"REAL" – WAGES TEST

Wanganui Chronicle, Volume 84, Issue 189, 13 August 1940, Page 10

" REAL" - WAGES TEST

JUDGE’S OBSERVATIONS BACK TO AVERAGE LEVEL CHRISTCHURCH, Aug. 11. “I cannot accept the contention of the union that the court for the purposes of the present inquiry must necessarily gauge its consideration of the cost of living by the rise in the retail price index since September 7, 1937, says Mr. Justice Tyndall. "I would further point out that the court is not directed in the regulations to limit its investigation to the period since the war commenced or any other period. “It is my view, therefore, that the court should '-ather take into account the relationship between the retail price index and nominal weekly wages received by the workers from year to year. Would Mean Record Level. “An examination of the position discloses that if a 10 per cent, increase in rates of remuneration were now made effective the weekly wage index would reach a level appreciably higher than that ever before enjoyed by workers of the country, not taking into account, however, the national security tax and other special war taxation just imposed. If an increase of 5 per cent, were granted and no increase in the retail price index occurred during the next six months the effective wage index during that period would be identical in value with the highest figure on record, namely, that for the calendar year 1938. “It would, of course, be unreasonable to suggest that no increase in the cost of living will take place during the next six months, although it is a fact that the retail price index for June shows a slight reduction in comparison with the May figure. Average of Three or Fours Years. If it is assumed, however, that the retail prices index will progressively increase in a manner comparable with the increase during the past six months, then a 5 per cent, increase in nominal rates of remuneration will result in an effective wage index almost identical in value with the average level enjoyed by workers over the past three to four years. *‘lt appears to me, therefore, that a 5 per cent, increase is the maximum which can be reasonably justified from a study of the cost of living position alone.”