Hundreds of Aboriginal public servants drafted into Tony Abbott's department to help "close the gap" are being paid up to $19,000 less than their new white colleagues doing the same jobs.
The Department of Prime Minister and Cabinet has more than 260 Aboriginal and Torres Strait Islander bureaucrats, brought in from the old FaHCSIA department in a plan to bring indigenous policy under the PM's control.
But while the Prime Minister spoke last week of "closing the gap" in indigenous disadvantage in Australia, hundreds of Aboriginal and Torres Strait Islander bureaucrats were settling into their new jobs working for Mr Abbott's department on wages well below those of their new non-indigenous co-workers.
There was more bad news for the department's officials on Friday afternoon as Secretary Ian Watt told his staff that PM&C could not afford to maintain its present staffing levels and that job losses were inevitable.
In another blow to indigenous voices in the federal arena, representative body the National Congress of Australia's First Peoples says it is sacking two-thirds of its workforce, a loss of 23 jobs, after the federal government cut its funding.
The new Prime Minister's Department recruits from the old FaHCSIA department and 854 of the non-indigenous employees have been told they will not be getting the same wages as their new well-paid co-workers at PM&C and will continue to be paid their old salaries.
Wages are about on par for the most junior employees, but there are big gaps further up the pay scale with a mid-level APS6 former FaHCSIA official earning $12,000 less than their PM&C counterpart.
In junior to middle management ranks, a level 1 executive
from the old indigenous department can be up to $19,000 a year worse off than their PM&C colleague.
PM&C is one of the public service's best-paid departments and among its least culturally diverse.
Before its dramatic expansion late last year, the elite "central department" had six indigenous workers from its 800-strong roster and just 22 other employees from non-English speaking backgrounds.
On Friday, a senior PM&C executive went to a meeting of the public service's Indigenous Champions forum in Canberra, but the spokesman for the department refused to say whether its new Aboriginal recruits, or their wages, were discussed. The spokesman said there would be no movement on wage parity among PM&C workers until this year's service-wide enterprise bargaining talks.
Mr Abbott's office did not respond on Friday to requests for comment.
The National Congress of Australia's First Peoples was set up in 2010 with federal funding of $29.2 million over five years but never became financially self-sufficient as had been intended.
In the May 2013 budget, the Gillard government provided a further $15 million in funding to flow over three years. But Indigenous Affairs Minister Nigel Scullion said this week the money would not be paid.
In an email to staff and other stakeholders, the congress's management said the decision would see 23 jobs axed and a reduction in campaign and events activities.
"The withdrawal of funding has forced congress to restructure our current secretariat of 35 dedicated staff to just 12 positions," the email read.
"On behalf of the board and members we thank the staff that will be leaving for helping build and grow congress over the last four years.''