The government is pushing to increase wages for low-paid workers. Source: Cottonbro Studios, Pexels.
The Albanese government is pushing to increase minimum wages in addition to tax cuts, to help with the battle against inflation and the cost-of-living crisis.
Last month, the RBA refused to cut interest rates despite inflation easing to 4.1 percent in 2023.
Inflation has stayed steady since then, but cost-of-living remains stressful for struggling households.
“While we’ve made welcome progress on inflation and seen a return to real wages growth earlier than forecast, many Australians are still under pressure – particularly low-paid workers,” said Treasurer, Jim Chalmers.
On Thursday, the labor government will officially submit a claim to the Fair Work Commission, arguing to raise wages to support low-paid workers who are disproportionately affected by inflation.
The government also argues that tax cuts, which will come in effect in July, are “designed to be in addition to any increase in award and minimum wages”, and not a substitute.
“Despite increases in nominal wages, and the return of annual real wages growth, the real value of award wages has been eroded in recent years given the global inflationary environment,” the submission reads.
“Low paid workers and their families are particularly affected by cost-of-living pressures because they typically do not have savings to draw on to cover rising costs.”
Approximately 2.5 million workers are under the national minimum wage and award wages.
If wages increase by 4 percent, it will mean workers would earn an extra $36 dollars a week.
Treasurer Chalmers said it hoped the Fair Work Commission does not let Australia’s lowest-paid workers’ pay go backwards.
“We don’t see cost of living relief as instead of decent wages growth, we want to see decent wages growth on top of the billions of dollars in cost-of-living relief that the Albanese government is rolling out,” he told ABC TV.
“One of the best ways that we can help people deal with cost-of-living pressures, is to get wages moving again so people earn more and keep more of what they earn.”
The Fair Work Commission is expected to make its decision in the next upcoming months.
