South Australia's nurses and midwives warned on Monday that they may still go on strike if negotiations with the state government over pay raise, staffing and workload fail.

Negotiations between the government and the Australian Nurses and Midwives Federation (ANMF) suffered a setback Monday when the group rejected a new pay offer by the state. Industrial Relations Minister Paul Holloway and ANMF SA secretary Elizabeth Dabars refused to divulge the amount of the offer.

Holloway expressed confidence that an agreement would be reached with ANMF accepting its offer. Dabars admitted that the offer was better than what they were expecting but staffing and workload issues have yet to be resolved.

The federation is demanding pay increases equivalent to 9 percent over the next three years. It also demanded changes in the staffing and workload.

The next meeting between the two sides is on Friday.

If no agreement is reached, Dabars said union members will decide what action to take. ANMF is considering stop-work meetings and bans on non-elective surgery admissions, answering of phones and enforcing overtime and meal breaks.

State Treasurer Kevin Foley said the government needs to cut its budget because revenue was down as a result of the global financial crisis.