The Politics    Wednesday, June 15, 2022

The magic pen

By Rachel Withers

Image of Prime Minister Anthony Albanese speaking during a tour of Rio Tinto’s Yarwun Alumina Refinery, north-west of Gladstone in central Queensland. Image © Brenda Strong / AAP Images

Prime Minister Anthony Albanese speaks during a tour of Rio Tinto’s Yarwun Alumina Refinery, north-west of Gladstone in central Queensland. Image © Brenda Strong / AAP Images

Today’s increase to the minimum wage puts to bed Morrison’s bizarre suggestion that better wasn’t possible

The fabled “magic pen” that Scott Morrison said did not exist has apparently been found, with the “loose units” at the Fair Work Commission increasing the minimum wage by a whopping 5.2 per cent. The increase is slightly above the figure that sent conservatives into meltdown during the election campaign, when Anthony Albanese casually backed a rise in line with the current 5.1 per cent inflation rate. The headline increase will unfortunately only apply to those on the national minimum wage, with the far larger number on award rates getting only 4.6 per cent. It’s also worth remembering that inflation is expected to reach 7 per cent by year’s end, meaning real wages are still set to fall. (And there will be no increase at all for people struggling to get by on JobSeeker.) Responses to the announcement have been predictable, with unions (which wanted a 5.5 per cent increase) celebrating the rise, and employer and industry groups (which had suggested more like 2.5) bemoaning it. Speaking in a press conference today, the PM said he “absolutely” welcomed the rise, in an echo of the “absolutely” he offered when asked about it during the campaign, and he brought back his $1 coin prop to boot. As Employment Minister Tony Burke commented, “The era of wages being kept deliberately low by the Liberal and National parties effectively came to an end today.” And so too did Morrison’s ludicrous claim that Labor couldn’t do anything about it.

The former prime minister’s contradictory messaging on wages – that his opponent didn’t have a “magic pen” when it came to increasing them, and yet was a “loose unit” who was going to wreck the economy by backing an inflation-level increase – never really made much sense, logically or politically. Pushing back so strongly against such a pay rise was, as Labor campaign director Paul Erickson noted at the National Press Club today, one of the many things that damaged the Coalition, with the Liberals’ claims that the sky would fall in undercutting their assertions about the economic recovery. “This wasn’t just incompetent, it was incoherent,” Erickson added. It was bizarre, as many remarked at the time, to watch the LNP argue against an increase to the minimum wage in the middle of a cost-of-living election, and it was especially insulting for Morrison to tell people that they would actually be worse off if they got one. But it was the suggestion that Albanese was, by promising an increase, playing workers for mugs that was truly galling, a continuation of Morrison’s outrageous claims that the economy could only be controlled by the Good Economic Managers of the Liberal Party.

Of course, Labor didn’t actually do this with a “magic pen” – the Fair Work Commission did. As FWC president Iain Ross noted in his remarks, the lowest-paid are “particularly vulnerable” to high inflation, which “erodes the real value of workers’ wages”. Labor didn’t even put a figure on its submission in the end, Albanese confirmed today, repeating his safe line about not wanting people to “go backwards”. But there’s no doubt that the new government’s advocacy counted for something. As Burke pointed out, this was the first time in almost a decade that a government had argued for a real wage increase, and, lo and behold, workers got one (at least until inflation rockets up). Labor is lucky, in some ways, that the commission decided to listen; it would have been incredibly awkward if it didn’t. But it goes to show the difference between a government that was actively suppressing wages and one that isn’t.

It was fortunate that Morrison’s dubious line about Albanese being a “loose unit” for wanting the lowest paid to not go backwards didn’t stick. And it seems unlikely that the new Liberal leadership will be accusing Justice Ross of being loose on the economy, although how the Opposition will play this remains to be seen. (We haven’t heard from either of the relevant shadow ministers today, although considering shadow treasurer Angus Taylor’s last press conference attempt, it’s not hard to imagine why.) Last month, the Australian people rejected the Coalition’s repeated arguments that better wasn’t possible, and the Fair Work Commission today affirmed that decision. Anthony Albanese didn’t have a magic pen, in the end. He simply used a normal one to sign a welcome government submission.

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Rachel Withers

Rachel Withers is the contributing editor of The Politics.

@rachelrwithers

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