The government told the commission it believes the likelihood of “below trend economic growth, subdued wages growth and a labour market that remains under competitive pressure suggest a limited scope for wage increases”.

About 18 per cent of Queensland employees, or 340,000 workers, rely on the federal award system, which currently, has the minimum wage set at $622 a week. Unions have called for a weekly increase of just under $30 but employer groups have requested a freeze.

The state government submitted a cautious approach would help achieve its 4 per cent unemployment target by 2018.

It wrote that global growth, despite a predicted rebound, was still predicted to be lower than historical average over the next two years and the drought, combined with lower prices, would see a reduction in agricultural exports over the same period.

”Domestically, the staged completion of three major LNG projects will cause business investment to fall in each year, from 2013-14 to 2015-16. This will restrain overall economic growth in both 2013-14 and 2014-15, despite an anticipated strong recover in dwelling investment in these two years,” the government submitted.

“LNG exports are expected to ramp up by 2015-16, which will boost the state's economic growth in that year.

“...For Queensland, the major domestic risk surrounds the timing and pace of the unwinding of LNG investment due for completion between 2014 and 2016. Given the large size of the three LNG projects, any pick-up in growth from other parts of the economy may not be enough to prevent economic growth slowing more rapidly than currently expected, especially in 2014-15.”

The combination of these factors, combined with the “current weakness in labour conditions” prompted the government's wariness.

“The Queensland Government submits that the economic outlook remains subdued for the course of 2013-14 and that declining multifactor productivity growth on average over the five years to 2012-13 does not support an increase in real wages.”

But it did recommend the pay rates for Queensland's apprentices and trainees be increased in line with federal pay rates, in support of “a nationally consistent fair minimum wage safety net”.

The government's submission comes as the state's Independent Remuneration Tribunal recommended a substantial pay rise for Queensland MPs who are office bearers, which includes committee members. The tribunal determined Premier Campbell Newman was to receive a 21.67 per cent pay increase, or just under $70,000, taking his salary to $379,160. Ministers received a 27.9 per cent pay rise, or $67,640 taking their pay to $310,066, which mirrored the increase received by Opposition leader Annastacia Palaszczuk.

The Labor caucus voted to reject the pay rise and are looking at ways to donate the additional pay, if the government does not change the legislation to send the tribunal back to the drawing board.

Government MPs have ruled that out, saying that intervening with the tribunal's decision would impede its independence.

Submissions to the Fair Work Commission have closed. It is due to hand down its decision in June.