NZ POLITICS DAILY: The politics of a low-wage economy

The politics of a low-wage economy are emerging on to the public agenda in time for the election. This should be welcomed.

After all, issues about low wages, the minimum wage and state subsidisation generally don’t get much discussion in electoral politics. But the economic slump, together with the shift towards a low-wage economy, is finally pushing these issues to the fore.

Today’s lightning rod for this is the industrial campaign on the part of cleaners in the parliamentary buildings to obtain a living wage – see: Lloyd Burr’s Parliament’s cleaners are earning ‘poverty wages’, as well as the news of Tiny gains in wage packets. It seems that those cleaning our politicians’ offices are earning something like only $13.50 per hour – the minimum wage.

Usefully, David Farrar shows that the plight of such low-wage workers is supplemented by Working for Families credits – see: The full story.

But this just illustrates that the state has stepped in to subsidise the private sector’s payment of low-wages.

As political commentators (and activists) Matt McCarten and John Minto have long pointed out, Labour’s Working for Families was always meant as a subsidy for business to enable them to get away with paying workers only $13.50 an hour.

Without WfF, businesses in industries such as office cleaning would struggle to survive, so effectively the state subsidises private business. In contrast, the idea of a living wage is that if you have a full-time job you should have enough to look after yourself and your dependants. John Pagani also succinctly makes this point in his blogpost The right prefers welfare to work.

For the rightwing view on all this, see Cactus Kate’s The Link Between Children and Poverty, which seems to come from the view that the poor shouldn’t procreate. Yet surely there’s a strong need for a wide public debate about creating a higher-wage economy in which welfare isn’t required for those in work. Unfortunately the political parties don’t seem to be up for any sort of proper consideration of alternatives – despite headlines such as: Politicians claim to have answers to increase wages.

It’s especially appropriate that the parliamentary cleaners are taking action to highlight their plight at a time that the focus is back on the extremely generous politician pay – see: RNZ’s MPs in line for potentially large pay rise, TVNZ’s Changes in store for MPs' perks and travel, and Tracy Watkins’ Perks law for next Parliament.

With salary packages of between $180,000 and $500,000, New Zealand Members of Parliament earn more than 99% of their constituents.

And it seems that MPs are about to get a hefty pay increase of perhaps $10,000 to make up for the fact that they have rightly lost their illegitimate rort of free international holidays, which was set up in the 1970s to surreptitiously inflate politician incomes. It’s a pity that such a $10,000 increase won’t be going to people that really need it, such as cleaners.

Other items today that are either important, interesting, insightful or informative include: John Hartevelt’s Life after Simon Power, Morgan Godfery’s Te Tai Tonga - the lowdown, Tracy Watkins and Danya Levy’s Treasury defends $13m consultants bill, Gordon Campbell’s Questioning rugby's social values, David Farrar’s Rugby and politics, David Farrar’s Gay issues and Andrea Vance’s Simon Power praises consensus.

Of course, the incident on the Parliamentary gallery balcony also deserves some analysis – see: Claire Trevett’s Balcony protest sparks squabble between MPs, John Armstrong’s Key's parting shots leave Labour agape and Grant Robertson’s Reflecting on yesterday - especially for the comment by Danyl Mclauchlan.

Bryce Edwards, NZPD Editor (bryce.edwards@otago.ac.nz)

Today’s content

A Living wage

Lloyd Burr (TV3): Parliament’s cleaners are earning ‘poverty wages’

Amelia Romanos (NZH): Parliament cleaners hit up MPs for better pay

Barry Soper (Newstalk ZB): Political Report for October 6

Stuff: Tiny gains in wage packets

John Pagani: The right prefers welfare to work

Cactus Kate: The Link Between Children and Poverty

David Farrar (Kiwiblog): The full story

Newstalk ZB: Politicians claim to have answers to increase wages

MP remuneration