Phil Goff
Leader of the Labour Party

28 July 2010 Media Statement

Wage gap with Australia blows out over $50 under Key

The wage gap with Australia has blown out by more than $50 a week under National despite Prime Minister John Key saying before the election ‘the fundamental purpose of his government’ would be to narrow the gap, says Labour Leader Phil Goff.

“The trend is getting worse,” Phil Goff said. “The gap is actually accelerating. In the past quarter, according to official statistics, Australian wages have increased by $17 a week, compared to $3 for Kiwi workers.

“Economic Development Minister Gerry Brownlee got it totally wrong yesterday when he told Parliament that the income gap ‘is certainly a lot less than it was when Labour was in office’. What he said in the House was untrue. He made it up.

“Kiwi workers have, in fact, fallen more than $50 further behind. John Key has failed to deliver on his most basic promise to Kiwis,” Phil Goff said.

“As well, Kiwi workers will fall even further behind from October when they will be paying a consumption tax (GST) that is 50 percent higher than in Australia.

“To make matters worse, for the first time in a decade Kiwi workers are more likely to be unemployed than Australians because the unemployment rate is now higher here.

“There has been an absolute expression of no confidence in National’s record on this issue,” Phil Goff said. “Don Brash said at the weekend that New Zealand would not catch up with Australia on ‘the Government’s present track’ and Reserve Bank Governor Alan Bollard has described National’s posturing as ‘unrealistic’.

“It is perhaps a reflection of the growing gap that Qantas is now employing staff on trans-Tasman flights out of its fully-owned subsidiary JetConnect in New Zealand because they can pay 30 percent less here and cut superannuation entitlements.

“National has no plan or even interim targets to catch up with Australia,” Phil Goff said. “It set up a 2025 taskforce which was a debacle and abandoned immediately, but National has put forward no alternative since. Mining in national parks was the answer, but that’s fallen over and was a shambles. The Jobs Summit has come up with nothing substantial in terms of closing the gap or creating jobs.

“New Zealand needs a skills plan to lift productivity, an R&D plan to increase innovation, and a savings plan to increase capital for investment, but in all these areas Australia has moved forward and New Zealand back since November 2008.”

ENDS

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