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Tuesday, 26 February 1985
Page: 173

Senator Dame MARGARET GUILFOYLE — I direct a question to the Minister for Finance. I remind the Minister that he told me yesterday that the wages accord required that movements in the consumer price index within the last six months be taken into account and that that was why the Government was supporting a 2.7 per cent wage rise before the Australian Conciliation and Arbitration Commission, reflecting the September and December quarters of last year, rather than 2.6 per cent, which is the figure since the last wage case and takes account of negative results in the earlier quarters. Why did the Minister misrepresent the prices and incomes accord by claiming that it stipulated a wage adjustment based on six-monthly consumer price index movements when no time is specified in the agreement? Further, how can the Government justify supporting a 2.7 per cent wage rise when pensions and benefits will be adjusted by the figure of 2.6 per cent, as will excise increases?

Senator WALSH —The last part of the question concerned the excise adjustment. Excise adjustments are to be made every six months. I am not sure, off the top of my head, whether an adjustment was made downwards because of the CPI figure at the end of the December quarter. In fact, I think that the six-monthly periods for adjustments to wages and excise are two different periods, but I will check that out.

In the first part of the question I am accused of having misled the Senate or something or other. I was advised by Mr Willis that one of the principles-I am not sure what is written down in the accord; I do not have it here with me-of the agreement which was made was that when wages are reviewed account will be taken of movement in the CPI over the previous six months. I think I said yesterday that I do not know whether the figure will be 2.6 or 2.7 per cent. Probably the case can be made for either one.

The major reason for the Government making the decision that it did was that the principles of the accord required that six-monthly adjustment. I suppose it could be argued that we should have gone to the Bench six months earlier and sought a 0.2 per cent downward adjustment in wages because of the change in the CPI, but it would have seemed to be a fairly trivial matter on which to conduct another national wage case.

Senator Dame MARGARET GUILFOYLE — I ask a supplementary question. Will the Minister provide the Senate with the extract from the accord which stipulates that wages adjustments are to be based on six-monthly CPI increases? My reading of the accord was that it did not reflect a six-monthly adjustment. I ask that the Senate be advised of the extract from the accord that provides for this.

Senator WALSH —As I have said, I do not have a copy of the accord here with me. Senator Button has reminded me that his understanding of the situation is that it is the wage principles as determined by the Australian Conciliation and Arbitration Commission. I will seek an answer from the Minister for Employment and Industrial Relations to clarify precisely the context in which that principles reference should be applied.