'Living wage' for city?

A Hamilton councillor says the city could pay its staff at least $18.40 an hour without hiking rates despite an extra $170,000 a year in wages.

Social policy researchers say the ''living wage'' is the minimum needed to let workers ''live with dignity and participate in their community''.

Currently the minimum wage is set at $13.50, however a Cabinet decision on any increase is expected soon and would apply from April 1.

Figures sought by the Waikato Times show 56 full time equivalent council staff are paid between the legal minimum and living wage rates.

City organisational development general manager Olly Te Ua said the basic cost of increasing all permanent staff to $18.40 was $168,276 per year.

Finance and monitoring chairman Dave Macpherson said he believed the council could stage increases to reach the higher rate over two years. Mr Macpherson is lobbying other councillors about setting the minimum wage as a policy in the upcoming annual plan budget-setting process.

He said phasing would give time to find the money in operational budgets and remove the need to lift property rates to fund the targeted increase.

Led by unions, the living wage campaign is focusing on persuading major employers, including local councils and central government, to adopt a living wage policy rather than trying to seek legislative change.

Hamilton City Council has more than 60 staff earning over $100,000 and lifting its minimum pay would cost the same as a third-tier manager.

However Mayor Julie Hardaker - formerly an employment law specialist - was unconvinced of the arguments for setting a higher minimum wage.

''If you start categorising things like minimum wage, that approach can prevent growth of wages and salaries. While it sounds like a good idea, it can be counterproductive, with less flexibility in what people can earn.''

Lower Hutt-based Anglican Family Centre researchers Rev Charles Waldegrave and Peter King calculated the $18.40 living wage rate as the minimum required to ''live with dignity'', based on a household having 1.5 incomes, producing a total income of $57,432.

It was ''about setting an income level that enabled people to live modestly while still contributing to society, rather than simply surviving''.

It was endorsed by Labour Party leader David Shearer.