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Minimum wage rise a small but important victory for the Left

Written By: - Date published: 1:08 pm, February 10th, 2009 - 20 comments
Categories: national/act government, phil goff, wages, workers' rights - Tags:

Great, through concerted pressure the Left managed to force a 9-cent an hour real increase in the minimum wage from National/ACT.

A 9 cent an hour real increase is not much but it’s a hell of a lot better than freezing the minimum wage at $12 an hour and letting inflation eat it as National/ACT had planned. The decision for freezing at $12 was set to be approved by Cabinet last Monday but media attention drawn to the issue by the Left forced the Government to delay its decision for week while the Key-populist camp wrangled with the English-conservative bloc. Fear of a backlash prevailed in the end and National/ACT approved an increase, albeit the smallest in four years, to $12.50 an hour, just enough to cover the increased cost of living. 

Because of that, the incomes of 120,000 workers and their families have been protected from the $20 a week cut they would have suffered had we let National/ACT slip through their no increase preference unchallenged.

Now, if we had a decent government we would be looking at at least the $13 an hour Phil Goff promised. Rather than a paltry $3.80 extra a week after inflation, full-time minimum wage workers would have another $23.80 a week or more to help support their families. But we don’t have a good government; we’ve got National/ACT. We have to make do with what we’ve got and try to force National/ACT into the best outcomes we can.

The experience of this mini-campaign shows that if the Left makes the effort, we can use Key’s populist instinct to good ends. When we work at it, we can hold the line and even win small victories.

20 comments on “Minimum wage rise a small but important victory for the Left ”

  1. Daveski 1

    What revisionist BS.

    The Left told everyone that the Nats would cut wages. Read your own posts.

    Now you try to claim credit for the Nats decision?

    You’ve become quite delusionary on this topic, particularly the fact you categorically stated that Key wanted to cut wages. When proven wrong, you’ve simply tried to ignore this fact and reinvent reality.

    I don’t normally get this fired up. Some of your posts are well researched, provocative and lead to reasoned discussion. This isn’t.

    You got it wrong. Admit it and stop trying to fudge the fact you were wrong.

  2. gingercrush 2

    When you say WE. Do not forget that until the polls say so. Most voters in New Zealand are happy for a National-led government. Don’t forget had Labour actually led the government after the 2008 election. Helen Clark would have been in charge and there is certainly no guarantee a $13 dollar minimum wage would be on the card.

    [it would have been at least $12.66, as per labour policy, probably more becasue a deal with have had to be made with the Greens and Maori Party. And, unlike under National/ACT, there would have been no doubt there would have been an increase. SP]

  3. Dave. How do you explain the Government’s sudden week delay in annoucing their decision? What changed?

    We know, because my source told me and my source knows, that the Government was going to take option 1 of the three options it was presented with, $12.00 – a drop in real terms of 40 cents, whereas the DoL was recommending option 2 – $12.50 – an increase in real terms of 9 cents (rounded).

    we know what changed. It became public knowledge that they were planning to keep the mw at $12 before the Government had a chance to slip it through. that forced them to revisit their decision and change their choice.

    Think about it, the decision was meant to be implemented at Cabinet last Monday. It wasn’t, it was delayed. Key told the media at the post-Cabinet press conference that there was a debate still to be had about which option to choose. Why did there suddenly have to be a debate after the time decision was menat to be announced? Because the situation had changed, the previous decision was now in doubt and was ultimately changed.

  4. Pat 4

    Did your “source” who “knows” also tell you that Key buckled due to posts on Leftist blogsites?

  5. gingercrush 5

    $12.66 isn’t $13.00 though is it. Hence my whole problem with Phil Goff. The Greens and Maori had such policy but Labour’s was different.

  6. no. My source told me the contents of the DoL advice to the minister ($12.50) and the option the minister was taking to cabinet for approval ($12).

    I imagine that it was pressure in the media from union and other Left wing voices, more than this blog, that caused the pause, then change of policy. We were the first to write of the Government’s plans (the Monday before the decision was originally to be taken) but the info was already spreading throughout the union movement, the greens etc. You’ll note I don’t claim any special credit for The Standard in the post. we’re just one small part of a larger movement comprising hundreds of thousands of Kiwis, including New Zealand’s largest democratic organisations, the unions.

  7. Daveski 7

    The delay was significant – it showed the divisions in National which is not unexpected.

    You are right to say people were expecting the Nats to keep the mw as it was – a cut in your view.

    You strongly promoted this as fact.

    As Pat shows, you have no evidence that left wing blogs or other vehicles influenced the Nats decision. I suggest it was Key’s pragmatism as evidenced by the Maori Party again.

    Again, I point out only because you avoided it, you rang a fear campaign based on Nats cutting wages. You’ve been proven to be wrong but continue to avoid acknowledging this. To my amazement, you know try to take credit for the decision!

    For the record, I think it’s a sensible decision – the Left want more (although would they have delivered??) – business is moaning so it would seen to be about right.

  8. Pat 8

    “I imagine..”

    Very apt words, indeed.

  9. djp 9

    ..and a defeat for NZ in general.

    See http://pc.blogspot.com/2009/02/minimum-wage-rise-everybody-loses.html for the hows and whys

  10. Daveski. both sides of an argument being unhappy does not mean the correct decision was made. For one, both sides would be calling for more in their direction no matter what the decision was. Secondly, comprimise doesn’t equal opitmal decision – by way of metaphor, if a building is being built and the engineer is saying ‘we need more strength’ and the designer is saying ‘i want more open spaces’ a comprimise is not a good outcome.

    And they were planning a cut in inflation-adjusted terms (the only meaningful measure) that was their plan but they had to change it at the last minute, after a barrage of media coverage on the issue.

  11. toad 11

    Daveski said: Again, I point out only because you avoided it, you rang a fear campaign based on Nats cutting wages. You’ve been proven to be wrong but continue to avoid acknowledging this.

    Daveski, they are still on track to cut wages. The fire@will.bill will cut wages because people coming into new jobs will be too scared to join a union for fear of being dismissed. This will undermine the strength of unions in wage bargaining, which is already low becasue of the global financial crisis.

    What’s more, the worst is yet to come – allowing non-union groups to collectively bargain in competition with unionised workers. I blogged about how that will lower wages over here.

    And a nil increase in the real minimum wage certainly won’t do anything to counter the effects of those other policies National are implementing. But strategically, an increase to just cover inflation was a good move for National because it helps them avoid being labelled hard right, as the were through the infamous 1990s NIL minimum wage increases.

  12. Daveski 12


    You point would be [more] valid if it applied to all workers. It doesn’t. I saw SP himself arguing that SME’s employ a fraction of the total workers. Do you have any evidence to back up the statement about the fear? I could retort that it will potentially allow others to increase their income through opportunities they may not otherwise get. Still, it’s not going to impact on all employees which is consistently and conveniently overlooked.

    Let’s face facts, the biggest issue the unions have to face regarding is the economic challenge.

    Before the election, there was criticism from the Left that regardless of what Labour did, the right opposed and criticised.

    All that’s happened is people have changed seats and the roles have changed. Regardless of what the Nats do, there will be opposition and criticism here.

    Edit – perhaps I have to retract one of my earlier comments – it has become a robust and interesting discussion but I have to head off!

  13. Greg 13


    Steve’s exactly right. And it scares the hell out of me. Why would you be proud to be a Nat? Surely any true Nat realises that any rise in the minimum wage (especially at this point in time) is extremly stupid.

    You do have a point though. All this ‘right wing agenda’ stuff thats come out of this site is proving to be false. Key is getting more and more Clark like every day. The left should be happy.

    I sure wish the Nats had a right wing agenda, we’d ALL be better off!

  14. Jum 14

    Every six months I shall be checking the wage stats.

    Meanwhile, I have your absolute promise that your beloved party of NZer lovers (NAct) will not cut wages. Thank you.

    Is that the new format – pretending to be annoyed with your NAct for being so kind to NZers, yet knowing if they get in for a third term, they will annihilate our assets? Cunning indeed. CrosbyTextor cunning, in fact.

  15. Greg 15


    Is that the new format – pretending to be annoyed with your NAct for being so kind to NZers, yet knowing if they get in for a third term, they will annihilate our assets? Cunning indeed. CrosbyTextor cunning, in fact.

    Thats the thing! Its not kind to New Zealanders at all. Sometimes the most obvious answer is not the right one. In the long run, all raising the minimum wage does is make the most vulnerable in our society worse off.

    I wish they’d get rid of a few ‘assets’. LTSA for example (why should the government own a chain of garages when we are more than adequately supplied for by the private sector). Or TVNZ what role does the government have to play in the media? Etc etc.

    Sadly however, in an effort to keep the baubles of office the National party will do little if anything with our state assets.

  16. I think the explanation for what happened is quite straight forward. The Government wanted to see what the reaction to the idea of a nil increase would be: the response from the public and the various interests involved was sussed out, and a small increase agreed.

    It should all be considered in the context of National’s project, which is to marginalise and shut Labour out – and nothing else. Refer you to this post I wrote earlier today.

    The left should be pleased because it is better for working people than a smaller increase. The left should be pleased because National’s running on Labour territory: the centre really has shifted to the left.

    The left should however be concerned: if we want to be making progress via being in government, it is a very difficult ask to beat a National govt which is dedicated to nothing more than keeping us out. They’ll do anything to achieve that one overriding goal.

  17. vto 17

    tangent – following your key pop and english old school view sp then watch out. you’re giving key mucho kudos. the party will revert to representing most and by the time that idea gets stretched english will be past it. too late for a second tilt.

    re your efforts at influence well done if so. it is then clearly a message that you are on the right track.

  18. Byron 18

    I gave a huge sigh of relief when the announcement was made that minimum wage was going up, then the next day I got a letter from the power company informing me their prices are going up, canceling out the pay increase I’ll get in April. As has been pointed out, its a pathetic increase.

  19. expat 19

    God bless John Key for looking out for the workers of NZ by raising the MW against the advice of his Minister.

    The union movement had nothing to do with it and should refund their members dues in advance for 2009 to help those lower paid workers cope with the recession.

  20. randal 20

    so much for the mimimum wage when this morning the dompost reports that labour had 16 support staff on $100,000 per annum but undr national that has ballooned out to 36 of the favoured few getting the big bux

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