As the Baillieu government announces public sector layoffs, the Municipal Association of Victoria reveals wages for the state's council employees have been rising faster than those in most sectors outside the mining industry.

By PHILLIP PENG

WAGES for Victorian council employees have been rising faster than many other sectors in the economy, according to the Municipal Association of Victoria (MAV).

Chief executive officer Rob Spence said people employed by local councils in the state had seen salaries rise by 5.1 per cent each year between 2009 and 2011.

Pay increases to Victorian council works were higher than those of the public sector as a whole in the same period, growing Australia-wide by 4.3 per cent a year. In the private sector wage increases for 2009-2011 averaged 4.6 per cent.

"[It’s] certainly above what we would see in sectors probably outside the mining sector," Mr Spence said.

The revelation comes just weeks before local council elections and as the Baillieu Government prepares to lay off thousands of state public servants.

Bureau of Statistics figures also show that total spending on employee expenses by all local governments in Victoria grew 8.9% per year last decade compared to 7.2% in the state government.

But Mr Spence defended the growth in wages.

"A lot of this comes out of enterprise bargaining agreements… they have productivity movement and have pay rate movement in them."

But critics say the higher growth in pay has contributed to a $396.9 million shortfall facing the previous defined benefit superannuation scheme that local governments are still liable for, because investment income has not grown as fast as wages and inflation.

78 of the 79 Victorian councils will hold their elections on Saturday October 27.