Government of Victoria: Melbourne, Victoria, 2021).

    The Premier’s annual remuneration adjustment guideline rate is a salary increase that public sector employers may pass onto executives and senior office holders. In November 2021, the guideline rate for both 2021-22 and 2022-23 was set at 1.5 per cent.

Annual Adjustment 2021

On 25 June 2021, the Tribunal made the Members of Parliament (Victoria) Annual Adjustment Determination 2021. The Determination is effective from 1 July 2021.

The full Determination and Statement of Reasons is available here:

As part of making the Determination, the Tribunal issued a notice of intention on 8 April 2021 which outlined the matters being considered by the Tribunal and invited submissions.

The following written submission was provided to the Tribunal:

The notice of intention is available to read below.

  • In accordance with section 24(1) of the Victorian Independent Remuneration Tribunal and Improving Parliament Standards Act 2019 (Vic)External Link (VIRTIPS Act), the Tribunal hereby publishes notice of its intention to make a Determination providing for an annual adjustment to the values set in the Members of Parliament (Victoria) Determination No. 01/2019 (varied by the Members of Parliament (Victoria) Annual Adjustment Determination 2020).

    The Determination will take effect from 1 July 2021 (section 25(5) of the VIRTIPS Act).

    Details of the matters to be considered by the proposed Determination are set out below.

    The Tribunal invites submissions from any person or body, including any affected person, or class of affected persons, in relation to the proposed Determination. Consultation questions and information on how to make a submission are provided below.

  • The Determination applies to the following elements of MP salaries and allowances:

    • basic salary
    • additional salaries for specified parliamentary office holders
    • electorate allowance
    • any expense allowance
    • motor vehicle allowance
    • travel allowance
    • parliamentary accommodation sitting allowance
    • commercial transport allowance
    • international travel allowance
    • the Electorate Office and Communications Budget.
  • In making the Determination, the Tribunal is required to consider the following matters under section 24(2) of the VIRTIPS Act:

    • any statement or policy issued by the Government in respect of its wages policy (or equivalent) and the remuneration and allowances of any specified occupational group as defined in the VIRTIPS Act
    • the financial position and fiscal strategy of the State of Victoria
    • current and projected economic conditions and trends
    • submissions received in relation to the Determination.

    The Tribunal’s understanding of current economic and financial conditions and wages policy is set out below.

    The coronavirus (COVID-19) pandemic has had a significant impact on the Australian and Victorian economies since early 2020. The latest Reserve Bank of Australia’s (RBA) Statement on Monetary PolicyExternal Link noted that a faster than expected economic recovery has been aided by Australia’s relatively better health outcomes (by global standards), the easing of restrictions and supportive fiscal policy. However, the RBA also noted that the recovery is likely to be bumpy and uneven, and will require ongoing fiscal and monetary support.

    Australia’s Gross Domestic Product (GDP) grew by 3.3% in the December quarter 2020, marking the first time in the more than 60-year history of the national accounts that quarterly GDP growth has exceeded 3% in consecutive quarters. Assuming that there are no further large outbreaks and accompanying hard lockdowns, the RBA noted that it expects GDP to reach pre-pandemic levels by mid-2021. The national unemployment rate decreased to 5.8% in February, down from a peak of 7.5% in June 2020.

    The 2020/21 Victorian BudgetExternal Link forecast that Victoria’s real Gross State Product (GSP) would contract by 4% in 2020-21, following a 0.5% contraction in 2019-20. More recently, the Mid-Year Financial ReportExternal Link for the State of Victoria noted that recent economic data has been positive. The report noted that Victoria’s State Final Demand (a measure of the total value of goods and services purchased in the state) grew by 6.8% in the December quarter 2020, led by a strong rebound in consumer spending. The report also noted rises in business and dwelling investment and signs of recovery in the housing market.

    Regarding movements in wages and prices, the Tribunal notes the following:

    • both the Consumer Price Index for Melbourne and Victorian Wage Price Index grew by 1.3% in the 12 months to December 2020
    • the average weekly ordinary-time earnings for full-time adults in Victoria increased by just over 4% in the 12 months to November 2020

    Financial position and fiscal strategy of the State of Victoria

    The Victorian Auditor-General’s Report on the Annual Financial Report of the State of VictoriaExternal Link , released in November 2020, noted that the COVID-19 pandemic ‘necessitated a significant shift in the state's revenue and expenditure policies, with longer-term consequences for financial sustainability’ (p.1). The report highlighted the significant unexpected falls in revenue, and increases in expenditure in 2019-20 and consequently debt, compared with 2018-19 and the original and revised budgets.

    The 2020-21 Victorian Budget forecast an operating deficit of approximately $23.3 billion for 2020-21, with smaller deficits expected in the following years. Net debt is forecast to be $86.7 billion (19.5% of GSP) in June 2021 and to increase to $154.8 billion (28.9% of GSP) by June 2024.

    The 2020-21 Victorian Budget included significant infrastructure spending. Annual capital investment is estimated to average $19.6 billion over the next 4 years, a substantial increase over the previous 4 years.

    The Victorian Government outlined several efficiency measures for government departments in the 2019-20 Victorian Budget. Given the government’s priorities of responding to the COVID-19 pandemic and of economic recovery, the 2020-21 Victorian Budget noted that implementation of these efficiency measures had been deferred.

    More recently, the Victorian Government’s 2020-21 Mid-Year Financial Report reported a higher operating deficit for the first 6 months of the 2020-21 financial year than in the previous full financial year ($10.1 billion compared with $6.5 billion, respectively).

    In February 2021, Moody’s Investor Service downgraded Victoria’s credit rating to Aa1 from Aaa and changed its financial outlook to ‘negative’, reflecting the state’s elevated debt burden due to the COVID-19 pandemic.

    Relevant Victorian Government remuneration policies

    The VIRTIPS Act requires the Tribunal to consider any statement or policy issued by the Government of Victoria which is in force with respect to its Wages Policy (or equivalent) and the remuneration and allowances of any specified occupational group.

    The Victorian Government Wages Policy and Enterprise Bargaining Framework (Wages Policy) which applies to departments and agencies in the Victorian public sector, is reproduced below.

    The Victorian Government Wages Policy and Enterprise Bargaining Framework has 3 pillars:

    • Pillar 1: Wages — increases in wages and conditions will be capped at a rate of growth of 2% per annum over the life of the agreement. In practice, this means employee wages and conditions will be allowed to grow at this rate.
    • Pillar 2: Best Practice Employment Commitment — all public sector agencies will be required to make a Best Practice Employment Commitment which will outline measures to operationalise elements of the Government’s Public Sector Priorities that reflect good practice within Government and can be implemented operationally or without significant costs.
    • Pillar 3: Additional strategic changes — additional changes to allowances and other conditions (not general wages) will only be allowed if the Government agrees that the changes will address key operational or strategic priorities for the agency, and/or one or more of the Public Sector Priorities.

    A ‘Secondary Pathway’ is also available for public sector agencies whose current enterprise agreement reaches its nominal expiry date on or before 30 June 2020 which permits one annual wage and allowance increase capped at 2.5% (instead of at 2%).

    Source: Industrial Relations Victoria, ‘Victorian Government Wages Policy,’ Wages Policy and the Enterprise Bargaining Framework (State Government of Victoria: Melbourne, Victoria, 2019).

  • The Tribunal invites submissions from any person or body, including any affected person or class of affected persons, in relation to the proposed Determination. Submissions are invited regarding the following questions:

    • What level of adjustment to the values of MP salaries and allowances should the Tribunal consider?
    • Should the Tribunal consider different adjustment levels for different elements of the MP salaries and allowances system? For example, should the Tribunal adjust the MP salaries with greater weight given to movements in the Wage Price Index, and adjust allowances with greater weight given to movements in the Consumer Price Index?
    • Are there any other matters the Tribunal should consider when making the Determination, in addition to those listed in the VIRTIPS Act?

    All written submissions should be emailed to the Tribunal Secretariat at enquiries@remunerationtribunal.vic.gov.au

    Submissions must be made by 5pm on Thursday 29 April 2021.

    If you require assistance to make a submission, please contact the Tribunal Secretariat by email at enquiries@remunerationtribunal.vic.gov.au.

    Publication of submissions

    The Tribunal may use information provided in submissions in its Determination.

    All submissions will be published in full or in summary form as appropriate on the Tribunal website, unless the person making the submission seeks confidentiality or the submission contains information that is identified as commercially sensitive. In this instance, the submission will be published in a form which protects the confidentiality or commercial sensitivity.

    The Tribunal may remove identifying information from submissions if published.

    Submissions that contain offensive or defamatory comments, or which are outside the scope of the Determination will not be published.

    The Tribunal may receive a request under the Freedom of Information Act 1982 (Vic)External Link . Any such requests will be determined in accordance with that Act which contains provisions designed to protect personal information and information given in confidence. Further information can be found at the Office of the Victorian Information CommissionerExternal Link website.

Annual Adjustment 2020

On 26 June 2020, the Tribunal made the Members of Parliament (Victoria) Annual Adjustment Determination 2020. The Determination took effect from 1 July 2020.

The full Determination and Statement of Reasons is available here:

As part of making the Determination, the Tribunal issued a notice of intention on 5 May 2020, which outlined the matters being considered by the Tribunal and invited submissions. One confidential written submission was provided to the Tribunal.

The notice of intention is available to read below.

  • In accordance with section 24(1) of the Victorian Independent Remuneration Tribunal and Improving Parliament Standards Act 2019 (Vic)External Link (VIRTIPS Act), the Victorian Independent Remuneration Tribunal (Tribunal) hereby publishes notice of its intention to make a Determination providing for the annual adjustments to the salaries and allowances provided to Members of Parliament (MPs) in Victoria.

    The Determination will take effect from 1 July 2020.

    Details of the proposed Determination are set out below.

    The Tribunal invites submissions from any person or body, including any affected person, or class of affected persons, in relation to the proposed Determination. Information on how to make a submission is provided below.

  • The Determination applies to the following salaries and allowances provided to MPs in Victoria:

    • basic salary
    • additional salary for specified parliamentary office holders
    • expense allowance
    • electorate allowance
    • parliamentary accommodation sitting allowance
    • motor vehicle allowance
    • travel allowance
    • commercial transport allowance
    • international travel allowance
    • Electorate Office and Communications Budget.

    The rates of these salaries and allowances were set by the Tribunal in the Members of Parliament (Victoria) Determination No. 1/2019.

  • In making a Determination, under section 24(2) of the VIRTIPS Act, the Tribunal is required to consider the following matters:

    • any statement or policy issued by the Government with respect to its wages policy (or equivalent) and the remuneration and allowances of any specified occupational group as defined in the VIRTIPS Act
    • the financial position and fiscal strategy of the State of Victoria
    • current and projected economic conditions and trends
    • submissions received in relation to the Determination.

    In recent months there has been an outbreak of COVID-19 across the world and affecting Victoria. Strict measures put in place by governments around the world to prevent or contain the spread of COVID-19 are having a significant impact on the global economy. The International Monetary Fund forecasts the global economy will contract by around three per cent in 2020 due to these measures.

    The Australian GovernmentExternal Link has noted that “the global spread of the Coronavirus and its global economic impact will also flow through to demand for Australia’s exports and the availability of inputs into domestic production and imported consumption goods”. Reserve Bank of Australia (RBA) modelling, referenced by RBA Governor Philip Lowe in a speech on 21 April 2020External Link , suggests that Australia’s Gross Domestic Product (GDP) could fall by 10 per cent over the first half of 2020. As at 30 March, the Australian Government has announced some $320 billion in economic support packages over the forward estimates, representing around 16.4 per cent of annual GDP.

    Financial position and fiscal strategy of the State of Victoria

    In early April, financial services company Standard and Poor’s (S&P) revised Victoria’s Triple-A credit outlook to ‘negative’ (implying that Victoria’s credit rating may be revised down in the future) because of an expected rise in public debt due to COVID-19. Nonetheless, as at 16 April 2020 Victoria’s credit rating from both S&P and Moody’s Investor Services remains at Triple-A level.

    Modelling released by the Department of Treasury and FinanceExternal Link (DTF) which assumes stage three restrictions related to COVID-19 will remain in place for six months, shows that Gross State Product could be 14 per cent lower in the June and September quarters relative to forecasts underlying the 2019/20 Victorian Budget (2019/20 Budget). In addition, the modelling suggests the unemployment rate could increase to around 11 per cent and property prices could fall by nine per cent by the end of 2020.

    The DTF modelling also suggests that the magnitude of the economic impact of COVID-19 makes it likely that Victoria will record negative economic growth in 2019-20 and 2020-21.

    The Victorian Government is expected to borrow around $24 billionExternal Link in emergency funding over 2019-20 and 2020-21 to support the community and businesses and to rebuild the economy following the easing of COVID-19 restrictions. This also includes $8 billion in funding for projects underway in 2020-21. This will add to Victoria’s net debt, which was forecast in the 2019/20 Budget to be around 8.3 per cent of GSP at the end of June 2020.

    This funding is in addition to the $3.5 billion the Victorian Government has previously committed, which includes a $1.7 billion economic survival and jobs package offering payroll tax refunds for eligible businesses, business support grants and help to workers who have lost their jobs to find new opportunities.

    Wages Policy

    The VIRTIPS Act requires the Tribunal to consider any statement or policy issued by the Government of Victoria which is in force with respect to its Wages Policy (or equivalent). The Victorian Government Wages Policy and Enterprise Bargaining Framework (Wages Policy), which applies to departments and agencies in the Victorian public sector, is reproduced below.

    The Victorian Government Wages Policy and Enterprise Bargaining Framework has 3 pillars:

    • Pillar 1: Wages — increases in wages and conditions will be capped at a rate of growth of 2% per annum over the life of the agreement. In practice this means employee wages and conditions will be allowed to grow at this rate.
    • Pillar 2: Best Practice Employment Commitment — all public sector agencies will be required to make a Best Practice Employment Commitment which will outline measures to operationalise elements of the Government’s Public Sector Priorities that reflect good practice within Government and can be implemented operationally or without significant costs.
    • Pillar 3: Additional strategic changes — additional changes to allowances and other conditions (not general wages) will only be allowed if the Government agrees that the changes will address key operational or strategic priorities for the agency, and/or one or more of the Public Sector Priorities.

    A ‘Secondary Pathway’ is also available for public sector agencies whose current enterprise agreement reaches its nominal expiry date on or before 30 June 2020 which permits one annual wage and allowance increase capped at 2.5% (instead of at 2%).

    Source: Industrial Relations Victoria, ‘Victorian Government Wages Policy,’ Wages Policy and the Enterprise Bargaining Framework (State Government of Victoria: Melbourne, Victoria, 2019).

  • The Tribunal invites submissions from any person or body, including any affected person or class of affected persons in relation to the proposed Determination.

    All written submissions should be emailed to the Tribunal Secretariat at enquiries@remunerationtribunal.vic.gov.au.

    Submissions must be made by 5pm on Wednesday 27 May 2020.

    If you require assistance to make a submission, please contact the Tribunal Secretariat by email at enquiries@remunerationtribunal.vic.gov.au.

    Publication of submissions

    The Tribunal may use information provided in submissions in its Determination.

    All submissions will be published in full or in summary form as appropriate on this website, unless the person making the submission seeks confidentiality or the submission contains information that is identified as commercially sensitive. In this instance, the submission will be published in a form which protects the confidentiality or commercial sensitivity.

    The Tribunal may remove identifying information from submissions if published.

    Submissions that contain offensive or defamatory comments, or which are outside the scope of the Determination will not be published.

    The Tribunal may receive a request under the Freedom of Information Act 1982 (Vic)External Link . Any such requests will be determined in accordance with that Act which has provisions designed to protect personal information and information given in confidence. Further information can be found at theOffice of the Victorian Information CommissionerExternal Link .

Reviewed 24 June 2022

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