Living Wage group puts Labour pledge at $100m over four years

Summarised by Centrist

Labour has promised to extend the Living Wage across the state sector. The Living Wage campaign says about 20,000 workers could be affected and estimates the policy would cost about $100 million over four years, or roughly $25m a year.

Chris Hipkins signed the pledge alongside the leaders of the Greens and Opportunity. It would cover workers such as school cleaners and caretakers, hospital cleaners and orderlies, and staff in other government facilities.

The Living Wage rate for 2026/27 is $29.90 an hour, $5.95 above the adult minimum wage of $23.95. It is a voluntary benchmark designed around the costs faced by a household of two adults and two children earning one-and-a-half full-time incomes.

The Taxpayers’ Union says higher payroll costs must mean “higher taxes, fewer jobs offered, or deeper cuts later”. It argues instead for indexed income-tax thresholds and says bracket creep costs a median worker $480.14 a year.

The group’s short release supplies no job-loss model, affected-worker breakdown or independent costing of the policy.

On the Living Wage campaign’s estimate, the trade-off is about $25m a year directed to low-paid state-sector wages, leaving the same amount unavailable for other services, tax relief or debt reduction unless Labour identifies an offset.

Read more at Pledge coverage | Living Wage rate | Minimum wage | Taxpayers’ Union | Ani O’Brien Substack

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