Page 873 - Week 03 - Wednesday, 22 March 2017
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wages growth, he would not be cutting the penalty rates of Australian workers. The reduction of penalty rates will only further exacerbate problems of low wage growth. This penalty rates decision will lead to wage cuts of up to $3,500 a year for some workers, according to the McKell Institute modelling.
The Prime Minister’s myth that this is good for the economy also needs to be busted. People in the middle class, and particularly those in the working class, spend almost the entirety of their income on the immediate economy. On the other hand, wealthier people are more likely to spend a greater proportion of their income on investments and high-return capital, not feeding that money back into the further economy. To quote Bill Shorten:
This won’t lead to greater employment; it will lead to greater hardship.
Prior to the ruling, a spokesman for the restaurant and catering association admitted that cutting penalty rates is really about getting employees to work longer hours for the same amount of money. Last year, Citigroup conducted a financial analysis which found that many large retail groups such as JB Hi-Fi and Myer were likely to pass penalty rate savings straight to shareholders. Those two chains alone employ hundreds of Canberrans, whose pay will be cut to boost the portfolios of international investors.
This decision attacks the lowest paid and most vulnerable in the community. Suburbs in my own electorate have people in retail and hospitality jobs, and cuts to their pay will significantly affect the community in which I live and the young families living there.
It was ironic to hear Mr Hanson yesterday bemoan Woden’s empty buildings, caused by the Liberal Party’s cuts to public service jobs. Two weeks ago, we heard that up to another 250 jobs will be going in the commonwealth Department of Health. What does he think will happen when all of the retail workers in Woden Plaza have their take-home pay cut by this penalty rate decision? It will affect demand.
We also know that this decision will disproportionally affect women: 56 per cent of people in retail are female, and 54 per cent of employees in accommodation and food services are women. These workers are far more likely not just to have children, but also to have more children and to be single parents. These sectors also have a disproportionate number of young people and students working in them. Putting further financial pressure on these people will have multiple poor consequences for our society.
For students particularly, forcing them to work longer hours just to get by will affect their study and ultimately their future employment prospects and the quality of the nation’s future workforce.
This decision does not affect just those thousands on the industry award; it also undermines the initial bargaining position of every other worker in these industries. With a lower base salary to start negotiations from, all enterprise agreements will inevitably have lowered pay rates as a natural consequence. This decision will affect
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