Brian Rudman 's Opinion

Brian Rudman is a NZ Herald feature writer and columnist.

Brian Rudman: How about a remuneration body for the poor?

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Auckland mayoral hopeful John Minto has a solution based on a relativities formula which is rather more radical. Photo / Richard Robinson
Auckland mayoral hopeful John Minto has a solution based on a relativities formula which is rather more radical. Photo / Richard Robinson

The living wage campaign is now part of the mainstream political agenda with new Labour leader David Cunliffe's promise to "roll out a living wage as a minimum for public servants and, as we can afford it, through the contractor process".

His predecessor David Shearer had also championed the campaign, but on an aspirational level. He pledged as prime minister to lift the compulsory minimum wage from $13.50 to $15 an hour, saying he would also "explore" the living wage concept "as a way to lift incomes".

Under Mr Cunliffe, Labour will raise that minimum wage, for public servants at least, to the $18.40 a hour calculated as a living wage by the Family Centre Social Policy Research Unit's Peter King and Charles Waldegrave.

Adding to the momentum is a report to today's meeting of Auckland Council's Auckland Plan committee calculating that paying all council staff - including those working for Watercare and Auckland Transport - a living wage would add $3.75 million to the council's $700.69 million wage bill.

It would involve boosting the wages of 1623 staff who now receive less than $18.40 an hour. A further 683 staff, sitting just above the new minimum on the existing pay ladder, would also receive a pay boost "to maintain a reasonable differential between staff in supervisory or higher evaluated positions".

The report suggests the increase could be funded by higher rates or reducing services and recommends any decision be left to the new council, to be elected next month. Given that the incoming councillors will score an immediate and handsome 9.6 per cent boost in their wages, with the hint of more to come, courtesy of the Remuneration Authority, it promises to be an interesting debate. How could they say no?

Earlier this year the authority delayed any Auckland Council politicians' pay rises until after the elections, when the mayor's salary is to jump from $247,300 to $251,010, his deputy's from $124,200 to $141,337, committee chairs' from $99,400 to $116,762 and councillors' from $90,050 to $98,672.

The authority said it had reviewed the work of Auckland elected members and had decided to set a new baseline remuneration, particularly for councillors, whose jobs were now "very close to full-time" and local board chairs, whose jobs were "moving close to full-time".

Acknowledging that "a significant one-off increase" could upset ratepayers "and undermine support for the process of local government in Auckland", the authority decided not to implement the identified - though secret - increase in full, "but will be commencing a transition to recognising a full-time regime over a number of years".

There were no reports to councillors, or debate, about whether Auckland could afford these proposed increases, or any mention of an increase in rates or reduction in services to cover the added costs.

Removing political salaries - both local and national - from the political arena was exactly the reason the Remuneration Authority was established. Salaries are to be decided independently, based on, among other benchmarks, "fair relativity with comparable positions ... the requirements of the job ... any prevailing adverse economic conditions and the need to be fair to the individuals whose pay is being set ".

All of which sounds so fair and reasonable and civilised, that you can't help wondering why a similar independent body is not also in place to determine poor people's salaries as well. Or to at least set a base living wage which people can actually live on.

Auckland mayoral hopeful John Minto has a solution based on a relativities formula which is rather more radical than the one employed by the Remuneration Authority experts. He would introduce a base wage of $18.40 an hour for all council employees and contractors and fund the increases at the bottom end by cutting the salaries of the mayor and senior staff. The mayor's salary would be set at four times the living wage at $153,088, and the chief executive's at five times the living wage, down from $768,759 to $191,360.

With more than 1165 staff earning over $100,000 and 123 senior staff paid more than $200,000, Mr Minto says all salaries will have to be pruned accordingly so as to, if I can borrow the words of today's report, "maintain a reasonable differential between staff in supervisory or higher evaluated positions".

Among the 1623 low-paid staff listed as benefiting are 155 library assistants, 102 lifeguards, 13 learn-to-swim assistants and 23 visitor centre staff.

With 39 per cent of all wage and salary earners nationwide on less than the "living wage" at June 2012, the Government claims bringing them all up to $18.40 an hour would cost $2.5 billion and force layoffs. However, the living wage campaign, launched in May last year by more than 50 union, church and other groups, isn't advocating a king hit approach. It argues that private employers pay only when they can afford it.

However, its message to public authorities such as councils and the Government is firmer. We as a society should not be paying fellow citizens to live in poverty.

- NZ Herald

Brian Rudman

Brian Rudman is a NZ Herald feature writer and columnist.

Brian Rudman's first news story was for Auckland University student paper Outspoke, exposing an SIS spy on campus during the heady days of the Vietnam War. It resulted in a Commission of Inquiry and an award for student journalist of the year. A stint editing the Labour Party's start-up Auckland newspaper NZ Statesman followed. Rudman decided journalism was the career for him, but the NZ Herald and Auckland Star thought otherwise when he came job-hunting. After a year on the "hippy trail" overland to London, he spent four years on Fleet St with various British provincial papers. He then joined the Auckland Star, winning the Dulux Journalist of the Year award for coverage of the 1976 Dawn Raids against Polynesian overstayers. He has also worked on the NZ Listener, Auckland Sun, and since 1996, for the NZ Herald as feature writer and columnist. He has a BA in History and Politics.

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