It’s the pay rise you have when you’re not having a pay rise.

The Department of Human Services (DHS) has officially offered close to 30,000 of its staff a conditional and conspicuously below-inflation increase on present salaries that sets the stage for a major industrial confrontation across the federal public service.

In a statement issued on Thursday, DHS General Manager, Hank Jongen said that “an offer of a 1.5 per cent pay increase in year one, 1.5 per cent in year two, and 0.55 per cent in year three,” had been put to staff, with the possibility of it being put to a vote “within the next two weeks.”

With Australia’s inflation officially rate hitting 3 per cent this week, the government must now try and persuade a bureaucracy already reeling from mass redundancies that a largely notional increase in money is better than none; even if take-home pay could clearly go backwards.

In a move clearly intended to accelerate what could otherwise be a highly protracted negotiation with the Community and Public Sector Union, DHS management has attached a 1st September 2014 deadline for acceptance of its first pay offer.

Credible reports in The Canberra Times had put the DHS base offer at 2.3 per cent over three years with a 1.25 sweetener contingent on the signing date and a reduction of manager-to-staff ratios.

The flurry of numbers and what they boil down appear to have prompted DHS to try and add some context, and its own voice, to what otherwise looks a deliberately provocative move.

“A 1.15 per cent pay increase in year one and 0.75 per cent pay increase in year two (as reported) would only apply if the new agreement commences on or after 1 September 2014 and we don’t meet the workforce profiling ratio of 1:9,” DHS’ Mr Jongen said.

The CPSU on Wednesday advised its members to reject the offer, saying it was “far worse than expected”, sought “major cuts to important workplace rights and conditions” and would “leave DHS staff much worse off than they are now.”

The union has also told members that DHS has informed it that the department will be “putting the proposed agreement out to staff for formal consideration next week.”

So far Public Service Minister Senator Eric Abetz is keeping shtum on the Abbott government’s wider intentions for enterprise bargaining across other agencies.

But the DHS enterprise bargaining round is quickly shaping-up to be a defining battle for the Abbott government’s future workplace relations agenda.

At the same time, the conspicuous ministerial silence means it has been left to senior public servants to take the heat on industrial reforms.

Government sources have also indicated there is no intention to provide a “running commentary” on individual negotiations as they played out across each department and agency.

Not so the Opposition, who immediately put the boot into the DHS offer and immediately invoked the ghost of Work Choices, albeit not directly by name.

“Mr Abbott is using the public service as a test-bed for his extreme industrial relations agenda and that should worry all Australian workers,” said Shadow Employment and Workplace Relations Minister, Brendan O’Connor.

Labor Senator Doug Cameron was more focused on how DHS could get more out of its existing resources by focusing on innovation rather than headcount and pay packets.

“This government is focused solely on cost-cutting, which ignores key drivers of efficiency, productivity and customer service,” Senator Cameron said.

“Negotiations should be focussing on drivers of productivity such as workforce skills, investment in technology, improved management systems and work organisation and a strong customer focus.”

Senator Cameron said the government’s “aggressive tactics” in negotiating an employment agreement with Department of Human Services staff was “a disturbing sign of things to come for public servants across Australia.”

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