The peak union body has called for a seven per cent pay boost for Australia’s lowest-paid workers to help them survive soaring living costs.
The ACTU made the recommendation in a submission to the Fair Work Commission’s national minimum wage review before a decision in June.
If granted, more than 2.6 million workers on minimum and award wages would be entitled to a new minimum hourly rate of $22.88, taking their annual pay to $45,337.28 from July 1.
The government will lodge a submission on Friday, but it won’t mention a specific number.
“We want to see wages moving again in this country in responsible and sustainable and meaningful ways,” Treasurer Jim Chalmers said in Canberra.
“And it’s just common sense to begin with the lowest paid Australians … our submission will be consistent with that.
“We don’t want to see people fall further and further behind.”
Dr Chalmers said the notion that inflation was being driven by low-paid workers getting wage rises was “complete and utter rubbish”.
But Opposition Leader Peter Dutton said it was important to get the balance right on wage increases so that inflation could be contained.
“Everyone’s in favour of increasing wages, but if you get yourself into a situation where you’re chasing inflation, then it will fuel inflation and inflation goes up,” he told 2GB.
“So even with a pay rise, it means that people aren’t getting ahead and inflation continues to go higher and higher and higher.”
ACTU secretary Sally McManus argues that because businesses posted strong – and in some cases record – profits in the most recent reporting period, the proposed wage increase is more than affordable.
Minimum and award wage increases had no discernible impact on inflation last year, it added, noting the biggest risk to the economy was a collapse in consumer spending power.
“There is no wage-price spiral in Australia,” Ms McManus said.
The ACTU said low-paid workers deserve the rise because they had suffered the most under rising inflation, which had eroded their buying power.
The current annual rate of inflation is 6.8 per cent, according to Australian Bureau of Statistics monthly consumer price index data released on Wednesday.
“It is simply about survival for the lowest paid workers in our country,” Ms McManus said.
Greens leader Adam Bandt agreed minimum wage workers needed a pay boost.
“But we should go further,” he wrote on Twitter.
“Minimum wage should be 60 per cent of the median wage, so we don’t see inequality spiral.”
In its 2022 decision, the Fair Work Commission raised the minimum wage by 5.2 per cent, equating to $21.38 an hour.
This was after the ACTU argued for a 5.5 per cent increase and the Australian Chamber of Commerce and Industry, Australian Industry Group and other employer bodies proposed an increase between 2.5 per cent and three per cent.
Submissions to the commission’s national minimum wage review close on Friday.
© AAP 2023
