Minimum wage to rise to $15.75 an hour, Government announces

The minimum wage is rising again, the Government has announced.
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The minimum wage is rising again, the Government has announced.

The minimum wage will increase by 50 cents to $15.75 from April 1, the Government has announced.

Workplace Relations and Safety Minister Michael Woodhouse says the increase will increase wages throughout New Zealand by $65 million a year, adding to the pay packets of nearly 120,000 workers.

Woodhouse said the increase was about "striking the right balance between protecting our lowest paid workers and ensuring jobs are not lost". 

"At a time when annual inflation is 0.4 per cent, a 3.3 per cent increase to the minimum wage will give our lowest paid workers more money in their pockets, without hindering job growth or imposing undue pressure on businesses."

READ MORE: $15.25 minimum wage's impact on Kiwi businesses

The starting-out and training hourly minimum wage rates will also increase, from $12.20 to $12.60 per hour, remaining at 80 per cent of the adult minimum wage.

Annual increases to the minimum wage since 2009 reflected the Government's commitment to growing the economy and boosting incomes, Woodhouse said.

A spokeswoman for Woodhouse said modelling carried out by the Ministry of Business, Innovation and Employment had estimated a 75-cent increase, to $16 an hour, would cost 3500 jobs.

An instant increase to the "living wage" of $19.80 an hour would cost 28,000 jobs, according to the same modelling.

Prime Minister Bill English said the Government had increased the minimum wage by $3.75 an hour, or 31 per cent, since winning power in 2008 - an increase in real terms of 17 per cent accounting for inflation.

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English said the Government had to balance the interests of Kiwis already in work with jobseekers who could struggle if a large increase put jobs at risk.

"We think we've, over time, struck about the right balance."

Labour workplace relations spokesman Iain Lees-Galloway said the increase would be "cold comfort" to the thousands of Kiwis struggling to pay their rent or mortgage.

“Fifty cents an hour simply is not enough to keep up with the enormous increases in housing costs that many New Zealanders currently face."

Too many Kiwis were currently on the minimum wage, making them "utterly reliant" on the Government to increase their income, Lees-Galloway said. 

 - Stuff

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