More to living wage than meets the eye

The Treasury has dumped a monsoon bucketful of scorn on the campaign for a living wage. But the case for such a campaign withstands the deluge.

In a report released last Friday, the Treasury argues the “living wage is not well targeted at the intended demographic of low-income families”.

It thinks the $18.40 an hour figure the campaigners are calling for is too high, and says that if widely adopted, it would cost jobs, push up prices and require an increase in taxation.

The question is whether hard-working parents, working 60 hours a week between them, should be able to earn enough from their wages to give a couple of kids a minimally decent start in life.

Living Wage Aotearoa New Zealand defines a living wage as “the income necessary to provide workers and their families with the basic necessities of life”.

It is transparent about how the $18.40 a week figure has been arrived at. It is spelled out at length in a report by the Family Centre Social Policy Research Unit, whose authors say “it embraces small but important things like being able to to pay for children to enjoy a school trip, having a computer in the home and being able to mix with friends recreationally, albeit modestly”.

It allows, for example, $275 a week for the roof over their heads. That wouldn’t stretch far in Auckland.  Continue reading.

Brian Fallow is the New Zealand Herald’s Economics Editor.

Source: The New Zealand Herald


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