The living wage

February 14th, 2013 at 9:00 am by David Farrar

Katie Chapman at Stuff reports:

Kiwis need to earn nearly $5 more than the to meet the “basic necessities of life”, a new report has found.

Bzzt Wrong. Not the story – just the report.

The wage was calculated as the necessary income for a two-adult, two-child family and is based on both adults working, one full-time and one part-time.

This is not the majority of households or the majority of adult New Zealanders. Most workers either do not have children, or their children are adults.

It is silly and wrong to say you need to earn $18.40 an hour to meet the “basic necessities of life”, even if you accept the calculations of Rev Waldegrave as gospel. This is what has been calculated as necessary to support a four person family.

Now the report (which does not appear to be online, which means it is hard to check how robust it is) seems to ignore the existence of Working for Families which can pay up to $217 a week net.

Now there is an argument to be made that you should have wages at a level where people can have a family and not need Working for Families. That is a legitimate argument.

However I bet you that not a single proponent of the campaign is saying that wages should be higher so the Government can scrap Working for Families. They want both.

And the reality is that economically it is daft to have a minimum wage based on the needs of 850,000 adults yet applying to all three million workers. Targeted assistance to those with children is more efficient and fairer than a one size fits all type living or minimum wage based on one particular family structure.

I would hope that most adults who are raising kids are in a job that pays $18.40 or more an hour. There are many jobs that pay that rate. But to advocate that every job in the economy should be at that rate is again daft and would kill off many jobs. A 16 year old living at home does not need $18.40 an hour to survive.  A couple with no kids doesn’t need that much. The partner of someone who is earning say $25 an hour doesn’t need $18.40 an hour. Individual circumstances vary greatly, and a campaign based on what is a minority living situation is no template for anything.

Tags: ,

37 Responses to “The living wage”

  1. infused (584 comments) says:

    This shit is pissing me off now. Stuff, you are officially useless at reporting.

    Popular. Like or Dislike: Thumb up 28 Thumb down 1 You need to be logged in to vote
  2. hamnidaV2 (247 comments) says:

    Hidden due to low comment rating. Click here to see.

    Unpopular. Like or Dislike: Thumb up 2 Thumb down 44 You need to be logged in to vote
  3. greenjacket (486 comments) says:

    Meh.
    Katie Chapman is the reporter.
    Charles Waldegrave is the writer of the report.
    What’d you expect?

    Vote: Thumb up 15 Thumb down 1 You need to be logged in to vote
  4. Lipo (230 comments) says:

    Why is it that the argument put up by these Socialist is always to increase wages so people can cope with the cost of living?
    How about reducing the cost of living
    Perhaps they should leave wages were they are and campaign on reducing costs. Approach councils and government departments and demand a 10% to 15% reduction in costs

    Popular. Like or Dislike: Thumb up 38 Thumb down 0 You need to be logged in to vote
  5. KiwiGreg (3,279 comments) says:

    Arguing the number is missing the point. Government mandated prices for anything are bad for people, bad for the economy.

    Popular. Like or Dislike: Thumb up 33 Thumb down 0 You need to be logged in to vote
  6. Kleva Kiwi (291 comments) says:

    Hammy, you are a complete idiot.

    You surf this website trolling with some of the worst nonsense from the media, never stopping to even read your own comments.

    I can live off $13.50 an hour. And I will still have my broadband, nice clothing and a lot of other luxuries.
    Here’s the thing, they are luxuries. There not human rights, and they are by definition, extra things over and above what you need to live and contribute to society.

    And that’s one thing you will never achieve Ham. So far your comments on this site have contributed nothing to society but reinforcing the presumption you are a complete idiot.

    Popular. Like or Dislike: Thumb up 35 Thumb down 0 You need to be logged in to vote
  7. mikemikemikemike (334 comments) says:

    So why can’t we have a combination of youth rates and a living wage? or do they have to be mutually exclusive? What am I missing?

    Vote: Thumb up 2 Thumb down 0 You need to be logged in to vote
  8. Grendel (1,013 comments) says:

    as usual Ham is full of shit.

    what have low taxes got to do with artificially inflating wages and removing low end jobs from the market?

    the word you are looking for is sensible. it is quite sensible to want a low tax regime as that keeps more money in the workers pocket and requires government to focus on its core activities. on the flipside a ‘living wage’ which is just a new word for an overinflated minimum wage will drive people out of work and will not result in an increase that the socialists expect.

    isnt it nice of wellingtons mayor to tell us she likes the idea and is keen to implement it? its not like its coming out of her pocket, or she needs to increase sales to make this work, she can just raise her compulsory prices.

    those of us in the real world, if we wanted to give all workers a $5 an hour rise would need to either lower our own incomes (potentially to lower than our employees), raise prices (and risk losing customers), lower other benefits to staff, or get rid of a couple of positions.

    but thats the real world, where idiots like ham, celia the mayor and the rest of the ‘living wage’ zealots dont live.

    ham does make one vaguely correct statement. yes if you are living on the minimum wage you probably dont have as many luxuries as the person on $30 an hour. where ham fails (as usual) in his envy laden spittle is to assume the solution is to enforce higher wages through government force. whereas again, in the real world the solution is to raise your worth, either through education, working harder, getting promoted etc. all done by the individual showing they are worth more.

    but then hard work and personal responsibility dont exist in hams world.

    Popular. Like or Dislike: Thumb up 28 Thumb down 0 You need to be logged in to vote
  9. mikemikemikemike (334 comments) says:

    There is a difference between being able to afford to live (something that I believe is a right) and affording to have a life (something you have to earn for yourself).

    I know of two people who have are on minimum wage jobs, who live in a nice part (and yes there are nice parts) of Sth Akl in their own home. They live simply sure, and they do receive assistance. The woman has one child from a previous relationship and wants more, but they recognise that they can’t afford kids right now and so don’t have any more, something that must be terribly hard to have to choose to do and I commend them for it. It is hard sure, but it can and is being done, even in Auckland.

    Vote: Thumb up 19 Thumb down 0 You need to be logged in to vote
  10. Lance (2,719 comments) says:

    Ham n Eggs has a fundamental mental disconnection between motivation to be valuable as a worker and associated improvement in income.

    You see Hammy it works like this.

    Study, train etc when you are young so that later in life you can earn what someone thinks your labour is worth.
    If you piss away your future on dissolute living or worthless degrees then you are not that valuable to an employer. Conversely if you are a valuable asset to a company you will be rewarded with a higher income which you can spend on luxuries like fishing boats or more children (the boat is MUCH cheaper).

    Vote: Thumb up 13 Thumb down 1 You need to be logged in to vote
  11. Cunningham (846 comments) says:

    hamnidaV2 you are a fuckwit! I studied for a degree to earn what I earn (which is not a massive salary). Am I supposed to feel guilty for that? Basides as DPF points out, this is such a simplistic view that it really is a crock of shit and the medias complete lack of scrutiny is ayet another black mark against them.

    Vote: Thumb up 13 Thumb down 1 You need to be logged in to vote
  12. Alan Wilkinson (1,938 comments) says:

    hamnidaV2: “I like to see you Neolibs try and live on $13.50 an hour. It would mean no Jack Daniels pre mixers, no tickets to the V8s in Hamilton, no fishing boats, no broadband, no clothes from Rodd and Gunn.”

    Guess what, when we had kids we had absolutely none of those. The only one I have ever had or wanted is broadband though as a result of teenage years spent working instead of partying I acquired high level qualifications and eventually, after a couple more decades of hard work, comfortable affluence.

    I support intelligence and good decisions. Nothing about this “living wage” campaign reflects either.

    Vote: Thumb up 20 Thumb down 2 You need to be logged in to vote
  13. flipper (4,332 comments) says:

    So….

    Would all those sucked in by silly, but well intentioned, Charles Waldegrave(et al), remind us what it was that the anointed Obamination advocated (for a US Federally mandated minimum wage) in his BS “State of the Nation” harangue just yesterday?

    No?
    We’ll let me help: $US 9 per hour. Yep, $US9 an hour!

    At an exchange rate of just 80c/NZ$ (compared to current 84c) that equates to $11.25 NZ. Given the plethora of US taxes (including the universality of a variable local/state retail sales tax means that even in 2013 US left wingers are more realistic than the NZ dip for brains advocating $18-$19 per hr. And make no mistake, to do that a fundamental, re-write of tax, health, ACC and benefit laws would be required.

    To quote one of Crusher Collins’ less than sane comments (on Bain/Binnie) that will come back to bite her –
    “Be careful what you ask for”. :)

    Vote: Thumb up 9 Thumb down 0 You need to be logged in to vote
  14. Peter (1,695 comments) says:

    I like to see you Neolibs try and live on $13.50 an hour.

    Easy. $540 per week.

    My house is paid off. I’ll make it even easier for you and pretend my wife earns nothing. We spend $170 p/w on food and alcohol. Let’s say essential utilities are $150 p/w. That leaves $220.

    If I was unqualified (I’m not), I’d spend some of that on getting more qualified. I’d also get my wife to work (she does).

    So, in my circumstances, even if my wife did nothing, I could still live on it. If me and my wife earned minimum wage, we’d live okay – especially in some small town near a beach and/or near people who grow a lot of food!

    You see – it really depends on personal circumstances.

    Vote: Thumb up 13 Thumb down 1 You need to be logged in to vote
  15. Weihana (4,621 comments) says:

    DPF,

    Now there is an argument to be made that you should have wages at a level where people can have a family and not need Working for Families. That is a legitimate argument.

    Wages should reflect the value of the service in a competitive market. What people need to live on is irrelevant.

    However I bet you that not a single proponent of the living wage campaign is saying that wages should be higher so the Government can scrap Working for Families. They want both.

    Should scrap the minimum wage and keep some form of Working for Families. Or scrap both and the existing benefits and institute a universal income. Government charity is best provided through direct benefits and/or entitlements, not in trying to plan the economy.

    Vote: Thumb up 10 Thumb down 0 You need to be logged in to vote
  16. WineOh (636 comments) says:

    At the risk of adding the blindingly obvious, very few low income families in NZ are actually living on their wage alone, because of our generous additions of Working for Families and housing supplements. Others have rightly pointed out that those without kids can get by comfortably on less, and those with young kids don’t have to get by on less!

    Vote: Thumb up 12 Thumb down 0 You need to be logged in to vote
  17. Weihana (4,621 comments) says:

    Peter (996) Says:
    February 14th, 2013 at 9:53 am

    …My house is paid off…

    …You see – it really depends on personal circumstances…

    Indeed. :)

    Vote: Thumb up 9 Thumb down 0 You need to be logged in to vote
  18. radvad (736 comments) says:

    Waldegrave belongs to the Anglican church, one of the countries wealthiest institutions. My (limited) understanding of church doctrine is that the church has a responsibility to help the needy. For example the good Samaritan did not force others to meet the needs of the wounded dude, he used his own time and resources. Despite this Waldegrave has made a career out of demanding other people do the job of the church.

    Vote: Thumb up 13 Thumb down 1 You need to be logged in to vote
  19. Peter (1,695 comments) says:

    I could even add in investment income (paid off apartment, bonds, shares etc)….but I went easy on the socialist Ham! :)

    If I count that passive income in, $13.50 per hour becomes free-spendin’ pocket money.

    Vote: Thumb up 3 Thumb down 1 You need to be logged in to vote
  20. Weihana (4,621 comments) says:

    mikemikemikemike (28) Says:
    February 14th, 2013 at 9:28 am

    There is a difference between being able to afford to live (something that I believe is a right) and affording to have a life (something you have to earn for yourself).

    No there isn’t or at least not a clear distinction. Much of what is considered a necessity today didn’t exist not that long ago. A fridge for instance. Even things which have existed for quite a while, such as houses, aren’t absolutely necessary to “live”. The word “live” clearly means something more than just having oxygen in your lungs long enough to be able to find a mate, reproduce, and then die. In the context people normally use it it means some sort of standard and that standard is inherently subjective and changes with the times. As society continues to get more wealthy what is considered “the basics” will continue to expand and so it should. It doesn’t seem that far off before having enough to “live on” is viewed as an entitlement regardless of desire for work.

    Vote: Thumb up 1 Thumb down 1 You need to be logged in to vote
  21. lyndon (321 comments) says:

    Report seems to be at at http://www.livingwagenz.org.nz/

    Vote: Thumb up 2 Thumb down 0 You need to be logged in to vote
  22. m@tt (637 comments) says:

    I want to see WFF scrapped, but the only way that is going to happen, and be generally accepted by society, is if employers are paying a wage that can be lived on.

    To scrap WFF you first have to have a living wage, it wont work the other way and in any case for people already on WFF their WFF payments will decrease, to a degree, as their wage increases.

    Asking employers to provide wages that are truly livable, so the government doesn’t have to top up from the tax I pay, is a no-brainer that only a true socialist would oppose.

    Vote: Thumb up 3 Thumb down 2 You need to be logged in to vote
  23. Weihana (4,621 comments) says:

    Grendel (738) Says:
    February 14th, 2013 at 9:22 am

    …on the flipside a ‘living wage’ which is just a new word for an overinflated minimum wage will drive people out of work and will not result in an increase that the socialists expect.

    Probably not, but it would add increased incentive to invest in automation.

    Vote: Thumb up 1 Thumb down 2 You need to be logged in to vote
  24. Peter (1,695 comments) says:

    And a note to th’ Ham

    I used to be a socialist tosser, much like yourself. Voted Labour. Ignorantly argued much the same as you do, in a pseudo-Marxist way.

    Then I took an interest in economics. I do recommend you read Hayek. Then read it again.

    It turned my life around. I went back to University. Got a job in an industry crying out for people. 20 years later, after much work, investment, saving, and not having kids, I’m one of those rich pricks.

    It’s great. Life is great.

    If I’d remained on the left, I’m not sure I’d be anywhere near as comfortable, or as happy.

    So, if you’re young, and before it’s too late (one day it will be) read Hayek.

    Vote: Thumb up 15 Thumb down 1 You need to be logged in to vote
  25. Weihana (4,621 comments) says:

    m@tt (481) Says:
    February 14th, 2013 at 10:17 am

    I want to see WFF scrapped, but the only way that is going to happen, and be generally accepted by society, is if employers are paying a wage that can be lived on.

    To scrap WFF you first have to have a living wage, it wont work the other way and in any case for people already on WFF their WFF payments will decrease, to a degree, as their wage increases.

    Asking employers to provide wages that are truly livable, so the government doesn’t have to top up from the tax I pay, is a no-brainer that only a true socialist would oppose.

    Whether it’s a price floor for wages or whether it’s a benefit, it’s still government charity. Trying to portray a price floor as some sort of capitalist anti-socialist policy by reference to the tax you pay for WFF is disingenuous. Replacing WFF with a higher minimum wage is simply shifting the tax to the consumer (assuming the job cannot be outsourced) whilst creating market distortions.

    Vote: Thumb up 2 Thumb down 2 You need to be logged in to vote
  26. Scott Chris (6,178 comments) says:

    but it would add increased incentive to invest in automation

    Yeah maybe in the service industry but less so in the manufacturing industry which relies on economies of scale to generate sufficient return on capital invested. Easier to employ a Thai.

    On the other hand, if the $kiwi wasn’t so grossly inflated our domestic labour (obviously) wouldn’t be as expensive in relation to the rest of the world.

    Whilst I agree a free market is on the whole a good thing, our bloated dollar is one example of the kind of distortion in value a free market can produce. Alas Bill English’s religious devotion to his conservative economic principles won’t bring effective intervention in the near future as far as I can see.

    Vote: Thumb up 1 Thumb down 0 You need to be logged in to vote
  27. nasska (12,111 comments) says:

    Perhaps we should cut ‘hamnidaV2′ a bit of slack. To lift yourself off the bottom rung & earn more than the minimum wage requires a bit of gumption & a smidgeon of intelligence. Those blessed with neither are reduced to joining unions & conning the simple folk who run newspapers & church charities into promoting the tearjerker that the $18.40/hr campaign has become.

    As our correspondent has indicated, with his sound bite comments & pigeon-holing of all non communists as “neo libs”, if he had a brain he’d probably be on the floor playing with it .

    Vote: Thumb up 5 Thumb down 1 You need to be logged in to vote
  28. marcw (260 comments) says:

    Can anyone enlighten us whether a couple with 2 children earning the “living wage” @ $18.40 ph each would still be entitled to WFF under the current rules? The answer to this question would go some way towards the real response to the suggestions of the gospel of Rev Waldegrave. Perhaps some employees could make a choice – either the status quo, or a “living wage” for your household.

    Also, to you no Ham in Hanmer, your rantings show you have not grown up even in your 74 posts as version 2. I am on a invalids benefit (through no fault of my own) and receive less than $7.00 ph – including some contribution to my extra medical costs. Instead of moaning about how I can’t afford this or that or an endless supply of largess from other taxpayers, I am truly grateful that I was born and live in a country that takes care of those of us like me that need help. I live within my means, and think you should maybe go and live somewhere like, say, Mali (if they would have you), and find out what true poverty is like should you be geographically unfortunate in your country of birth.

    Vote: Thumb up 7 Thumb down 0 You need to be logged in to vote
  29. krazykiwi (8,040 comments) says:

    The very notion of a living wage is insulting. It assumes that individuals are helpless victims of their own choices and life circumstances, and therefore someone else must decide what they’re owed.

    Every day people make decisions. Decisions to work, or not. Decisions to re-locate, buy things, try things. Decisions to trade off one outcome for another. Decisions to be frugal, or wasteful. Decisions to be inspired or to be complacent, to plan or to take what comes.

    Every individual’s combination of decisions leads to potential to secure resources, and to a likely set of costs (monetary and/or other).

    That’s some talk about a living wage suggests they believe it’s sensible to insulate people from the consequences of their decisions. I think the opposite.

    Vote: Thumb up 7 Thumb down 0 You need to be logged in to vote
  30. hmmokrightitis (1,596 comments) says:

    Ill join the noise hamdick. I managed to live on much less as a fresh from varsity worker. And didnt expect any more, from my employer, the taxpayer or anyone else. And its this sense of entitlement – the gubbermint owes us – mentality that really fucks people off.

    The gubbermint – the taxpayer – owes you nothing. You can live on low income. If you dont like it, improve your lot. Study, work hard, show initiative. And until you earn enough, stop smoking, drinking, gambling, buying expensive cuts of meat, and live simply. Worked wonders for me. You should try it.

    Vote: Thumb up 9 Thumb down 0 You need to be logged in to vote
  31. Keeping Stock (9,384 comments) says:

    Hamnida V2 said

    I like to see you Neolibs try and live on $13.50 an hour.

    It would mean no Jack Daniels pre mixers, no tickets to the V8s in Hamilton, no fishing boats, no broadband, no clothes from Rodd and Gunn. The list goes on.

    It is quite telling that the same people who argue for lower taxes, also fail to support a living wage. I think there is a word for that.

    Not being sure what a Neolib is, I won’t self-label. But I am an employer of 40-plus staff; up from five just six years ago, so I guess I’m doing something right.

    All of our staff earn more than the minimum wage, in some cases more than double it. Our admin staff are all on $17-plus per hour, which is pretty good money in our neck of the woods, and our fortnightly wage bill, including PAYE etc which we ALWAYS pay on time is getting up around the $70k mark.

    I’m more than happy to go down to the office now and tell all the admin staff that they will be on $20 per hour effect 1 March 2013. But I would also need to leave them to have a meeting to decide which two of them will be getting a glowing reference when they leave; on 1 March 2013.

    If we are lucky this year, we will break even, or maybe even return a very small profit. We can’t raise our prices as it would make us uncompetitive in our market. We’re already working to full capacity; 60 hours is an average week for me. We have added staff as we have grown, but we’ve never been able to get ahead. Hundreds of other businesses like ours are in the same boat, and hundreds more are even worse. The notion that employers are fat cats ripping off their staff is a complete and utter fantasy.

    We pay our staff generously, and they reward us generously with the effort and commitment. Employer/employee relationships go both ways. And that is why this campaign by the unions, the Greens and Labour will ultimately fail. It will send businesses to the wall, and jobs will be lost. Who wins then?

    Vote: Thumb up 19 Thumb down 0 You need to be logged in to vote
  32. Paulus (2,712 comments) says:

    What is become relevant over the last say 4 – 5 years appears to be the acceptance of more individual personal responsibility. This comes about having a stable government with stable financial reponsibilities which other countries do not have.

    It is difficult for the many left wing politicians to accept the slow change towards what many others now accept.
    It is that individuals have become more accustomed to thinking more about your own, and family’s, resposibility.

    Socialist’s obviously hate it – look at the continued poor showing of Labour, and the leftwing defection movement towards neo communist Greeenpeace ideals.

    Vote: Thumb up 3 Thumb down 0 You need to be logged in to vote
  33. Right of way is Way of Right (883 comments) says:

    Well, as I have been saying for years, WFF is the biggest handbreak to productivity in this country.

    Why on earth would anyone strive to get ahead in work, business, whatever, when all that will happen is if you earn more money, you get less benefits? When people are truly rewarded for their own efforts, and we all work harder to get ahead, we all win in the long run.

    All Working for Families has done to this country is reinforce welfare dependancy and our long standing culture of mediocrity!

    Vote: Thumb up 5 Thumb down 0 You need to be logged in to vote
  34. Joseph Carpenter (214 comments) says:

    If we abolished WFF and Accommodation Support for the same cost we could have a universal income tax free threshold of nearly $19,000 and remove 1.3 million citizens from being under IRD/MSD and immediately free 1,900 workers for productive work actually contributing to NZ GDP.
    Or we could reduce GST to 11%.
    Or we could reduce Company tax to 7%.
    And remove a massive distortion in the economy.
    And remove a huge injustice in the tax system.

    Don’t forget WFF was only introduced in 2005, National could have repealed it in 2008, they had the excuse because of circumstances and if they had shown the trade-offs it costs NZ I believe they could have made the case. Same with interest free student loans and host of other issues. But they didn’t even try, and now with 2014 being the next earliest opportunity it’s become so entrenched it will never be removed. But hey they did tinker around the edges to save $180 million but added a whole extra layer of regulations and complexity and bureaucrats. So they actually left it pretty much untouched BUT they still end up with Labour, Greens, Maori, Mana et al attacking them as the heartless nasty party that craps on the poor with the millionaire John Key personally getting his jollies grinding their face in the gutter when he’s not dining on babies at his Hawaiian mansion.

    Vote: Thumb up 5 Thumb down 0 You need to be logged in to vote
  35. duggledog (1,628 comments) says:

    All right the next ass hole that complains about being hard done by in this country can choose another country – any other country in the world – surrender their NZ passport and piss off but they can’t come back.

    I’ll pay the god damn one way flight. Any takers? No I thought not

    Vote: Thumb up 2 Thumb down 0 You need to be logged in to vote
  36. Inky_the_Red (764 comments) says:

    http://www.buggerthebankers.com/

    Vote: Thumb up 1 Thumb down 0 You need to be logged in to vote
  37. leftyliberal (651 comments) says:

    DPF: The living wage calculations included both accommodation supplements and WFF tax credits in determining the amount – you may wish to update your original post and remove the bit casting doubt on this. See page 17/18 for a summary, and later pages for computations.

    http://www.livingwagenz.org.nz/files/embargo%20file/Living%20Wage%20Investigation%20Report.pdf

    Vote: Thumb up 0 Thumb down 0 You need to be logged in to vote