Govt defends 50c an hour minimum wage lift

Outrage has greeted a 50c-an-hour rise in the minimum wage – but the Government says it strikes the right balance.

The increase will take the minimum wage to $13.50 an hour, a rise of about $20, to $540 a week for fulltime workers, before tax.

The Government's coalition ally the Maori Party was the first to condemn the rise, saying it lacked courage and failed to deliver for the poor.

Co-leaders Tariana Turia and Pita Sharples said the minimum wage needed to be $16 an hour.

National had failed one of the first tests of its commitment to reducing income inequality and poverty, they said.

Labour leader David Shearer said the rise was "paltry". Labour campaigned on raising the minimum wage to $15 an hour.

"[It] will do little to help Kiwis who are working hard but simply can't earn enough to support their families," Mr Shearer said.

Prime Minister John Key said the Government was trying to "get the balance right" between "making sure that people can feed their children and look after their families and themselves, and also ensure that they keep their job".

The increase was "slightly above" the rate of inflation.

"We're on our way to the magical $15 people talk about, but we can't get there in one step," Mr Key said.

Many people on the minimum wage would also be receiving Working for Families.

Labour Minister Kate Wilkinson said Labour Department analysis suggested raising the minimum wage to $15 an hour could cause the loss of up to 6000 jobs.

The Dominion Post