THE PRESS FRIDAY, MARCH 2, 1984. Quest for wage order

Press, 2 March 1984, Page 14

THE PRESS FRIDAY, MARCH 2, 1984. Quest for wage order

The Federation of Labour’s about-face on postfreeze wage adjustments seems certain to prolong Government control of the incomes of union members; Given the choice of a general wage order or a limited round of free wage bargaining, the F.O.L. chose the latter. That was before Christmas. Now the federation’s president, Mr W. J. Knox, has announced a change of heart: the F.O.L. and the Combined State Unions demand a general wage order on April 1. The switch, and Mr Knox’s dismissive comments about the future of the talks to find a long-term system of fixing wages, are likely to be sufficient to torpedo these negotiations. The collapse of the talks would make an early increase in wage rates even more remote and a return to free wage bargaining an unlikely prospect. The Government has left no doubt that the machinery for long-term wage fixing must be agreed to before any wage increase will be permitted. The regulations that impose the freeze on wages will continue in force until agreement is reached. This much has been repeated by various Cabinet Ministers at various times. The F.O.L. is well aware of this policy, yet the latest demands would attempt to ignore it. The timing of the announcement of the F.O.L.’s new stance — coincident with the official end to the freeze on prices and on incomes other than wages — might have been intended to impress upon union members the importance of the F.O.L. in obtaining an increase in wages. It might also have been a tactical ploy in the wage negotiations, though what purpose it could serve in’ this context would be open to question. These interpretations are less depressing than putting the latest developments down to intransigence. The F.O.L. is running the risk of getting offside with its membership. Attempts by the F.O.L. leadership to inspire campaigns for immediate wage increases during the freeze — first of $2O a week and then of $5O a week — did not generate wide support. The F.O.L. executive has staved off requests from some of

its constituent unions to hold an early conference to deal solely with the wage-fixing issue. A feeling is abroad in some sections of the union movement that the F.O.L. is as much to blame for a delay to a wage increase as the Government or the employers. If the F.O.L. seeks to nullify this feeling with its new attitude, it has embarked on an uncertain course.

In general, unions have behaved well during the freeze. They might expect that their co-operation will be rewarded by reasonable measures to minimise any financial disadvantages arising from price movements in the next year or so now that the freeze has accomplished its task. This would certainly include some modest increase in wages. The F.O.L.’s vacillation over how this might be best accomplished, because it will delay any wage rise, could breed resentment among its membership. A modest increase in wages is fair, the Government has said as much. The guidelines for a round of wage bargaining would probably have come close to amounting to a general wage order anyway. The top limit that the Government would have placed on negotiations would have become the norm with only a few exceptions. All this now hangs in the balance. The time spent late last year settling the guidelines for a limited wage round this year appears to have been wasted. The Government might well consider that a general wage order — should it agree to one — is sufficient evening-up between incomes and the cost of living; this would mean a continued hold on wages afterwards and the higher the wage order the longer the clamp on wages would be likely to remain. These shortterm considerations do not answer the more difficult problem of finding an improved mechanism for wage fixing. If Mr Knox’s pessimistic view of solving this' problem is correct, Government control of wage levels will have to continue for a long time yet. A return to the unsatisfactory procedures of the past would not be welcomed by anyone.