Minimum wage rise less than inflation

Fair Work Australia this week lifted the minimum wage by $26 a week or 69c an hour. The minimum wage is now $15 an hour or $569.90 per week. Whilst the agreement was greeted by the ACTU as a very good outcome for working Australians, it actually represents a cut in real wages, the 4.8 percent increase is below the official Consumer Price Index, which has risen 5.4 percent over the past 21 months since the last rise.

About 1.4 million award-dependent workers are affected by the FWA ruling, including about 100,000 on the National Minimum Wage. They are the country’s worst-paid workers—including child care workers, shop assistants, cafe and restaurant workers, labourers, office staff and cleaners.

The position of the ACTU is particularly outrageous. The $26 an hour rise is only one dollar less then the ACTU had asked Fair Work Australia (FWA) to award, despite the rise equating to a cut in real wages. In an election year, Jeff Lawrence, ACTU Secretary has made no attempt to disguise the Union’s response as anything other than shameless campaigning for the ALP. In the ACTU press release responding to the rise he states ““The increase in minimum wages is a testament to the economic management of the Labor Government, which saved 200,000 jobs in the global downturn and is predicted to create 450,000 new jobs over the next two years.” He went to describe the desultory pay increase as ““It delivers the decent rise to minimum wages that working families need and is further indication that working Australians are much better off under the Labor Government’s new Fair Work laws.”

This response is pathetic given that welfare agencies had called for a much greater rise in wages of 9% or $49 a week just to make up for the cuts in wages that occurred under Howard’s Australian Fair Pay Commission.

According to the World Socialist Web’s,Noel Holt,
“Deputy Prime Minister Julia Gillard said she was pleased by the pay ruling, saying that the increase of around $6 a week above inflation would “no doubt be welcomed by those who are paying their mortgage or rents, and buying the family groceries”. Last year, she urged workers to accept the pay freeze imposed by the Fair Pay Commission because it was an “independent industrial umpire”.

Far from being concerned for the low-paid, the Rudd government is only worried that minimum wages have fallen so low that jobless workers could actually be better off on unemployment benefits—which the government has deliberately kept near official poverty rates. The government asked the FWA to ensure that the minimum wage rose just enough to ensure there remained “financial incentives” for people to “enter paid work”.”

Noel also explains that in last year according to the BRW the nations 200 wealthiest have added $21 billion to their collective fortune.
Depressing and predictably the nations employers have slammed the rise irresponsible and unjustified with Peter Anderson from the Australian Chambers of Commerce stating “It will be a dangerous setback to economic recovery in the small business sector....The pay rise has no natural funding basis given the complete absence of productivity trade-offs.”

Read the World Socialist Web commentary here
Read the Socialist Alliance commentary , here