John Key. Photo by Getty
The minimum wage will go up 50c to $14.25 an hour from
April 1 this year, Prime Minister John Key said this afternoon.
The increase is ahead of expectations of a 25c rise but
remains well short of the $18.80 an hour living wage
campaigners say is needed to feed two adults and two children
in New Zealand.
Mr Key said advice considered by Cabinet when it made its
decision today was that the increase would result in a
"relatively negligible" loss of jobs.
However that advice also said a rise to $14.50 an hour would
result in the loss of about 2300 jobs.
Council of Trade Unions economist Bill Rosenberg said the
increase was "unfair given several years of stagnating wages,
an economy that is starting to grow, and widespread concerns
about how that growth will be shared."
"This minimum wage increase goes little distance to
addressing the inequalities in society."
Mr Rosenberg said the minimum wage was the only way other
than through the taxes and benefits the government had to
ensure wage and salary earners, particularly those on low
incomes, benefited from a growing economy.
"A more effective system of collective bargaining would be a
much fairer way to spread the economic benefits to the
majority of the workforce while reflecting the situation that
each industry is in."
Mr Rosenberg said that in five years, Mr Key's government had
raised the minimum wage by 14 per cent including the increase
announced today. After inflation, the increase over five
years was just 3 per cent.
"The government has been saying people should expect wage
rises. The minimum wage review was a missed opportunity to
ensure that everyone from the lowest paid upwards gets a
decent increase after several years of hard times," he said.
Labour MP Darien Fenton said the government had "once again
blown an opportunity to give Kiwi workers on the minimum wage
a decent pay rise".
"Today was the perfect time for John Key to send a message
that in his 'rock star' economy, the low paid can expect a
"He didn't. Instead he's singing from the same old National
songbook and some 200,000 Kiwi workers will still be taking
home less than $15 an hour."