Public sector play key role in wage rises

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A plan to increase wages would need to start with a public sector pay rise as Labor promises to address the cost of living crisis.

The federal government's workforce could be a leader in driving wage growth for Australian workers in all sectors, the union representing public sector workers says.

A necessary shift in public sector wage policies was flagged by Reserve Bank of Australia governor Phillip Lowe in a speech following the decision to lift interest rates on Wednesday.

"I expect over time governments will need to shift their (public sector) wages policies," Mr Lowe said.

Campaigning in the marginal seat of Chisholm in Melbourne on Wednesday, Labor leader Anthony Albanese reiterated his pledge to legislate a same job, same pay policy and indicated it could extend to outsourced labour hire.

But the opposition has not stated a benchmark for wage growth, as inflation outstrips current pay rises.

Mr Albanese also did not answer questions about whether he would push for a public sector pay rise.

The coalition has long restrained wages for public sector workers which locked in stagnation for all Australian workers, Community and Public Sector Union secretary Melissa Donnelly told AAP.

"We know, and the Reserve Bank acknowledges, that public sector wage increases drive broader economic growth. As a major employer, the Morrison government should be using the public sector to drive wages growth," she said.

"Allowing public sector workers and their union representatives to genuinely negotiate real wage increases, the public sector can be a leader in driving wage growth for Australian workers in all sectors."

Labor has previously announced if elected it would scrap the coalition's approach to public sector bargaining, including their wages policy.

Mr Albanese said Labor would also address domestic supply constraints, flagged by the RBA in its explanation as to why interest rates were raised on Tuesday following a two-decade high inflation spike.

"Skills ... is a real constraint on our economy. We have around about one and a half million Australians who are either unemployed or want more work. The issue of insecure work is a big one," he said.

"The casualisation of the workforce - so the use of labour hire, contracting out -means insecure work, people want more hours. Those capacity constraints are things that we will deal with."

Australian Council of Trade Unions head Sally McManus told AAP removing limits on wage growth and providing real pay rises for the prime minister's own workforce would generate real wage growth in the economy.

"Last week Ken Wyatt, who makes more than $426,000 per year, claimed that politicians need a pay rise, but the prime minister and his government continue to deny real pay rises for their own employees," she said.

"This is a government which looks after itself, not Australian workers."

But when it came to unemployment benefits, Labor refused to commit to raising the JobSeeker rate beyond the current $46 a day.

Mr Albanese said his government would assess the adequacy of the payment at every budget.

"One of the things that a Labor government should always do is to assist people in need," he said.

"We don't need a review to know that people are doing tough. What we need to do (in) each and every budget (is) examine and do what we can do to assist."

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