Like what you've read?

On Line Opinion is the only Australian site where you get all sides of the story. We don't
charge, but we need your support. Here�s how you can help.

  • Advertise

    We have a monthly audience of 70,000 and advertising packages from $200 a month.

  • Volunteer

    We always need commissioning editors and sub-editors.

  • Contribute

    Got something to say? Submit an essay.


 The National Forum   Donate   Your Account   On Line Opinion   Forum   Blogs   Polling   About   
On Line Opinion logo ON LINE OPINION - Australia's e-journal of social and political debate

Subscribe!
Subscribe





On Line Opinion is a not-for-profit publication and relies on the generosity of its sponsors, editors and contributors. If you would like to help, contact us.
___________

Syndicate
RSS/XML


RSS 2.0

Cost of living crisis revisited

By Tristan Ewins - posted Wednesday, 27 August 2008


In the 12 months to March 2008, meanwhile, electricity rose 10.5 per cent, and bank fees went up by 7.6 per cent.

Variable interest rates of Australia’s banking oligopoly, in particular, have been rising well above official RBA (Reserve Bank of Australia) rates. The banking sector should be expected to exercise social responsibility - especially in the face of probable economic contraction.

While bank share value has declined, bank profits are still strong. In August, for example, the Commonwealth Bank registered profits of almost $4.8 billion. All in all, this raises the question as to whether the Rudd Government ought to consider the re-establishment of a public sector bank to provide real competition and counter profit-gouging and collusive practices.

Advertisement

Beyond this, industrial relations and minimum wages, as well as tax and welfare reform must be at the heart of any effort to respond to the cost-of-living crisis.

Overall, the wage share of the economy declined from 70.6 per cent of GDP in 1999 to 66 per cent in 2007 - representing over and above $2,000 a year.

This year the Australian Fair Pay Commission (AFPC), ruled in favour of an increase of only $21.66 a week for low-paid-workers, which does not even keep pace with inflation. The ACTU had called for a minimum wage increase of $26 a week.

But Margarita Windisch, writing for Green Left in July 2008, argued that “To cover the real cost of living increases for low-income workers, the minimum wage needed to be increased by 6 per cent, or $31 per week”.

Clearly, there is a need for wage justice especially for the low paid: and increases in the overall cost-of-living need to be met with welfare reform - not just “some time in the future” but immediately.

The compassionate and just response to inflation is not to impose wage restraint - especially for the low-paid - but rather ought to involve tax reform, increasing the relative share of burden in combating inflation for those most able to afford.

Advertisement

Accompanied by such tax reform, greater wage justice - and a greater wage share -should be secured for those on middle, minimum and low incomes. Enabling workers to bargain collectively must be part of this strategy - including acceptance of the legitimacy of pattern bargaining.

Complementing such strategies, Australia’s tax free threshold should be raised and means tests relaxed for those on low incomes.

Finally, in the face of the cost-of-living crisis, there is a strong case to be put that full pensions should be raised to 30 per cent of Male Average Weekly Earnings (MAWE) (up by 5 per cent of MAWE or more - to $646.16 a fortnight).

  1. Pages:
  2. 1
  3. 2
  4. 3
  5. Page 4
  6. 5
  7. All


Discuss in our Forums

See what other readers are saying about this article!

Click here to read & post comments.

43 posts so far.

Share this:
reddit this reddit thisbookmark with del.icio.us Del.icio.usdigg thisseed newsvineSeed NewsvineStumbleUpon StumbleUponsubmit to propellerkwoff it

About the Author

Tristan Ewins has a PhD and is a freelance writer, qualified teacher and social commentator based in Melbourne, Australia. He is also a long-time member of the Socialist Left of the Australian Labor Party (ALP). He blogs at Left Focus, ALP Socialist Left Forum and the Movement for a Democratic Mixed Economy.
.

Other articles by this Author

All articles by Tristan Ewins

Creative Commons LicenseThis work is licensed under a Creative Commons License.

Photo of Tristan Ewins
Article Tools
Comment 43 comments
Print Printable version
Subscribe Subscribe
Email Email a friend
Advertisement

About Us Search Discuss Feedback Legals Privacy