The Guardian 31 August, 2005

Real wages to be cut 59%

Industry Minister Ian Macfarlane has blown John Howard’s workplace cover, revealing plans to slash real wages by around 50 percent. Macfarlane came clean at the end of a 2GB interview with Alan Jones in Sydney last week, confirming claims made by critics of his government’s radical workplace agenda.

"We’ve got to ensure that industrial relations reform continues so we have the labour prices of New Zealand", Macfarlane said. "We’re already a decade behind the New Zealanders. There is no resting."

The admission flies in the face of claims by the Prime Minister and Workplace Relations Minister Kevin Andrews that legitimising unfair dismissal, slashing entitlements, and sidelining collective agreements in favour of individual contracts would lead to "higher wages".

New Zealand introduced similar legislation, the Employment Contracts Act, in 1991, and by 1997 its real wages were lower than they had been in 1977.

A study of supermarket wages, published in that country’s Labour Market Review, revealed real wage falls of between 11 and 44 percent in the decade to 1997.

The steady decline in Kiwi earnings led to a flood of New Zealanders setting up home in Australia.

Annual immigration from the Shaky Isles rocketed from 8080 persons in 1991 to 34,339 in 2001.

Around 15 percent of working-age Kiwis now live in Australia and the New Zealand government says its economy is being held back by a serious labour shortage.

Burwood-based bus driver, Yvonne Carson says her wage packet increased by "around 50 percent", depending of shifts, as soon as she crossed the Tasman.

She said, with overtime, her bus driver husband earned up to double his New Zealand pay.

The Australian Manufacturing Workers’ Union released the following earnings comparisons for production workers, on either side of the Tasman, employed by the same company.


NZ Tradesperson — NZ$18.14 per hour, Aust$25.51

Advanced Tradesperson — NZ$19.18, Aust$27.75

Cleaner — NZ$10.75, Aust$16.29

Forklift Operator — NZ$11.89, Aust$16.33.


Forklift Driver –NZ$14.69, Aust$22.74

Operator — NZ$15.53, Aust$26.02.

Carter Holt Harvey Packaging:

Corrugated Stacker Operator –NZ$11.99, Aust$23.09.


Single Face Operator –NZ$12.69, Aust$22.84.

The base weekly wage for a semi-skilled production worker is $503.00 while his/her Australian counterpart earns $912.50.

Meanwhile, figures from the two nation’s statistics departments reveal that Australian workers’ hourly productivity is 22.5 percent higher than their low-wage counterparts.

Mr Macfarlane made his on-air comments after attending cabinet meetings at which the effects of workplace changes were discussed.

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