Consideration
53The PSA's primary submission, supported by the other union parties, was that it was not open to the Commission to award increases of less that 2.5 per cent on the basis of economic or fiscal considerations. The Secretary submitted to the contrary, that is, the Commission maintains a discretion to award increases in remuneration or other conditions of employment that increase employee-related costs by less than 2.5 per cent. The Secretary's submission did not derive from any opinion he held or the parliament held about the Commission maintaining a discretion to order less that 2.5 per cent on fiscal or economic grounds. Despite the extensive parliamentary discussion on the purpose of the Industrial Relations Amendment (Public Sector Conditions of Employment) Bill 2011 (which I shall shortly refer to) nowhere is it mentioned that s 10 or s 146(2) of the Act maintained a role in fixing rates of pay for public sector employees.
54The Secretary's submission was based primarily on a statement by the Full Bench in Crown Employees (No 1) where the Full Bench stated at [41]:
[41] It is not our position that increases in employee-related costs from a source other than an award or order of the Commission cannot be taken into account in determining increases in remuneration or other employment conditions. In addition to s 146C and the Regulation, the Commission retains a residual discretion to set fair and reasonable conditions of employment pursuant to s 10 of the Act and s 146(2) of the Act imposes the following obligations:
(2) The Commission must take into account the public interest in the exercise of its functions and, for that purpose, must have regard to:
(a) the objects of this Act, and
(b) the state of the economy of New South Wales and the likely effect of its decisions on that economy.
55The observation by the Full Bench at [41] was not essential to its decision. What the Full Bench was required to determine was whether the annual limit of net increase in employee-related costs was 2.5 per cent regardless of whether that flowed from an award or order or from some other source of "employee-related costs" as defined in cl 8 of the Regulation. The Full Bench recorded its finding at [53]:
[53] We find that having regard to our textual analysis of cl 6(1)(a) of the Regulation, the context in which that text appears in the Regulation, the purpose of s 146C and the Regulation and the extrinsic materials that assist in elucidating the purpose of cl 6(1)(a), the increases in remuneration or other conditions of employment referred to in that provision are only those increases resulting from an award or order made or varied by the Commission either by consent or in arbitration proceedings.
56The observation at [41] was entirely incidental to the matter required to be determined and is to be properly regarded as obiter dicta, that is, an expression of opinion not necessary to the decision in a case. The opinion, therefore, is not binding. In Quinn v Leatham [1901] AC 495 at 506 the Earl of Halsbury LC said:
[E]very judgment must be read as applicable to the particular facts proved, or assumed to be proved, since the generality of the expressions which may be found there are not intended to be expositions of the whole law, but governed and qualified by the particular facts of the case in which such expressions are to be found. The other is that a case is only an authority for what it actually decides. I entirely deny that it can be quoted for a proposition that may seem to follow logically from it. Such a mode of reasoning assumes that the law is necessarily a logical code, whereas every lawyer must acknowledge that the law is not always logical at all (applied by McHugh J in Shepherd v The Queen [1990] HCA 56; (1990) 170 CLR 573 at 593).
57What is more, the application of s 10 and s 146(2) and their relationship with s 146C was not raised nor argued by any party. In those circumstances it would be unjust on the union parties to treat the observation in [41] as anything other than obiter: see Farah Constructions Pty Ltd v Say-Dee Pty Ltd [2007] HCA 22; (2007) 230 CLR 89 at [132].
58A real issue, therefore, arises in the present proceedings as to whether the Commission's power is limited to the extent it may not award increases of less that 2.5 per cent per annum on the basis of economic or fiscal considerations as contended for by the Secretary.
59The issue falls to be determined according to the rules governing statutory interpretation. These rules were referred to in Crown Employees (No 1) and I respectfully adopt what was there said at [21]-[22].
60The process of determining this issue must begin with a consideration of the ordinary and grammatical meaning of the words of the provision having regard to their context and legislative purpose: Australian Education Union v Department of Education and Children's Services [2012] HCA 3; (2012) 285 ALR 27 at [26] per French CJ, Hayne, Kiefel and Bell JJ; Board of Bendigo Regional Institute of Technical and Further Education v Barclay [2012] HCA 32; (2012) 220 IR 445 at [41] per French CJ, Crennan, Gummow and Hayne JJ; Certain Lloyd's Underwriters Subscribing to Contract No IH00AAQS v Thelander [2012] HCA 56; (2012) 293 ALR 412 at [23] per French CJ and Hayne J. Context may also be considered "in a broader sense as including the general purpose and policy of the legislation, in particular the mischief to which the statute is directed and which the legislature intended to remedy.": Certain Lloyd's Underwriters at [88] per Kiefel J. Whilst consideration of extrinsic materials should not displace the clear meaning of the text of a provision, the purpose of a provision may be elucidated by appropriate reference to them: Certain Lloyd's Underwriters at [70] per Crennan and Bell JJ.
61Prior to the introduction of s 146C in 2011, the Commission had a broad discretion in making awards about industrial matters. Section 10 enabled the Commission to make an award "setting fair and reasonable conditions of employment for employees." In doing so, however, s 146(2) of the Act required the Commission to take into account the public interest in the exercise of its functions and, for that purpose, required the Commission to have regard to: "(a) the objects of this Act, and (b) the state of the economy of New South Wales and the likely effect of its decisions on that economy."
62Additionally, s 17(3)(d) of the Act provided:
(3) An award may be varied or rescinded in any of the following circumstances only:
...
(d) after its nominal term if the Commission considers that it is not contrary to the public interest to do so.
63As the PSA submitted, when setting salaries and conditions of employment, the Commission has traditionally taken into account the public interest, including the state of the economy of New South Wales and the likely effect of its decisions on that economy: Re Public Hospital Nurses (State) Award (No 4) [2003] NSWIRComm 442; (2003) 131 IR 17 at [233] ("Nurses (No 4)"); Crown Employees (Teachers in Schools and TAFE and Related Employees) Salaries and Conditions Award [2004] NSWIRComm 114; (2004) 133 IR 254 at [432] ("Crown Employees (Teachers)"); Crown Employees (Police Officers - 2009) Award (No 2) [2012] NSWIRComm 104 at [70]-[72] ("Police Officers (No 2)"). The Commission took economic or fiscal considerations into account as part of the broad discretion it then had to set wages and conditions of employment.
64In Nurses (No 4) the Full Bench held at [233] that:
[233] As the HAC contended, the Commission is required, pursuant to s 146(2) of the Act, to take into account the public interest in the exercise of its functions and, for that purpose, must have regard, inter alia, to the state of the economy of New South Wales and the likely effects of its decisions on that economy. Hence, even though wage increases may be justifiable under the work value principle, if to grant them were to have an adverse impact on the economy, a case may exist for restraint. The onus of demonstrating the need for restraint would fall on those opposing the increase because unless it can be convincingly demonstrated that real harm will be done to the economy by the granting of any increase, the employees concerned are entitled to receive remuneration commensurate with the value of their work.
65In Crown Employees (Teachers) the Full Bench held at [432]:
[432] We note that these statements of principle were adopted in Health Employees Pharmacists (State) Award, and we also adopt them in this matter. The economic and financial position of the State and the effects of our decision on the New South Wales economy have played a significant role in our decision, but not a determinative one. It is our statutory duty to fix fair and reasonable rates of pay and conditions. In a matter, such as this one, where a compelling basis for increases in rates of pay has been demonstrated, then the Commission must give recognition to that conclusion even though it may temper the final result in recognition of economic considerations. The terms of s146 of the Act require no more than this, particularly in the light of the paramount requirements of s10 of the Act. It is those duties that we will discharge in this matter. We shall exercise those duties without fear or favour and in order to do justice between the parties in the light of the evidence and submissions in the proceedings.
66In Police Officers (No 2), the Full Bench stated at [70]-[72]:
[70] When taking into account the public interest, the Commission must also, for that purpose, have regard to "the state of the economy of New South Wales and the likely effect of its decisions on that economy". Whilst that requirement (which is found under s 146(2)(b) of the Act) might not always operate in favour of restraint, the long history of jurisprudence in this Commission and its predecessors would indicate that the provision more often operates as the limitation or restraint in the award making function (particularly in relation to wage fixing) and, in that respect, may, to some extent, be seen as a juxtaposition of the provisions of s 10 of the Act.
[71] There is a long line of cases in this Commission considering the reconciliation of those provisions. We consider that the observations of the Full Bench in Re Public Hospital Nurses (State) Award (No 4) [2003] NSWIRComm 442; (2003) 131 IR 17 at [233] ('Public Hospital Nurses (No 4)') amply set out the relevant principles:
[see Public Hospital Nurses (No 4) above]
[72] It follows from this authority that the submission of the Commissioner to the effect that the Commission should have regard to all factors relevant to the determination of the general claim including economic and, more specifically, fiscal considerations and then make a global assessment of what is a fair and reasonable wage to be determined in the circumstances, should be accepted. In this context, the state of the economy, including fiscal considerations (see Crown Employees (2004) at [471]) will be taken into account in the overall assessment but will not be determinative of the Commission's decision: Crown Employees (2004) at [432].
67In 2011, the parliament removed the Commission's wide discretion to fix fair and reasonable conditions of employment for employees in the public sector. In doing so, the Minister responsible for the Industrial Relations Amendment (Public Sector Conditions of Employment) Bill 2011, which introduced s 146C into the Act, made it clear that the very purpose of the bill was to remove what he described as the Commission's "broad-ranging discretion when it comes to wage fixing." This was "the mischief to which the statute is directed and which the legislature intended to remedy." In the second reading speech (New South Wales Parliamentary Debates (Hansard), Legislative Council, 24 May 2011, p889 et seq) the Minister stated:
Underpinning the need for fiscal restraint is the Government's wages policy. The policy was first introduced by the previous Labor Government in 2007, but that Government failed to implement it. The New South Wales Coalition Government will continue the key provisions of the wages policy introduced by the former Labor Government. However, the Coalition Government has proposed changes to the way the wages policy operates to ensure that the key requirements of the wages policy are actually followed. Our policy and legislative response will ensure that wage increases of 2.5 per cent are available each year to our hard-working public sector employees. Increases in excess of 2.5 per cent are available but will be required to be funded through employee-related savings.
Key elements of the policy require that any increases to employee-related expenses exceeding 2.5 per cent per annum, including wages, allowances, superannuation and conditions of employment, must be funded through employee-related cost savings that have been achieved. Details of the savings measures used to fund increases in excess of 2.5 per cent are to be detailed in the award or agreement where that is appropriate....
...
The Industrial Relations Commission has rejected key aspects of the 2007 wages policy on a number of occasions. In the 2008 public servants salaries case the Government accepted the Industrial Relations Commission's strong recommendation for the settlement of the Public Service Association's claim. The recommendation provided for increases of 4 per cent per annum over three years and committed the Government and the union to achieving a range of employee-related cost offsets that were not identified at the time. The Government and the union then reflected the commission's recommendations in a memorandum of understanding. A subsequent decision by the commission in 2010 regarding the interpretation of the memorandum constrained the areas of employee-related cost savings the Government was able to pursue, severely limiting the opportunity for public sector agencies to pursue significant savings through industrial reforms.
In the December 2010 State Wage Case decision the Full Bench of the Industrial Relations Commission specifically rejected the basis for the Government's wage policy requirement to limit wage increases that did not contain additional offsets to 2.5 per cent. At the same time the commission also created a new productivity and efficiency wage fixing principle to allow unions to seek potential wage increases independent of the need to identify employee-related savings, and that is directly at odds with the former Government's policy and our Government's policy. Presently, the Industrial Relations Act 1996 provides the Industrial Relations Commission with broad discretion to determine public sector wage outcomes that do not accord with government wages policy.
I now turn to elements of the bill. The primary amendment to be made to the Industrial Relations Act is the insertion of a new section 146C containing the explicit requirement that when making or varying awards or orders the commission must give effect to the Government's policy on conditions of employment for the public sector as declared under the regulations....
Under the current framework of the Industrial Relations Act, the Industrial Relations Commission is required to have regard to a range of matters in the exercise of its functions. These include the objects of the Act in section 3, the instruction in section 10 to make awards setting fair and reasonable conditions of employment for employees, the public interest provisions in section 146, and the state of the economy of New South Wales and the likely effect of its decisions on that economy, also in section 146. That is already in the Act. The commission also applies a set of wage fixing principles that set out the circumstances in which wage increases can be awarded. These are applied when the commission deals with public sector awards, which are not affected by the minimum wage increase set in the general State Wage Case.
As can be seen, the commission exercises a broad-ranging discretion when it comes to wage fixing. This environment is conducive to submissions that the Government's wages policy should be disregarded or that other considerations are more significant than the wages policy. As outlined earlier, the Government's wages policy is designed to ensure fiscal discipline and to protect the budget bottom line, therefore ensuring that services and other commitments of the Government to the citizens of this State are able to be delivered. It is not a good outcome for New South Wales when government wages policy is disregarded. That is why the bill includes the new requirement in section 146C (1) that in public sector matters the Industrial Relations Commission's prime objective is to give effect to the Government's wages policy. This will support the achievement of the Government's budgetary objectives.
The objective is supported and strengthened by subsection (3) of proposed section 146C, which provides that any award or order that is inconsistent with the declared wages policy of the Government will be of no effect. The amendment also includes very specific words to ensure that its intention may not be subverted by reference to section 146 or any other provisions of the Act. This is found in proposed subsection (7). In order to make it clear to the commission what the amendment requires it to do, the relevant elements of the policy will be declared in the regulations....
...
The amendments in this bill will ensure that the Industrial Relations Commission of New South Wales has a central role in providing New South Wales public sector workers with fair and reasonable wage increases, while also ensuring that the New South Wales Government contains expenses, provides efficient service delivery and invests taxpayers' money wisely.
68It is abundantly clear that as a consequence of the 2011 amendments to the Act and the promulgation of the Regulation that the Commission is no longer able to apply the test of "fair and reasonable" in s 10 to the task of public sector wage fixing according to the Commission's assessment of what that test entails. Instead, the Commission is required to give effect to the Government's wages policy as declared under the Regulation, which for all practical purposes limits any increase in remuneration to 2.5 per cent per annum.
69This effect was described by the then Minister in his second reading speech as providing "New South Wales public sector workers with fair and reasonable wage increases." In these circumstances, there is no scope to apply a "fair and reasonable" test that is in any way inconsistent with what is required under s 146C and the Regulation. To that extent the award making power under s 10 is qualified by s 146C.
70The practical effect of this is that where there is contest about whether the annual wage increase to be awarded to public sector employees should be 2.5 per cent or less, the Commission will be required to apply the fair and reasonable test and the tests in s 146(2). I say more about this below in my consideration of the applicability of s 146(2).
71That is not to say s 10 of the Act (and s 146) may no longer be applied in the manner it was prior to the s 146C amendment. Local Government awards, for example, remain within the Commission's jurisdiction. In fixing conditions of employment under those awards the Commission is bound to apply s 10 (and s 146) of the Act.
72As is the case with s 10, s 146C and the Regulation have qualified the public interest test in s 146(2) of the Act insofar as public sector awards are concerned. However, I am unable to agree with the PSA's submission that s 146C and the Regulation wholly displaces s 146(2).
73In pursuit of its contentions, the PSA referred to the "NSW Public Sector Wages Policy 2011" (see Premier's Memorandum M2011-10) ("the Wages Policy"), which was said to underpin s 146C and the Regulation. The Wages Policy provides that:
1.1. The primary aim of this policy is to ensure better services and value for the public. In this context, the Government is committed to a policy of fair working conditions and allowing increases in remuneration and other conditions of employment that do not reduce services and are consistent with maintaining fiscal sustainability.
1.2. Since 1997 real average wage increases in the NSW public sector have increased by 21.9 per cent. The policy is designed to maintain the real value of public sector wages over the medium term in line with the mid-point of the Reserve Bank of Australia's target range for inflation over the cycle.
74Consistent with the Regulation, the Wages Policy provides:
3.1.3. Public sector employees may be awarded increases in remuneration or other conditions of employment that do not increase costs by more than 2.5 per cent per annum.
3.1.4. Increases in remuneration or other conditions of employment that increase employee related costs by more than 2.5 per cent per annum can be awarded, but only if sufficient employee related cost savings have been achieved to fully offset the increased employee related costs.
75The aim of the Wages Policy is self-evidently to strike a balance between providing "fair working conditions" and ensuring that increases in remuneration and other conditions of employment do not reduce services and are consistent with maintaining fiscal sustainability. As paragraph 1.2 of the Wages Policy states:
The policy is designed to maintain the real value of public sector wages over the medium term in line with the mid-point of the Reserve Bank of Australia's target range for inflation over the cycle.
76According to the PSA that Wages Policy, which is reflected in the Regulation, would not permit the Commission, as it has previously done under s 146(2)(b), to have regard to changes in work value, or improvements in productivity, or inflation, or changes in the cost of living, or the effect of salary increases upon the economy, or the fiscal position of the State Government on each occasion a claim is made for an increase in wages or other employment conditions in public sector awards.
77The PSA submitted that the rationale for a regulation that makes available increases in remuneration or other conditions of employment that do not increase employee-related costs by more than 2.5 per cent per annum is to "maintain the real value of public sector wages over the medium term in line with the mid-point of the Reserve Bank of Australia's target range for inflation over the cycle." Any annual adjustment to public sector award wages that takes into account the Government's fiscal position, or annual movements in the CPI, would be inconsistent with the policy underpinning the Regulation.
78In other words, as I understood the PSA's submission, in striking a balance between fair working conditions and fiscal sustainability, the Government has determined this is to be achieved by maintaining the real value of wages "over the medium term" (not year on year) in line with the Reserve Bank's inflation target "over the cycle". The balance is to be achieved by making available increases in remuneration or other conditions of employment that do not increase employee-related costs by more than 2.5 per cent per annum. If the Commission were to give unqualified effect to s 146(2)(b) and discount the 2.5 per cent based on the Government's fiscal position in any one or more years, it would be inconsistent with the policy rationale underpinning the Regulation and real wages could not be maintained in accordance with the Policy over the medium term. The balance sought to be achieved under the Policy would be placed out of kilter.
79The PSA's further submission was that it is evident from the Minister's second reading speech that the Government regarded the public interest as being to "ensure fiscal discipline and to protect the budget bottom line, therefore ensuring that services and other commitments of the Government to the citizens of this State are able to be delivered" whilst at the same time ensuring that "wage increases of 2.5 per cent are available each year to our hard-working public sector employees." According to the PSA, that necessitated removing the Commission's "broad-ranging discretion when it comes to wage fixing..." In removing that discretion the parliament, in effect, modified the public interest test in s 146(2) so that the test is subordinated or made subject to the Government's policy referred to in s 146C and the Regulation the effect of which is described above. This was said to be confirmed by s 146C(7), which provides:
(7) This section has effect despite section 10 or 146 or any other provision of this or any other Act.
80If I could commence in dealing with this aspect of the PSA's submission by referring to the decision of the High Court in Public Service Association and Professional Officers' Association Amalgamated [Union] of NSW v Director of Public Employment at [17], where French CJ stated:
[17] Sections 10 and 146 of the IR Act are expressly subordinated to s 146C by operation of s 146C(7) and thereby to any declared policy upon conditions of employment. That is to say, the constraint imposed on the award-making power by s 10, that it relate to "fair and reasonable conditions of employment", may be displaced or qualified. So, too, may the requirement, in s 146, to have regard to the objects of the IR Act, the state of the economy of New South Wales and the likely effect of the Commission's decision on that economy. In effect, a policy declared by a regulation made under s 146C may pre-empt judgments by the Commission of those matters....
81The PSA's submission would have it that s 146C and the Regulation "displaced", that is, replaced or rendered inoperative s 10 and s 146, rather than qualified those provisions. That cannot be so because to adopt that construction would render s 146(1) nugatory, which cannot have been the legislature's intention given that provision identifies the general functions of the Commission.
82However, I think the main flaw in the PSA's submission is that it relied too heavily on extrinsic material, namely parliamentary statements, instead of the words of the legislation, to contend s 146(2) had been displaced.
83I referred earlier to the second reading speech where it was said the government would ensure "wage increases of 2.5 per cent are available each year to our hard-working public sector employees." In August 2011, in a debate regarding a motion to disallow the Regulation (Hansard, Legislative Council, 3 August 2011), it was stated by the then Minister for Industrial Relations in opposing the motion:
We have guaranteed minimum conditions in relation to annual/eave (sic), sick leave, long service leave, public holidays, parental/eave, superannuation and part-time work entitlements.
The regulation also makes clear that existing conditions of employment in excess of the minimum conditions can only be reduced with the agreement of the relevant parties in the proceedings. Labor's 2007 wages policy had no protections for conditions of employment. Despite the scaremongering from the Opposition, our policy is more transparent than Labor's 2007 policy by clearly guaranteeing the 2.5 per cent increase and minimum conditions.
84Nothing could be stated more clearly about the government's intentions, namely that a wage increase of 2.5 per cent per annum would be guaranteed for public sector employees, as would minimum conditions, including superannuation. That such a guarantee might be made is not surprising given that price increases may vary within the Reserve Bank's target range of 2-3 per cent over the medium term (or even outside the range), thus creating losses and gains in real wage movements. So that whilst public sector employees might be better off with a 2.5 per cent increase where inflation is running at less than that figure and real wages may increase, the employees will be worse off if inflation runs above 2.5 per cent. In choosing the midpoint of the Reserve Bank's target range as the basis upon which wages might increase, presumably it was considered an appropriate amount given that prices were likely to fluctuate above and below this amount, although I note in the past seven years CPI increases have averaged 2.8 per cent per annum.
85However, the guarantee of an annual increase of 2.5 per cent wage increase did not find its way into the legislation. In interpreting legislation the courts must determine what parliament meant by the words it used, not what parliament intended to say: Re Bolton & Others; Ex parte Beane [1987] HCA 12; (1987) 162 CLR 514 at 518; Byrne v Australian Airlines Limited [1995] HCA 24; (1995) 185 CLR 410 at 459; Harrison v Melhem [2008] NSWCA 67 per Spigelman CJ at [14] and [16].
86The policy that the Commission must give effect to in accordance with s 146C is relevantly cl 6(1)(a) of the Regulation, namely, that subject to compliance with the declared paramount policies:
(a) Public sector employees may be awarded increases in remuneration or other conditions of employment that do not increase employee-related costs by more than 2.5% per annum.
87The Regulation does not guarantee an annual wage increase of 2.5 per cent. It states public sector employees "may be awarded increases in remuneration... that do not increase employee-related costs by more than 2.5% per annum."
88The Commission cannot award more than 2.5 per cent (subject to cl 6(1)(b) of the Regulation), but it is open to it to award increases in remuneration of 2.5 per cent or less. Within that narrow scope it seems to me the Commission is bound to apply the provisions of both s 10 and s 146(2) of the Act and there is nothing in s 146C or the Regulation that would make it inconsistent for the Commission to apply those provisions.
89I acknowledge the PSA's submission that underpinning the Regulation is a Wages Policy that is aimed at striking a balance between fair working conditions and fiscal sustainability, and in that respect the government has determined this is to be achieved by maintaining the real value of wages "over the medium term" in line with the Reserve Bank's inflation target "over the cycle". As I have already observed, according to the PSA that objective is inconsistent with applications to the Commission on a yearly basis to fix wage increases at a level less than 2.5 per cent. That is to say, because the government has fixed on 2.5 per cent to maintain the real value of wages "over the medium term", if the Commission were to interfere with that amount on the basis of fiscal and economic considerations, the objective of striking a balance between fair working conditions and fiscal sustainability would not be achieved.
90However, it is only if the government's Wages Policy and the Regulation guaranteed an increase of 2.5 per cent per annum, would the PSA's submission about putting the government's balance between fair working conditions and fiscal sustainability out of kilter, be valid. This would be so because the balance, according to the Wages Policy and Regulation, would be maintained by a guaranteed annual increase of 2.5 per cent. Any interference with that guaranteed increase by the Commission awarding less than 2.5 per cent would be inconsistent with the Policy by upsetting the pre-ordained balance. As I have found, however, the legislation does not provide for a guaranteed wage increase of 2.5 per cent per annum.
91This is not to say the government's policy objective of striking a balance between fair working conditions and fiscal sustainability by maintaining the real value of wages "over the medium term" will necessarily be achieved by applying the Regulation. To maintain real wage levels over the medium term in line with the Reserve Bank's inflation target of 2 to 3 per cent over the cycle, then nominal wages would need to be adjusted (presumably annually) for the effect of prices and this would need to be done in the absence of any arbitrary ceiling on the amount of wage increase that could be made available. If inflation runs at the upper end of the Reserve Bank's target range, between 2.5 per cent and 3 per cent per annum, or exceeds 3 per cent, real wages may not be maintained over the medium term because the maximum wage increase available (subject to cl 6(1)(b) of the Regulation) is 2.5 per cent.
92In those circumstances the government's Wages Policy is merely aspirational and subordinate to the statute and Regulation. That does not mean it is unimportant because as a matter of public interest the Commission should have regard to the objective of maintaining real wages over the medium term in line with the mid point of the Reserve Bank's inflation target of 2 to 3 per cent over the cycle, within the parameters set by the Act and Regulation.
93I find that s 146 and, in particular s 146(2), is not displaced by s 146C. Further, that in determining whether there should be an annual increase of 2.5 per cent or less the Commission, in exercising its wage fixing function, is required to take into account the matters in s 146(2) of the Act, subject to the provisions of s 146C and the Regulation.
94In relation to s 17(3)(d), it provides that an award may be varied or rescinded "after its nominal term if the Commission considers that it is not contrary to the public interest to do so." That provision is not displaced by s 146C, but in applying any public interest test under that provision it must be done in a manner consistent with the policy referred to in s 146C and the Regulation.