Public servants in Prime Minister Tony Abbott's department have been offered a pay rise of just 0.7 per cent a year, less than one-third the rate of inflation.
And the Department of the Prime Minister and Cabinet's 2400 officials must wait a day before they see their bosses' full plans for cuts to conditions and entitlements.
The Community and Public Sector Union condemned the proposal on Wednesday morning, saying it was a "complex, low-ball offer with many, many strings attached".
PM&C staff were told on Tuesday their long-awaited pay offer would be 2.17 per cent over the three-year life of the new enterprise bargaining agreement, but it remains unclear what "genuine productivity offsets" will be proposed.
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There will be an effort to address the gaping pay disparity between long-term PM&C employees and many of the 1700 public servants who were drafted into the department, which was expanded massively in the wake of Mr Abbott's 2013 election victory.
But "pay parity" would only be achieved "over time", senior PM&C executive Ben Neal told staff on Tuesday afternoon. About 950 of the department's public servants will be given access to a pay increment system designed to eventually bring their salaries up their colleagues' level.
It is understood that under the proposed deal, low to mid-ranking staff among the new recruits would not reach pay parity for at least five years, while "core" PM&C bureaucrats would have to accept cuts to their top pay points and slower career progression.
"The department proposes a single pay and classification structure, which will enable us to move towards pay parity over time," Mr Neal said.
He said the deal on offer had taken months to develop before being approved finally by the Public Service Commission.
Mr Neal told workers the raft of claims from the Community and Public Sector Union had been costed at more than $60 million.
"The cost of the EA over the three-year life of the agreement will be around $14 million," he wrote.
"The CPSU's proposed position would cost in excess of $60 million. The department cannot afford this position under any circumstances."
But the union's national president, Alistair Waters, shot back, saying PM&C staff would be much worse off under the proposal.
"It's clear that this pay rise will not keep up with the cost of living," Mr Waters said. "While we have not seen the full list of cuts to conditions, we know from experience that staff will be much worse off under this deal."
Pay disparity has been a sore point for many public servants drafted into PM&C in the government's first round of "machinery of government" changes in 2013.
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, an executive level 1 from the old indigenous affairs department can be up to $19,000 a year worse off than their PM&C colleague.