The ACTU wanted $30. The Fair Pay Commission gave them $27. ACTU secretary Greg Combet said the decision is a victory for the union movement. Workplace Relations Minister Kevin Andrews said it showed the justice of the Government’s wage fixing policies. He described it as very good news for low-paid workers but bad news for the opposition.

“The decision is the final nail in the scare campaign being conducted by the ACTU, Kim Beazley and the Labor Party,” Andrews said. “The only people disappointed about this decision are Kim Beazley, Stephen Smith and the ACTU who have been running around Australia saying this decision would reduce wages for Australians.”

“Howard’s ‘hitman’ now the worker’s friend”, the headline on Tim Colebatch’s report in The Age reads today:

Everyone was caught out of place, leading to fancy footwork as they tried to get back on the hop to put their spin on the decision to lift minimum wages by $27.36 a week, or 5.65%.

ACTU secretary Greg Combet and Labor’s Stephen Smith, who have spent 18 months bagging the commission as a bunch of Howard Government hitmen sent out to drive down real wages, suddenly found themselves praising it…

Brad Norington writes in The Australian :

The politics of yesterday’s ruling mean that Howard cannot afford to publicly castigate the independent tribunal he appointed to replace the Australian Industrial Relations Commission in fixing the minimum wage

A politician as astute as the Prime Minister knows it would be crazy, just 12 months from an election, to criticise an increase for low-income people who may well vote for him…

But Howard used soothing words such as “genius” and “nice balance” and “very clever economically” to describe a decision that he, too, should be cranky about. The same goes for workplace minister Kevin Andrews calling the decision “very fair” and highlighting the commission’s independence.

Only Treasurer Peter Costello betrayed the Government’s real thinking.

He candidly admitted that Harper – in displaying independence – had granted “a large increase”, different to what the Government had submitted.

Colebatch and Norington are both shrewd commentators –

yet surely both of their analysis is completely wrong this time around. Peter Hartcher at the SMH is close to the mark:

[T]here are three areas of policy that are not so amenable to a ready political fix: Howard’s Work Choices law, the war in Iraq and interest rates are all live threats to the Government’s fortunes…

Work Choices has always been an unpopular initiative, and that is unlikely to change between now and the election. The Government cannot win on this, but it is working hard to neutralise it. It will be a hard-fought issue all the way to election day.

The Government is hammering Labor for scaremongering… Yesterday’s Fair Pay Commission decision to give the lowest-paid workers a percentage pay rise in line with the national average gave the Government more evidence of Labor hallucinations.

That’s much closer to the truth – and John Howard has won this round.

Ian Harper was the subject of much criticism when he was appointed to head the Fair Pay Commission. We were told how he would conspire with the Government to keep wages down.

Actually, the Government doesn’t need to do any conspiracy. All they’ve needed to do is exactly what they’ve done – appoint someone to the job who knows what the agenda is.

The agenda is to blunt ACTU attack on WorkChoices – and make the Labor Party’s critique look hysterical. And that’s exactly what yesterday’s ruling by the Fair Play Commission has done.

Harper and his colleagues have delivered something close to what the ACTU wanted. Labor’s attack looks exaggerated. Combet can’t help but grin. Everything is off to a much better start than anyone could have imagined.

Deputy director of the Melbourne Institute of Applied Economic and Social Research at the University of Melbourne Mark Wooden writes in the Fin :

If the government was expecting things to change when it transferred responsibility for setting minimum wages from the Australian Industrial Relations Commission to a newly created Australian Fair Pay Commission, then it received a rude shock yesterday…

Wrong again. It didn’t look as if the PM had received a rude shock on the TV news last night. More than 1.2 million Australians had received a pay rise – and it looked as if he’d got an early Christmas present.

Peter Fray

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