2. Review of operations
In 2022‑23, the Tribunal undertook work in relation to the remuneration arrangements for the following occupational groups:
- Members of the Parliament of Victoria (MPs)
- executives employed in Victorian Public Service (VPS) bodies and prescribed public entities (PEs)
- Mayors, Deputy Mayors and Councillors in local governments in Victoria.
2.1 Members of Parliament
The Tribunal is responsible for inquiring into and setting the value of salaries and work‑related parliamentary allowances for MPs [reference - VIRTIPS Act, ss. 6(1)(a)-(c)]. It may also make guidelines with respect to the use of some work-related parliamentary allowances and the EO&C Budget [reference - VIRTIPS Act, s. 36(1)].
The Tribunal made its first Determination of MP salaries and allowances in 2019 — the Members of Parliament (Victoria) Determination No. 01/2019 (2019 MP Determination). In 2020, 2021 and 2022, the Tribunal made Determinations providing for an annual adjustment to the values of the salaries and allowances set in the 2019 MP Determination.
The Tribunal is required to make a new Determination setting the values of salaries and allowances for MPs within six months after the first sitting day of each subsequent Parliament [reference - VIRTIPS Act s. 17(7)]. The 60th Parliament of Victoria held its first sitting on 20 December 2022. Thus, the Tribunal was required to make a new Determination no later than 20 June 2023.
2023 Determination of salaries and allowances
On 20 June 2023, the Tribunal made the Members of Parliament (Victoria) Determination No. 01/2023 (2023 MP Determination). This Determination set the values of MP salaries, work-related parliamentary allowances and the EO&C Budget with effect from 1 July 2023.
In making the MP Determination the Tribunal considered the role of an MP which encompasses parliamentary duties, work within their electorates, management of an electorate office and party-political activities (Figure 1).
Figure 1: Categories of responsibilities and duties of MPs
The Tribunal strives to achieve fair and reasonable recompense for MPs in performing their public duties. Having regard to that foundation principle and legislative factors, the Tribunal set the value of the basic salary for an MP at $198,839 per annum. This represented an annual increase of 3.5 per cent. In making its Determination, the Tribunal gave particular weight to current Wages Policy, the Victorian Government’s financial and fiscal objectives and prevailing economic conditions and trends.
The Tribunal determined the values of additional salaries and expense allowances for eligible specified parliamentary office holders. Additional salaries were set in the range of $7,954 to $221,871 per annum. The expense allowance for 15 specified parliamentary offices varies from $3,558 to $60,480 per annum. These decisions also represented a 3.5 per cent annual increase.
The Tribunal also set the values of several work-related parliamentary allowances, which are provided to MPs to assist them in performing their public duties. Table 1 outlines the types of allowances set by the Tribunal, their values as at 1 July 2023 and the change in values compared to 1 July 2022.
Table 1: Types of work-related parliamentary allowances for MPs
| Type of allowance | Purpose | Value as at 1 July 2023 ($ p.a.) | Change compared to 1 July 2022 (per cent) |
|---|---|---|---|
| Electorate allowance | Cover costs associated with providing services to constituents. | 45,022 - 53,933 | 6.8 |
| Motor vehicle allowance | Available to MPs who elect not to be provided with a fully maintained motor vehicle. | 23,225 - 34,994 | 3.9 |
| Commercial transport allowance | Cover eligible transport costs (on a reimbursement basis). | 5,195 - 17,898 | 3.9 |
| Travel allowance | Cover the costs of commercial accommodation, meals and incidentals for overnight stays (on a reimbursement basis). | As per the travelling allowance rate set by the Commonwealth Remuneration Tribunal | Not applicable |
| International travel allowance | Cover eligible international travel costs (on a reimbursement basis). | 10,765 | 6.8 |
| Parliamentary accommodation sitting allowance | Cover costs incurred by MPs in certain regional electorates who choose to maintain a residence in metropolitan Melbourne to help them carry out their public duties. | 56,609 - 53,217 | Unchanged |
The increase to the electorate and international travel allowances was consistent with the annual percentage increase in the Melbourne Consumer Price Index (CPI) [reference - Year ending March quarter 2023]. The increase to the motor vehicle and commercial transport allowances were consistent with the annual percentage change in the ‘Transport’ sub-group of the Melbourne CPI [reference- Year ending March quarter 2023].
The Tribunal continues to link the value of the travel allowance to rates set by the Commonwealth Remuneration Tribunal. The Tribunal left unchanged the value of the parliamentary accommodation sitting allowance.
The values of three allowances — the electorate, motor vehicle and commercial transport allowances — were also set to vary depending on the size of the MP's electorate. This recognises the additional costs incurred by MPs in serving larger electorates.
The Tribunal also took the opportunity to reset the formula for the EO&C Budget. The effective rate per voter was increased by 6.8 per cent, reflecting movements in the Melbourne CPI.
Further information about the 2023 MP Determination, including a detailed Statement of Reasons accompanying the Determination, is available on the Tribunal’s website.
2023 MP Guidelines
On 20 June 2023, the Tribunal made the Members of Parliament (Victoria) Guidelines No. 01/2023 (2023 MP Guidelines). The 2023 MP Guidelines aim to better support MPs to carry out their public duties, consistent with legislative principles and overarching obligations. They provide MPs with greater flexibility in using the EO&C Budget to communicate with their electorate, including by allowing an MP to communicate with their constituents on any matter that they reasonably believe is of importance or interest to them, subject to the legislative framework and prohibitions on party-political activity. They also enable joint communication between two or more MPs from any geographical location or House of Parliament.
The 2023 MP Guidelines also clarify:
- that an MP may claim the travel allowance for an overnight stay immediately preceding and following their parliamentary business, committee business or Ministerial business
- that an MP must not make a claim under the EO&C Budget for costs incurred or activity undertaken to communicate with their electorate between the issuing of writs for a general election or by-election and the declaration of the poll for the electorate
- the arrangements for an MP to carry over unspent funds from the EO&C Budget remaining from a pre-election period, including where an MP is elected to a different electorate.
The 2023 MP Guidelines are available on the Tribunal’s website.
2.2 Public sector executives
The Tribunal is responsible for inquiring into and determining the remuneration bands for executives employed in VPS bodies and PEs [reference - VIRTIPS Act, ss. 6(1)(d) and 6(1)(g)].
The Tribunal also has the functions of [reference - VIRTIPS Act, ss. 6 and 37]:
- issuing guidelines with respect to the placement of executives within the remuneration bands
- providing advice to employers proposing to pay an executive above the relevant remuneration band
- providing advice to the Minister about the remuneration of executives.
In 2022-23, the Tribunal’s work in relation to executives comprised:
- Determinations providing for an annual adjustment to the values of the remuneration bands for executives employed in VPS bodies and PEs
- advice to public sector employers proposing to pay an executive above the relevant remuneration band
- completing a review of remuneration arrangements for executives in the major transport infrastructure sector.
Figure 2 summarises the VPS and PE employers within the scope of the Tribunal’s Determinations.
Figure 2: VPS and PE Employers within the scope of the Tribunal’s Determinations
Annual adjustment Determinations
In 2022-23, the Tribunal was required to make an annual adjustment to the values of the remuneration bands for both VPS and PE executives, originally set in 2020 and adjusted in subsequent years [reference - Remuneration bands for executives employed in public service bodies (Victoria) Determination No. 01/2020; Remuneration bands for executives employed in public service bodies (Victoria) Determination No. 01/2020].
On 29 June 2023, the Tribunal made the Remuneration bands for executives employed in public service bodies (Victoria) Annual Adjustment Determination 2023 and the Remuneration bands for executives employed in prescribed public entities (Victoria) Annual Adjustment Determination 2023.
The annual adjustment Determinations took effect on 1 July 2023 and provided for:
- an adjustment of 4 per cent to the notional salary component of the remuneration bands
- a further adjustment to reflect increases to executives’ statutory superannuation entitlements which took effect on 1 July 2023.
Tables 2–4 below outline the remuneration bands for VPS executives from 1 July 2023. The remuneration bands are expressed as a total remuneration package (TRP), defined as the sum of [reference - VPSC. 2022, Victorian Public Service Executive Employment Handbook]:
- base salary
- employer superannuation contributions
- employment benefits (i.e. non-salary) specified in the executive’s contract of employment
- the annual cost to the employer of providing the non-monetary benefits, including any fringe benefits tax payable.
All values are for executives employed on a 1.0 full-time equivalent basis and apply pro rata to executives employed on a part-time basis.
The values of the remuneration bands for executives employed in PEs are available on the Tribunal’s website.
Table 2: Value of remuneration bands for the VPS Senior Executive Service
| Classification | Base of band TRP ($ p.a.) | Top of band TRP ($ p.a.) |
|---|---|---|
| Senior Executive Service-3 | 401,018 | 533,431 |
| Senior Executive Service-2 | 279,239 | 401,017 |
| Senior Executive Service-1 | 216,376 | 279,238 |
Table 3: Value of remuneration bands for Administrative Office Heads
| Classification | Base of band TRP ($ p.a.) | Top of band TRP ($ p.a.) |
|---|---|---|
| Administrative Office Head-3 | 401,018 | 533,431 |
| Administrative Office Head-2 | 279,239 | 401,017 |
| Administrative Office Head-1 | 216,376 | 279,238 |
Table 4: Values of remuneration band for Department Heads and the Victorian Public Sector Commissioner
| Classification | Base of band TRP ($ p.a.) | Top of band TRP ($ p.a.) |
|---|---|---|
| Department Head / Victorian Public Sector Commissioner | 577,716 | 778,492 |
The Tribunal considered several legislative requirements in making the annual adjustment Determinations:
- the Victorian Government’s Wages Policy
- the financial position and fiscal strategy of the State of Victoria
- current and projected economic conditions and trends
- submissions received in relation to the proposed Determinations.
The Tribunal’s decisions are consistent with ensuring that public sector employers are able to offer remuneration arrangements that are fair and reasonable to attract and retain talented executives to deliver the agenda of the government of the day.
The annual adjustment Determinations and accompanying Statements of Reasons are available on the Tribunal’s website.
Payment above the band advice
The Tribunal is required to provide advice to public sector employers proposing to pay an executive above the maximum of the relevant remuneration band set by a Determination [reference - VIRTIPS Act, s. 37(1)].
In 2022-23, the Tribunal provided advice in response to 44 requests from public sector employers to pay an executive or executives above the maximum of the relevant remuneration band. 14 requests for advice were made by VPS employers and related to 36 individual executives, while 30 requests were made by PEs and related to 40 individual executives (Table 5).
Table 5: Requests for payment above the band advice by employer type, 2022-23
| Employer type | Number of requests | Number of executives |
|---|---|---|
| Victorian Public Service | 14 | 36 |
| Prescribed public entity | 30 | 40 |
The majority of requests for advice related to executives employed in the major transport and finance sectors (Figure 3).
Figure 3: Requests for payment above the band advice by sector, 2022-23.
Requests for advice from the Minister about public sector executives
The Minister may request the Tribunal provide advice about remuneration and funding in relation to any specified occupational group and remuneration in relation to prescribed public sector bodies [reference - VIRTIPS Act, s. 37(3)].
The Tribunal submitted its advice to the Minister about remuneration arrangements for executives in the major transport infrastructure sector in December 2022.
2.3 Mayors, Deputy Mayors and Councillors
The Tribunal is responsible for making Determinations setting the value of the allowance payable to Mayors, Deputy Mayors and Councillors (Council Members) in all 79 local governments in Victoria [reference - VIRTIPS Act, s. 23A].
The Tribunal’s first Determination for Council Members was made in March 2022 [reference - Allowance payable to Mayors, Deputy Mayors and Councillors (Victoria) Determination No. 01/2022]. The Determination set a base allowance for each Council Member, the value of which varies according to the role (Mayor, Deputy Mayor or Councillor) and the allowance category to which the Council has been assigned.
The Determination also provided for a remote area travel allowance and set eligibility criteria for claiming it.
The Tribunal is required to make annual adjustments to the value of the allowances payable to Council Members. In 2022-23, the Tribunal was required to make two annual adjustments, one in 2022 and another in 2023.
On 8 December 2022, the Tribunal made the Allowance payable to Mayors, Deputy Mayors and Councillors (Victoria) Annual Adjustment Determination 2022. This Determination increased the value of allowances by 1.5 per cent from 18 December 2022, taking into account:
- current and projected economic conditions and trends
- the financial position and fiscal strategy of the State of Victoria
- the Victorian Government’s Wages Policy
- recent remuneration adjustments for comparable roles
- the limited period of time that had passed since the Tribunal made its first Determination setting the values of allowances for Council Members.
On 30 June 2023, the Tribunal made the Allowance payable to Mayors, Deputy Mayors and Councillors (Victoria) Annual Adjustment Determination 2023. This Determination increased the values of allowances by a further 2 per cent with effect from 1 July 2023, consistent with the timing of the annual adjustment for public sector executives.
In addition to legislative requirements, the Tribunal also considered:
- the limited amount of time that had passed since the last annual adjustment to allowances of 1.5 per cent
- remuneration adjustments for comparable local government roles in other Australian jurisdictions
- the Victorian Government’s rate cap of 3.5 per cent for all Councils for 2023‑24
- its 2023 Determination of salaries and allowances for MPs, which resulted in a 3.5 per cent increase in the MP basic salary.
The current value of allowances for Mayors, Deputy Mayors and Councillors are set out at Table 6. Further increases to allowances are scheduled to be phased in from 18 December 2023.
Table 6: Value of the base allowance for Mayors, Deputy Mayors and Councillors, by Council allowance category, 1 July 2023 until 17 December 2023
| Council allowance category | Mayoral allowance ($ p.a.) | Deputy Mayoral allowance ($ p.a.) | Councillors allowance ($ p.a.) |
|---|---|---|---|
| Category 1 | 79,492 | 39,746 | 25,650 |
| Category 2 | 102,650 | 51,325 | 31,980 |
| Category 3 | 126,958 | 63,480 | 38,316 |
| Category 4 – Melbourne City Council | 253,920 | 126,959 | 57,473 |
The annual adjustment Determinations — including details of scheduled phased increases — and accompanying Statements of Reasons are available on the Tribunal’s website.
2.4 State Budget performance measures
The Victorian Budget 2022/23 specifies one quality and one timeliness performance measure for the Tribunal [reference -Department of Treasury and Finance (2022), Budget Paper No. 3 – Service Delivery, pp. 327-328].
The quality measure relates to the satisfaction of key stakeholders — including MPs, public sector employers and Council Members — with the Tribunal’s processes regarding Determinations, reviews and advice.
To measure stakeholder satisfaction a questionnaire was sent to approximately 380 stakeholders, including MPs and the Clerks of the Parliament of Victoria, PE board Chairs, senior VPS department human resources officers and local government Mayors. The questionnaire asked respondents to rate their overall satisfaction with the Tribunal’s delivery of outputs [reference - The question asked was ‘Considering consultation methods, consideration of views and issues, communication of outcomes, and timeliness, how satisfied were you overall with the Tribunal's delivery of determinations, reviews and advice in 2022-23’].
The Tribunal recorded an overall level of stakeholder satisfaction of 87 per cent against a target of 80 per cent, based on 75 responses to the questionnaire.
The timeliness measure related to delivery of the Tribunal’s legislated work program within established timeframes. In 2022-23, the Tribunal’s legislated work program comprised:
- making comprehensive and annual adjustment Determinations consistent with timeframes set out in the VIRTIPS Act
- responding to requests for advice submitted by VPS and PE employers proposing to pay an executive above the relevant remuneration band — the Tribunal aims to provide advice within 15 business days of a complete request being received
- providing advice as requested by the Minister for Government Services — the advice must be provided within a reasonable time after receiving the request
- provision of the Tribunal’s 2021-22 annual report by 31 October 2022.
In 2022-23, the Tribunal delivered 96 per cent of its legislated work program within established timeframes, against a target of 85 per cent.
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