Cost of Living

[COUNCIL - Thursday, 12 August 2010]

 HON LYNN MacLAREN (South Metropolitan)

[10.56 am]: I rise to agree to the motion; I think it is a very sensible motion. I will make six points in relation to it so that other members have an opportunity to make their comments. The Greens (WA) believe it is fair and reasonable to increase pay for the lowest paid workers, and government health workers are unfortunately amongst those lowest paid workers. I thank very much the Leader of the House, who has outlined the government wages policy. It helps us to understand why the government is struggling to pay these workers more. However, he has also noted that it is possible for them to receive an increase of 12.25 per cent, and we think that that is fair. The government should find a way to make that happen.

The government policy, of course, is that wage increases are somehow linked to consumer price index growth. It is ironic that this week the Salaries and Allowances Tribunal announced that it would increase our own wages. It was notable that parliamentarians’ wages were not so tightly connected to the CPI. One way that we could improve this in the long term would be if we were to link our own wages to CPI growth. However, it was still worthwhile to understand the government’s viewpoint on its wages policy.

The point is, however, that a lot of the lowest paid workers in the state—the workers that the government will rely upon to deliver government services—are non-government workers. They come from the community services organisations, through which this government wants to deliver more services, but they will not be protected by that wages policy. If the government is looking at trying to improve the wages of people who are delivering the essential services that the government should be providing, it should look at increasing the wages that are provided to community service workers in non-government organisations.

I note that Hon Sue Ellery mentioned $41 000 as an average wage in the government health industry. Today I did a little research before I spoke to this motion and found out that the average weekly earnings in Western Australia for men—as we all know, it will be a little higher than for women—is $1 346. If we take into account wages for both men and women, the amount is $1 053. The $41 000 that government health workers are getting is far below these average weekly earnings. In fact, I quickly calculated that it would be $788 per week, which is dramatically below the average wage. We obviously know that what is making the average wage climb is the incredibly high-paid workers in our two-speed economy. The mining industry is booming and paying people well, and the rest of us are struggling to keep up. That is why cost pressures are going up. The way to address this is to look not just at wages and how much people earn, but also at costs and how much people have to pay for essential services. The Western Australian Council of Social Service’s most recent cost-of-living report looked at the average costs of households. They went up $105 a week, or 17.7 per cent, in the period 2007 to 2009. During the same period, the income levels for minimum wage earners went up $41 a week—that is only 1.15 per cent. More costs need to be met by smaller wages.

I will now very briefly look at the graphs that are put out by the economic people who measure what is happening in the financial markets. We are trying to deal with an incredible crisis on a global scale. All the graphs have squiggly lines; they go up and then they slip down. When the first shock of this global crisis hit us all in 2008, official interest rates were very high. They came down at the beginning of 2009 and then they stayed flat. We have seen them start to climb again. Official interest rates have climbed in a step-by-step process. In April 2009 they were at three per cent, and this year they are sitting at five per cent. That is the money that is tightening in the market. The unemployment rate is gradually going up. Unemployment has increased; in fact, in Western Australia it is 4.9 per cent. The rate that is most concerning for us is the consumer price index, which was 1.3 per cent. After a peak of five per cent in September 2008, it dropped to 1.3 per cent in September 2009. There has since been a sharp escalation from 1.3 per cent to 2.9 per cent. Those are the costs that are influenced by government policy, and government policy could be better to keep these costs down.

The two ways that the Greens (WA) have put forward to keep our prices down are changes in energy policy and in transport policy. The Minister for Energy spoke today about the reason that costs have increased, but he did not address the way to bring them down—by using more renewable energy that is available for free. We need to make an investment in that industry so that users do not have to pay the costs of coal generation. The incredible cost of producing electricity in this state could be dramatically reduced by the use of renewables, which are abundant in this state. It is high time that this government invested wisely in that industry to bring down household costs. Secondly, on our transport policy, the government is failing to address the need for low-carbon options for transport. We know that systems that can be powered by renewable energy, such as light-rail systems, will help to meet our transport needs, so that the people who need to get to jobs in our sprawling city can reduce their transport costs by using a public transport alternative. Those are the points that I wanted to make on this motion. I strongly support the motion and I thank the member for moving it.