Australian Workplace Agreements

Rule out wage cuts: ACTU

Instead of confirming yesterday that 1.6 million Australians reliant on award wages face the prospect of a cut in their real wages, the Federal Government's new Pay Commissioner, Professor Ian Harper should rule this out says the ACTU.

Commenting on a speech by Prof Ian Harper yesterday, ACTU Secretary Greg Combet said:

"There is no justification for cutting the real wages of award workers and the new pay Commissioner should rule this out immediately.

It is wrong for the Commissioner to flag the prospect of a real wage cut when he hands down his first decision due later this year.

The economy is performing well and minimum wage workers deserve a decent share of national productivity. Living expenses keep going up and so wages for hard-working award workers should go up as well.

The ACTU welcomes the Commissioner's decision to oversee new research into the effects of movements in award wages however we would be concerned if the new studies were conducted by researchers with a less than impartial record.

In recent years both the Federal Government and the peak employer groups have repeatedly asserted that increases in minimum wages costs award workers jobs but have failed to produce any convincing empirical evidence to support their claims.

Misleading claims are also often made about how much award workers actually benefit from a lift in minimum wages once tax is taken out and social security payments for families is considered.

In fact, recent research by the independent National Centre for Social and Economic Modelling (NATSEM) shows that the majority of working people get to keep most of any pay rise they receive and relatively few individuals are badly affected by tax and social security.

The NATSEM study shows the average effective marginal tax rate for all individuals is 38% with only 8% facing an EMTR above 60%.

It also shows that the three million individuals living in the poorest half of households get to keep nearly two thirds of any pay rise. They face an average EMTR of 35% -with only 10% facing an EMTR above 60%.

It is also very important that Professor Harper take into consideration the dignity of work. People must be able to receive a fair day's pay for a fair day's work and should not be forced to rely on welfare to maintain a decent standard of living.

The ACTU again calls on Professor Harper and the Federal Government to guarantee that the real value of award wages will not be cut."

© 2001 Community & Public Sector Union - State Public Services Federation (CPSU-SPSF) - National Office

http://www.cpsu-spsf.asn.au/latest_news/general/20060217_award.html
Last Modified: 17 Feb 2006