THE PRESS SATURDAY, NOVEMBER 20, 1982. Time for talks on incomes

Press, 20 November 1982, Page 14

THE PRESS SATURDAY, NOVEMBER 20, 1982. Time for talks on incomes

The renewed dialogue between the Government and the Federation of Labour to establish a new wage-fixing policy is a good sign. The third necessary partner to these discussions, the Employers’ Federation, is still in the wings but has expressed an eagerness to take part in any earnest attempt to work'out a new policy. The talks began three years ago; they have been deferred, disrupted, aborted, and abandoned on several occasions since then. They have also been resumed after an interval each time, an indication that all engaged in them.. appreciate that the present system has run its course. Frequently the stumbling block to successful negotiation has been the linking of the policy talks with other issues. Most often an industrial dispute has been the reason that talks did not proceed. The last collapse resulted from a lack of agreement on the Government’s proposal for a wagetax trade-off. A difficulty with this week’s approach by the Federation of Labour to set the ball rolling again has been that the offer was linked to a claim for a $2O a week across-the-board wage increase. Inevitably, the Government refused the claim, but it appears that the three-way talks will continue, probably early next year. All parties have shown a willingness to come to grips with the problems of finding a new wage-fixing system and appear to have accepted that the issue cannot be postponed any longer. The president of the F.0.L., Mr W. J. Knox, has said that further action by the F.O.L. in support of the wage claim will not mean the closing of plants. This responsible approach should mean that the wage talks will not be clouded or disrupted this time because of unrelated events. The on-again, off-again history of the talks over the last three years has given the impression that the parties have been struggling to find a new formula and

have grasped at pretexts to file the negotiations in the “too hard” basket. Finding a replacement for the present system, bedevilled by the close linking of incomes and by unyielding • claims of relativities, will ’hot be easy; but the freeze on incomes and prices provides the most promising environment the talks have had. The freeze also implies a kind of deadline. The time being bought by the freeze will have been frittered away if a new policy is not agreed on. The parties’ are aware that agreement on a better system of setting wages would be the most important result . of the freeze. They must also be aware that the system should provide long-term benefits in reducing the rate of inflation, eclipsing whatever temporary - but desirable — reduction in inflation may result from the freeze itself. The parties are obviously aware that, if a new policy is not forthcoming, the Government will almost certainly extend the freeze or at least <. some measure of wage control devised by the Government alone.

The ease with which such terms as “an incomes policy” can be tossed about obscures .the real difficulties of getting agreement on the goal, on the means, and on ensuring compliance. Agreement even on principles will not mean an end to all argument about their application. The F.O.L.’s suggestioh of a special Government-funded body to review wagefixing has not been ruled out by the Prime Minister, Mr Muldoon. Such a body might assist the discussions; but it would be counter-productive if it meant further delay before the parties get around the table. The essence of the problem is to determine a mix between what the market dictates and what is deemed best in the country’s social and economic interests. Firm ideas on this mix are needed before methods can be discussed.