Stabilisation aim ‘not achieved’

Press, Volume CXI, Issue 32777, 30 November 1971, Page 2

Stabilisation aim ‘not achieved’

(Sew Zealand Press Association)

WELLINGTON, November 29.

The strict objective of the Stabilisation of Remuneration Act is unlikely to be achieved, according to the annual report of the Wellington Employers’ Association.

The July cost of living order, based on the consumer price index movement, was 4.8 per cent, and there was every indication that the January order would bring the cost-of-living increase to 10 per cent.

The report, presented to the annual meeting of the association today, said the level of wage and salary increases would exceed 7 per cent for the year.

Average wage and salary increases would be more than this figure, and might be up to 13 per cent, tne report said.

The primary criterion for the Remuneration Authority was restraint, not relativity, but the restraint of wages in the form of a 7 per cent guideline was virtually impossible when the authority was required to take into account the consequences of approving rates of pay which might disturb established rates in other occupations. But the report added that the Remuneration Act had been a major factor in slowing the rate of wage escalation, which had grown to alarming proportions in 1970. “The insidious development last year of unions seeking the renegotiation of awards during their currency contributed to the massive wage escalation. “The updating procedures provided for in the act have virtually eliminated this ‘leapfrogging’ tactic,” the report said. “The unions have certainly not suffered under the legis-

lation,” the report said. “In most cases they have viewed the legislation as guaranteeing a minimum wage increase of 7 per cent, and expect

more on relativity arguments.”

The report said that while criticism could be levelled at particular features of the act, it was vitally necessary for the New Zealand economy that there be some stabilisation of wages. “The act is a vehicle for this purpose, and deserves support and adherence from every section of the community, including the trade union movement,” it said.