Almost 750,000 Kiwis look set to be classed as the new working poor this week when the union movement fixes the value of a "living wage" needed to have a decent life here.

The rate, expected to be $18-$20 an hour, has been calculated by researchers at the Anglican Church's Family Centre in Lower Hutt to be "the income necessary to provide workers and their families with the basic necessities of life".

About 40 per cent of the country's 1.85 million employees, or around 740,000 people, earn below that rate - including beginning teachers, chefs, truck drivers, mechanics and carpenters, as well as traditionally low-paid groups such as cleaners, caregivers and checkout operators.

The unions have invited national and overseas researchers to a two-day conference in Auckland on Thursday and Friday to launch the study as the basis of a campaign to lift all wages to the "living wage" level.


They are not asking for legislation, unlike the minimum wage of $13.50 an hour which is updated each year by law. A Cabinet decision on this year's minimum is imminent.

Instead, unions are targeting major employers such as councils and universities to pay at least the living wage to their own employees, and to make it a condition in their contracts with companies that provide services such as cleaning and security.

A similar campaign in London, whose Tory mayor, Boris Johnson, has endorsed a living wage of £8.55 ($15.62) an hour, has raised wages for about 45,000 low-paid workers.

Auckland's Labour mayor, Len Brown, is more cautious. "People who work fulltime should absolutely be able to earn a decent, sustainable wage," he said. "My focus is to ensure we continue to create good jobs for Aucklanders as our city grows."

Council of Trade Unions president Helen Kelly predicted that the idea would "take off" in New Zealand.

"The deal is that if you go to work and work hard, you should have a decent standard of living at the end of the week," she said.

"The argument that you shouldn't have a living wage only seems to apply to the poor. Others seem to get wages that most people couldn't even imagine are being paid in this country. I think there is a moral question here."

Charles Waldegrave, who led the Family Centre study, said the $18-$20 figure was based on "not including any luxuries at all".


"A living wage would mean that you could have a computer in your home with the kids, you could afford your kids to go on a school camp, and you could have a modest recreational event with friends, say once a month. It's pretty minimal," he said.

"The whole idea is you could participate in society and have enough to pay your rent and food and power."

He said it needed to be higher than in London because Britain had higher family tax credits, including a universal family benefit, and because the London wage assumed that a family lived in public housing and used only public transport - both out of reach for most working Kiwis.

The figure is based on Otago University's calculation of the costs of a "basic" healthy diet for a family of two parents and two children, assuming all food is cooked at home with no takeaways or meals out. The university's latest estimate for a couple with children aged 10 and 4 in Auckland is $217 a week.

Most other costs are based on the household economic survey, which showed that couples with two children spent an average of $158 a week on petrol and other transport costs, and $669 a week on other costs excluding food and housing, in 2010. Mr Waldegrave's team has made judgments about which items are "essential" and which are "luxuries".

He said it was up to the state to make housing affordable through the accommodation supplement.

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