Unions have revised up their annual wage review claim from five per cent to 5.5 per cent after the Reserve Bank of Australia jacked up its forecast for inflation.
The ACTU says this will ensure the quarter of the workforce who rely on pay increases under the Fair Work Commission review do not go backwards in the midst of an accelerating cost of living crisis.
The ACTU’s initial claim of five per cent was made on March 31 and just after the federal budget had been handed down, which forecast inflation rising to 4.25 per cent by the middle of this year.
Since then inflation has already jumped to 5.1 per cent and the RBA is now forecasting 5.5 per cent by the middle of this year, before heading to six per cent by the end of 2022, nearly double what it expected just a few months ago.
“A 5.5 per cent increase is what is now needed just to ensure people tread water, anything less has them drowning in bills,” ACTU secretary Sally McManus said.
This increase would lift the hourly rate in the minimum adult wage from $20.33 to $21.45, the weekly rate from $772.60 to $815.09 and the annual rate from $40,175.20 to $42,384.84.
“Scott Morrison must act to support increases to the minimum and award wages to protect one in four working Australians from rising cost of living pressures,” Ms McManus said.
“Scott Morrison’s failure to act to back working people is a danger to the economy.”
She said every dollar working people lose in real terms is a dollar not spent in local businesses, adding people have already cut back discretionary spending.
“They will have no choice but to cut it completely as for so many workers – cleaners, aged care and retail workers – there is nothing left after the rent, groceries, and petrol,” she said.
