The Northern Territory government has backflipped on its controversial public sector pay freeze in a move welcomed by the union movement.
The controversial wage freeze policy, brought in by Chief Minister Natasha Fyles' predecessor, Michael Gunner, had been criticised by unions and the Country Liberal Party opposition.
In a statement released on Wednesday morning, the government said public servants would now receive a two per cent annual increase.
The pay rise will apply to all public sector workers, even those who were covered by enterprise agreements that saw workers offered lump sum bonuses in exchange for frozen wages.
Politicians would not receive a pay rise, the statement said.
Speaking at a press conference on Wednesday afternoon, Ms Fyles said the decision was made to assist Territorians with rising costs of living.
But she said the cost to the budget from the change was yet to be determined.
"It will have an impact on the budget, but I can't give you a global figure because we need to negotiate each agreement, and each agreement has various options within it that will have different financial outcomes," she said.
"What I can assure Territorians is we take the responsibilities of running the Northern Territory government budget very seriously - we are aiming still to get to an operating surplus."
The government's statement said treasury was now forecasting a $1.4 billion improvement to the budget over the next four years.
Unions hail 'a great day' after strike action
Much of the general public service agreed to the controversial wage freeze last year as part of protracted enterprise bargaining agreements.
However the government has since faced pushback from teachers and prison officers, who are yet to sign their agreements, and went on strike last month.
Unions NT secretary Erina Early said today's announcement was "a great day for public sector union workers".
"The chief minister has listened to the union members and agreed that public sector workers deserve better," she said.
"We have the won the battle to lose the freeze and now our members can now properly negotiate their conditions of employment".
The government had been pursuing the wage freeze for its 24,000 public servants as part of a bid to save $424 million over four years.
It had used the findings of the 2019 Langoulant Report as justification for the freeze, despite the report recommending public sector workers receive a $1000 pay rise each year over four years.
Opposition leader Lia Finocchiaro described the government's decision as a "humiliating backflip".
"There is no doubt that since the pay freeze was announced two years ago, [the Labor government] has substantially eroded the trust between public servants and the government," she said.
"This government is tired and asleep at the wheel. It has no economic plan, no plan for community safety and no plan to drive down the cost of living."
