Council of Trade Unions media release
20 August 2010
The Government is conveniently playing with numbers in its statement that after tax the average weekly wage only increased 3 per cent between 1999 and 2008, said the CTU today. Its tax calculations do not include the Working for Families tax rebates which were introduced over that period and made a significant difference to poverty and inequality of families with jobs.
“However tax cuts do not make the country richer,” said CTU Economist and Policy Director Bill Rosenberg. “The fact is that the average hourly wage increased by a miserly 6 percent over the entire decade 1990-2000 after inflation – far behind increases in productivity of 31 percent for the same period. It rose faster, but still only 11 percent in real terms in the decade 2000-2010 under more favourable industrial relations laws.”
“The biggest issue continues to be low wages, not cutting taxes and putting public services at risk.”
“We hope that the Reserve Bank is not signalling in the Governor’s latest speech that it will choke off reasonable wage increases. Many low income earners were not adequately compensated for the increases in GST and other costs due to government policy changes and will seek to get the difference in their wages.”
“It would be highly unfair if wage catch-ups for low income earners were treated by the Reserve Bank as inflationary while the $460 million the Government added to its deficit to pay for tax cuts to high income earners were not.”