State sector trade union members are currently being balloted over a new three-year agreement worth 12.8%. The major part (8.17%.) will be spent on general wage increases while 2.2% has been set aside as “pool funding” for other improvements. In addition to this, the regulator mechanism (which ensures a parallel wage development between the public and private sector) and local wage developments will account for 2.23% of the increase. A new element is compensation to state employees for the growth in fringe/staff benefits in the private sector. This is set at 0.2% and means that the wage difference between the state sector and the private sector has been narrowed by 0.2% on a permanent basis. The general pay increase thus amounts to 8.37% over the next 3 years (the 8.17%. in general wage increases plus the 0.2%. compensation for fringe/staff benefits). The agreed wage increases guarantee a real wage development each year. Overall this is the largest wage hike n the state sector in 20 years (since 1987).