FAIR GO 101: It's Time To Change The Rules

Big business groups are already out attacking out our #ChangeTheRules campaign.

RT if you think workers need more secure jobs and a wage rise. #auspol pic.twitter.com/NPNIwAku86

— Australian Unions (@unionsaustralia) March 11, 2018

How we see the cost of living in Australia in 2018

Essential Report, 30 January 2018:

​A substantial majority believe that, in the last 12 months, cost of living (73%) and electricity costs (75%) have all got worse. The only economic measure that has got better is company profits (42% better/12% worse).

Compared the last time this question was asked in February 2016, there has been an increase in the percentage that think electricity costs (up 13% to 75%) have got worse. However, there has also been an increase in the percentage that think company profits (+12), unemployment (+19) and the economy overall (+18) have got better.

51% (down 2% since August) believe that, in the last two years, their income has fallen behind the cost of living. 28% (up 3%) think it has stayed even with the cost of living and 14% (down 1%) think it has gone up more.

64% of those earning under $600 pw and 58% of those earning $600-1,000 pw think their income has fallen behind while 54% of those earning over $2,000 pw think it has stayed the same or gone up.

Australian Council of Trade Unions (ACTU), media release, 31 January 2018:

Australian Bureau of Statistics (ABS), 1 November 2018:

According to the ABS, over the last twelve months up to end September 2017 the Living Cost Index* rose:

2.0% for Pensioner and Beneficiary Households

2.1% for Other Government Transfer Recipient Households

1.7% for Age Pensioner Households

1.6% for Self-Funded Retiree Households

1.5% for Employee Households 

One of the principal drivers to the rise in costs for these groups has been the rise in housing costs due to the rise in wholesale electricity costs.

* The Living Cost Indexes (LCI) have been designed to answer the question:

'By how much would after tax money incomes need to change to allow householdsto purchase the same quantity of consumer goods and services that they purchased in the base period?'

So what does Australia's public debt look like in January 2018?

As of 5 January 2018 Australian Government public debt stood at an est. $515.6 billion at face value. Six months earlier this debt had stood at est. $500.9 billion. So government debt continues to grow.

This early January 2018 public debt breaks down as:

Treasury Bonds	$477,278m
Treasury Indexed Bonds	$34,897m
Treasury Notes	$3,500m
Other Securities	$6m

Australian Office of Financial Management, 5 January 2018:

Treasury Bonds are medium to long-term debt securities that carry an annual rate of interest fixed over the life of the security, payable semi-annually.

All Treasury Bonds are exempt from non-resident interest withholding tax (IWT).

These treasury bonds were first issued between January 2006 and September 2017, with interest repayments ranging from 1.75% to 5.75% per annum due throughout 2018 and, in all but two instances the years beyond up to 2047. It is likely that at least 50% of these bonds are held by foreign investors.

The Turnbull Government appears to be using reduced government spending by way of funding cuts to essential government services and ‘reformed’ welfare payments in order to manage a portion of this debt – the remainder possibly being serviced by further bond issuance.

Given the potential to retain a higher dollar amount of cash transfers for longer periods in government coffers if the Cashless Debit Card is universally introduced for welfare recipients under retirement age, then I rather suspect that future welfare recipients may be disproportionately servicing this debt if Turnbull & Co have their way.

And while considering that growing public debt, the sustained federal government assault on safety-net welfare since 2013 and the attack on penalty rates in 2017, readers miight like to consider this……

The Australian Parliament consists of 226 elected members sitting as MPs or senators.

Between them they are reported to own 524 properties and, in addition to their salaries and any additional remuneration for ministerial position or committee membership, they also receive generous parliamentary entitlements of which they freely avail themselves:

Federal politicians claimed more than $55 million in expenses over the second half of 2015, new documents have revealed.

Federal politicians claimed almost $49 million in expenses over the first half of 2016, new documents have revealed.

The Australian, 5 January 2018:

Australians have endured their longest period of falling living standards in more than a quarter of a century as growth in costs outstripped earnings for the fifth consecutive quarter, leaving households worse off than they were six years ago.

After allowing for inflation, taxes and interest costs, average household incomes dropped 1.6 per cent in the year to September, capping a sustained fall in ­living standards that has not been seen since the 1990-91 recession.

Economists say more than half the cost increases for households are being driven by electricity, rent, health, new housing and tobacco, while modest wage rises are being partially absorbed by workers being pushed into higher tax brackets……

After adjusting for living costs, interest and taxes, average earnings in the three months to September were 0.7 per cent lower than in the same period of 2011, which marked the peak of the ­resources boom.

Over the previous six years from 2005, households had seen an average improvement in their living standards of 17 per cent.

AMP chief economist Shane Oliver said the mid-year budget update delivered before Christmas provided only limited scope for tax cuts.

“To be anything more than ‘sandwich and milkshake’ tax cuts and still maintain a trajectory ­towards a budget surplus by 2020-21, they would have to be offset by spending savings elsewhere. That is where the politics kicks in and the government has had difficulty getting things through the Senate,” he said.

Dr Oliver said if the government was successful in getting the 0.5 per cent increase in the Medicare Levy through the Senate, it would offset the benefit of any tax cut. The Medicare Levy increase is scheduled to start on July 1 next year and increase personal taxes by $3.6 billion in its first year and $4.3bn in the second.

Although living standards stopped rising after 2011, the ­decline since the middle of 2016 is new and reflects both the fall in wage growth and an increase in tax payments.

The ABS Wage Price Index shows a 1.9 per cent rise last year, but this is measured before tax and records the average increase for each job. National accounts show that personal income tax collections are rising much faster than pre-tax wages, partly ­because more wage income is being pushed into higher tax brackets. They show a 4 per cent lift in taxes per capita over the year to September, absorbing 60 per cent of the increase in wage income per person, which rose only 1 per cent.

Much of the very strong ­employment growth in the past year has been in lower paying jobs in the services sector, which has reduced average incomes overall.

Effect of proposed company tax cuts according to Australian Prime Minister Malcom Bligh Turnbull - "All boats will rise"

As households across the country began the count down to the holiday season, Australian Prime Minister Malcolm Bligh Turnbull smugly informed an ABC interviewer that as a result of a proposed cut in the company tax rate* everyone’s income will increase – “All boats will rise”.

This is another way of referring to that now legendary faux economic theory popular with right-wing politicians – the Trickle Down Effect.

This assertion is tested in an Australian Treasury working paper ANALYSIS OF THE LONG TERM EFFECTS OF A COMPANY TAX CUT (May 2016) which modelled a tax cut reducing company tax from 30 per cent to 25 per cent – presumably implemented over the 10 years to 2026-27 proposed by government.

Yes, this working paper estimates that for “a static representative household” “calibrated to match the expenditure, income patterns, and taxes faced by aggregate Australian households” real wages will rise if all other factors in the economy remain unchanged.

So it seems that Turnbull's claim is genuine - or is it?

What Turnbull fails to say is that this “real” wage rise will probably be a paltry est. 1.0-1.1% in total, will take at least 20 years to achieve and will only come about if the average individual also works longer hours.

Based on ABS May 2017 All Employees Average Weekly Total Earnings and an optimistically estimated average annual wages growth of 1.9 per cent; at the end of those 20 years an average worker will have received a total wage increase of est. $851 to $929. Spread out over those 20 years that works out to between 81-89 cents a week extra in his/her pay packet as a direct result of the Turnbull Government’s company tax cut.

Because in real life these company tax cuts are staged and, each stage would have a lag time, no-one is going to see 81-89 cents in their pay packets anytime soon. Indeed a great many people will probably never see this meagre increase at all as the real wages of many low-skilled workers haven't increased alongside higher-skilled workers for the last seven years and there is no indication as to if or when this trend will end.

Over this same twenty-year time period any increase in company income as a result of a 5 per cent cut in the company tax rate would result in millions to one billion plus being added to the bottom lines of a significant number of medium to large corporations. With such savings being just as likely to be diverted into bonuses paid to senior management or paid as dividends to shareholders as they are to being reinvested in a business.

Once more proving that tax cuts for industry, business and those individuals wealthy enough to incorporate their landholdings/investments, have what is essentially a neutral outcome for rest of the population.

Company tax cuts will hardly stir the water beneath those metaphorical boats belonging to ordinary workers.

Therefore this classic illustrative meme still stands under the Turnbull Coalition Government:

Image from Perry Street Palace

Something to remember when it comes time to vote in the next federal election.

* A company tax rate very few companies actually pay. A tax rate that an estimated 36% of more than 2,000 of the biggest corporations doing business in Australia ignore entirely given they unilaterally decided that under current taxation law and for accounting purposes they should pay no tax at all.

Turnbull Government gets a lesson in 'Be Careful What You Wish For'

“Low wage growth means Australians aren't reaching into their pockets at the shops, Prime Minister Malcolm Turnbull believes.” [Sky News, 6 October 2017]

For years Liberal and Nationals state and federal politicians, along with the business sector, have been insisting wages need to be kept low in the ‘new’ economy.

They got their wish and then began to complain that consumers, who through their spending account for more than half of Australia’s GDP, weren’t spending with gusto anymore.

Apparently not one of these wage scrooges had stopped to consider that government economic policy leading to weaker consumer spending would impact on the national economy.

Now economists are beginning to point out the relationship between cause and effect.

Financial Review, 18 October 2017:

Australia's biggest domestic economic risk is a "skewed consumer cycle" and the government may need to step in with a policy on wages, Commonwealth Bank of Australia chief economist Michael Blythe says.

Normal wage growth is around 3.5 per cent per annum, according to the Reserve Bank of Australia, but Mr Blythe noted that wages are now growing at around 2 per cent per annum, "if you're lucky".

"There's a disconnect between slow wage growth and other economic fundamentals such as the employment rate, which are approaching levels that the Reserve Bank considers normal for a robust economy," he said.

"Given the usual economic fundamentals, like the unemployment rate, you would be expecting to see wages growth faster than it is right now. There's a market failure here, in a way, and governments are there to sort out market failures."……

In Australia, the risk is that low wage growth contributes to changing consumer behaviour.

Amid talk of higher official rates in 2018, Australians are already carrying very high levels of debt. Moreover, workers are concerned about job security, even as households face big increases in energy bills. All of which add up to a "pretty difficult mix", Mr Blythe said.

"Consumer spending is 56 per cent of GDP, so if it[s] underperforming it is a drag on the rest," he said.

To date, households have been running down savings rates, Mr Blythe noted, but "there's a limit to how far you can go on that front and what that tells you is we need to get some more income".

The income story consists of wages, interest rates, taxes and social welfare payments.

But of those four factors, wages are really the only "swing variable" as interest rate cuts or tax cuts are unlikely to occur any time soon and social welfare payments are under pressure from winding back the budget deficit, Mr Blythe said.

Some of the traditional mechanisms that have delivered wages increases in the past aren't delivering the same outcomes in the current environment. Tightening labour markets normally deliver higher wages. As the unemployment rate falls, wage growth tends to come through

.

"But we've been expecting that for a few years now and that hasn't happened," said Mr Blythe. "There's a fair amount of slack in the labour market, it seems, even though the headline unemployment rate has been falling."

Mr Blythe said that this indicates there's a high degree of underemployment in the economy. "When the economy works some of that off I think you'll get a wage response," he said.

However, he believes that low income growth has already changed consumer behaviour.

"Consumers seem to be less responsive to good news and the risk is they overreact to the bad news coming through…..

"So it's an indication that not all the good news is flowing through and if you were to get a negative shock, for example oil were to go up, you would quite likely see consumers cut back their spending more aggressively than they normally would."

"This kind of skewed consumer cycle remains a risk to the broader outlook I think. It's the main domestic risk we talk about when we look at the economy."

More evidence that the far-right in politics and industry are determined to drive working class Australians into generational poverty?

The Sydney Morning Herald

Wage fraud, wage freezes, cuts to penalty rates and companies scrapping enterprise agreements will reduce the retirement savings of millions of workers by $100 billion by the time they retire, a report has found.

The report, the Consequences of Wage Suppression for Australia's Superannuation System by the Australia Institute's Centre for Future Work, says the government will pick up more than one third of the cost, equivalent to $37 billion in lost taxes due to lower super contributions and higher age pension payouts.

It estimates that three million people, or one in four workers, have experienced some form of wage suppression, which will adversely impact their super payout.

The author of the report, Jim Stanford, describes wage suppression as an economic "time bomb". He says while individual families are grappling with the immediate impact of wage cuts, the long-term impact when they retire is yet to play out.

[THE CONSEQUENCES OF WAGE SUPPRESSION FOR SUPERANNUATION, p.9]

Centre for Future Work at the Australia Institute, Jim Stanford, Ph.D., The Consequences of Wage Suppression for Australia’s Superannuation System, September 2017, excerpt from Summary:

Wages and salaries in Australia’s labour market are exhibiting their weakest growth in the history of the relevant statistics. Hourly wages are growing at less than 2 percent per year, and real wages (adjusted for consumer price inflation) are stagnant or falling. The unprecedented stagnation of wages reflects many factors, including chronic weakness in labour demand and the erosion of traditional wage-setting institutions (such as minimum wages and collective bargaining). But it also reflects, for millions of Australian workers, the aggressive efforts by employers (both private- and public- sector) to deliberately suppress wages below normal levels. These wage-suppression strategies take many forms: from the imposition of temporary wage freezes, to the unilateral termination of enterprise agreements, to the outright theft of wages through below-minimum payments. These pro-active measures to suppress labour incomes, breaking the normal link between labour incomes and labour productivity (which continues to grow at over 1 percent per year1), impose great harm on affected workers, their families, government budgets, and Australia’s macroeconomic performance.

There is another important consequence of these wage suppression strategies that is often not sufficiently understood by workers, employers, policy-makers and regulators: their flow-through impact on Australia’s retirement income system. When workers’ wages are unduly suppressed, then the normal flow of employer contributions into their superannuation accounts is also constrained. They will have smaller superannuation balances when they retire, and will consequently experience a lasting reduction in post-retirement incomes. Moreover, governments will share a significant portion of the resulting damage: they will collect less in taxes on superannuation contributions and investment income, and will pay out more in means-tested Age Pension benefits (since workers’ superannuation incomes will be smaller). These significant, lasting consequences from wage-suppression strategies should be documented and considered. They provide a powerful motive for all stakeholders to challenge employers’ wage-cutting initiatives. They also should be of direct concern to superannuation trustees and administrators – since the capacity of the superannuation capacity of the superannuation system to provide decent, secure retirement incomes for its members is being undermined by this growing pattern of wage suppression.

This report presents results from several quantitative simulations of the impact of wage suppression on superannuation entitlements of affected workers, their long-run retirement incomes, and corresponding fiscal effects on government. The report considers several specific scenarios, corresponding to different instances of pro-active wage suppression strategies that have been experienced by Australian workers in recent years. It traces through the impact of those policies on workers’ wages, superannuation accumulations, and retirement incomes. The simulations also describe the spill-over impacts on government (arising from reduced taxes collected on superannuation contributions and investment income, and increased Age Pension payouts). The simulations confirm that:

* Wage suppression undermines superannuation accumulations by automatically reducing employer contributions. Moreover, the damage is compounded over time due to the subsequent loss of investment income.

* Even temporary wage restraint measures (like temporary wage freezes) have lasting negative impacts on superannuation balances, by altering the trajectory of a worker’s wages for the rest of their career.

* The most dramatic instances of wage suppression – the termination of enterprise agreements by employers, and resulting large wage reductions as workers are placed back on minimum award conditions – can reduce the superannuation balance of a retiring worker by as much as $270,000.

* More modest wage suppressing policies (such as temporary nominal wage freezes, producing real wage reductions that are then sustained through a worker’s remaining years of service) reduce retirement superannuation balances by $30,000 or more.

* Government bears a share of the resulting losses, through both reduced tax collections before affected workers retire, and increased Age Pension payouts after they retire. In the worst-case scenarios, governments can experience fiscal losses of over $50,000 per worker (in real 2017 dollar terms).

* Millions of Australians have been confronted with one or more of these forms of wage suppression from their employers, so the aggregate impacts across the economy are enormous. Based on plausible estimates of the number of workers confronted with each form of wage suppression, the aggregate loss of superannuation balances on retirement (if the pattern of wage suppression is maintained) could ultimately exceed $100 billion (in real 2017 dollars) by the time affected workers retire, and the aggregate fiscal cost to government could reach $37 billion (in real 2017 dollars)………..

1 A recent Department of Finance research paper on productivity trends confirms that labour productivity continues to grow at typical historical rates – advancing at an annual average rate of 1.8 percent over the last five years alone. See Simon Campbell and Harry Withers, “Australian Productivity Trends and the Effect of Structural Change, “ August 28 2017, http://treasury.gov.au/ PublicationsAndMedia/Publications/2017/ Australian-productivity-trends-and-the-effect-of-structuralchange

[THE CONSEQUENCES OF WAGE SUPPRESSION FOR SUPERANNUATION, p.10]

No sign of an increase in employees' share of Australian economic growth

Financial Review, 6 September 2017:

Wage growth is showing no sign of the increases the Reserve Bank of Australia is banking on, with average employee compensation going backwards and hourly pay growth at record lows.

The economy's overall wages bill rose a modest 0.7 per cent in the June quarter and 2.1 per cent for the year, according to the latest national accounts figures, but fell per non-farm employee by 0.3 per cent on a quarterly and annual basis.

The data, released by the Australian Bureau of Statistics on Wednesday, suggests that while more people are getting into work, with 240,000 jobs created over the year, the jobs are also lower paid on average.

Capital Economics chief economist Paul Dales said the wage figures were even worse when broken down to average employee compensation per hour.

Annual growth in compensation per hour fell over the June quarter from 1.1 per cent to negative 0.3 per cent, the weakest growth in almost 25 years.

While the hourly figures are volatile, the Reserve Bank last year cited strong compensation growth per hour as a cause for optimism in the face of persistent low wage growth.

Mr Dales said that "there is no evidence whatsoever that wage growth has started to rise as the RBA expects".

Professional and technical services, covering engineers and IT workers, as well as health care drove the overall growth in the nation's wages bill.

History of monetary compensation for number of hours worked - 1985 to 2015

OECD Data

This Turnbull Government minister thinks voters won't realise this is not an exercise in truth telling.....

This is almost embarrassing to watch.

.@SenatorCash: This government believes the best form of welfare is a job. #auspol MORE: https://t.co/ZynnpjAbti pic.twitter.com/ejVeTSAJhL

— Sky News Australia (@SkyNewsAust) August 1, 2017

Can't live on the wage you bring home but can't get a raise from the boss? Here's the reasons why

In 2016 an est. 3.89 million people living in New South Wales had a personal weekly income of between $0 and $644 per week, according to the Australian Bureau of Statistics.

In Tasmania an est. 1.03 million people had way less than $573 per week.

Between March Quarter 2016 and March Quarter 2017 wages growth remained at record lows.

So this should come as no surprise……

Industrial relations lawyer Josh Bornstein writing in The Sydney Morning Herald, 5 July 2017:

When Reserve Bank governor Philip Lowe recently declared a "wages crisis" following a prolonged period of low wages growth, it appears to have caught the federal government on the hop. Quick to respond to crises about border protection, terrorism and rising energy prices, this is one crisis that renders the government mute. There is no plan, no working group, or commissioning of a white paper from the Productivity Commission. Instead, the government has announced a plan to pay up to 10,000 "interns" to work in the retail industry for as little as $4 an hour. This plan will only exacerbate the wages crisis.

Phillip Lowe is not the first prominent mandarin to observe that stagnant wages threaten economic growth. A new consensus has emerged since the Global Financial Crisis that anaemic wages growth and increased income inequality is retarding economies and stoking political volatility in developed economies. Nevertheless, Lowe is the first in Australia to join the chorus. His suggested remedy – that employees need to speak up more to request higher pay – is strikingly naive, inviting the obvious question. What if the boss says "no"?

Lowe's counterpart at the Bank of England, Andy Haldane, has offered a more sophisticated analysis of the wages crisis, focused on the transformation of the labour market. Haldane recently observed that profound changes in workplaces had produced a period of "divide and conquer" that left workers less able to bargain for higher wages. "There is power in numbers. A workforce that is more easily divided than in the past may find itself more easily conquered. In other words, a world of divisible work may reduce workers' wage-bargaining power," he said.

The collapse in bargaining power for workers that Haldane has observed is reflected in the plight of Australian trade unions, which are languishing at their weakest point in their history. Only 14.5 per cent of employees belong to a trade union. In the private sector, that number sits at a shocking 10 per cent and falling. The tipping point passed long ago. Australian trade unions are fighting for their survival. That wage growth and employee share of GDP has hit record lows is no coincidence…..

The explanation for the severity of the collapse of unionisation is far more prosaic. It's our laws. Unions have been seriously weakened by 30 years of constant political and legislative attacks. The last conservative prime minister not to establish a royal commission into trade unions was Billy McMahon (1971-1972). For decades, business lobby groups have permanently and successfully campaigned for legislative change that weakens unions.

In this era, workplace laws have been changed in two key ways. First, the laws have been deregulated to encourage employers to cut wages and de-unionise their workplaces. At the same time, unions have been subjected to complex regulation that restricts their ability to access workplaces, recruit members and to bargain for better wages and conditions. The laws have allowed employers unprecedented ability to cut labour costs, outmanoeuvre employees and their unions while at the same time inveigling unions into a kind of regulatory quicksand…..

Read the full article here.

Yet another Liberal-Nationals publicly funded program ripe for rorting by the private sector

Remember the pile on to hoover money from the Research and Development (R&D) Tax Incentive program administered by the Tax Office and the Department of Industry, Innovation and Science or the debacle which is the Vocational Education and Training program?

Well now the Turnbull Government has decided this is great idea. What could possibly go wrong?

HuffPost, 3 April 2017:

CANBERRA – A voluntary internship program, designed to get young people eventually into work, has just been kicked off by the Turnbull Government despite widespread concern about its efficacy and potential for youth exploitation.

Under the Youth Jobs PaTH Program, an unemployed or disadvantage young person under 25 years will be paid an extra $200 a fortnight "incentive" on top of the usual income support payments to complete an internship of between four to 12 weeks….

Businesses partaking in the program will receive an upfront bonus of $1,000 for taking on an intern and get an additional $6,500 if the internship turns into a job.

The Guardian, 3 April 2017:

The Turnbull government launched its Prepare, Train and Hire (PaTH) internship program on Monday despite the legislation for its full implementation being stuck in the Senate.

Implementing the internships without legislation could cost workers up to $42 a fortnight, because the $200 a fortnight they receive for taking on work placements will count as income that reduces their other social security payments.

HuffPost, 3 July 2017:

Prime Minister Malcolm Turnbull trumpeted a breakthrough for his government's controversial PaTH internship program on Monday, as he unveiled a plan for 10,000 retail interns, but the businesses onboard with the plan have come under fire over previous penalties for mistreating and underpaying workers.

The PaTH plan -- Prepare, Trial, Hire -- was announced in the 2016 budget, designed as a way to get young unemployed people into job training and work experience programs, with a view to getting them off welfare and into paid employment. The job skills training is compulsory, but participating in an internship is voluntary, and completing up to 25 hours a week gives "interns" an extra $200 on top of their existing welfare payments. Businesses that take on interns would also receive thousands in financial incentives.

Unions and workers groups slammed the idea, claiming it would lead to "churn" culture where businesses would stop employing casual or part-time employees who the business itself has to pay, and instead sign up to receive a revolving door of interns who the business not only does not pay, but actually gets paid to take on.

On Monday, Turnbull joined employment minister Michaelia Cash to announce the Australian Retailers Association would "partner" with the government to offer up to 10,000 internships through the PaTH program. News Corp reported that retailers including Battery World, Coffee Club, Bright Eyes and Bakers Delight will participate in the program, but opponents have seized on the recent history of some of those businesses.

"The employers that have signed up to the Youth Path program don't have a good track record treating their workers with respect," said Labor's shadow employment minister Brendan O'Connor and shadow minister for employment services Ed Husic.

"Bakers Delight apprentices, and assistants were reimbursed almost $40,000 after the Fair Work Ombudsman found they were being underpaid. A former Coffee Club franchisee in Brisbane was fined more than $180,000 in penalties for contraventions including an unlawful cash back payment."

The Coffee Club decision was announced on the government's own Fair Work Ombudsman website just two weeks ago.

"The Turnbull Government can't explain how the Youth PaTh program won't displace jobs that could go to full-paid employees. The Government has not outlined how its agreement with retailers will stop subsidised workers from being used by some retailers to avoid paying penalty rates -- by engaging subsidised, so-called 'interns' in penalty shifts that would normally be staffed by employees," Husic and O'Connor said.

SBS News, 4 July 2017:

On Monday, Minister Cash sought to assure potential interns that they would have a decent chance of getting a job at the end of their placement…..

Australian Council of Trade Unions president Ged Kearney said the program offered no path to qualification, employment or workforce protection.

"This is a government-sanctioned program that actually borders on slavery," she told reporters in Melbourne.

"If this does create new jobs, then pay the kids for the jobs. Pay them a wage. They're going to be productive. They're going to be contributing to the bottom line of these businesses."

Quotes of the Week

"Globalisation can't be just about outsourcing and low wages"   [Jeff Immelt, Chief Executive Officer General Electric, quoted in Financial Review, 26 June 2017]

“In an appearance at the University of Chicago on Monday, former President Barack Obama unloaded a relentless barrage of complete sentences in what was widely seen as a brutal attack on his successor, Donald Trump.” [Andy Borowitz writing in The New Yorker, 24 April 2017]

“Coal India—a government-back coal company–is reportedly closing 37 of its "unviable" mines in the next year to cut back on losses.

India is primed for an energy revolution. The country's ongoing economic growth has been powered by fossil fuels in the past, making it one of the top five largest energy consumers in the world. But it has also invested heavily in renewables, and the cost of solar power is now cheaper than ever. In some instances, villages in India have avoided coal-powered electricity altogether, and "leapfrogged" straight to solar power.” [ Journalist Ankita Rao writing in Motherboard, 24 June 2017]

Clarence Valley Council's nine elected members decline pay rise for fifth year running

Clarence Valley Council, media alert, 28 June 2017:

Councillors again decline pay rise

FOR the fifth year running, Clarence Valley councillors have declined to give themselves a pay rise.

At their meeting in Maclean last night, councillors voted unanimously not to accept increases allowed under the Local Government Remuneration Tribunal guidelines. Councillors have not

accepted any increase since 2013/14.

Councillors will continue to receive $17,490 a year while the maximum allowable under the guidelines for a regional rural council, such as the Clarence Valley Council, is $19,310.

Under the remuneration schedule adopted by council last night, the mayor will receive an additional $35,525 (maximum allowable under the guidelines is $38,880) and the deputy mayor will receive an additional $2935 (maximum allowable $3240). The deputy mayor’s allowance is deducted from the mayoral allowance.

The motion not to accept the allowable increase was moved by the deputy mayor, Cr Jason Kingsley, and supported by all colleagues present (Cr Arthur Lysaught was an apology for the

meeting).

The mayor, Cr Jim Simmons, said the amounts were not large, but it was important for councillors to show restraint when the organisation was looking to improve its financial position.

Release ends

Members of Australian Parliament receive third pay rise in four years raising base salary to $203,020 per annum

The 226 members of the House of Representatives and Senate will receive a base salary which is almost six times higher than the June 2017 full-time minimum wage – commencing on 1 July 2017.

Excerpts from Remuneration Tribunal 2017 Review of Remuneration for Holders of Public Office Statement, 22 June 2017:

The Tribunal has decided to increase remuneration by 2 per cent for public offices in its jurisdiction, with effect from 1 July 2017…….

In conducting its annual review of remuneration, the Tribunal takes account of economic conditions in Australia, past and projected movements in remuneration in the private and public sectors (including the APS), as well as the outcomes of reviews of public offices completed by the Tribunal. In order to inform its conclusions the Tribunal draws upon authoritative external sources such as the published material available from the Government, the Reserve Bank of Australia (RBA) and the Australian Bureau of Statistics (ABS) as well as trends in public and private sector remuneration. It is obliged by its legislation also to consider the Annual Wage Reviews of the Fair Work Commission.

Adjustments arising from the Tribunal’s annual review generally apply to the broad spectrum of offices in the Tribunal’s determinative jurisdiction including the most senior offices in the public service and statutory agencies, certain government-owned businesses, Secretaries, numerous part-time offices and the federal judiciary, as well as parliamentarians. Ordinary annual adjustments in remuneration of this kind recognise the achievement of ongoing objectives and the steady evolution in responsibility that is characteristic of public administration.

The Tribunal considers it important that remuneration for offices in its jurisdiction be maintained at appropriate levels over the longer term to attract and retain people of the calibre required for these important high level offices. The Tribunal is conservative in its approach to annual increases and in this case is conscious of the Government’s policy of wage restraint for the APS and non- APS government agencies. Ideally, the Tribunal is concerned to avoid, in the future, any need for significant one-off increases to restore proper relativities and to recognise fully ongoing changes in work requirements…..

The Tribunal sets remuneration for a range of offices that sit at the forefront of the private/public sector ‘divide’. Heads of agencies, members of boards and technical/professional specialists often straddle roles between both sectors. Many of these office holders do not expect or require that monetary compensation be set at private sector levels.

Rather in the true sense of the phrase ‘public service’, office holders serve for the public good. This means that in setting remuneration the Tribunal has traditionally set rates below those of the private sector.

Nonetheless over the past year there has been a notable increase in submissions to the Tribunal seeking higher remuneration for offices and individual office holders based at least in part on private sector remuneration.

As well as achieving an appropriate balance in the assessment of both private and public sector wage movements, the Tribunal must make its assessment of wages and other economic considerations based not just on past experience but also on predictions of future movements. The Tribunal is also conscious of the Government’s policy of wage restraint applying to APS and non-APS agencies. Ultimately the Tribunal has decided to set its general increase at 2 per cent…..

This wage increase translates into the following figures.

The Australian, 22 June 2017:

The rise will push ordinary members of parliament up by just under $4000 to $203,020 per annum.

The Prime Minister will get a $10,350 pay rise from $517,504 a year to $527,854

Cabinet ministers, currently paid a base salary of $343,344, will get nearly $7000 extra and will now be paid $350,210 a year.

Shadow ministers, on $248,800 per year, will get bumped up to $253,776 a year.

MPs and senators had already been granted additional taxpayer-funded support staff six months ago.

The Australian, 20 December 2016:

Taxpayers will fork out an extra $35.8 million over the next four years for federal politicians to ­employ 33 additional staff, adding to more than 1500 people already employed by MPs.

The allocation will see the extra full-time positions divided ­between the Coalition, Labor, the Greens and crossbench MPs, and also provide for some existing roles to be reclassified, costing $9.1m annually from 2017-18.

The mid-year budget review says $35.8m will “allow parliamentarians to more effectively manage their workload and represent the interest of their constituents”.

The total number of personal staff employed by government MPs is 448, including 401 for the 30 ministers and 25 for the 12 parliamentary secretaries, who are called assistant ministers.

Eight staff work for government whips and a further 14 have other roles.

The opposition employs 101 personal staff; 37 are allocated to the Leader of the Opposition, and six to opposition whips. The Greens have 17 personal staff. Each of the 15 crossbench MPs and senators have been allocated an extra three staff. In addition, there are almost 1000 staffers working in electorate offices, with the 226 MPs and ­senators entitled to four workers each.

Department of Finance documents show the number of staff classified as senior advisers ­jumped from 61 in February last year to 101 last month. In the same ­period, the total staff in lower-paid positions fell by eight.

Government staff are paid ­between $48,000 annually for an entry-level electorate staffer to $245,000 for a senior adviser, plus allowances of up to $30,000 a year.

The staff have just signed a new enterprise bargaining agreement that locks in salary and allowance increases of 2 per cent a year for the next three years.

Readers will recall that Turnbull Government MPS and senators opposed the June 2017 minimum wage rise, actively supported cuts to penalty rates for workers in the retail, fast food, restaurant, hospitality and pharmacy sectors and, continue with planned welfare cuts including a freeze on family tax benefit rates for two years from 1 July 2017, a freeze on "income-free areas" and "means-test thresholds" for certain payments and allowances for three years and extending waiting periods for parental payments and youth allowance for those who are not full-time students or apprentices.

Women are still the majority of the low paid workers in Australia - a fact that is conveniently ignored by government

The Australian Taxation Office publishes a range of statistics which, despite the time lag, state and federal governments and their agencies rely on for a financial profile of the nation.

This April the data release covers the financial year 2014-15.

Table 3: Individuals – selected income items, 2013–14 to 2014–15 income years
Income item	2013–14			2014–15
	Individuals (no.)	Average ($)	Median ($)	Individuals (no.)	Average ($)	Median ($)
Salary or wages	10,304,687	56,689	46,656	10,469,919	57,576	47,502
Gross interest	7,335,773	1,821	162	7,659,362	1,622	138
Dividends – franked amount	2,861,982	7,971	506	2,849,504	7,776	549
Dividends – franking credit	2,855,343	3,422	218	2,843,250	3,338	237
Allowances, earnings, tips, director's fees etc	2,297,379	3,801	463	2,344,140	3,778	453
Net rent	2,033,973	−1,828	−1,675	2,077,235	−1,749	−1,624
Net non-primary production amount	1,748,849	28,993	5,122	1,786,937	28,582	4,927
Net income or loss from business – non-primary production transferred from item P8	1,078,383	26,269	12,095	1,122,260	26,192	12,221
Dividends – unfranked amount	1,060,280	887	78	1,064,264	942	84
Australian Government allowances and payments like Newstart, Youth Allowance and Austudy payment	922,538	5,664	4,942	966,709	5,906	5,178
Australian Government pensions and allowances	645,097	10,127	10,250	676,083	10,318	10,368
Net capital gain	609,678	23,585	1,901	672,484	25,944	2,137
Total income or loss	12,964,285	59,851	44,697	13,213,814	60,714	45,471

Note Total income or loss: components do not add to the total number of taxpayers because taxpayers may declare more than one type of income. Some components of total income are not listed in this table. The count, average and median for total income or loss are calculated including zeroes.

[See https://www.ato.gov.au/About-ATO/Research-and-statistics/In-detail/Taxation-statistics/Taxation-statistics-2014-15/?anchor=Individuals#Individuals]

Whichever way one looks at salary/wage line in this table it clearly shows that ordinary Australian workers are not doing well, with half having annual incomes below $47,502. That's 5.1 million people earning far less than the $195,130 base salary enjoyed by 
members of the Turnbull Government who are even now looking for ways to reduce the takehome pay of such workers. 

Of the 13.21 million individuals who lodged a tax return in 2015, 6.85 million were males and 6.35 million were females. According to the Australian Bureau of Statistics in 2013-14 there were also an est. 1.22 million people of working age lived alone with a significant number of these individuals having incomes below the median annual salary/wage, so it is likely that a similar situation existed in 2014-15.

If one divides the ATO tax returns by gender it is not hard to see that more women than men would be found in the group earning less than $47,502.

This is not just a passing phase in wages growth – women have consistently been on the bottom of the wage ladder this century. This despite the fact that they are better educated now than in centuries past and so many are in paid employment.

The Guardian helpfully published a breakdown on 18 April 2017 from which I selected three graphs to illustrate the point:

In the article Greg Jericho concluded: Women made up 45% of all people earning a taxable income in 2014-15, and yet they accounted for just 25% of those in the richest 10% but 57% of those in the poorest decile……It goes without saying that if you earn a large income you are more likely to be a man and if you earn a small income you are most likely to be a woman – and it really does not matter what your job is.

The Australian Government Workplace and Gender Equality Agency stated in August 2016:

The full-time average weekly ordinary earnings for women are 16.2% less than for men.

Among non-public sector organisations with 100 or more employees, the gender pay gap for full-time annualised base salary is 19.1%, and for full-time annualised total remuneration is 24.0%.

The full-time average hourly earnings for women are 13.9% less than men's full-time average hourly earnings.

The gender pay gap in ASX 200 organisations is 28.7%.

Average graduate salaries for women are 9.4% less than for men. When factors such as personal characteristics, occupation, industry and education are accounted for, average graduate salaries for women are 4.4% less than for men.

Average superannuation balances for women at retirement are 52.8% less than those for men.

Of people aged 65 years and older receiving the aged pension, 55.6% are women.

This agency also pointed out that:

Of all women aged 20-24, 90.1% have attained year 12 qualifications or above, compared to 86.3% of men in the same age bracket.

Of all women aged 25-29, 39.6% have achieved a bachelor degree or above, compared to 30.4% of men of the same age bracket.

A slightly higher proportion of men (6.1%) aged 15-74 years attained a postgraduate degree than women (5.7%) of the same age bracket.

The reality is that women have never enjoyed equal pay across all industries and occupations and the national economy relies on them supplying cheaper labour.

So the next time your local MP tells you that he or she understands how "middle Australia" is feeling or attempts to position their family there – openly scoff at such a nonsensical viewpoint.

If your MP tells you that he/she supports the right to equal pay - walk away whilst raising a middle finger in disgust.