New attack on the minimum wage is beyond the pale
MAURICE Newman is hardly a household name, but make no mistake, he is one of the most influential people in Australia.
For many years, Newman (pictured) has been in the shadows on the edge of power as a key confidante of conservative politicians. He was one of John Howard’s closest advisors, and was rewarded with a number of plumb jobs, including chairman of the ABC.
With the election of Tony Abbott, Newman has again been given a key role of incredible influence: chairman of the Prime Minister’s Business Advisory Council. This council will be dictating the government’s approach to economic and workplace policy over the next three years.
Covert power and influence
People like Maurice Newman exert their power covertly, through networking and influence. They prefer to operate that way, to stay under the radar, and present an opaque, non-threatening personality to the general public.
But occasionally, just occasionally, they pop up into public view and give us a taste of what they really think.
Newman – a member of Australia’s business elite stratosphere who made his millions as a stockbroker and investment banker – did just that on Monday night this week, delivering a wide-ranging critique of the recently-departed Labor Government in a speech to the Committee for Economic Development of Australia.
In some respects, it was more of the monotonous, nonsensical views we’ve come to expect from the business community, which despite its total lack of newsworthiness, ends up on the front pages of the Australian Financial Review and The Australian.
But it was Newman’s surprisingly frank contempt for the structures that make up our system of workplace rights and protections that has earned him the title of the inaugural member of the Working Life Hall of Shame.
“While any discussion in Australia about industrial relations evokes screams of outrage and spectres of WorkChoices, we cannot hide the fact that Australian wage rates are very high by international standards and that our system is dogged by rigidities,” Newman is reported to have said.
What is so concerning about Maurice Newman’s comments is that they must represent a widely-held view in the new government that minimum wages are too high and must be cut.
He went onto note that Australia’s minimum wage – which in July rose to $16.37 an hour or $622.20 a week – was far higher than that in the United Kingdom, United States and Canada.
“When we’re $US33,500 and the US itself is only $15,080 you can see there’s an enormous disparity,” he said.
Newman claimed he was not suggesting Australia’s minimum wage should be halved, but it is difficult to come to any other conclusion from his comments, in which he also questioned why business pays workers’ compensation and superannuation, and why employees get paid sick and holiday leave.
For good measure, he also called for a review of the funding commitments to the National Disability Insurance Scheme and to the better schools program (the ‘Gonski reforms’).
A decent minimum wage is a sign of a civilised society
As we have noted many times before, a decent minimum wage is a sign of a civilised society. Australia was a world pacesetter in establishing a living wage at the beginning of last century, and it has always been one of the hallmarks of the fair and egalitarian society we have had since that we support a relatively high minimum wage. It is what distinguishes Australia from much of the rest of the world.
A decent minimum wage is one of the bulwarks that prevents Australia developing a large underclass of working poor, which now so dominates the United States. And it is credited as helping to sustain our economy during the slowdown caused by the Global Financial Crisis, when other nations with a lower minimum wage sunk into recession.
Not only that, but more enlightened public figures in the US, like President Barack Obama and the newly-elected Democratic Mayor of New York City, Bill De Blasio, realise that minimum wages there urgently need to rise or the nation will be stuck in an economic quagmire and poverty and inequality will worsen.
Yet in Australia, it is the throwback views of the business elite, epitomised by Maurice Newman, that are gaining traction.
A surprising critic of Newman’s views emerged yesterday in Professor Ian Harper, former head of the WorkChoices-era Fair Pay Commission.
“When it comes to the competitiveness of the Australian economy, really the minimum wage is not a big deal. Very few Australians are paid the absolute minimum wage,” Harper told the ABC.
“And even if you think about the minimum classification wages, very few Australians are paid that as well. Most Australians who earn wages are paid wages that are negotiated as part of enterprise bargaining agreements, and they’re above the absolute minimum.”
What is so concerning about Maurice Newman’s comments is that they must represent a widely-held view in the new government that wages, especially the minimum wage, are too high and must be cut. Just as many Liberal MPs share the view of the business community that penalty rates must be cut or abolished.
Last month, the Australian Financial Review profiled Newman in its annual power issue and predicted he would be highly influential in shaping the Abbott Government’s economic policies. Interestingly, today’s Fin claims that Newman’s speech was written in close consultation with Abbott’s office.
Newman is also a known climate change sceptic, and his fingerprints can be seen all over that Coalition policy too. In his speech on Monday, he came out as an enthusiastic supporter of the so-called ‘direct action’ approach to climate change and said investing in renewable energy was effectively a waste of taxpayers’ money.
With a key review of public spending already outsourced to big business through the Commission of Audit chaired by Tony Shepherd, it looks like the new government will be doing a lot of listening to corporate Australia, and pay scant attention to the rest of us.
Newman’s comments can only be interpreted as an early salvo on a full-scale assault on wages and conditions.
For these reasons and more, Maurice Newman enters the Hall of Shame, a place where we will shine the spotlight on those in business, politics and public policy who by words and by deeds pose the greatest threat to the lives of working people.
He has definitely earnt the dubious honour.
Working Life is a forum to share ideas and opinions about work and life, both light-hearted and serious. The opinions presented on Working Life are those of the author, and do not necessarily represent policies or views of the ACTU.