Prime Minister Anthony Albanese is now into his first week of leadership and all eyes are on the new PM to see how he plans to deliver on those promises made on the campaign trail.
Increasing wages was a big part of Labor’s election campaign, with the then Leader of the Opposition making headlines as he backed a 5.1% increase in the minimum wage, in line with inflation.
The Fair Work Commission is the independent body that regulates the minimum wage in Australia and, while the government does not have direct power over the body, it can make recommendations for changes.
Albanese announced last week that his government would be writing to the Commission to recommend an increase in the minimum wage as the Commission is currently conducting its annual review of the hourly rate.
The pay rate for Australia’s lowest-paid workers is currently $20.33, which Albanese said on the campaign trail that he would like to see raised by 5.1% to $21.36. Increasing the minimum wage typically has knock-on effects for wages in general since it puts upward pressure on salaries from below. This is especially true for those who earn closer to the minimum.
However, last week his tune changed somewhat as he refused to name a figure by which the government would be recommending the Commission lift the minimum wage.
“The submission will be consistent with what I said during the election campaign: that people who are on the minimum wage can’t afford to go backward (and) can’t afford a real wage cut,” he told the ABC last week.
“There won’t be a number in the submission. What there will be though, is the strong view that we have, that people who are on the minimum wage simply can’t afford a real wage cut.”
Albanese has already written to the Commission, who are in the final stages of their wage review, to ask for an extended deadline for submissions and has been given until Friday to outline what he has called a “fair” increase in wages.
Around 3 million Aussies earn at the minimum rate, meaning that a large portion of the labour force could see real benefit from the rise if it goes ahead in line with the government’s proposal.
The Commission is set to make changes, if any, to the minimum wage in June, giving workers just a few weeks to wait to see if their salaries will be keeping up with the rising cost of inflation.
Already, the new Liberal Party leader Peter Dutton has criticised Albanese for “lying” to the Australian public over his “absolute” support for a 5.1% minimum wage increase. Economists are divided however on whether a minimum wage increase will help deal with inflation or make the situation worse.
It remains to be seen exactly what the Commission will do, but there will likely be more than a few disappointed voters if the new Labor government does not follow through on its election promise.
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