Labor hopes Australians will end the year by looking forward – at how much money it says the average worker will lose over the next four years due to the government’s economic management.
The opposition’s finance and industrial team, Katy Gallagher, Tony Burke and Brendan O’Connor (Jim Chalmers is on leave), calculated the average full-time worker would lose $2,100 over the next four years in wage growth alone.
“As Australians head into 2020 too many are burdened by stagnant wages, sky-rocketing bills and record debt,” the group said in a statement.
“Wages growth has been downgraded in almost every budget and budget update since the Liberals came to office.
“Even with these downgrades the Liberals have failed their own wages growth tests 33 times.”
Since Mathias Cormann’s admission in March that low wage growth was “a deliberate design feature of our economic architecture”, intended to prevent “massive spikes in unemployment”, Labor has highlighted each budget downgrade of wage growth predictions.
The most recent economic forecast, released last week, slashed projected wage growth from 2.75% in the April budget, to 2.5% over the next two years, with a return to 3% not forecast until at least 2022-23.
The Reserve Bank of Australia declared wage growth of 2 and 3% the “new normal”, despite the relatively healthy employment and participation rates.
The government has blamed circumstances outside its control, most notably repeating the phrase “global headwinds” as it attempts to navigate and sell a sluggish economy.
“Real wages growth, which is wages growth above inflation, is stronger than it was when Labor lost government,” Cormann said in December.
“The economy is facing some global economic headwinds, some domestic challenges in the context of the drought in particular, but our economy continues to grow, our wages continue to grow faster than inflation, and the growth in disposable income across Australia is the fastest it has been in more than a decade,” Cormann said.
.@David_Speers: Do you agree flexibility in wages and keeping wages at a modest level is a deliberate feature of our economic architecture? @lindareynoldswa: No absolutely not. For Bill Shorten to even suggest that...
— Sky News Australia (@SkyNewsAust) March 10, 2019
DS: I'm quoting Mathias Cormann.https://t.co/aYBwbeRGPk pic.twitter.com/SSKF51zw06
The statement, timed for the end of the year, is part of Labor’s new strategy of highlighting what it considers big picture issues with the government’s plan, as it attempts to win back voters it lost in the 2019 election.
As part of the strategy, which was laid out in the election loss review, Labor is seeking to reposition itself as strong economic managers, with Scott Morrison and Josh Frydenberg’s management of the economy a key and repeated attack line.
The government has responded by accusing Labor of ‘talking down the economy’ but was forced to downgrade its much-mooted forecast surplus from $7.1bn to $5bn in the next financial year, with a cumulative $21bn slashed from the projected surpluses over the forward estimates.
That result came before the bushfire crisis, which is expected to land another hit on the government, as the emergency enters its third month.
