Govt warns of pay cuts for public sector workers

Finance Minister Bill English has warned public sector workers not to expect pay increases this year, angering state sector unions and setting the stage for major strike action in the health and education sectors when contracts come up for renegotiation next year.

Any pay freeze would mean a cut in real wages as pay packets fall behind the rising cost of living.

Nurses Organisation industrial adviser Glenda Alexander told the New Zealand Herald that nurses had intended having talks with the Government in good faith when their contract expired next March.

"It is not particularly good faith to try to set up the scene without us having explored issues of interest to us. We are aware we are in difficult circumstances, but this is extremely bad faith," she said.

"I think it's insulting to nurses and to the process. It's incredibly bad form."

The exchange in Parliament where English made his comments can be found here.