Press conference – Sydney | Ministers’ Media Centre
TONY BURKE MP, MINISTER FOR EMPLOYMENT AND WORKPLACE RELATIONS, MINISTER FOR THE ARTS: Today’s a great day for workers. Today’s a great day if you’re on the minimum wage. Today is a great day if you’re on award wages.
Today, the Fair Work Commission has handed down the best decision for the minimum wage in the history of these decisions. They’ve handed down the best outcome for award wages in the history of these decisions, and the Government very much, very much welcomes the decision of the independent umpire in the Fair Work Commission.
This decision comes off the back of a decision last year as well, where the Government went in and argued that people who find it the hardest to make ends meet, the people who are on the minimum wage, should – at the very least – be in a position where they don’t go backwards.
We were told at last year’s election campaign that that was a terrible economic idea, that the sky would fall in. We now have two decisions in a row where the Fair Work Commission has weighed up all the evidence, has listened to the economic advice and has listened to the advocacy of all the parties, including the Government, arguing on behalf of those people who are finding it hard to make ends meet.
In response, the Fair Work Commission today has delivered that decision for award workers of a 5.75 per cent increase, starting on the 1st of July. If you’re on the minimum wage, there’s an additional technical change, which means the shift in the minimum wage is an increase of 8.6 per cent. On any measure, that means for the people who are finding it hardest to make ends meet, it’s well in front of where the CPI is at the moment. And remember the budget forecasts, which forecast inflation for next year to hit 3.25 per cent.
This means we are now getting closer to the point where, for many workers, the line between wages and prices will start to cross. It’s only possible because we have a government that had been willing to argue for people to get a pay increase and has been willing to change the law for people to get a pay increase. The people who rely on today’s decision are disproportionately young, are disproportionately women, and are disproportionately in insecure employment.
The decision by the Parliament last year, when I introduced the Secure Jobs, Better Pay Bill, was to put job security and gender equality at the heart of the decision making of the Fair Work Commission. That’s part of what has made today’s decision possible.
This makes a huge difference in people’s lives. For people who have been watching the bills move around with the magnets on the fridge, wondering how they can make ends meet, this is a situation now where – from 11 July – the difference in the change of Government becomes clear in people’s bank accounts. The difference in the change of Government becomes clear when people get a better capacity to be able to pay their bills than what would have happened if we continued to have the settings of the previous Government.
We had 10 years where low wages were a deliberate design feature of this country. We now have the second decision in a row which reflects a government that has getting wages moving as a deliberate design feature of how we manage the economy.
This will make a huge difference, a huge difference. Across the two decisions, last year’s decision and this year’s decision, the minimum wage is now nearly $3 higher, nearly $3 an hour higher for minimum wage workers. They’re the people who needed the most help, and none of that would have happened were it not for there being a change of Government.
I should also respond briefly to the media release that’s been put out by my counterpart, Senator Cash. I know Senator Cash has put out figures today that are wrong. She’s a former Minister in the portfolio, so I would like to be surprised, but she’s claimed the minimum wage has only gone up by 5.75 per cent. That’s completely wrong. The figure, as I said, is 8.6 per cent. Details matter in this because the details affect what goes into people’s bank accounts.
I know in radio they have that thing where you had the six second delay between the audience hearing something and someone saying it in case someone says something really weird, and that is just wrong. I think they have a dump button in radio. Someone from Senator Cash’s office ought to look at getting one of those buttons.
To be putting out information that is just plain wrong, that affects the most vulnerable workers in Australia, it’s a bit stupid, and it’s deeply irresponsible. But we were told that the Secure Jobs, Better Pay Bill would close down Australia. What we’re seeing now is it’s opening up opportunities in people’s lives. Happy to take any questions.
JOURNALIST: Minister, the RBA Board meets next Tuesday. Are you concerned at all that a pay rise this high will add to those inflationary pressures and force up interest rates on everyone?
BURKE: I think the best way of responding to that is the words of the President of the Fair Work Commission, President Hatcher himself, today, where he said today’s decision would neither “cause nor contribute to any sort of a wage price spiral”.
I find it dreadful. With all the different inflationary pressures that are out there, some international, some caused by long term neglect in our supply chains, that some people want to just argue somehow it’s workers’ fault, and particularly the workers who are reliant on the award system and the minimum wage.
JOURNALIST: Was this increase more than Government assumptions using their budget forecasts?
BURKE: Look, the forecasts go within a range, and so that’s more a question to Treasury than to myself, but certainly it’s not like this is significantly off the sorts of the range issues that the Treasury would have dealt with.
JOURNALIST: Even the Commission itself admits that the real wages of the people gaining this increase are still going to go backwards. Should they have gone for a higher increase?
BURKE: That’s the case for people on awards, certainly not the case for people on the minimum wage, and only the case if you measure where CPI is at the moment. Remember, for people on awards, we’re talking about a 5.75 per cent increase where the Budget papers are forecasting that next year we’re expecting inflation to be at 3.25 per cent. We are getting closer to the point where those lines will cross.
JOURNALIST: In a cost of living crisis is $23.23 really enough for someone to survive on for per hour? Could you do it personally?
BURKE: The situation for these individual workers is that it remains really tough, and the Government doesn’t pretend otherwise. What the Government has said we would do is we would actively move to be able to improve their situation, and we’ve done that, we’ve argued, use the existing forums in the Fair Work Commission. Then when we looked at where the law needed to be changed, we’ve changed the law. We’ll be doing more of that later this year.
I guess the best way of summarising it is this: today’s decision is the best outcome that we have ever had for workers from an Annual Wage Review, or from its predecessors. It’s the best decision for workers we’ve ever had. That has only been possible because of the actions of the Government. But yes, there are still more changes that we need to make. There’s still a series of loopholes that undercut wages, and we’re intending to deal with that at the second half of this year.
JOURNALIST: Do you accept any of the arguments that some of the employer groups have made that this will make it a lot more challenging for small businesses, in particular, to come out of the other side of COVID and get ahead?
BURKE: For all the different challenges on businesses, and I’ve had a respectful relationship with all the business groups, so I’m not out here to have a go at them in any way, and they are paid by their members to try to keep all sorts of bills down, including wages bills. But for all the different pressures that face business, I don’t want us to get to a situation where we’re blaming the most vulnerable workers. I really don’t think that’s a correct path.
Thank you very much.