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FAIR PAY COMMISSION FAILS TO TAKE ACCOUNT OF FARM REALITIES

26 October 2006

While recognising the decision by the Australian Fair Pay Commission to increase the minimum wage by $27.36-a-week may be representative of the broad economic conditions across Australia, the National Farmers’ Federation (NFF) said today’s announcement failed to take account of the realities facing farmers.

“We are disappointed in today’s decision,” NFF President David Crombie said. “The increase in wages of $27.36-a-week is too high for farmers to bear. With half of Australia’s agricultural regions in the grip of the worst drought on record, clearly farmers are already under pressure to keep the farm afloat and keep paying existing wages.

“Australia’s farms directly employ over 330,000 people – that level of on-farm employment is already under immense pressure due to drought. Today’s announcement will only exacerbate pressures on farmers to lay off workers, something we don’t want to do.”

In its submission, NFF asked the Commission to take into account the specific concerns affecting agriculture, including the current severe drought, when considering a national wage rise.

“We know from studies that demand for labour in regional Australia is more elastic in response to wage changes than in the cities,” Mr Crombie said. “Many farmers and businesses in rural Australia have had to make some tough decisions on retaining labour through this drought.

“NFF also argued that the any increase be based on the Consumer Price Index (CPI). The Commission has set the rate well above the substantial $20-a-week rise the CPI would have warranted, which would have included the sharp rise in the September inflation figures released yesterday.

“While today’s decision affects incorporated farmers, as well as farmers in Victoria, the ACT and the NT, the decision will now be a catalyst for the Australian Industrial Relations Commission to follow suit when it makes a wage determination later this year.

“The Australian Industrial Relations Commission must have regard to today’s decision when deciding wage increases for employees under transitional awards. Amid the impact today’s decision will have on farmers, the NFF will argue exceptional circumstances before the Australian Industrial Relations Commission when it meets.”

The NFF stressed that it supports the processes undertaken by the Australian Fair Pay Commission, however, considers that it has not fulfilled its charter in considering the extenuating circumstances facing farmers, as employers, to pay the new wage scales.

Media Enquiries: Brett Heffernan, NFF Public Affairs, (02) 6273 3855 or 0408 448 250 email:

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