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The living wage is a dumb way to help poor working families

Media Release
5 September 2014
ACT Leader Dr Jamie Whyte


ACT backgrounder: the living wage is a dumb way to help poor working families

The Treasury found that two-thirds of households earning between $14.25 and $18.40 per hour had no dependants and receive little in the way of welfare payments.

The red bars in the diagram below show how much goes back to the government in taxes and reduced welfare payments, such as abatement of working for families.

A living wage helps the government claw-back a lot of welfare payments including working for families, it then helps single people who have no children, and last of all, working families on low wages. That payoff matrix is before any discussion, and there must be that discussion, of the job losses from a higher minimum wage.

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