Darien FENTON
Labour Issues Spokesperson
4 August 2011

Urgent action is needed to restore the real value of the minimum wage after a serious decline, says Darien Fenton, Labour’s spokesperson for Labour Issues.

“The minimum wage has declined in real terms by $16.80 a week since June 2010, which leaves low income earners struggling even more to cope with the rising cost of living,” says Darien Fenton.

“Things are unlikely to get better. In just three months since the miserly 25 cents an hour increase in the minimum wage on 1 April this year, half of its value has already been wiped out despite the Minister’s assertions that this increase would maintain the value of the minimum wage.

“The Government can’t continue to maintain that the tax switch compensated minimum wage earners either,” Darien Fenton said.

“Once inflation is taken into account, then ‘Sam’, the minimum wage worker used as an example by the government to justify last year’s tax switch, has now seen his supposed $6.30 a week October 1 income increase completely eroded despite factoring in April’s small minimum wage increase.

“Not only are minimum wage earners suffering, but New Zealand is suffering as well. It doesn’t take much to work out a minimum wage earner would be at least $7 an hour better off in Australia, and this is one of the factors driving record levels of migration across the ditch,” Darien Fenton said.

“This is an issue of fairness in our wages system. It isn’t fair that the lowest paid are expected to take effective wage cuts while at the same time our richest people have increased their wealth by 20 per cent.

“Labour is calling on the Government to compensate minimum wage workers by immediately increasing the minimum wage to $15 an hour.”

ENDS

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