Wednesday, November 6th, 2013

Mayor's social experiment could ripple through to other businesses' costs

The Auckland Mayor's desire to pay Council staff 'A Living Wage' is something of a social experiment says Kim Campbell, chief executive of the Employers and Manufacturers Association.

"We can understand the Mayor may want to pay Council staff more but branding the increase a 'Living Wage' is not persuasive," Mr Campbell said.

"If the increase is paid regardless of whether staff are more productive it could well see extra costs ripple through from contractors to Auckland Council and onto other Auckland businesses.

"With the Council set on paying more in salaries and wages, ratepayers will also want to know that Auckland's very large capital works programme will be adequately funded.

"Now is not the right time to be making apparently casual commitments like this to boost Council pay without ensuring an offsetting boost to staff productivity.

"Decisions of this sort indicate Auckland is likely to face a debt ridden future."
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