Thanks for the top tips, gents, but I've seen plenty of the CPI basket mix and how it has changed over the years as part of my macro studies at business school. 7% on education may not be what you pay, but it is extremely close to what the average household pays. I guess not everyone chooses to spend their money on expensive private schools? I never said CPI was "flat" so I have no idea why you wrote "If the true CPI was flat..."
As for the RBA target, it's actually 2-3%. not 3%.
RBA: Inflation Target
Sure, CPI is not perfect. But it's a hell of a lot more relevant than AWOTE if you're going to discuss a pay freeze and its impact.
Derfred, I'd be happy to see your "plenty of evidence" why pay rises are "bench marked" (by who?) against 3%. I guess no one has told Borghetti that in his latest offers to staff!