Dris proposal for national licensing of the electrical occupations

Wage rate

A jurisdiction-specific wage rate has been used in the model, based on data available from the Australian Bureau of Statistics relating to ‘Employee earnings and hours’.⁸³

Hourly cash earnings

The figure for hourly cash earnings for electricians has been sourced from the Australian Bureau of Statistics (Employee Earnings and Hours Catalogue 6306.0, using the Australian and New Zealand Standard Classification of Occupations (ANZSCO) Codes.

According to the ANZSCO code 341, electricians design, assemble, install, test, commission, diagnose, maintain and repair electrical networks, systems, circuits, equipment, components, appliances and facilities for industrial, commercial and domestic purposes; and service and repair lifts, escalators and related equipment. ANZSCO suggests that an indicative skills level for this occupation is an Australian Qualifications Framework Certificate III, including at least two years of on-the-job training; or an Australian Qualifications Framework Certificate IV.⁸⁴ It is acknowledged that these wage rates are likely to overestimate the wage rate for apprentices.

The hourly cash earnings rates below are based on ordinary time worked per person (excluding overtime), based on the specific hours worked in each jurisdiction.⁸⁵

It is assumed that, as the activities involved with national licensing are ancillary to employment, the cost of time is the wage rate that can be earned in the industry (i.e. hourly cash earnings).

On-cost and overheads

According to the Australian Bureau of Statistics (Labour Costs Survey 2002–03), an on-costs multiplier of 1.172 is appropriate for the ‘electricity, gas and water supply’ industry, which includes:

• 
  employee earnings
  
• 
  superannuation
  
• 
  payroll tax
  
• 
  workers’ compensation
  
• 
  fringe benefits tax.⁸⁶
  

In the absence of any other information, the Victorian Competition and Efficiency Commission guidance note suggests that an overheads multiplier of 1.5 is appropriate.⁸⁷ The Victorian Competition and Efficiency Commission suggests that overhead costs include building costs (floor space, fixtures and fittings maintenance and services), equipment, consumables, IT and other support services, administrative support and corporate overheads (senior management, corporate finance, human resources and legal services).

Due to the characteristics of this industry, including a high proportion of self-employed individuals who have lower overheads and fewer on-costs (i.e. no payroll tax and superannuation benefits) an overheads and on-cost multiplier of 1.5 is applied to the hourly cash earnings of electricians.

Inflation rate

In order to inflate the hourly cash rates to 2012 dollars, the national consumer price index (CPI) for the period March 2010 to December 2011 was used based on data from the Australian Bureau of Statistics (Catalogue 6401.0).⁸⁸ Please note that the national CPI figures have been used (December 2011 was the most recent CPI figure available at the time of writing this Decision RIS).

While ideally the wage rates would be inflated to 1 July 2012 (as the net present value is calculated as at 1 July 2012), the most recent data available when writing this report was CPI figures from December 2011.

Table H.4: Wage rate assumptions

Assumption	Unit	Value	Source
Hourly cash earnings
NSW	$ per hour	$25.70	Australian Bureau of Statistics, Employee Earnings and Hours, catalogue 6306.0, May 2010, Australian and New Zealand Standard Classification of Occupation (ANZSCO) Code 341 ‘Electricians’, Table 1B Note: Based on ‘ordinary time per person’ (excluding overtime)
Vic	$ per hour	$30.60	Australian Bureau of Statistics, Employee Earnings and Hours, catalogue 6306.0, May 2010, Australian and New Zealand Standard Classification of Occupation (ANZSCO) Code 341 ‘Electricians’, Table 1C Note: Based on ‘ordinary time per person’ (excluding overtime)
Qld	$ per hour	$31.30	Australian Bureau of Statistics, Employee Earnings and Hours, catalogue 6306.0, May 2010, Australian and New Zealand Standard Classification of Occupation (ANZSCO) Code 341 ‘Electricians’, Table 1D Note: Based on ‘ordinary time per person’ (excluding overtime)
WA	$ per hour	$34.40	Australian Bureau of Statistics, Employee Earnings and Hours, catalogue 6306.0, May 2010, Australian and New Zealand Standard Classification of Occupation ANZSCO) Code 341 ‘Electricians’, Table 1F Note: Based on ‘ordinary time per person’ excluding overtime)
SA	$ per hour	$29.00	Australian Bureau of Statistics, Employee Earnings and Hours, catalogue 6306.0, May 2010, Australian and New Zealand Standard Classification of Occupation (ANZSCO) Code 341 ‘Electricians’, Table 1E Note: Based on ‘ordinary time per person’ (excluding overtime)
Tas	$ per hour	$34.50	Australian Bureau of Statistics, Employee Earnings and Hours, catalogue 6306.0, May 2010, Australian and New Zealand Standard Classification of Occupation (ANZSCO) Code 341 ‘Electricians’, Table 1G Note: Based on ‘ordinary time per person’ (excluding overtime)
ACT	$ per hour	$36.60	Australian Bureau of Statistics, Employee Earnings and Hours, catalogue 6306.0, May 2010, Australian and New Zealand Standard Classification of Occupation (ANZSCO) Code 341 ‘Electricians’, Table 1I Note: Based on ‘ordinary time per person’ (excluding overtime)
NT	$ per hour	$38.70	Australian Bureau of Statistics, Employee Earnings and Hours, catalogue 6306.0, May 2010, Australian and New Zealand Standard Classification of Occupation (ANZSCO) Code 341 ‘Electricians’, Table 1H Note: Based on ‘ordinary time per person’ (excluding overtime)
On-costs and overheads multiplier
On-costs and overheads multiplier	Multiplier	1.5	Assumption based on Australian Bureau of Statistics ‘Labour Cost Survey’ data and guidance material from the Victorian Competition and Efficiency Commission.
Inflation rate (May 2010 to December 2011)
Inflation rate	%	4.91%	Australian Bureau of Statistics, Catalogue 6401.0 – Consumer Price Index, Australia, December 2011 Note: Inflation index from March 2010 (index number of 171.0) to December 2011 (index number of 179.4).