Living Wage proposal would mainly help the Government, not low income families

November 1st, 2013 at 4:00 pm by David Farrar

Bill English has announced:

The “” campaign claims a minimum hourly pay rate of $18.40 is necessary for a family of two adults and two children. But Treasury analysis shows that not just the figure, but the concept, is flawed, Mr English says.

“It might sound politically attractive to be able to dial up a pre-selected made-up wage rate, but for higher wages to be sustainable they have to be based on productivity and affordability in real workplaces,” he says.   

The “living wage” idea is based on a two-adult, two-child family, yet analysis shows that people in this situation make up only 6 per cent of families earning less than $18.40 an hour. 

This is the point I have been trying to make. It is a calculation for a particular type of family (which are just 6% of all households) and to have politicians lemming like insist it must be a minimum wage for everyone is moronic.

Almost 80 per cent of those earning less than $18.40 are people without children, including young people and students.

When Labour says everyone must be paid the living wage, they are saying that a 16 year old starting his or her first job must be paid $18.40 an hour or over $38,000 a year!

The analysis shows that the “living wage” would least help low-income families whose welfare support would abate as their income rose. In those cases, the main beneficiary of the living wage would effectively be the Government because it would receive more in tax and pay out less through abated transfers.

It is quite legitimate to debate how to have higher wages. But the living wage is a slogan, not a policy.

The Treasury also notes that although New Zealand’s minimum wage has grown faster than the median or average wage over the past decade, it has not increased average incomes relative to other countries.

You raise wages through productivity, not through legislation.

The Treasury analysis is here. Some extracts:

  • A low wage two parent family with two children would only gain $63 a week from the living wage while the Government would gain (via abatements and extra tax) $126 a week!
  • Very low incomes tend to be temporary – only 24% of those in the bottom income decile in 2002 were in that decile seven years later
  • 43% of those who earn below the living wage are aged under 30
  • The living wage would only reduce the relative poverty rate by 0.3%!!

Treasury suggests four other measures which would help low income families without the bad consequences of the living wage:

  1. Shifting Working for Families towards parents with younger children
  2. Targeting Early Childhood Education subsidies more strongly
  3. Shifting the benefit abatement regime to incentivise 3-5 days of work, and
  4. Making our system of service interventions for children aged 0-5 years more
    focused and integrated.

Treasury also point out that the calculation used for the living wage is basically not based on any empirical evidence such as need:

The figure chosen is essentially an average of  the estimated current expenditure of the lowest half of the income distribution, and close to two thirds of the national average expenditure of two adult, two child households. Thus it is a relative measure of income and not one based on
estimating need.

So Labour and Greens have trumpeted the living wage as the amount calculated that a family needs to live on, and are basing their policies on it. But it isn’t based on what a family need to live on. It is simply based on a percentage of average expenditure (which of course is based on income).

Also you know how Labour and Greens say there is a crisis in manufacturing? Well guess what the living wage would do to that sector:

Manufacturing is the biggest industry to have experienced negative employment growth over the period. With 40 percent of its workforce earning below $18.40, adoption of the Living Wage could be expected to put further downward pressure on the industry’s growth.

And on the issue of our minimum wage:

In 2011 our minimum wage was 60% of the median earnings for full-time workers. This was amongst the highest ratios in the OECD, and well above the level found in most countries which is typically around 45%. For instance, the ratio was 45% in Australia, 38% in the United Kingdom, 40% in Canada, and 28% in the United States. Increasing the rate still higher to 88% of the median wage would take the minimum wage well outside the normal range. This is likely to make employment for people with low skills difficult in an internationally focused economy.

We already have one of the highest minimum wages in the world, relative to the median wage.

And the living wage compared to other countries:

The proposed $18.40 Living Wage is also high compared to the other Living Wage rates being proposed by similar groups overseas. Compared to Australia, Canada, USA, and the UK, it is the highest proposed Living Wage relative to GDP per capita

A great way to export jobs.

Also treasury says that only 12.5% of FT employees are paid less than 2/3rds of the median wage which is one of the lowest proportions in the OECD. The US is 24.8%, UK 20.6%, Canada 20.5% and Australia 14.4%.

Excellent analysis by Treasury. The data fatally undermines the policies being pushed by Labour and Greens. Only 6% of those who earn below the living wage are in the type of family the calculation is based on. Who would you set wages for 94% based on a situation which doesn’t apply to them?

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65 Responses to “Living Wage proposal would mainly help the Government, not low income families”

  1. lastmanstanding (1,297 comments) says:

    DPF haven’t you ever heard of lies damn lies and statistics. That’s what the Socialists will say in rebuttal of the Treasury figures. The Socialists wont be satisfied until they drive every SME in NZ to the wall. That’s what Kunliffe et al are about. They want to see small business bought to its knees and then destroyed.
    Watch for compulsory union membership to be enacted if the Socialists/Communists gain the Treasury benches post November 2014. Remember Kunliffe has to make the payment for the Unions support and that’s just one small price to be paid.
    Kunliffe Robertson Arden et al know nothing of the real NZ family. None of them represent the real NZ family. They live in a bubble world divorced from reality.
    Send the bastards and the bitch around to me and I will soon educate them on what is a real NZ family.

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  2. mandk (998 comments) says:

    “A low wage two parent family with two children would only gain $63 a week from the living wage while the Government would gain (via abatements and extra tax) $126 a week!”

    This neatly illustrates the cruelty towards people on Struggle Street of slogan-driven socialism.

    And please can we stop calling it the Living Wage? The term doesn’t tell anyone anything meaningful.

    What we are talking about is a proposal to vastly increase the barrier to employment.

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  3. dishy (248 comments) says:

    Cunliffe and the other dishonest, fiscally-illiterate clowns should just be content with the Leaving Wewege.

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  4. RJL (146 comments) says:

    A low wage two parent family with two children would only gain $63 a week from the living wage while the Government would gain (via abatements and extra tax) $126 a week!

    So what? The given low wage family still gets a net gain of $63.

    The government’s “gain” is mostly because it will be handing less taxpayer money to the low wage family via Working for Families etc, which is currently being handed to the family to compensate for the fact that its low wage is insufficient to live on. Shouldn’t the Union of Taxpayers be extremely happy that an increase in the minimum wage will mean that less of the tax take is “wasted” in redistribution from the wealthy to the poor?

    Treasury suggests four other measures…

    If Treasury has some good ideas, adopting those doesn’t preclude also increasing the minimum wage.

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  5. JeffW (327 comments) says:

    The Living Wage Proposal would mainly help the government – I call BS on that. How many jobs would be lost, resulting in lower tax take and higher welfare payments?

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  6. Mobile Michael (452 comments) says:

    I’m pretty sure I would not have met the living wage level until my mid 20s. (Hard to estimate as the “Living Wage” figures for that time don’t exist.) I15 years on ‘m now in the top 10% of earners and wealth. Most people see this and understand low wage jobs are a stepping stone to bigger things.

    The issue with persistant low earnings is a very different beast and can’t just be solved by slogans and campaigns – most of the responsibility lies with the person in that situation. While the state and employers can provide some incentives, the motivation has to come from the individual to achieve lasting, beneficial change.

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  7. Psycho Milt (2,412 comments) says:

    The analysis shows that the “living wage” would least help low-income families whose welfare support would abate as their income rose. In those cases, the main beneficiary of the living wage would effectively be the Government because it would receive more in tax and pay out less through abated transfers.

    So, it would be terrible for people to be able to live off their wages alone, rather than needing welfare supplements from the government, and equally terrible for the government to escape having to make such welfare payments? That’s the advice the government is getting from ‘experts’ in Treasury? Seriously?

    You raise wages through productivity, not through legislation.

    No doubt there are fairies at the bottom of your garden as well. Wages rise through industrial action, skill shortages or legislation – incidences of productivity increases getting passed on to wages can be assumed to have occurred through accident or incompetence on the employer’s part.

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  8. Simon (728 comments) says:

    Wage rates are a function of supply & demand. That’s 101 economics.

    Minimum wages laws are socialism and therefore don’t work & and as usual with socialism cause poverty.

    Could National argue these two points? Nope living wage is instead about splitting hairs in a one party state.

    “The data fatally undermines the policies being pushed by Labour and Greens.”

    Yep this is just a wedge issue for the sheeple in a one party state.

    Not sure who is more stupid National supporters who don’t understand minimum wage laws or Labour supporters who think Cunliffe by promoting living wage is the equivalent of the second coming.

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  9. nickb (3,687 comments) says:

    Milt, if I was to make an assumption, it would be that you are just another cloistered public sector business hater who has never risked a dollar of your own money in your life.

    Close enough?

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  10. Nick R (507 comments) says:

    @ Simon – quite right about supply and demand. That’s why productivity has stuff all to do with pay. In the long run it doesn’t matter how productive your business is. If you pay significantly less than your competitors, chances are that sooner or later you will struggle to retain staff.

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  11. Bill Ted (93 comments) says:

    I think what Milt is trying to say is that if we introduce a living wage we can scrap all welfare – except of course the dole which we’ll need for the tens of thousands of people who lose their jobs and all the youth who won’t be able to get one.

    The sad thing about this whole thing is the guy behind it, the Anglican bishop, is an exceptionally good guy. He has pure intentions. I’ve met him once before when he was in Auckland. His biggest failing is he doesn’t understand how an economy works, nor the real harm this idea would do to real people. He’s not a fan of capitalism – he believes we can all be happy living a basic, communal-style life. Unfortunately how he enjoys life doesn’t necessarily translate to how everyone else does.

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  12. JC (958 comments) says:

    Treasury working with Otago University have done some great work drilling down to the core of those living in “persistent hardship”.. its 6% of the population mostly but not entirely in the two bottom deciles and surprise.. its mostly Maori and solo parents who are overrepresented.

    One of the most dangerous things we can do is to accept figures like 20% are in poverty.. the Treasury work shows that figure might represent some *temporary* condition of poverty but you hardly want or need to create a living wage for people in most deciles who end up in a spot of bother for a short time.

    JC

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  13. MikeG (425 comments) says:

    So this Treasury advice is good so Bill English quotes it, but some other selective Treasury advice is bad so Bill English tries to hide it. Funny that we never see posts about that ‘bad’ Treasury advice.

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  14. duggledog (1,559 comments) says:

    Mobile Michael +1

    I don’t reckon I would have met the minimum wage till my mid twenties either and now I’m supposed to feel guilty 20 years later because I’m in the top 10%.

    Fuck that. I have no quals, but I hung in there, advanced myself when I could, took opportunities when they presented themselves, worked my balls off, went without overseas trips (except on business) married really well and didn’t produce ten kids.

    $13.50 an hour is ample even if you’re a two parent two child family. All it means is you have to live in Invercargill and drive a shitty car. Better than living in Calcutta.

    BTW I think the Anglican Bishop is a complete and utter fool. Collins is right. He’s the sort of guy that drives people away from the church. Reminds me of that dreadful Salvation Army lady

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  15. wreck1080 (3,924 comments) says:

    The best way for people to earn a living wage is to study at school and learn some shit.

    I understand petroleum engineers earn a bit.

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  16. seanmaitland (501 comments) says:

    @RJL – Some of them would get a net increase of $63 a week – the majority of them would either have their hours cut or their jobs dissovled.

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  17. Kimble (4,440 comments) says:

    Wages rise through industrial action, skill shortages or legislation – incidences of productivity increases getting passed on to wages can be assumed to have occurred through accident or incompetence on the employer’s part.

    Which is why those high income economies have such great productivity; industrial action, skill shortages, and government wish-making.

    Why don’t all those silly third world technocrats just make the wages in their countries higher?!? They could just pass a law, or organise strike actions to shut down entire industries, or make it illegal to hire women to reduce the supply of labour!?!!

    Dont they understand its as easy as that?! Why are they keeping people poor when they could, with the smear of a crayon, instantly make everyone better off!?!!!? HALLIBURTON!!!!!!!!!

    So, it would be terrible for people to be able to live off their wages alone, rather than needing welfare supplements from the government

    Well, welfare is paid by ‘society’ whereas wages are paid by, potentially, as few as one person. Society pays because there is (supposedly) a social benefit to doing so. The employer pays because they need the inputs to their production. You seem to be crying that the employer should also pay for all the social benefits as well.

    Your comment reeks of the lefty attitude that “its all OUR money afterall”! Never any consideration that its not as simple as your adolescent mind wishes it was. No thought that maybe your primary school teacher view of the economy isnt as nuanced as paid professionals in Treasury.

    Oh, but you go on thinking that you are more intelligent that people in Treasury if it makes you feel like a big, important man.

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  18. hemihua (31 comments) says:

    You wouldn’t hear this in our lame MSM though would you, can’t let facts get in the way of a good old beat-up.

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  19. stever (26 comments) says:

    It’s not just about lifting the min wage , once done you need to lift all wages the same amount.

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  20. Sponge (184 comments) says:

    Milt, let me give you a real world example. I am about to employ someone at my business (actually 2 people but one will be at a high wage). The job is a pretty simple clerical role and I will be offering around $16 per hour. Ramp the cost up to $18.40 and I will probably not employ this person. How is that a good result for anyone?

    Oh and we all know that the introduction of a “living wage” would not result in a reduction in WFF or any other transfers.

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  21. bc (1,367 comments) says:

    So if the living wage helps the government (i.e. taxpayer) then that’s a good thing right?

    Something doesn’t add up here.

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  22. Psycho Milt (2,412 comments) says:

    Sponge: there are various good arguments against Labour’s enthusiasm for making $18.40 a de facto minimum wage. My point is that “People will lose their WFF benefits” and “Government will pay less in WFF benefits” aren’t two of them.

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  23. OneTrack (3,117 comments) says:

    “Wage rates are a function of supply & demand. That’s 101 economics.”

    But the chardonnay socialists dont take Economics 101. They are more into PhDs in political science or ethic studies or arts.

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  24. Psycho Milt (2,412 comments) says:

    Why don’t all those silly third world technocrats just make the wages in their countries higher?!? They could just pass a law, or organise strike actions to shut down entire industries, or make it illegal to hire women to reduce the supply of labour!?!!

    When you’ve recovered from whatever fit you’re having, have a think about what has actually driven wages up in western countries in the last hundred years or so. Employer eagerness to pass on the benefits of productivity increases accounts for a small fraction of fuck-all of it.

    You seem to be crying that the employer should also pay for all the social benefits as well.

    If your business isn’t making enough to pay a full-time employee enough to live on, it’s uneconomic. The taxpayers can subsidise your uneconomic business via WFF or whatever, but let’s not pretend that it isn’t what you guys love to call “socialism.”

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  25. Psycho Milt (2,412 comments) says:

    Wage rates are a function of supply & demand. That’s 101 economics.

    I’d hope that even the most jaded Econ101 lecturer would trouble themselves to point out it’s not that simple. Some students never make it past 100 level, of course.

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  26. burt (8,275 comments) says:

    Where is Dr Cullen when you need him – treasury sometimes have these ideological burps. Bwaahaahaa.

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  27. Sector 7g (242 comments) says:

    Here is a fucking slogan for these assholes.
    “Fuck working harder to earn a pay rise, just vote Labour”
    Pricks.

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  28. Johnboy (16,689 comments) says:

    If you give the bastards $18.40 an hour they will just waste it on cake instead of being happy with bread! :)

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  29. lilman (960 comments) says:

    My boss got a delegation from 4 men at work about 4 months ago to be paid the Living wage of 18.50 an hour after a union meeting on site,he didn’t say too much but did ask if a few of us other wanted it,I said no thanks as did 5 others from my shift.
    You should have heard them piss and bleat when they realised they were actually getting 19.00 already and he gave them a 50 cent pay reduction,you just cant help some people but it did make for interesting banter at smoko.
    Boss said he would pay them their full rate backdated but not for a few weeks and he did,still laugh thinking about it.

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  30. Kimble (4,440 comments) says:

    Employer eagerness to pass on the benefits of productivity increases accounts for a small fraction of fuck-all of it.

    And industrial action, government mandates, and shortages of people with skills are how those high wage economies became high wage economies? Seriously? You think that productivity has NOTHING to do with the income level of a country? Are you a child?

    NZ’s productivity quintuples over night, and you think that would not have any affect on the demand for our labour. If I can do your job twice as well as you, I can sweep those floors twice as fast, I can up sell to the mega-value meals twice as often, and I can unblock the toilet in half the time, do you really think I will choose to replace you in that shitty, go-nowhere job if I only made exactly as much as you did?

    Your lefty brain is probably clouding over with all this discussion of oppressed peoples enslaved by nasty capitalistic masters so how about this instead. A new fuel is developed that is twice as efficient as that currently available. We would LIKE to pay the same amount for it, but it will probably cost more because it can do more, and replace more of the previously purchased fuel. That’s pretty fucking obvious to everyone on this side of the fence. It is why absolutely nobody other than you is saying that employers are eager to pay more. They dont fucking have to be.

    If your business isn’t making enough to pay a full-time employee enough to live on, it’s uneconomic.

    If your business isnt making enough to pay our 90% taxes then its uneconomic. Now, is it the business that is uneconomic, or the tax?

    You know what would return that “uneconomic” business you consider damned by God into something that resembles a going concern? Shutting down manufacturing operations in NZ and moving to a place where the productivity level better matches the labour costs.

    You’d probably sniff and say ‘those are crap jobs anyway’, but then still whine about our dwindling manufacturing sector.

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  31. MT_Tinman (3,205 comments) says:

    No worries Milt, I simply don’t employ anyone. No doubt if the joke “living wage” – not a defacto minimum wage but actually exactly that – is enforced a lot more small businesses will do the same.

    As far as why wages have increased, I’m betting good employers have increased workers’ remuneration a damned sight more in the last 20 years than union scum can claim credit for in that time.

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  32. Kea (12,841 comments) says:

    You raise wages through productivity

    Sure, that is why senior executives get paid millions (with bonuses) as they run profitable companies into ruin.

    The problem in this country is not those at the bottom getting paid too much, it is overpaid and over rated people at the top.

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  33. burt (8,275 comments) says:

    Kea

    The problem for the government however is keeping enough of them here paying tax while denigrating them for earning more than some perceived level where ‘a lot’ turns to ‘obscene’. There will always be people who command what others perceive as ridiculous salaries – that’s the fodder for cheap politics of envy.

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  34. Kea (12,841 comments) says:

    burt, you miss my point. My point is that people do not get paid what they are worth. That is clearly rubbish… in some cases.

    The real problem is not some getting paid too much, it is many not being paid enough.

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  35. mikemikemikemike (325 comments) says:

    All this says to me is that the median wage is the one that needs raising. Not the minimum one.

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  36. Sponge (184 comments) says:

    But Kea people do get paid what they are worth. I am not going to pay someone who is filing papers alphabetically $18.50 an hour. I just will not employ them. Who wins? Neither me nor the person I would have employed.

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  37. Kea (12,841 comments) says:

    Sponge, would you pay someone a million dollar bonus for bankrupting your company ?

    You are reading more into my comments than I am actually saying.

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  38. Psycho Milt (2,412 comments) says:

    You think that productivity has NOTHING to do with the income level of a country?

    I’m saying the fruits of that productivity increases wages to the extent that workers fight for it, or the market for skills requires it, or governments mandate it. History demonstrates that pretty conclusively. In itself, increased productivity does nothing to increase wages.

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  39. Sponge (184 comments) says:

    Sorry Kea – I do now see what you are saying.

    Some people do get paid more than they are worth. “Fred the Shred” being a good example. But that does not, in my view, mean that someone who undertakes a job that anyone could do (and this is not putting people down) should be paid more than they are worth.

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  40. Nostalgia-NZ (5,221 comments) says:

    ‘seanmaitland (337) Says:

    November 1st, 2013 at 5:24 pm
    @RJL – Some of them would get a net increase of $63 a week – the majority of them would either have their hours cut or their jobs dissovled’

    Sharp comment.

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  41. Kimble (4,440 comments) says:

    I’m saying the fruits of that productivity increases wages to the extent that workers fight for it, or the market for skills requires it, or governments mandate it

    Of course employers wouldnt pay more if they didnt have to. Nobody would. But its competition for resources that drives up wages, not skills shortage. What you dismiss as “skills shortage” is the market behaving as anyone should expect.

    Your idea that Union thugs and venal politicians will merely redirect the gains from productivity increases to those generating them is a fantasy. Just as likely the industrial action destroys productivity, or holds it to ransom, and politicians will direct the gains for political purposes.

    In itself, increased productivity does nothing to increase wages.

    We are talking about a wage increase WITHOUT an increase in productivity.

    That’s what we have been talking about from the first minute this stupid idea of massively increasing the minimum wage was raised!

    If the Left was honest they would sell their stupid policy like this:
    We intend to target all you people making less than $38k. Some of you will get a pay increase, and some of you will be made unemployable. (Dont worry, we will make sure that you know that the evil greedy bosses are to blame, not us.) And then every year we will let some religious guy decide whether to increase that amount and just take the risk that he might increase it too much and make it UNECONOMIC to employ some more people.

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  42. Sir Cullen's Sidekick (890 comments) says:

    Labour will win in 2014 based on this bribe..nobody reads or understands treasury analysis….

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  43. burt (8,275 comments) says:

    Sir Cullen’s Sidekick

    I fear you are right. The only thing that gives me hope is that 6-9 years later Cunliffe will probably be given a cushy number at some basket case union dominated SOE. Hopefully one just like Post that’s dying a thousand cuts because militant unions have resisted all change.

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  44. emmess (1,428 comments) says:

    And please can we stop calling it the Living Wage? The term doesn’t tell anyone anything meaningful.

    I suggest the Killing (Jobs) Wage

    Oh and we all know that the introduction of a “living wage” would not result in a reduction in WFF or any other transfers.

    Yeah, remembering back to ancient history (2005), Labour told us that WFF was a wonderful policy that would solve poverty. National and the vast majority of people favoured tax cuts. Are Labour now saying that WFF should be lowered and taxes cut if the want to save the government money on it?

    And then every year we will let some religious guy decide whether to increase that amount

    So the left want to give a cleric more power than even the clerics have in a theocracy like Iran in this area of the economy

    A minimum national wage applies to each sector of activity as defined by the Supreme Labor Council. In 2009 this was about $263 per month ($3,156 per year).

    http://en.wikipedia.org/wiki/Economy_of_Iran

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  45. cha (4,036 comments) says:

    A low wage two parent family with two children would only gain $63 a week from the living wage while the Government would gain (via abatements and extra tax) $126 a week!.

    And the brand spanking new taxpayer union is going to set about making damn sure that the government gains (via abatements and extra tax) $126 a week?.

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  46. Duxton (654 comments) says:

    Kea: “The problem in this country is not those at the bottom getting paid too much, it is overpaid and over rated people at the top.”

    Quite right, Kea. So tell that lying, smarmy cunt Cunliffe to take a pay cut….

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  47. Psycho Milt (2,412 comments) says:

    We are talking about a wage increase WITHOUT an increase in productivity.

    And many times there’s an increase in productivity WITHOUT a wage increase. Somehow the world endures.

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  48. ross69 (3,652 comments) says:

    And many times there’s an increase in productivity WITHOUT a wage increase. Somehow the world endures

    Absolutely. Look at Auckland Ports. Wharfies there were feted by management for being so productive, at the same that management wanted to cut workers’ wages by 20%. Funnily enough, I don’t recall David Farrar or commenters here ever complaining about that.

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  49. ross69 (3,652 comments) says:

    Friday, August 30, 2013

    Media Release

    Ports of Auckland 2012/13 Annual Results

    •Total port operations EBIT up 11.4% on increased port operations revenue, up 5%
    •Trading profit before income tax up 22.8% to $44.4m
    •The declared dividend for the financial year is $29.5m, up 46.8% up on the 2011/12 dividend of $20.1m
    •Multi-Cargo business performed well, EBIT up 6.5%
    •Container volumes increased by 1.3% to 818,819 TEU, Container Terminal EBIT up 18.7%
    •Interest expense was down 20.8%

    Ports of Auckland has reported improved results for the year to 30 June 2013, reflecting increases in both labour productivity and volumes across all port operations.

    Hmmm so Ports of Auckland should be looking to raise workers’ wages, not cut them. I’m sure David Farrar would agree.

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  50. Reid (16,514 comments) says:

    Labour will win in 2014 based on this bribe..nobody reads or understands treasury analysis….

    The way to combat this for conservatives is to come up with a simple line that makes people pause for thought, and my suggestion is the line often cited by DPF: if legislating people out of poverty is so easy, then why not make the minimum wage $50 p.h? Why stop at $18?

    Accompany this with a few simple facts on say, the numbers of youth that will not get a job as a result of this. The time to start doing this is now and with every minister vaguely discussing finance in every interview they have, so it has time to seep into the public consciousness. Conservatives always let these things run away and by the time they start combating it, the meme has already embedded itself and it won’t be shifted. Conservatives won’t do this because they don’t understand propaganda like lefties do and I predict they will wait till the election campaign before starting which won’t work.

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  51. ross69 (3,652 comments) says:

    We are talking about a wage increase WITHOUT an increase in productivity. That’s what we have been talking about from the first minute this stupid idea of massively increasing the minimum wage was raised!

    Hang on…the Right have banged on ad nauseum that if you pay workers more, they’ll be more productive and will be delighted to work longer hours. You seem to be saying that’s nonsense.

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  52. Manolo (13,839 comments) says:

    ross69 must be in Christchurch rooting for his idol Silent T. Good luck, comrade.

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  53. ross69 (3,652 comments) says:

    I find it staggering that Bill English is commenting on the living wage proposal. This is the guy that rorted a fortune from taxpayers and then begrudgingly paid it back. Why does Bill need taxpayers to pay for a cleaner to tidy his house when a) he or his wife could do it, and b) he and his doctor wife get paid plenty for them to pay a cleaner?

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  54. wat dabney (3,778 comments) says:

    The main beneficiary of the living wage would effectively be the Government because it would receive more in tax and pay out less through abated transfers.

    This strikes me as bollocks.

    The government will be paying out more to the resultant unemployed.

    The real beneficiaries are whites and people with skills and experience.

    The real losers are those who are currently able to compete on wages; the young, the unskilled and minorities.

    Remember, Labour isn’t owned and operated by the unemployed; it is owned and operated by unions looking to protect their members from competition. Labour advocating a high minimum wage is no different from the support that racist white unions notoriously gave to minimum wage legislation in South African.

    After all, which supporter of the minimum wage was it who said that “Having on the market a rather large source of cheap labor depresses wages outside of that group, too – the wages of the white worker who has to compete. And when an employer can substitute a coloured worker at a lower wage – and there are, as you pointed out, these hundreds of thousands looking for decent work – it affects the whole wage structure of an area, doesn’t it?

    Why, it was lefty hero John F. Kennedy. Just another racist happy to throw poor blacks under the bus like Labour.

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  55. big bruv (13,934 comments) says:

    “This is the guy that rorted a fortune from taxpayers and then begrudgingly paid it back.”

    That sounds familiar…………oh yes, the Labour party pledge card and the Greens MP’s housing scam.

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  56. big bruv (13,934 comments) says:

    Ross69

    “Hmmm so Ports of Auckland should be looking to raise workers’ wages, not cut them”

    Why would they want to raise their wages?

    It’s hardly skilled work it is. There are plenty (apparently) out there who would gladly take their jobs.

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  57. ross69 (3,652 comments) says:

    We already have one of the highest minimum wages in the world, relative to the median wage.

    And how does our median wage compare to the rest of the world?

    “According to figures from the Ministry of Social Development for 2011, and quoted by Rashbroke, the average income of a single-person household in the middle band of income distribution was $30,800 in 2011, a figure that had risen less than 20 per cent from 1984, when it was $25,000″

    Less than 20% over a period of 28 years! Hmmm and I wonder what the rate of inflation was over that period…

    http://www.stuff.co.nz/national/9182609/NZ-income-gap-at-crisis-level-author

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  58. ross69 (3,652 comments) says:

    [from the above link]

    …half the population, including beneficiaries and pensioners, earn less than $24,000.

    Rashbroke said one of the biggest problems with entrenched inequality was the way it “makes a lie” of the idea that there were equal opportunities.

    “The evidence shows that in very unequal countries about half of your income, as an adult, can be predicted from what your parents earned.

    “When you’ve got really entrenched inequality, half of your success is based on how successful your parents are.”

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  59. ross69 (3,652 comments) says:

    Why would they want to raise their wages?

    Because according to David Farrar, productivity increases lead to wage rises. Hence his statement: “You raise wages through productivity, not through legislation.”

    You obviously disagree.

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  60. Colville (2,272 comments) says:

    I find it staggering that David Cunliffe is commenting on the living wage proposal. This is the guy that rorted a fortune from taxpayers and kept it. Why does David need taxpayers to pay for a cleaner to tidy his house when a) he or his wife could do it, and b) he and his lawyer wife get paid plenty for them to pay a cleaner?

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  61. wat dabney (3,778 comments) says:

    Ross69,

    You are missing the point.

    The point is that pricing the young and the unskilled out of work – depriving them of the opportunity to gain skills and experience – is the very last thing they need.

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  62. big bruv (13,934 comments) says:

    Ross69

    Damn right I disagree. We are often told by the likes of you that there are “no jobs” (which is absolute rubbish) so there is no pressure on the POA to raise wages.

    As I have previously said, this is hardly skilled work, given the high percentage of knuckle draggers who currently work at POA it is clear that they are already earning far in excess of what they are worth.

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  63. rg (214 comments) says:

    Everyone shoudl earn a living wage, and it is each persons responisibility to ensure that they do. If you do not earn enough to have two children then don’t.

    As for a 16 year old living at home, a living wage for them is very low, trouble is the Nats have refused to support ACT’s living wage for youth (youth rates) and that is why thousands of them can not get work because John Key with his timid little training wage has not doen enough to make them affordable I do not employ 16 year olds any more because they are too expensive and now thanks to the Nats they can not drive.
    Get rid of the Nats I say, lets give the youth a chance with the ACT Party

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  64. Kimble (4,440 comments) says:

    And many times there’s an increase in productivity WITHOUT a wage increase. Somehow the world endures.

    And many times there’s an increase in food production WITHOUT an increase in population. Somehow the world endures.

    That’s how stupid what you just said was. We can indefinitely sustain an increase in food production without an increase in population, but we cannot indefinitely sustain an increase in population without an increase in food production.

    Hmmm so Ports of Auckland should be looking to raise workers’ wages, not cut them.

    These would be the famously overpaid port workers.

    Lets see, a CEO of a failing company gets paid $20million. The likes of you would be whining about how he doesnt deserve it and that there should be a cap on salaries. But then the company turns things around and becomes profitable. I find it hard to believe that you would then be saying the CEO deserves a pay increase.

    And yet that is what you are saying about those overpaid port workers.

    And Milt, that’s where your “industrial action” gets us. Workers in entrenched positions, who already extract more than their fair share by holding revenue hostage, demanding an even greater share.

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  65. Kimble (4,440 comments) says:

    Oh, and when I talk about productivity, I am talking about the economy, not a single person in a job. The only reason I ever framed it like that was because that is who you guys are approaching it.

    Pointing to a single person, or a small group, and saying “Look, they have higher productivity and didnt get paid more” in no way contradicts the claim that wage levels in a country are closely related to productivity.

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