Solidarity Library

Monday, April 30, 2007


Why workers deserve 8% pay increases!

The government claims that inflation in New Zealand is low, somewhere around 2 to 3%.
CPI (inflation) increase 3.4% for year ending dec 2006.

But inflation figures are not factoring in some of the huge increases in workers cost of living, like housing, petrol and transport. For example, electricity has gone up by 10% in 2 yrs , 60% in last 5 years.

House prices have gone through the roof in Auckland- most families can't afford a house even with two incomes coming in. According to the NZ Herald (30/4/07), the cheapest house in Otara is now selling for $300,000, and prices have increased by 20% every year for the last five years. Rent has also shot up by 30%, as landlords want to pay off their steep mortgages.

Petrol prices are increasing every month, and with peak oil, look set to continue increasing in the future. petrol increase 33% (rounded) since feb05 (39c over 1.17) Busses have gone up by 8% and trains by 16% in Auckland alone. Even the basics like food are shooting up. With a low wage economy, NZ workers suffer a lot from high debt, and at 7.75%, interest rates for bank loans in New Zealand are the highest in the Western world.

A pay rise of 4% with price increases like this is really a pay cut. A genuine increase would add 4% on top of inflation- that's why Solidarity is arguing for



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