Ideally, you should not have a conversation with a prospective employer about salary or benefits until you have received an offer, or at least reasonably anticipate receiving one. You will be in the best position to negotiate once the organization is convinced that you are the right person for the job.
However, some employers will bring up the topic far earlier in the process, even as soon as the first interview, for two reasons. Public sector employers may have a very limited budget for hiring and want to ensure that you are willing to consider the salary being offered before wasting your time and theirs by continuing with the interview process. Similarly, private sector employers may be paying below the market compensation.
What should you say if you are asked about your salary requirements? Start by saying that your requirements are negotiable, and that you are certain that the organization pays a fair market rate. You can also say that your primary concern is with the position itself and your “fit,” and that you would be happy to discuss compensation once you have both decided that you are the right person for the job. If the interviewer continues to push the issue, you could then ask for the range budgeted for the position.
Ideally, you want the interviewer to state numbers first. If you are forced to put numbers on the table first, state a very broad range. The danger in naming a range from the outset is that almost always, if you get the job, you will be offered a salary at the lowest end of the range you indicated.