A WAGE TO KEEP THE ECONOMY TICKING OVER

4 August 2009

SA Unions' State Wage Case claim is aimed at keeping South Australia's economy ticking over by helping the lowest paid to make ends meet.

SA Unions Secretary, Janet Giles says the claim is fair and modest, and balances the needs of "bread and butter" families with sustainability for business.

SA Unions is seeking a 3.9% increase.  That matches the ABS Wage Price Index for South Australia for the past year.  We're asking that the lowest paid workers be given the same average increase already received by workers covered by agreements.

Ms Giles says the claim is justified and sustainable, particularly as there are consistent signs that the economy and business confidence is improving.

"It is important that we maintain the relative value of wages.  If the lowest paid, who have little or no bargaining power, are left behind then it's a social and economic millstone around our neck", Ms Giles says.

"For the low paid, the cost of living has already outstripped the CPI.  Families are struggling to get by while their expenses for everything from food essentials to power and gas have risen dramatically.  The gulf between low paid workers' wages and their living expenses will widen as the economy strengthens."

"If we want to keep our economy ticking over with a view to growth, we can't afford to create a class of working poor who risk becoming a burden on the state's finances."

Reasons for rejecting a freeze

SA Unions rejects arguments by the big business lobby for a wage freeze.

"Such an approach would actually hinder our state's economic growth for all the reasons I've just stated.  We can't afford a short sighted reaction that caters only for the narrow demands of big business at the expense of the greater good."

"We also reject as hypocritical calls for SA to emulate the last decision of the now defunct Fair Pay Commission.  Big business urged SA to reject the FPC when it awarded a rise, but wanted it embraced when its recent ruling delivered nothing."

"Not only was the last FPC ruling widely criticised including by the federal government, it has been rejected by other states including NSW, WA and Tas, which have recently awarded modest increases to the minimum wage.  The Qld case has been heard and a decision is pending."

"The FPC is a discredited and defunct body that operated on a charter that is inconsistent with the objectives of the State Act.  It's been replaced by the Fair Work Act.  It's common sense that the SA IRC would operate with consideration to the new Act, not the old."

Economic outlook

Key witness for SA Unions, economist and member of the SA Economic Development Board, Grant Belchamber will give evidence that many of the arguments put forward by big business have been supplanted by more recent publications and data, showing an improvement in economic and business confidence, and indicating that South Australia continue to perform well.

The Department of Trade and Economic Development publication "South Australia's Economic Performance" shows most indicators of state economic activity continue to show strength.  It says unemployment is low, labour force participation is at a near record high, population growth is at its highest annual rate since records began and business investment reached $10.3 billion in the year to the March quarter 2009 - a record high.

Ms Giles says it makes sound economic and social sense to spread our wealth.

"Our true performance as a society isn't measured only by the balance sheet, but by how we support al of those in our society.  A modest rise for the lowest paid isn't charity, nor is it a cost' it's an investment in society and investment in our economic prospects for the future", she says.