Police are effectively taking a pay cut because of Government budget slashing, Labour's Kris Faafoi says.

Officers have voted for a "modest" pay increase - which will see no extra money next year and lags behind inflation.

Police Commissioner Peter Marshall confirmed yesterday the service had reached an agreement with the Police Association after weeks of talks.

The three-year agreement sees no increase for the first year followed by a 1 per cent increase for years two and three. This is against inflation forecasts of about 2 per cent over the next three years.

Faafoi, Labour's police spokesman, says frontline officers have been forced to sign up to a pay deal and the negotiations have caused ''genuine upset with many officers feeling like they are being stretched in terms of time, resources and now their wages.''

He said the "cut" will have a negative effect on the frontline.

"The Government tried to lay blame with front-line officers for the pressures on the police budget with scare tactics ahead of negotiations. Now, our cops are being lumped with a pay cut,'' he said.
 
Marshall said the agreement was ''fair and reasonable in the current economic climate.''

Police Association president Greg O'Connor said police were ''pragmatists.''

''It reflects the time we are in and what is happening in our industry.''

All existing conditions remained the same, he said.

Police Minister Anne Tolley congratulated the negotiating teams involved for ''their calm and sensible approach.''

''This agreement allows everyone involved to concentrate on preventing and reducing crime in our communities,'' she said.

With no new money in May's Budget the service must stick to an annual budget of $1.4 billion, and about 70 per cent goes on wages.

Police managed to stave off any budget cuts by agreeing to ambitious new targets to cut crime, through innovative policing methods and increasing frontline hours.

The wage round talks threatened to turn sour after a series of leaks and counter leaks. It was claimed the force faced a $350m shortfall, with station closures threatened.

Figures detailing the number of police officers paid over $80,000 a year then appeared on a National-aligned blog and a leaked letter suggested the executive wanted to introduce performance-related pay.

Projected CSI increases alone will cost $170m over four years, forcing police to find savings in other areas, such as back office functions.

It was announced earlier this year that 126 non-sworn posts would be cut.

Earlier this year Marshall signalled the closing of some police stations was a possibility, but there were no plans in train.

He also pledged no frontline staff would lose their jobs. Police graduates start on a salary package worth about $58,000, rising to just over $76,000 after five years.

Finance minister Bill English said police have been ''constructive'' and can now focus on cutting crime rates.

- © Fairfax NZ News