Federal public servants offered 10.5 per cent pay hike

Chief negotiator Peter Riordan on Tuesday released the federal government's pay offer for Australian Public Service employees.

The offer is the largest pay increase that APS employees will have received in more than 10 years.

The full breakdown includes four per cent in the first year, 3.5 per cent in the second year and three per cent in the third year.

"The Australian government is committed to providing APS employees with fair and equitable conditions of employment through genuine APS bargaining," a statement said.

"In addition to negotiating a set of common terms and conditions, we are also seeking to provide a fair and affordable pay rise for APS employees.

"At the end of this process, APS employees can expect a package of pay and common conditions that better position the APS as a model employer and employer of choice."

The date of effect for any agreed pay increase remains a matter for bargaining.

Recent wage outcomes across the country, economic indicators, the labour market and budgetary considerations were factors in the decision.

Treasury forecasts inflation will decline to 3.25 per cent in 2024/25 and reach 2.5 per cent by 2026/27.

Community and Public Sector Union members have until May 30 to vote on the offer.

Union members had endorsed a pay claim of nine per cent in the first year, six per cent in the second and five per cent in the third.

CPSU national secretary Melissa Donnelly said feedback from members would inform the union's next steps.

"To be engaging in genuine negotiations with the government on pay and conditions is a far cry from where we were just a year ago," she said.

While she would not pre-empt feedback from CPSU members on the offer, she said the union's pay claim was ambitious "because it has to be".

"The public, public sector workers and the federal government need the APS to catch up - and catch up quickly - to meet the demands and competition that exist in the modern labour market," she said.

Australian Associated Press