The minimum wage should be a living wage
The ALP is supporting the union movement, while the Liberal Party throws its weight behind employers in the battle over the minimum wage.
The union movement is pushing for a 6 per cent increase to the minimum wage in a two-step process to get it up to what it says is a living wage.
The ACTU says no full-time worker should be living in relative poverty – which is defined by the OECD as 60 per cent of median earnings.
This landmark could be reached, says the ACTU, with a further 5.5 per cent increase in 2020.
As The Lamp goes to press the ALP has committed to replacing the minimum wage with a living wage.
Even though corporate profits have increased by 43 per cent since 2016 compared to an 8 per cent rise in wages, employers groups are lobbying the Fair Work Commission to limit a rise in the minimum wage to between zero and two per cent.
Restaurant and Catering Australia, in its submission to the Commission, advocated for no increase – effectively a real wage cut – while the Australian Chamber of Commerce and Industry called for a 1.8 per cent increase and the Australian Industry Group want the increase limited to two per cent.
The federal Liberal Party leadership appears to back the employers’ position. Finance Minister Mathias Cormann described slower wages growth as a “deliberate design feature”.
Prime Minister Scott Morrison said Labor’s proposal to change the rules used by the Fair Work Commission to set the minimum wage would “force businesses to sack workers”.
The Victorian Labor government, in its submission, argued for a 5.6 per cent increase – close to that of the ACTU.
The federal Labor opposition argued that international evidence shows that “significant increases in the minimum wage can be sustained without costing jobs”. It also cited a Reserve Bank of Australia research paper, which found that “modest, incremental” wage increases do not harm jobs or hours.