More than 220 Serco workers at Acacia Prison are set to get a pay increase 55 per cent above what public servants are entitled to under the Government's tough wages policy - and taxpayers are funding it.
A little-known clause in Serco's contract to manage WA's only privately run prison stipulates its guards must be paid the same as government officers so the best and most experienced staff do not go into the public system.
Since 2006, when Labor handed the prison management contract to Serco, almost $5 million has been handed to the company under the parity policy, including $512,000 budgeted for this financial year.
The policy means Serco guards at Acacia, whose current pay deal expires on Monday, must receive an increase of at least 4.25 per cent a year in line with the 12.75 per cent over three years given to public officers in May last year.
The deal was negotiated before the Government's public sector wages policy of limiting increases to the consumer price index came into effect.
WA Police officers settled for increases of 2.75 per cent, 2.5 per cent and 2.5 per cent last week, when the Government told firefighters and public servants to expect the same amid tough fiscal circumstances.
Community and Public Sector Union/Civil Service Association WA secretary Toni Walkington supported the Acacia Prison wages parity policy, which her union helped negotiate in 2006 when it represented Serco prison guards.
But she labelled the Government's public sector wages policy unfair because it used Treasury's "inherently conservative" projection of inflation in May's State Budget - 2.75 per cent - when Perth's CPI was currently 3.1 per cent. Her members may not accept the deal, Ms Walkington said.
Corrective Services Minister Joe Francis said wages were only one component of operating costs at Acacia, which included maintenance and administration, and taxpayers still got a better deal compared with the Government running it.
"In the 2012-13 financial year the prisoner cost per day for Acacia was $173 compared with the public sector rate of $317 per day," he said.
Funds handed to Serco under the parity policy had been factored into the contract.
John Welch, secretary of the WA Prison Officers Union which now represents Serco prison guards at Acacia, said it would be very difficult for the private sector to employ staff without the wages parity policy.
A Serco spokesman said its staff retention rate at Acacia was 95 per cent.