Low-paid income will drop: Gillard
Sid Maher July 08, 2009
Article from: The AustralianJULIA Gillard has condemned the Australian Fair Pay Commission's decision to freeze minimum wages, saying it failed to "strike the right balance" and would send low-paid workers' incomes backwards.
Employer groups and the opposition hailed the move as the necessary decision to protect jobs.
Despite the government not specifying a wage rise figure in its submission to the Fair Pay Commission's latest wage deliberations, the Acting Prime Minister said the freeze decision was "disappointing".
"We didn't nominate a figure; we suggested that the Fair Pay Commission should consider a pay rise for these workers, and we were obviously concerned that people should, at least, maintain their real wages," Ms Gillard said yesterday.
"This decision inevitably means that there will be a real wage reduction for low-income Australians."
In its final decision, the Fair Pay Commission decided to leave the federal minimum weekly wage at $543.78, or $14.31 an hour, despite unions asking for a $21-a-week increase.
Ms Gillard said changes to
the tax system and the federal government's stimulus package had provided real increases in
disposable incomes for most households.
The decision incensed unions and won immediate backing from employer groups, who said it would save jobs.
Australian Industry Group chief executive Heather Ridout said the decision was understandable given the current economic circumstances.
"The decision delivers a broader signal about wage restraint and the need for the current round of wage negotiations to take account of the continuing economic pressures on businesses and employment," Ms Ridout said.
"In making its decision, the Fair Pay Commission has taken into account that under the new Fair Work workplace relations system, wages will be reviewed in early 2010 by Fair Work Australia, with any minimum wage increase awarded operative from
1 July, 2010."
She said disposable incomes had been boosted by recent tax cuts, the indexation of family payments and the impact of the cash payments in December and March as part of the federal government's stimulus package.
The combination of tax cuts, family tax benefit increases and stimulus payments had added disposable income of more than $20 a week, or 4 per cent, to a single worker on the minimum wage.
Australian Chamber of Commerce & Industry workplace policy director David Gregory said the freeze on the minimum wage was a sensible decision, given the economic environment.
"Certainly we think that it's the best outcome in that context for Australian businesses," Mr Gregory said. "It's also the best outcome for Australian employees in terms of preserving Australian jobs."
ACTU secretary Jeff Lawrence said the Fair Pay Commission was a leftover from the Howard government-era Work Choices regime and the decision was "another kick in the guts for working Australians".
He said the Fair Pay Commission had shown no respect for the contribution low-paid workers were making to the economy during the downturn and had relied on discredited research.
"The decision means ordinary working Australians and their families are bearing the brunt of an economic downturn they did not cause," Mr Lawrence said.
Opposition workplace relations spokesman Michael Keenan backed the decision, saying the most important consideration in the current economic environment was to protect jobs.
"While everyone would like to see low-paid employees get a pay rise, at the moment we need to balance those considerations with the most important thing, which is preserving jobs," he said.
What/Who is the ACCI, FPC and ACTU?What are some of the criticisms of the lack of increase in minimum wage?List and explain some of the problems with raising the minimum wage in the current climate.
http://www.abc.net.au/unleashed/stories/s2889517.htm
