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Thursday, 31 May 1973
Page: 3073

Mr Lloyd asked the Treasurer, upon notice:

(1)   How much will the recent national wage case decision add to the national wage bill.

(2)   What percentage increase will this be.

(3)   How much of this additional wage bill will be recovered by increased income tax.

Mr Crean - The answer to the honourable member's question is as follows:

(1)   On the basis of figures presented in the Australian Government's Submission to the National Wage Case hearing, the annual cost of the total wage increase is estimated to be between $850m and $l,010m, depending on the extent of flow to wages and salaries not under the jurisdiction of the Commonwealth Conciliation and Arbitration Commission. In its Reasons for Decision the Commission relied on these estimates in stating that the cost of the total wage increase would be 'not less than$850m. Because of data limitations and other uncertainties it is very difficult to provide a reasonable approximation of the cost of the minimum wage increase; however, in a recent answer to a Question on Notice in the Senate (Question No. 247, Hansard, 23 May 1973, pages 1901-1902), the Department of Labour was cited as having estimated the total annual cost at approximately $42m.

(2)   Again, on the basis of the Australian Government's Submission, the total wage increases would add from about 4 to 41/2 per cent to the national wages and salaries bill. The minimum wage decision, on the Department of Labour's estimate, cited in (1) above, would add about 0.2 per cent

(3)   The increase in income tax, in a full year and at present rates of personal income tax, that would be payable as a result of increases in the national wages and salaries bill on the basis of the estimates set out in (1) and (2) above is estimated at between $260m and $300m.

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