Darien Fenton
Labour Spokesperson

8 February 2012

Wage rise lost in translation

The Government’s failure to increase the minimum wage to $15 an hour is a lost opportunity to address soaring income inequality in New Zealand and assist low income families that are struggling to makes ends meet, Labour’s spokesperson on Labour Issues Darien Fenton says.

“At a time when the government is talking up its concerns on poverty and its impact on families and children, it has failed to take one of the most significant steps in addressing income inequality.

“Of course every little bit helps, but Kate Wilkinson can’t take any credit for being generous here,” Darien Fenton said.

“If you look at the statistics family incomes have dropped in real terms by 4.7 per cent over the last two years. In 2011 the average family was spending 7.4 per cent more on rent alone compared to what they were spending in 2010, while 53 per cent of Kiwi families now say they are either ‘barely able’ or ‘unable’ to meet their basic needs.

“An extra 50c an hour is hardly likely to improve their lot. They will still be treading water.

“It is galling too that despite this latest increase and despite this Government’s grand plan to bring New Zealand into line with our Australian counterparts, the minimum wage across the ditch is still some $6.50 an hour higher than it is here.

“Ms Wilkinson might like to think the increase ‘strikes a balance between protecting low paid workers and ensuring that jobs are not lost’, but if you look beyond the rhetoric the facts are that someone on the minimum wage is only 20 cents better off today than they were in 2009.

“The argument that increasing wages will lead to more people out of work is a red herring as well. Treasury has repeatedly noted that there is no evidence that a higher minimum wage leads to job losses.

“New Zealanders deserve a decent living wage. While $20 a week will be welcome, the basics – like power, food and rent – will undoubtedly continue to climb, meaning our poorest workers will be no better off at all,” Darien Fenton said.

“We can only hope the Government will get in behind my member’s bill that would immediately increase the minimum wage to $15 an hour.”

ENDS

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