FIXING OF BASIC WAGE

Southland Times, Issue 23026, 21 October 1936, Page 6

FIXING OF BASIC WAGE

Employers Present Case RAISING OF THE AGE SUGGESTED (United Press Association.) Wellington, October 20. Evidence by P. E. Warner, a boiler maker at Lower Hutt, concluded the workers’ case before the Arbitration Court, which is hearing evidence before fixing the basic wage in all industries covered by awards or industrial agreements. Messrs J. Robinson (Dunedin) and J. Roberts (Wellington) appeared for the workers and Mr T. O. Bishop, secretary of the New Zealand Employers’ Federation, for the employers. Mr A. W. Nisbet was present to watch proceedings for the Wellington Manufacturers’ Association.

Mr Bishop said that Professor A. H. Tocker, of Canterbury College, had prepared a statement and he proposed calling him to-morrow and giving Mr Robinson and Mr Roberts an opportunity of perusing Professor Tocker’s statement meanwhile. Mr Warner, in the course of evidence, said that the New Zealand retail price index, however excellent it might be as an indication of the general price movement, could not measure variations in the cost involved in maintaining a specific standard of living. He believed negotiations in more than half of tho more serious labour disputes were protracted and embittered through the inability of the parties to agree to what wage would secure to minimum wageworkers a reasonable standard of living. He expressed the opinion that, the Government should call a conference of selected representatives to confer with the Government Statistician in selecting formulae and applying weights to be used in groups and sub-groups. Future of Industries. Mr Bishop said that New Zealand had no former experience of a system of wage regulation, which required fi xa “ tion of the basic wage to apply to all industries. The future of New Zealand industries might depend very largely upon the Court’s decision. The basic wage, once declared, would be the foundation of a new wage structure and it was essential that the declaration should be economically sound. He did not propose to suggest any sum as a basic wage, but rather to submit what he regarded as essential factors to be considered. In the light of the judgment given by Mr Justice Frazer on November 12, 1925, which provided for a full minimum wage of £2 10/6 a week to workers over 22 years of age, lie submitted that it was open to the Court, in making any new award, to include in it a scale of wages which would determine in each case at what age the basic wage should apply. There had been a clear recognition of the principle that the age at which the full minimum wage should be payable must vary with the class of work to be done and the prospects of further advancement. If an arbitrary definition of an “adult” were to be adopted, as, for instance, one who was 21 years of age, this principle would be entirely destroyed. Professional Careers. In illustration of this point, Mr Bishop said that boys who entered upon professional careers remained at school longer than those who entered a trade or took up manual work. It was not reasonable or sensible that a boy who remained at school till he was 18 and then entered an office of a public accountant with a view to qualifying in the profession should attain to the basic wage at the same age as a tradesman or manual worker. Boys of 18 and over could not qualify themselves in the short space of two and a-half or three years to earn the basic wage, and hence emplovers would engage younger boys. He contended that it was competent for a Conciliation Council or the Court of Arbitration to prescribe in any award a scale of wages leading up to the basic rate and the age at which the basic rate should apply. The word “adult” had no clear and definite meaning which must be accepted in law, though the popular assumption of an adult was a person of 21 years. It was open to the Court to adopt its own definition. According to the Act the Court must first take into consideration the economic and financial conditions affecting trad®'and industry and, second, the cost of living. The Court was required to fix as a basic wage a sum which would enable a family of five to be kept in such a reasonable standard of comfort as the economic and financial circumstances affecting trade in New Zealand would permit.

Not An Average Family

Mr Bishop called attention to the fact that the hypothetical family of five was not the true average family of New Zealand’s male wage-earner. It assumed the existence of 97,000 nonexistent wives and approximately half a million non-existent children. Another point was the necessity for a declaration of a basic wage on a daily and hourly, as well as a weekly, basis, as a weekly base was not applicable to the case of a very large number of workers whose employment was casual. Mr Bishop further contended that the full effect of the recent industrial legislation had not yet been reflected in retail prices and the effect would not fail to be a widening of the gap between external prices and internal costs. Wage increases could not fail to increase the costs of production, and, in many cases, such increases were cumulative. The Court was faced with the necessity of finding a formula, which would not only give a correct result for the present, but would also be capable of use in the half-yearly adjustments which the law provided for. He suggested that a base period be adopted, and a wage for that period calculated on the value of production per head of population for that period and adjusted periodically to changes in the value of production per head. Tire base period might be 1924-25, when there was full employment, or 1924-29, when there was some unemployment.

Effect of Education. “The general opinion among secondary school teachers is that 21 years is too low for the application of the basic wage,” said Mr W. A. Armour, headmaster of Wellington College and president of the New Zealand Secondary Schools Association, in evidence. Children were likely to leave school too soon, and employers were likely to be deprived of the services of welleducated youths, he said. The basic wage should not operate before the age of 23. . “The evils arising from the operation of the basic wage at the age of 21 years, so far as our schools are concerned,” Mr Armour said, “are:— (1) Children are likely to be deprived of a very valuable portion of their education. (2) Employers are likely to be deprived of the services of welleducated youths, since they will be compelled to appoint less mature, but more poorly equipped, youths. The higher the general educational level of the employee, the better should he be adapted to promote the interests of his employer’s busi-

ness and thus the business of the whole country. (3) The business of our schools is to prepare pupils to earn their living, but, in addition, to train them for life and for the increasing leisure that is to be theirs. This we consider most important. Unless our schools are given time to prepare our young people for the proper enjoyment and use of their leisure time, they will cease to perform one of their most valuable functions. Such preparation will be impossible if our young people are to go off to work at the age of 15. (4) Another likely evil, should there be a general exodus from our schools before the attainment by pupils of their 16th year, will be a tendency toward excessive cram. Parents will endeavour in the brief post-primary period at the disposal of their children, to force the pace at which advancement should be made. Even to-day much of the work of our schools is too hurried, so that full advantage of it is not gained by many pupils. With the operation of the basic wage at 21 that position will be much worse.”