The NSW Government, via a press release, has announced it will raise its 2.5% wage ceiling to 3% next financial year and up to 3.5% in 2023-24, in the face of incomes falling behind consumer price inflation and scheduled industrial action. The revised caps would apply to industrial instruments struck after July 1. The 3% rise would apply for the next two years, while a further 0.5% will be available in 2023-24 "for employees that make a substantial contribution to productivity-enhancing reforms", but the Government provided no further detail on what that might entail. The NSW Government will also make a one-off $3000 payment to permanent NSW Health workers to recognise their work "on the frontline of the COVID-198 pandemic". 

The NSW Government's shift will reduce but not close the gap between public sector wages and consumer price inflation, currently rising at 5.1% a year.  Unions want to axe the cap, rather than have its effects ameliorated. The cap has been in place for more than a decade.