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Kiwi wages will never reach Australia's - Bollard

Published: 5:18PM Monday September 24, 2012 Source: ONE News

Outgoing Reserve Bank Governor Alan Bollard believes Kiwis will never receive the same pay as their Australian counterparts.

Bollard is exiting the Reserve Bank this week after ten years and 80 official cash rate announcements.

He told ONE News New Zealand wages would never catch up to what they were in mineral-rich Australia.

"God looked at Australia and scattered minerals all across the country's surface and they make a heap of money from mining those. It's just a different country, a different world there," he said.

The average weekly income in New Zealand for the first quarter of 2012 was $860.62 compared with the latest figures from Australia putting the average weekly paycheck at $1047.20.

The pay difference equates to an extra $186.58 in the Aussie workers' paycheck each week.

Bollard believes few countries would be able to catch up with the level of growth Australia has experienced.

"We compare ourselves to Australia all the time but Australia is a very unusual country like that."

Bollard said the country is too fixated on a high New Zealand dollar that is causing concern amongst business owners.

He said the economy should be looking to make the most of the high Kiwi dollar such as importing goods in US dollars and exporting into the Australian economy.

"It's the people and the businesses that can say 'well that's the world, we're going to get on with investing and consuming,' that'll do best," said Bollard.

Kiwi businessman Graeme Wheeler will take the helm of the bank next week.

Wheeler worked at the World Bank from 1997 to 2010 in various roles, including the managing director of operations and vice-president and treasurer.

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