Hamilton ‘living wage’ cost blow-out a timely warning for Auckland Council

News that Hamilton City Council’s proposal to adopt a living wage for staff has nearly quadrupled in likely cost for their ratepayers is a timely warning for Auckland Council, says Auckland Councillor for Orakei Cameron Brewer.

Last month Auckland Council’s own Business Advisory Panel, which Mr Brewer chairs, firmly rejected the council following in the footsteps of Hamilton and Wellington city councils and adopting a living wage policy for its staff. The Auckland Council will decide whether or not to adopt one in the coming months, with staff now doing more work on the policy’s likely impact.

A council report to the Auckland Plan Committee on 12 March advised that lifting the hourly rate for 1,544 council staff to $18.40 could cost ratepayers over $2.5 million, excluding two large CCOs Auckland Transport and Watercare. Likewise, if the so-called Auckland Living Wage of $24.11 was introduced affecting 3,354 staff it could cost ratepayers over $17.2m per annum.

“The potential costs that Auckland Council is promoting exclude staff in Auckland Transport, Watercare, and council contractors, and so the end cost for ratepayers would be much higher than the millions we’ve already been warned about. What’s more if you bump up the least paid employees’ hourly rate by quite a margin, council would then also have to bump up their supervisors’ rate to maintain a differential, and so on. So rest assured there would be plenty of flow on costs to the organisation and for Auckland ratepayers,” says Cameron Brewer.

“Before Auckland Council rules on this issue, all the true, on-going and flow-on costs need to be put on the table. For a council to fund a living wage, ratepayers have no choice. Either existing council services get cut or rates go up. Auckland Council needs to think very carefully before going down this path,” says Mr Brewer.

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