By James Vassilopoulos
SYDNEY — A Tandberg cartoon in the Sydney Morning Herald captured very well the Liberal government's offer of an $8 a year increase to low-income earners. It shows a worker walking away from Howard sitting at his big, big desk. Howard has a huge mouth, squirrel-like teeth and furry eyebrows. The worker says, "that's an extra 20 cents an hour". Howard replies, "If he got any more he wouldn't be a battler".
The federal government is supporting an increase in the minimum wage for low paid workers of $24 over three years. For someone on $400 a week that would represent a 2% yearly increase in wages. Only workers earning less than the average ordinary time earnings of $677 a week ($35,000 a year) are to get the increase. Howard said that the increases "give the lie to these ridiculous claims still made by the Labor Party that we are indifferent to the interests of the low paid".
The ACTU called the offer a "joke" and "pathetic". Greg Crombet, ACTU assistant secretary, said, "our living-wage claim asserts that people need a substantial lift at the lower end of the pay scale so that they can meet the costs of living, whereas this would only just maintain existing real wage rates. For anyone earning in excess of $400 a week, what it represents is a real wage cut."
The response of employer groups has been mixed. The Australian Chamber of Commerce and Industry expressed "concern" that an across the board increase would have a significant impact on employers in industries such as hospitality and retailing. They suggest that pay rises should be linked to individual workplaces. Others like the chief executive of the Council of Small Business Organisations of Australia, Rob Bastian, supported the pay increase, stating that it will not apply to many small firms as they paid rates above average weekly ordinary time earnings.
Howard's suggestion that he aims to "protect the battlers" is rubbish. The wage increase is a cynical manoeuvre to avoid alienating those ex-Labor voters who supported Howard in the March election and to make it look like he is going into bat for the "battlers". In reality, $8 is crumbs thrown to the working poor, or worse.
Under the new scheme:
- If inflation averages 2.1% over the three years everybody will suffer a cut in real wages. The budget estimates inflation to be 2.75%.
- Only those who have not had an enterprise bargaining agreement, who earn under $35,000 per year and who do not receive over-award payments — one third of the work force — receive the increase.
- The recently passed Workplace Relations Bill guts awards to 20 conditions. What is the price for those loss of conditions?
- Howard's first budget launched a massive attack on the social wage including cuts to universities, the dole, public services, public housing and public sector jobs. These cuts hardly benefit the "battlers".
The Labor Party has attempted to expose the proposed wage increase, but its own Accord Mark VII in 1993 only delivered an $8 increase. Accord Mark VIII in 1996 was to deliver a $11-14 increase coupled with the introduction of a compulsory employee superannuation levy. This too would have had the effect of another real wage decrease for workers. Peter Reith, the opposition industrial relations spokesperson at the time, released a media statement on June 25, 1995 which said: "Accord Mark VIII delivers real wage cuts ... consistent with long-standing Labor policy and practices."
So who is to be believed? Labor says the Liberals will cut real wages. The Liberals say Labor have cut real wages. Both are correct. Both major parties have and will continue to cut real wages. Both major parties will not protect the "battlers".
- The recently passed Workplace Relations Bill guts awards to 20 conditions. What is the price for those loss of conditions?
- Only those who have not had an enterprise bargaining agreement, who earn under $35,000 per year and who do not receive over-award payments — one third of the work force — receive the increase.