Australian Newsletter New Increases Start Wages Spiral Again

Press, Volume CII, Issue 30179, 10 July 1963, Page 20

Australian Newsletter New Increases Start Wages Spiral Again

[By FRANK PUDDICOMBX. N.Z.PA. Special Correspondent] SYDNEY, July 7. * Events in the last week indicate Australia may be threatened with another bout of wage inflation.

Salary rises for professional engineers began the trend which this week extended to all ranks, other than commissioned officers, in the. three armed services.

In between, 36,000 Commonwealth public servants and members of the academic staff of the University of New South Wales had their pay increased.

The implications of these latest “adjustments" are expected to reverberate throughout the Australian wage structure, and the New South Wales Employers’ Federation has already expressed serious anxiety. “Stability a Myth” * As the “Sydney Morning Herald” said editorially this ■week, the cost stability, of which the Federal Government is so proud, is now i plainly becoming a myth. Hardly a month, sometimes only a week, goes by without the announcement of a new award which bumps up wages and reduces the profit of industry. Increases Reduced

Fears of a general 20 per cent increase in high-level wages throughout Australia were removed when the State Industrial Commission reduced by up to £530 a year salary increases granted last September (but deferred pending an appeal) to members of the academic staff of the University of New South Wales.

The university staff association viewed the amended award with incredulity. Its president. Mr P. Elkin, said. “This is a blow, especially

in view of increases of up to £7OO a year for Commonwealth scientific experimental officers.”

Even so, the new award will add hundreds of thousands of pounds to the annual wages bill at the State’s three universities.

Although the award by the Industrial Commission applies only to the university of New South Wales, it will -affect the salaries of all academies in the State.

The salary increases for public servants 'will cost the Commonwealth about £3 million in a full year. £l2 Million Rise

When all public service salaries and those of the firmed services have been adjusted, observers believe the Commonwealth Government wages bill will rise by between £l2 million and £l5 million a year. More than 1.000,000 whitecollar workers have protested to the Federal Government tor “justice” on salaries and margins, and New South Wales public servants are threatening to campaign against the State Labour Government in the next election because of its failure to grant their salary claims. Public servants in the State are demanding salary rises ranging from £6O to £7OO a year for 22,000 members.

Among the pay rise claims, the Industrial Commission this week reduced the wages of 2500 male hairdressers by up to 19s a week. Tax Cuts Hoped For

The hopes of Australians are riding high that at long

last there will be some tax concessions in the Budget to be introduced next month. Political observers in Canberra believe it is “odds on” that industry and social services will benefit, and some go so far as to suggest that the individual income-tax payer might gain something. In social services, increases in child endowment are considered most likely, for they have not been increased for many years. The Acting-Prime Minister, Mr McEwen, in a speech to a Country Party conference this week, hinted he would fight for concessions to stimulate economic growth.

The Treasury has staunchly opposed too many concessions because of the risk of generating inflationary pressures. Growth, Not Stability

Mr McEwen said that for a country such as Australia, stability was not enough; Australia had to pursue growth and development—even if it impinged on stability. It is believed the Budget will contain some company tax relief and taxation concessions to encourage new industries in country areas. The Government is still concerned with unemployment, and this could help the argument of Ministers in favour of concessions. The' Government is expected to end the financial year with a small surplus instead of the estimated deficit of £llB million. This is because of record loan raising, totalling nearly £270 million. The Institute of Public Affairs has suggested the Budget should include some reduction of the company tax.

The Commercial Bank of Australia “Economic Review” suggests a cut in personal income-tax, which would signify a policy of providing a fresh stimulus to the economy.