The Treasury has destroyed the fallacy and fantasy that is the living wage. A number of people far more qualified than me to comment have written about it.
Lindsay Mitchell wrote a column in Truth about this and she republishes it:
The ‘living wage’ idea poses more questions than it answers.
Apparently the proposed non-compulsory hourly wage of $18.40 is based on the needs of a family with two children, with one full-time and one part-time worker.
But someone with dependent children who is earning less than the living wage will almost certainly be receiving Working For Families assistance.
As well, someone without children might be receiving an accommodation supplement which helps with rent, board or a mortgage.
Because these are income-tested payments, they reduce as the employee’s salary or wage increases.
Under the living wage scenario then, an employer would pay more, but in many cases the worker’s income would remain the same as he progressively loses other government assistance, especially the accommodation supplement. Who has gained? Neither of them. The gaining party would be the government. Read more »