The Government faces potential widespread industrial action from public sector unions with a possible nurses’ strike being just the start.

At the heart of the problem is the frustration of the unions who have had to put up with nine years of National’s austerity but now, just when they thought they had a sympathetic Government, they find themselves facing Grant Robertson’s Budget Responsibility rules.

There are four separate actions underway.

One is the nurses who yesterday “ strongly rejected” the latest pay offer from the District Health Boards.

The offer would see nurses’ pay rise between nine and 16 percent over the next 18 months.

Though they are preparing for a strike, the nurses are seeking immediate mediation or facilitation with the DHBs.

But New Zealand Nurses Organisation CEO,  Memo Musa said that strike action was a last resort.

However should it go ahead he said that patient safety would be paramount.

“We have had several meetings with DHB representatives to begin preparation to ensure patient safety,” he said.

“NZNO will work with DHBs to agree provision of life-preserving services, and we will be absolutely comply with the Code of Good Faith for the public health sector,” he said.


But deputy Prime Minister Winston Peters, standing in yesterday for Jacinda Ardern at the weekly post Cabinet press conference, seemed intent on lowering expectations.

Apparently reading from a pre-prepared statement he said the nurses’ claim was the product of the nine years of underfunding by National.

“We won’t be able to fix all the problems in just one pay round,” he said.

“It takes time to fix neglect.

“We have to balance competing priorities and make sure we have the money aside for a rainy day.

“This Government will exercise fiscal restraint.”

That restraint will be exercised within the Budget Responsibility rules which sources say Finance Minister Grant Robertson is adamant cannot be relaxed even for a pay settlement for loyal Labour supporters like the nurses.

Peters repeated a frequent Robertson message that the Government had to balance the books and run a strong economy in order to be able to afford the pay claims public servants are making.

“And we need to run a strong surplus to cover the cost of unforeseen events like M Bovis and natural disasters,” Peters said..

“So our approach is measured, planned and delivered over time and focussed on a fair result for teachers and nurses while maintaining fiscal discipline.”

Peters’ addition of “teachers” to the list of pay claims was a revealing slip.

The Government is particularly fearful of a forthcoming wage claim from secondary teachers and another from the police.

The firm response to the nurses is, in part, intended to send a message to the teachers that the Government is not going to be profligate in settling pay claims.

And Health Minister David Clark emphasised yesterday that the Government had no more money for the nurses.

He said that the Government had a fiscal limit with which to settle the nurses’ claim but he too was warning the teachers..

“We’ve put out there the money that we feel we can put out there,” he said.

“Beyond that, of course, other settlements are still to come that will in some ways look to what is happening here.’

“They are separate, and we’ve also tried to draw the distinction in saying that the nurses are unique.”

Secondary teachers have just completed a series of meetings and have agreed on their claims for their wage round which they expect will begin in August.

A PPTA paper said the top of the teacher pay scale needed to grow by 14.5 per cent, from $75,949 to $86,967, to restore top teachers to the same relative wage they earned in 2002.

PPTA president, Jack Boyle says, “The solutions are known, there is political support, and budget surpluses are available.”

This will be the crux of the teachers’ argument; that the budget is in surplus in absolute terms.

That ignores Robertson’s Budget responsibility rules which commit the Government to maintaining the surplus at one point one percent of GDP this year.

Meanwhile strike action is likely to take place in the somewhat unlikely environments of Inland Revenue and the Ministry of Business, Innovation and Employment.

Four thousand PSA members in those departments were balloted yesterday about their support for two 2-hour stoppages on 9 July and 23 July.

Results of the ballot were not available last night.

PSA National Secretaries Erin Polaczuk and Glenn Barclay said at both organisations, staff were paid below the market rate when they start, on the expectation they would move up quickly – but that didn’t happen.

“MBIE is insistent on a performance-based system, which we know doesn’t work and actually increases pay inequities,” Mr Barclay says.

“Progression is slow and often unfair – and PSA members are saying ‘no more’.”

“Meanwhile, IR is refusing to make a pay offer to recognise increasing costs of living.”

Industrial action in the Inland Revenue Department is unlikely to be a significant political embarrassment for the Government, but the cumulative effect of widespread, ongoing industrial action in the public sector is targeting Robertson’s Budget Responsibility rules.

There will be some sympathy within Labour’s caucus for the wage claims and Robertson will find himself under pressure to stick to his rules.

But so far he has been resolute in resisting any pressures to move away from them.