Katy Gallagher (ACT, Australian Labor Party, Shadow Minister for Finance) Share this | Link to this | Hansard source

My question is to the Minister representing the Treasurer, Senator Cormann. New data released today confirms that already stagnant wages growth has slowed further since the election. Can the minister confirm that today's ABS wages data reveals that annual wage growth has fallen to a low of just 2.2 per cent and, at just 0.5 per cent, Australian workers experienced no real wages growth in the September quarter?

Mathias Cormann (WA, Liberal Party, Vice-President of the Executive Council) Share this | Link to this | Hansard source

The good news is that wages continue to grow faster than inflation. When Senator Gallagher, in a rather misleading way, seeks to focus on the nominal growth, she ignores the fact that inflation is also comparatively low. What I can confirm is that the wage price index rose by 2.2 per cent through the year to the September quarter; private sector wages grew by 2.2 per cent through the year; the private sector WPI, including bonus payments, grew by 2.8 per cent; and public sector wages grew by 2.5 per cent. What I can also confirm is that real wages grew by 0.6 per cent, higher than the 0.4 per cent through the year when Labor lost government, and 0.6 per cent is higher than when Labor lost government and is indeed in line with the 20-year average.

Opposition Senators:

Opposition senators interjecting—

Scott Ryan (President) Share this | Link to this | Hansard source

Order on my left!

Mathias Cormann (WA, Liberal Party, Vice-President of the Executive Council) Share this | Link to this | Hansard source

The 20-year average of real wages growth in Australia is 0.6 per cent. But obviously when inflation runs higher that 0.6 per cent, on average over the long-term, leads to a higher nominal growth figure than it would in the context of the current low inflation environment. That is very obvious. The situation is stronger than it was under Labor.

I also make the point that average weekly ordinary time earnings for full-time adults rose by 3.1 per cent over the past year, the strongest growth in six years. And, on 30 May 2019, as you might recall, the independent Fair Work Commission announced its decision to increase the national minimum wage rate by three per cent from 1 July 2019. The increase is higher than the economy-wide wage growth and higher than inflation. And— (Time expired)

Scott Ryan (President) Share this | Link to this | Hansard source

Order, Senator Cormann! Senator Gallagher, a supplementary question?

Katy Gallagher (ACT, Australian Labor Party, Shadow Minister for Finance) Share this | Link to this | Hansard source

Today's poor wages data is more bad news for hardworking Australians, who are working harder and yet going backwards. After more than six years in office, why does the government still have no plan to deal with low wages?

Mathias Cormann (WA, Liberal Party, Vice-President of the Executive Council) Share this | Link to this | Hansard source

When we came into government, we inherited a weakening economy, rising unemployment and a rapidly deteriorating budget position. The unemployment rate is well below where it was when we came into government. Employment growth has been incredibly strong, running at about 2.6 per cent or 2.7 per cent over the last couple of financial years and 2.5 per cent over the most recent year, well above the 1.8 per cent long-term average. I would again refer to what happened to the lowest income earners in Australia under Labor.

Scott Ryan (President) Share this | Link to this | Hansard source

Order, Senator Cormann. I have Senator Wong on a point of order.

Penny Wong (SA, Australian Labor Party, Leader of the Opposition in the Senate) Share this | Link to this | Hansard source

The point of order is direct relevance. The Leader of the Government in the Senate is working valiantly to ensure he doesn't respond to the question about why they have no plan to deal with low wages, but it is not directly relevant to the question asked by my colleague for him to talk about Labor, Labor, Labor. You're the government; what's your plan? That's the question.

Scott Ryan (President) Share this | Link to this | Hansard source

On the point of order, Senator Wong: I was listening carefully to the minister's answer. I think it is in order for a minister to glance across alternative approaches and other historical contexts. I do believe the majority of his answer I was hearing was directly relevant. I call on him to continue.

Mathias Cormann (WA, Liberal Party, Vice-President of the Executive Council) Share this | Link to this | Hansard source

Let me say again that I reject the basic premise underpinning the question. That is because real wages growth today is stronger than when we came to government. What I would also point out is that under the previous government the real minimum wage—

Opposition senators interjecting—

Scott Ryan (President) Share this | Link to this | Hansard source

Order on my left!

Mathias Cormann (WA, Liberal Party, Vice-President of the Executive Council) Share this | Link to this | Hansard source

The lowest earners in Australia were hit by real wage cuts in three out of the six years that Labor was in government. In three out of six years, the lowest income earners in Australia were hit with real wage cuts—

Opposition senators interjecting —

Scott Ryan (President) Share this | Link to this | Hansard source

Order, Senator Cormann. I'm going to ask for slightly more quiet on my left. I am having trouble hearing the minister. Senator Gallagher, a final supplementary question?

Katy Gallagher (ACT, Australian Labor Party, Shadow Minister for Finance) Share this | Link to this | Hansard source

Australians are struggling, weak consumption is being driven by stagnant wages, household debt is at record highs, almost two million Australians are underemployed or unemployed, and retail trade has had its worst result since the 1990s recession. When will the Morrison government come up with a genuine plan to restore wages growth, which continues to deteriorate under its watch?

Mathias Cormann (WA, Liberal Party, Vice-President of the Executive Council) Share this | Link to this | Hansard source

I completely reject the premise of the question. Real wages growth is stronger today that it was in Labor's last year in government. And, indeed, we turned around the rapidly rising unemployment rate that we inherited from the Labor Party, with about 1.5 million new jobs created. Workforce participation is the second highest on record, female workforce participation is the highest on record and welfare dependency of the working-age population is the lowest it's ever been.

But, of course, Australia is facing some global economic headwinds. We are dealing with some significant domestic economic headwinds, including, of course, significant drought in large parts of regional Australia, which is having an impact. And, yet, do you know what? The Australian economy continues to grow. We are in our 29th year of continuous growth. If we had adopted the policy prescriptions of the Labor Party—the socialist, high-taxing, antibusiness agenda that Labor took to the last election—the economy today would be weaker. Employment would be higher, and wages would be lower. (Time expired)

Penny Wong (SA, Australian Labor Party, Leader of the Opposition in the Senate) Share this | Link to this | Hansard source

Mr President, on a point of order: the minister's microphone continued to operate well beyond the clock, and I ask that you bring that to the attention of those with the microphone.

Scott Ryan (President) Share this | Link to this | Hansard source

You will note I was calling the minister to—

Honourable senators interjecting—

Order! I was going to respond. I was calling the minister to order from the time the clock went to zero. You've made the point, which I'm sure the attendants with the microphones will—

Honourable senators interjecting—

Order! Senator Wong, on the point of order?

Penny Wong (SA, Australian Labor Party, Leader of the Opposition in the Senate) Share this | Link to this | Hansard source

We're happy to have our questions go longer too.

Scott Ryan (President) Share this | Link to this | Hansard source

Senator Cormann, on the point of order?

Mathias Cormann (WA, Liberal Party, Vice-President of the Executive Council) Share this | Link to this | Hansard source

On the point of order: I was seeking to provide all of the relevant information in a way that was directly relevant to the question asked.

Scott Ryan (President) Share this | Link to this | Hansard source

Order! It's going to be one of those days. Senator Wong, on the point of order?

Penny Wong (SA, Australian Labor Party, Leader of the Opposition in the Senate) Share this | Link to this | Hansard source

On the point of order: if he ever outlined a plan to do something about low wages, we'd be happy to give him more time, but he still hasn't. We'll give you leave now. No plan.

Government senators interjecting—

Scott Ryan (President) Share this | Link to this | Hansard source

Order! On the point of order: I was calling the minister to order, as I do, when the clock hit zero. The point was made by Senator Wong. If there were less noise in the chamber, I am sure people approaching the clock would actually be able to hear my ruling. Senator McMahon.