Slow wage growth also hits Treasury

In his last annual report as Treasury boss, Philip Gaetjens said it had been a "productive year".
In his last annual report as Treasury boss, Philip Gaetjens said it had been a "productive year".

The Department of Treasury is often criticised for its poor forecasting record for wages growth, a critical guide to the economic outlook.

In recent years, Treasury's predictions have repeatedly fallen short of reality.

There are various theories as to why wages have not lived up to expectations at a time when employment growth has been strong.

But what the department can't be accused of is relying on lived experience as a reason for its inflated forecasts.

The Treasury's 2018/19 annual report shows all staff in the department received a salary increase of just two per cent late last year under its 2018-2021 enterprise bargaining agreement.

The wage price index - Treasury's preferred measure of wages - was growing at an annual rate of 2.3 per cent as of June and 2.6 per cent for the public sector.

Treasury's award was also lower than other enterprise bargaining agreements with government data showing the average annualised wage increase in the December quarter last year was 2.7 per cent for the public sector.

The annual report showed the number of staff employed at Treasury was 993 as of June 30, 2019 up from 912 a year earlier.

In his last annual report as Treasury secretary before taking up his new role as head of Prime Minister and Cabinet, Philip Gaetjens said it had been a "productive year" for his department.

From briefing a new treasurer after last year's leadership spill to preparing the budget on April 2 - five weeks earlier than usual - and providing information for the financial services royal commission, Mr Gaetjens said the department has been supporting "strong, sustainable economic growth".

Mr Gaetjens was in the role of Treasury boss for just over a year, the second shortest tenure since Federation.

His total remuneration package for last year was $879,978.

Australian Associated Press