Minimum wage rise hits sour note with Maori Party

Lifting the minimum wage is a defining issue for the Maori Party in government, and yesterday's 25 cents and hour increase falls far short of what the party would be comfortable with, says co-leader Pita Sharples.

The Government lifted the minimum wage from $12.50 an hour, saying the increase was in line with the Consumer Price Index, but the small amount left a bitter taste for many New Zealanders.

"My decision was based on the need to find a balance between protecting jobs and ensuring a fair wage," Labour Minister Kate Wilkinson said after announcing the increase.

She said the modest amount would still have an impact on businesses, especially in the hospitality retail industries, and would cost employers about $52 million more a year.

Business NZ chief executive Phil O'Reilly said the increase was reasonable, but others such as unions and low-paid workers have slammed it as a miserly amount that may not even cover inflation.

The Maori Party was critical of the refusal of National and the ACT Party to support a bigger raise and would continue to work to "pull these right-wing monetarist policies" back into balance, Dr Sharples said today.

He said the party had considered $15 should be an "absolute minimum".

"We believe an increase to $15 per hour could be phased in incrementally if necessary, to provide immediate relief, along with the promise of a brighter future."

He said the party had actively supported policies it believed would promote economic growth and business development, and also wanted fairness and equity.

"We have urged our National Party colleagues to get real about economic recovery. As the economic gloom lifts, we can see ever more clearly the harsh reality of the working poor."

Dr Sharples said two-thirds of all Maori earned less than the median wage and that reality was felt as lower educational, health and social performance by whanau.