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Pay hike another drain on a strained economy

8 July 2008

THE National Farmers’ Federation (NFF) is dismayed by today’s Australian Fair Pay Commission (AFPC) decision to increase minimum and award rates of pay by $21.66 per week, effective from 1 October 2008.

“The AFPC’s decision is a concerning tact given the current economic climate,” NFF President David Crombie said. “The NFF had sought an increase no more than the increase to the Consumer Price Index (CPI).

“This would have ensured that minimum wages are maintained, relative to inflation, without adding unnecessary burden to businesses that will not see productivity gains to offset the pay rise.

“Farmers are already hard-hit by increases to the cost of production – fuel, fertiliser and chemical prices have more than doubled over the last 12 months, wage rates have soared on the back of 30-year lows in unemployment and official interest rates have risen by 3% since 2002.

“An increase of this magnitude only adds to the cost pressures of those farmers already feeling the greatest pinch.

“That said, overwhelmingly, it will make little, if any, difference to the bulk of farmers already paying well over the Award.”

Today’s decision also marks the end of the deferral period for eligible drought-affected employers.

“The 2007 deferred rates were embraced by the most severely affected farmers across Australia,” Mr Crombie said. “In many ways, these farmers are the most marginalised employers in the sector. At least, they have had a year’s respite from the wage hike.”

This year’s decision and, indeed, the 2006 decision both exceeded the NFF’s proposed increase, to be aligned with CPI. The NFF is concerned by the AFPC’s trend in the face of prevailing economic pressures, especially while the drought lingers across significant parts of Australia.

“Despite our concern on the magnitude of today’s increase, the AFPC has demonstrated a meticulous, thorough, consultative and research-based approach to setting minimum wages,” Mr Crombie added. “It has moved Australia out of, and beyond, its adversarial wage setting past.

“The good umpire isn’t the one who always makes the decisions we like, it’s the one who makes well-informed, fair and considered decisions, taking into account the situation of all those affected. That is one trend we would like to see continued.”

[ENDS]

Media Enquiries: Brett Heffernan on (02) 6273 3855 or 0408 448 250.

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