Government Promotes Low Wage Vision

The CTU has strongly criticised comments by Deputy Prime Minister Bill English that New Zealand has a competitive advantage in attracting overseas investment because our wages are 30 percent cheaper than in Australia.

Peter Conway, CTU Secretary said ‘this contrasts strongly with the stated aim of Government to close the wage gap with Australia”.

“There is no doubt that we have low capital per worker in New Zealand and that makes it harder to lift both wages and productivity. But advertising our low wages as an advantage is not going to lift them”.

Peter Conway said that the capital-labour ratio fell by 22 percent between 1992-96 when a National Government previously attacked the rights of New Zealand workers. That fall in capital investment, as the cheap labour route was promoted, has had a long legacy.

“We are seeking a credible economic plan that results in a rise in real wages on a sustainable basis. That requires better distribution of income, higher investment in skills, and greater cooperation at a workplace level.”

“But the vision suggested by this Government is that we should compete with Australia using our low wages. That will only result in more and more New Zealand workers going to Australia. It is a barren vision”.

“The Government has already embarked on a programme of undermining work rights in this country. This latest comment raises huge concerns about what the Government will do next to labour laws to keep wages low in New Zealand”.

ENDS

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