Living wage not on Hutt City agenda

22:23, Dec 16 2013

Wellington councillors have signed off on a living wage for their lower paid workers but the concept isn't even on the starting blocks at Hutt City Council.

Wellington City Council agreed nine votes to five last week to become the first local authority in New Zealand to ensure no staff earn less than $18.40 an hour.

The Wellington council has 450 staff earning less than this amount. A majority of councillors agreed to add $750,000 to the 2014/15 draft budget to cover the higher wage bill.

Hutt City Council chief executive Tony Stallinger is not convinced the council should be doing the same for its 180 workers out of a total of 444 who earn less than $18.40 (February figures).

"It is the Government that sets the minimum wage and therefore it is the Government who can change the base line of wages in our economy.

"Hutt City has no plans to take on the role at a cost to ratepayers," Mr Stallinger said.


The minimum wage set by the Government is $13.75. However, a report released in February by the Anglican Family Centre Social Research Policy Unit said $18.40 an hour was the amount that an adult in a fulltime job, with a partner in a part-time job, needed to support themselves and two children modestly, while also having enough to participate in community life.

Hundreds more staff work for companies contracting to Wellington City Council, but are not covered by the new deal. Council officers warned the cost of insisting contractors also be paid a living wage could be more than $2.5 million and there were complicated issues to sort out. A plan for including these staff was to be left until the 2015 annual plan.

Mr Stallinger said he had seen little analysis of the effect a living wage would have on the economy and as a council, which deals with ratepayers' money, "it's important we make sound decisions based on balanced analysis".

Hutt council pay rates are based on market data, and a range of non-monetary benefits are also offered, he said.

Councils are required by Government to meet the needs of communities for good-quality local infrastructure, local public services, and performance of regulatory functions in a way that is most cost-effective for households and businesses.

"We cannot achieve this purpose and be most cost-effective if we pay more than the market dictates is required to recruit the staff we need," he said.

Councillor Lisa Bridson said yesterday that when the Hutt council briefly discussed the matter in June she could see she was about the only one in favour "and there didn't seem much point in pushing it [then]".

However, she said the concept at least merited a proper debate, and she believed new councillors elected in October may be more open to it.

Councillor Max Shierlaw is opposed to the idea. He said the Local Government Act obliged councils to deliver services in the most cost- effective manner and "arbitrarily" increasing wages ran counter to that.

Asked if he thought the Wellington council could be tripped by a legal challenge, he said: "I hope they do. They're going ahead and increasing wages with no heed to what the law requires them to do.

He cannot understand why councillors are discussing it. "It's an operational matter [for chief executives to decide]."

Hutt News