The Federal Tribunal made its recommendation after calls for moderation in wage rises by Prime Minister Fraser.
As well as Federal politicians, the rise will cover top-level bureaucrats and judges, and, if accepted, will be deferred for three months.
It will take the Prime Minister's salary to $127,700.
The Opposition Leader will get over $84,000, and the Chief Justice $98,000.
The Basic MP's salary will be $38,500.
Mr Fraser asked for the below-inflation increase to set an example to industry leaders and unions to moderate pay demands, but early union reaction is unfavourable.
Victorian Secretary of the Metalworkers' Union, John Halfpenny, described the move as economic nonsense.
Jeremy Thompson reporting.
Prime Minister Fraser has arrived in New Zealand on the last leg of his overseas tour.
Mr Fraser will attend the 13th South Pacific Forum in Rotorua today, where he's expected to announce a big increase in aid to the South Pacific.
The two main political issues to be discussed at the Forum will be the future status of New Caledonia and French nuclear tests in the Pacific.
When Mr Fraser arrived in New Zealand, he had to wait 25 minutes in his VIP aircraft because there was no official welcome.
Later in Rotorua, there was another delay when no one was there to meet him either.
Seven federal parliamentarians have told how they were caught in crossfire during the coup attempt in Kenya.
The delegation was on a fact-finding mission in Africa when rebels in Kenya's Air Force tried to take power.
One of the men, Federal Labour MP Barry Cohen, told of how he and his wife were forced to take cover behind stone pillars in a Nairobi hotel's reception lounge when shooting broke out.
During that time, one tourist was shot dead, a woman raped and two members of the hotel staff wounded.
He also told of how a bullet went through the window of John Moore, the former Minister for Business and Consumer Affairs.
Mr Moore was out of his room at the time.
The exiled religious leader of Tibet has arrived in Australia for the first time.
The Dalai Lama is here for a week-long tour. He arrived in Melbourne yesterday.
The 47-year-old Dalai Lama is the spiritual head of Tibet's Buddhists and to them the reincarnation of Buddha himself.
While in Australia, he will talk with scholars and church leaders on his views for world peace and unity between religions.
He'll also address some of Australia's 100,000 Buddhists at public meetings in capital cities.
Sunday trading has finally come to South Australia.
Hundreds of people spent yesterday at the very first pub to win a Sunday licence, the German Arms at Haundorf near Adelaide.
It's allowed to sell liquor from 12 to 2 and from 4 to 6 pm on Sundays.
As an added incentive to day-trippers yesterday, the beer flowed for free during the first half hour.
In Sydney this morning, thousands of people are dragging aching feet out of bed.
Their legacy of yesterday's annual City to Surf Fun Run.
A record 27,000 competitors crammed into William Street for the start of the 14-kilometre race to Bondi Beach.
For many, the object was to enjoy the race as much as possible.
But there were serious competitors. The winner, Olympian Steve Austin of Victoria, who came home in 41 minutes, 42 seconds.
A time well outside the race record set last year.
In other headline news, Australia's Distilled Spirits Industry Council wants a 17.5% tax on wine in the budget.
Industry and Commerce Minister Philip Lynch meets representatives of steel importers and users today to discuss increased import protection for BHP.
The former Sydney Harbour ferry, Kosciuszko, has been burnt to the waterline in suspicious circumstances in Tasmania.
The US nuclear warship Goldsboro arrives in Sydney at 9 o'clock this morning.
Overseas, doctors in Turkey have fought to save the life of an American guerrilla involved in yesterday's attack on Ankara Airport.
They hope he'll be able to give authorities vital information about the raid.
One guerrilla and at least five other people died in the two-hour drama.
The terrorists threw bombs into the terminal and took hostages before being overpowered by security forces.
Also overseas, a 21-year-old black man charged under South Africa's security laws has been found hanged in his cell in Johannesburg Police Headquarters.
He's believed to be the 47th person to die in police custody.
World Formula One champion Nelson Piquet came to blows with a fellow driver when a crash robbed him of the lead in the West German Grand Prix.
The Brabham driver had led from the start and by the time the accident happened in the 18th lap, he was about 30 seconds ahead.
His sixth position and out goes Piquet. My goodness! It seems that the Brabhams are fated and he has hit Eliseo Salazar and he's furious.
The Brazilian and the Colombian driver, I couldn't help it, says, and take back. Oh my goodness!
Well, Nelson Piquet understandably slivid with rage.
The race was eventually won by Frenchman Patrick Tambay. He finished more than two minutes ahead of countryman René Arnoux.
Third was Kiki Rosberg. Rosberg now moves into third place in the Drivers' Championship.
With Peroni out of action for the rest of the season after his crash in the practice rounds, Britain's John Watson is the effective leader.
Now for the latest on the American PGA Championship, we cross to our Golf Studio for the leaders at the moment.
Ray Floyd still has a commanding lead. He's seven under par. Australia's Greg Norman is four under par.
With Calvin Peat, also four under par. And Wadkins, also four under par. Haas, Couples and Simons are all three under par.
The fleet of tall ships which set sail from Britain two weeks ago has started arriving in Lisbon, Portugal.
It's the halfway point in one of the world's most spectacular ocean races.
The tall ships are worth millions, yet in this race they're crewed mainly by young hopefuls on their maiden voyages, tasting the wind-jumming way of life for the first time.
Sail training forges character very quickly, makes men out of boys and sometimes girls, and generally gives them a rough time before the mast.
The youth of many countries, heavily disciplined, eager to please and at this point in the race heading back to Britain with all the seasickness behind them and new friends won from the teamwork of sailing.
And for those who think it's all an expensive waste of time, marine experts are now saying if fuel prices keep going up, sailing ships will return in force to world trade routes by the end of the century.
And finally two of America's most famous feuding families have met to celebrate the 100th anniversary of their feud.
The Hatfields and McCoys disagreed over the Civil War, so much so that the two clans killed or wounded 100 family members.
100 years later, it's peace and friendship, although they've promised a taste of the old rivalry when they meet next weekend for a local football game.
That should be worth watching, Brian. Good morning, Brian Beurie.
Good morning, Eric. Good morning, ladies and gentlemen. It certainly would be. Look at this, a beautiful shot of Sydney. That's at Kirribilli.
The fishermen are out and they're ready to get the morning's catch there. Kirribilli is a beautiful place. It's just round the corner from Lavender Bay.
Hence the song, Lavender Bay Kirribilli. You all know it.
Mandy Chivers of Doonside in New South Wales, a very happy day to you. We've dedicated the day to you.
Sunrise in Sydney was magnificent. Someone pick Steve up, please. He's just fallen down.
Perth today, fine and partly cloudy. Southerly winds and the top temperature of 17. Broad about the southerly winds by that cold front.
Look at it and the low pressure systems associated with it. Rather strong.
But I just wonder if the high pressure system will be strong enough to keep it out and send it down to the southeast to the Tasmanians.
In Adelaide today, it will be beautiful. Fine at first with northwesterly winds. A shower or two will develop later.
And the farmers would like a bit of it out in this way too into the Riverland area.
But the showers will develop in the city later and the top temperature of 22. Beautiful spring type weather.
Hobart, fine and mild. Cloud increasing. Rain developing tonight.
Northwest to northerly winds. They'll become very strong and gusty during the morning.
But tending cold as southwest at least tonight. But before that, 19. Barmy in Hobart.
Melbourne, fine, mild to warm and mainly cloudy. Fresh to strong, gusty, northerly wind.
And the top temperature of 20 degrees. A beautiful day in Melbourne too.
Canberra will be fine with light to moderate northwesterly winds and a maximum of 19.
Now Sydney will be cool to mild. Increasing high cloud. Won't have too much to do to keep the sun out though.
Light winds. Moderate north to northeasterlies and 17. A shower or two in Brizzy today.
But a fine day. Brisbane and a top temperature of 21. Brizzy is a term of endearment. Don't get upset.
Outer Springs fine and 25. Darwin fine and 32. So that's our glorious Australia today, Stephen.
Thank you, Brian. Lavender Bay, curability. Patent that one, mate. They'll be lining up the steel at later this morning.
We'll take a break now and then we'll be back to talk with Sam Lipsky about the latest moves in the Israeli War with the Palestinians.
The great Australian miseries can hit just about any time of the year.
Yet somehow it always feels like winter. Your head feels stuffy and your throat feels sore.