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Unions React to Wage Restraint Call

15 June 2006

Unions React to Wage Restraint Call

The Council of Trade Unions says that calls for wage restraint are misplaced.

Carol Beaumont, CTU Secretary, said that it is unfair to single out workers for wage restraint and to reduce their standard of living when employers and others are not being called upon to absorb the effect of fuel price increases.

She says that comments by both Michael Cullen and Alan Bollard are unfortunate.

“Wages rose by 3.3% in the last year, the same as inflation. Yet we know that profits increased by 44% in the 2001-2004 period and have shown little sign of easing much since then,” said Carol Beaumont.

“Productivity has increased by 2.6% a year on average for over a decade, yet real wages have hardly gone up at all in that period. New Zealand wages lag 35% below Australian pay levels.”

“New Zealand now has a structural problem of low wages. If we want this to change we need real wages to rise – which means regular increases above the rate of inflation,” said Carol Beaumont.

“Such increases do not add to inflationary pressures if employers are prepared to share the profits of recent years and if labour productivity increases at the average rate.”

Carol Beaumont said that if the sole focus of unions in bargaining was inflation, then maybe claims would be at much higher levels given the 23.5% increase in petrol prices.


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