Mr Davis did not return repeated calls from The Sunday Age, so it is not known whether cabinet endorsed the strategy. In order to make the savings, the government planned to make nurse-patient ratios - currently one nurse is rostered on for every four patients - more flexible; replace some nurses with low-paid, low-skilled ''health assistants''; reduce the ratio of university-qualified nurses on wards; and introduce shorter shifts and split shifts. Mr Davis's submission reveals that in return for these cuts, which amount to 4 per cent of the nurses' wage budget, nurses would get a pay rise of just 3.5 per cent per year. Police recently received a 4.7 per cent pay rise. The government appears determined to pursue its policy despite its submission acknowledging that interstate nurses ''receive significantly higher pay rates'' than Victorian nurses. Negotiations for the new agreement began in September, and on Friday nurses voted to give themselves the ability to take legally protected industrial action from Thursday.

The government's aim, revealed in the submission, is to have the crisis continue to a point whereby the industrial tribunal, Fair Work Australia, is either called in or steps in because negotiations have broken down and the nurses' action is deemed harmful to public welfare. This would force both parties into arbitration, where the government's push to reduce nurses' conditions is likely to be successful because the tribunal is not permitted under the constitution to tell states the ''number, identity or appointment'' of the workforce they employ. ''[We] believe that a demonstrated preparedness to take such claims to full-blown arbitration (despite the risks involved) is the best means of inducing the ANF to reach an acceptable agreement,'' the submission argues. ''These proposals will be difficult to have agreed in negotiation, but may be successful should the parties end up in arbitration.'' The Australian Nursing Federation's Lisa Fitzpatrick told The Sunday Age the government had adopted a ''sham approach'' to the negotiations. ''They're prepared to force nurses to take industrial action such as bed closures which they then argue is harming the community, and say how terrible the nurses are,'' she said yesterday.

''But this is what they've set out to do all along. It's duplicity of the greatest proportion - more than we've ever seen before.'' Mr Davis's submission details savings of $42 million per year from ''roster/shift flexibility'', $39.3 million by changing nurse ratios and using ''health assistants'', and $19.9 million from ''nurse-patient ratio flexibility''. It says the government wants ''significant replacement [of nurses] at the lower end [of the skill range] by a new generation of assistants'', even though the rate of technological change in nursing ''easily surpasses that experienced by other professionals''. It says more flexibility is required to make sure that ''management prerogative … in relation to workforce planning is enhanced as far as practicable''. At present, state health facilities employ registered nurses who have done a three-year university degree and enrolled nurses who have completed an 18-month TAFE diploma. The government wants to save money on nursing wages by employing unregistered health assistants who have little if any training, similar to personal care assistants who work in the private aged-care sector.

The Austin Hospital is trialling a program whereby health assistants are tending patients on wards, but they are in addition to the existing nurse-patient ratio. Kate Robinson and Kylie Thompson, nurses at the Royal Women's Hospital, said if the government tried to save $104 million from nurses' wages, they would look for different jobs. And Hannah Harris, an enrolled nurse at the Peter James Centre, said the move would create so much stress that ''we're going to lose nurses, surely''. The government has appointed two law firms to manage negotiations. The Fair Work Act requires parties to negotiate in good faith. Ms Fitzpatrick said the union ''needs to get legal advice about whether this constitutes good faith bargaining''. Loading

Ms Fitzpatrick said the union had clear evidence that the government was dragging out negotiations. But when she alleged this in a letter to the Department of Health's director of industrial relations, Tom Olthof, in September, he denied it. ''I note with disappointment and incredulity your statement … that the Department … are not genuinely seeking negotiated outcomes,'' Mr Olthof replied.