Fed: Wage agreements under control, despite GST fears

AAP General News (Australia)
02-14-2000
Fed: Wage agreements under control, despite GST fears

A new survey's found major wage agreements in Australia have dropped to their lowest
level of increase in at least three years -- despite fears workers will be using the GST
to demand more money.

The survey, by economists with the HSBC bank, found the 17 major wage agreements struck
in the December quarter last year produced average wage increases of 3 per cent a year.

That was down from 3.3 per cent in the previous quarter, and was the lowest outcome
since the bank began its survey three years ago.

Reserve Bank Governor IAN MACFARLANE has warned the GST is fully compensated for by
tax cuts, and any attempt to chase the tax with wage claims will only increase pressure
on interest rates.

Workers appear to have been heeding the warning -- with just one of the 17 major agreements,
at Toyota's Altona plant, including any provision for the GST.

While the overall average wage outcome was held down by a modest 2.6 per cent increase
granted to 24,000 workers at Myer/Grace Bros, even the biggest increase -- Toyota's 4.2
per cent -- is still below the Reserve Bank's upper limit of 4.5 per cent.

AAP ss/mfh/sub/as

KEYWORD: WAGES (CANBERRA)

2000 AAP Information Services Pty Limited (AAP) or its Licensors.