“It’s unacceptable that an adult Australian in 2019 could work full time and yet still live in poverty.”
In seeking an interim substantial increase to the minimum wage, Labor argues “no-one working full-time should be living in poverty; everything is going up except for people’s wages; since 2013 productivity has grown four times faster than wages; and since 2016 company profits have grown five times faster than wages”.
It also contends that “international experience shows that significant increases in the minimum wage can be sustained without costing jobs; and persistently low wages growth poses a real threat to consumer demand and the broader economy”.
The government increased its attack on Mr Shorten’s approach.
Energy Minister Angus Taylor wrote to key union leaders quoting recent modelling by BAEconomics that forecast the economic impact of meeting Labor’s 45 per cent emissions reduction target would amount to a real fall in annual wages of $9000.
Mr Taylor said Mr Shorten owed the unions an explanation on the wages impact of his climate policy and “you owe to your members to seek urgent clarification”.
Tax changes offset wage rise
The ACTU is seeking an increase of 6 per cent, or $43 a week, followed by 5.5. per cent next year to lift workers out of poverty, which it defines as less than 60 per cent of median earnings.
However, Australian Industry Group, which represents manufacturers and fast-food franchises, will argue last year’s tax offset changes have already raised incomes for the low-paid and so justify a “modest” increase in the minimum wage of 2 per cent.
“The low and middle income tax offset has increased disposable incomes for many low wage earners,” AiGroup chief executive Innes Willox said.
“While the impacts vary across low and middle-income groups, the increase in disposable income for a person earning the current national minimum wage of $719.20 a week is 0.63 per cent, which equates to a change in pre-tax income of $6 per week, which is nearly 1 per cent (0.83 per cent).”
Mr Willox said low productivity, weak inflation, fewer job vacancies and a rise in insolvencies in construction, retail and hospitality all supported a smaller increase this year.
“The Australian economy moved back into the slow lane in the second half of 2018 and looks set to stay there for some time,” he said.
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