MIN­I­MUMWAGE

The Tribune (NZ) - - CONVERSATIONS - Dion Martin Palmer­ston North

In the run-up to the an­nual min­i­mum wage an­nounce­ment, i be­lieve what is needed is a sub­stan­tial in­crease to help boost spend­ing and guard against de­fla­tion

I dont think a 25 cent or 50 cent in­crease will ‘cut the mustard’ for work­ing peo­ple and their fam­i­lies and nor will it help lift the econ­omy

New Zealand is in a unique sit­u­a­tion where we can sub­stan­tially in­crease the min­i­mum wage to both boost spend­ing in the econ­omy (as the Re­serve Bank has called for) and re­duce in­equal­ity

A min­i­mum wage should be at least two-thirds of the av­er­age wage, or $19.46.

The govern­ment can im­ple­ment this in three stages: $16.50 this year; $18.46 in 2017; and up to the an­tic­i­pated level of the av­er­age wage in 2018 of $20.65

Over the last year the spectre of de­fla­tion has con­tin­ued to grow. Gov­ern­ments and Re­serve Banks both here and across the world are search­ing for ways to restart their economies and lift in­fla­tion into their tar­get bands. I be­lieve a sig­nif­i­cant in­crease to the min­i­mum wage ticks all boxes

When in­fla­tion is at or near the top of the band the govern­ment and the Re­serve Bank have called for wage re­straint be­cause they say it’s in­fla­tion­ary. With in­fla­tion now at 0.1% and en­forced re­straint on low wages over the last decade, the Govern­ment has an op­por­tu­nity to ‘‘re­vive two birds with one pol­icy’’ by in­creas­ing the min­i­mum wage by at least $1.75 to $16.50 per hour on 1 April this year. I await the Gov­ern­ments an­nounce­ment with huge ex­pec­ta­tion along with equal trep­i­da­tion.

PHOTO: SUP­PLIED

Cat­tle in creeks and wa­ter­ways is be­com­ing a defin­ing is­sue.

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