PM lays into Labour leadership contenders' living wage proposal
Key says Labour is adopting the policies that sent NZ broke during the Muldoon era.
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Prime Minister John Key has laid into the Labour-backed “living wage” proposal.
The union-backed concept would see the minimum wage bumped from $13.75 an hour to $18.40.
The policy has the qualified backing of Labour leadership contenders Grant Robertson and David Cunliffe (who wants an initial focus on the public service), while Shane Jones has been more circumspect, saying the main focus should be on economic growth.
"Show me one country in the world where they’ve legislated for high wages and it’s been successful," the PM said on Breakfast this morning.
"If you turn around tomorrow and say we’re going from $13.75 an hour to $18.40, what are the implications?
"Most companies have to pay more. That means they have to put their prices up. That means you as a consumer pay more. That means inflation goes up and the Reserve Bank raises interest rates and mortgage costs go up. And by the way quite a few people lose their jobs as small businesses say ‘I won’t have three people I’ll have two and actually we’re no further ahead.
"It’s a fool’s paradise. We have to earn more as a country. We have to upskill people. The government has a big responsibility to encourage people to invest and try to create jobs – but if we think it’s just a stroke of a pen – if my life was that easy, I’d make it $30 this afternooon."
Another policy that has emerged during the Labour leadership fight - to regulate supermarkets to bring down the price of food - also got short shrift from the PM.
Mr Key likened it to to the Muldoon era of price fixing, which he dubbed a failure. Labour's minimum wage and power pricing regulation and housing policies also reminded him of that time.
"In the late seventies and early eighties we went bankrupt as a country," he said.
NBR staff
Mon, 02 Sep 2013
Mon, 02 Sep 2013
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PM lays into Labour leadership contenders' living wage proposal
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