Al­lowance for Govt em­ploy­ees clar­i­fied

Pilbara News - - News - Peter Long Peter Long is the City of Kar­ratha Mayor.

There has been some con­fu­sion in the com­mu­nity about the Dis­trict Al­lowance and our Shire be­com­ing a City in 2014.

The Dis­trict Al­lowance is paid to public sec­tor em­ploy­ees as com­pen­sa­tion for “the dis­ad­van­tages as­so­ci­ated with work­ing in re­gional West­ern Aus­tralia”.

It is pro­vided for un­der agree­ments which “pro­vide a ro­bust method­ol­ogy for the an­nual cal­cu­la­tion of the DA based on three dif­fer­ent fac­tors — cost of liv­ing, cli­mate and iso­la­tion”.

The cost of liv­ing com­po­nent is af­fected pri­mar­ily by move­ments in the re­gional price in­dex, which it­self is de­ter­mined by a sur­vey of costs in large re­gional cen­tres and is con­ducted every two years.

The method­ol­ogy al­lows for the rise and fall in DA rates to re­flect changes in the cost of liv­ing. This was sup­ported by Gov­ern­ment and public sec­tor unions dur­ing agree­ment ne­go­ti­a­tions in 2010.

The iso­la­tion and cli­mate com­po­nents are ad­justed by move­ments in the an­nual Perth con­sumer price in­dex.

On July 1, 2010, the DA for Kar­ratha/Dampier was $9839.

A year later, it went up to $15,671 — a whop­ping 59 per cent in one year.

In 2012, it went up again to 16,537. This was in re­sponse to cost of liv­ing pres­sures dur­ing the min­ing boom.

How­ever, in 2013, the heat was gone from the min­ing boom and the re­gional price in­dex re­vealed sig­nif­i­cant re­duc­tions in cost-of-liv­ing pres­sures in our area and a con­se­quent re­duc­tion in the DA. To soften the blow in Kar­ratha, Gov­ern­ment em­ploy­ees were al­lowed to re­main at the 2012 rate un­til June 30, 2014, when the DA dropped to $9192 — a re­duc­tion of 42 per cent.

On July 1, 2014, the Shire of Roe­bourne be­came the City of Kar­ratha and some thought this pre­cip­i­tated the 42 per cent drop in their DA.

This was not the case — lo­cal gov­ern­ment sta­tus has noth­ing to do with the Dis­trict Al­lowance. It’s re­lated to costof-liv­ing fun­da­men­tals, which be­gan to drop in 2013, but weren’t passed on un­til 2014.

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