Bernard Orsman

Bernard Orsman is Super City reporter for the NZ Herald.

Rates to rise to pay for living wage

Funds for increased payments to council staff won't come from efficiency savings as mayor promised.

Cameron Brewer.
Cameron Brewer.

Auckland Mayor Len Brown is pressing ahead with a living wage for council workers after promising voters two months ago he would first assess its feasibility.

On the election hustings Mr Brown said he supported the living wage concept and if re-elected would propose that council investigate options to implement the increased costs from efficiency savings.

"But a full review is needed to confirm that," he said on October 4.

Since the election, Mr Brown has proposed to lift all council staff to the living wage in his draft 2014 budget.

The mayor's proposal would come in over three years and cost $3.75 million. The first-year cost of $1.25 million would not come from efficiency savings, but a 0.1 per cent rise in rates. As well as promising a full review, Mr Brown voted for a council resolution in September requesting chief executive Doug McKay provide a report on the living wage to the incoming council.

Len Brown.
Len Brown.

The report was to include the potential benefits and costs and option for funding the living wage.

A spokesman for Mr Brown said a comprehensive report by council staff on the living wage was under way. It was due to go to the mayor and councillors in the new year for them to review the proposal.

"By including it in the annual plan the mayor is giving the community the chance to have their say," the spokesman said.

A Treasury report released last month said the living wage was not well targeted and would benefit singles over the intended demographic of low-income families.

It calculated that for a family of two parents and two children, where one partner works 40 hours a week for $16 an hour and the other 20 hours a week for the minimum wage of $13.75, and where they pay $380 a week to rent a three-bedroom house, the living wage would raise their take-home pay by $63 a week, or just over $1 an hour.

Councillor Cameron Brewer said he was not surprised Mr Brown was leading from the front on the living wage policy, but surprised he was not doing the promised work. "He has leap-frogged ahead of good process of doing the policy work purely for political expediency reasons," he said.

The living wage debate

September 2013: Councillors request a report on the living wage.
October 4: Len Brown supports living wage for council employees, subject to a full review.
November 7: Brown tables living wage as part of his 2014 budget without a review.
November 21: Budget committee votes 11-9 to proceed with living wage proposal without a review.

How they voted

To include $1.25m for a staged implementation of the living wage in the draft budget.

For: Arthur Anae, Len Brown, Cathy Casey, Ross Clow, Chris Darby, Alf Filipaina, Penny Hulse, David Taipari*, John Tamihere*, Wayne Walker, John Watson.

Against: Cameron Brewer, Bill Cashmore, Linda Cooper, Denise Krum, Calum Penrose, Sharon Stewart, John Walker, Penny Webster, George Wood.

*Maori Statutory Board members.

- NZ Herald

© Copyright 2014, APN New Zealand Limited

Assembled by: (static) on red akl_a4 at 17 Sep 2014 12:19:26 Processing Time: 559ms