Labour gets behind 'living wage' movement

Last updated 17:18 19/04/2012

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Labour leader David Shearer is urging the introduction of a "living wage" movement in New Zealand to pay people what they need to live on, rather than just sticking to the minimum wage.

He said Kiwis have been working harder "than almost anyone in the developed world" for years but were not reaping the rewards.

However, Shearer told reporters in Nelson that the idea of a living wage would be "aspirational" and would not be passed into law.

Central goverrnment agencies and local government would work towards paying the wage under a Labour government, but would not be required to do so.

"We are looking at a living wage because it raises families' incomes to a level where they get decent pay for their work. It's an idea that's not a legislated thing that we would do. It's certainly something we would encourage," he said.

"Over time as we are able to afford the funding for it, we would be looking to lift wages."

A unit within the Government would set out what a living wage was in New Zealand and that would be "the aspiration to which people would aspire to".

He said all policies were under review, but the Labour caucus had not yet considered whether to scrap the policy of taking GST off fresh fruit and vegetables, which it campaigned on in 2011.

Labour wanted to win the votes of small business, and would reveal policies to do that.

Earlier in a speech, Shearer said the "living wage" was an idea launched overseas and he was interested in seeing it catch on here.

While it was a voluntary scheme, it had cross party support in Britain and thousands of employees were covered.

The living wage was "the amount a person needs to earn to provide for themselves and a family" and while it was not enforced by law, a lot of employers had joined the scheme because it showed they were good employers.

It paid people more than the minimum wage and was based on costs like food, accommodation and transport.

Shearer said the average wage in 1989, in today's dollars, was $21.49.

By 2011, it had reached $24.43.

"But if wages grew as much as productivity for the 22 years up to 2011 then the hourly rate would have been $31.85.  That's an extra seven dollars an hour or $297 a week that the average worker earned but didn't get paid.

"How many people would be wanting to go to Australia as they are now in record numbers if we paid that. Surely lifting everyone up must be the point of economic growth, or why do we bother?"

That was why New Zealand needed to create a new economy - a clean, green and clever one.

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"The Government's answer has been for businesses to pay lower wages or push people harder for the same pay or move jobs overseas. It is now making a virtue of our low wage rates, calling it New Zealand envy.

"It's as if they want to make new Zealand a truck stop on the way to Mexico."

Shearer reiterated Labour's policy to subsidise apprenticeships and also said its priority in government would be to see all under-20s either in work, training or education.

- The Dominion Post

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