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Labour, NZ First and the Maori Party have slammed the Government's plans to raise the minimum wage by 50c an hour, saying it won't bridge growing inequality.
Kate Wilkinson, National's minister for labour, announced today the minimum wage will go up from $13 an hour to $13.50 from April 1.
The training and new entrants' wage will increase from $10.40 to $10.80.
Wilkinson said the rise strikes the "right balance" between protecting low paid workers and retaining jobs.
"Those working full time on the minimum wage will earn an extra $20 a week, or more than $1000 a year," Wilkinson said.
But Labour's spokesperson on Labour Issues, Darien Fenton, says the increase represents a "lost opportunity" and will fail to address income inequality.
"If you look at the statistics, family incomes have dropped in real terms by 4.7% over the last two years," said Fenton.
"In 2011 the average family was spending 7.4% more on rent alone compared to what they were spending in 2010, while 53% of Kiwi families now say they are either 'barely able' or 'unable' to meet their basic needs."
Fenton said the Government's claim that increasing wages would lead to more people out of work is a "red herring".
"Treasury has repeatedly noted that there is no evidence that a higher minimum wage leads to job losses."
"A pittance"
NZ First leader Winston Peters described the 50c an hour increase as a "pittance".
"This is the government that gave huge tax cuts to its rich mates," he said.
"Remember the boss of Westpac got more than $5000 a week in tax cuts while the workers had to pay higher GST on the cost of everything to pay for these tax cuts."
Peters said National and its coalition partners - especially the Maori Party - "should feel ashamed".
"The reality is the gap between rich and poor is growing all the time and the Maori Party is just as guilty as National," he said.
Maori Party co-leaders Tariana Turia and Pita Sharples have condemned the rise, saying they support a $16 an hour minimum wage.
"Such a modest adjustment, from $13.00 to $13.50, does not reflect the political courage and strategic vision we need to eliminate poverty," Sharples said.
"We are very disappointed that, in one of the first tests for National in being able to address income inequality and reduce poverty, this administration has failed to deliver," the co-leaders said.
Prime Minister John Key says households on the minimum wage, which amounts to $540 a week, qualify for help from the state.
Key says anyone earning the minimum wage with a family will have it topped up by Working for Families.
He says there are around 64,000, mainly young people, who qualify for state assistance.
"Not helpful"
Act Parliamentary Leader John Banks says the rise won't help young people trying to find jobs.
"Increasing both the training and new entrants wage erodes the incentives for businesses to hire young people, leaving youth out of hope and out of dignity," Banks said.
"Act would like to see young people given the opportunity of work, the ability to gain experience and a chance to contribute to our economy.
"This will only happen if we give employers the right incentives to do so by reducing impediments to youth employment, not increasing them."
Hospitality New Zealand has also come out against the wage rise, saying consumers will bear the cost of the increase.
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Post new commentOnPoint said on 2012-02-11 @ 08:30 NZDT: Report abusive post
...and that is why 1,000 Kiwis leave for Australia every year where the average wage is $68k. We have the best country in the world, though our economy is shot. For any Kiwi ex-pats returning home like myself the job situation is worriesome.
nwilks said on 2012-02-08 @ 21:55 NZDT: Report abusive post
I think it is a responible about, lets remember that who the minimum wage is for.. And some people in this world would be happy to get .50 cents an hour full stop! It's employers that are going to have to come up with the extra $ to substanciate the increase anyways.