In a letter to the Australian Financial Review today former presidential members of the federal arbitration tribunal reveal the Government’s approach to the proposed changes to the National Minimum Wage Case Safety Net Review.

The Australian Industrial Relations Commission has properly refrained from participation in the debate about possible reforms to the manner and criteria whereby minimum wages are determined.

Aspects of the commentary, however, are inaccurate and misleading and should not go unanswered. In particular, the claim that the commission has disregarded the employment and price effects of its decisions is in danger of being accepted as a fact.

It is a claim that could only be made by people who are unfamiliar with the commission’s published reasons for decision, especially in the safety net cases.

Under section 88B of the Workplace Relations Act, the commission must ensure that a safety net of fair minimum wages and conditions of employment is established and maintained, having regard to: The need to provide fair minimum standards for employees in the context of living standards generally prevailing in the Australian community; Economic factors, including levels of productivity and inflation, and the desirability of attaining a high level of employment; When adjusting the safety net, the needs of the low paid.

The commission complies with this direction. In safety net cases, the levels of productivity and inflation and the employment effects of minimum wages are discussed at great length. The commission takes close account of the information and arguments put before it by governments, the Australian Chamber of Commerce and Industry, the Australian Council of Trade Unions, other employer and union representatives and other interests.

The commission is, as a result of the parties’ assistance, as well informed on the economic effects of wage fixation, and the debates surrounding them, as any of the commentators. The conclusions that it draws are invariably within the range of opinions propounded by competent and respected economists whose work is broughtto the commission’s notice. Its task is often made more difficult, however, by disagreements between the experts.

It is, of course, perfectly legitimate to disagree with the commission’s conclusions and the priorities that it accords to conflicting goals.

It is not legitimate to mislead the public by misrepresentation of its conduct in dealing with economic issues.

The signatories to this letter are former presidential members of the federal arbitration tribunal.

Former Justice Stephen Alley, Toorak, Vic

Former Justice Judith Cohen AO, Kew, Vic

Former Deputy President Joe Isaac AO, Kew, Vic

Former Senior Deputy President Keith Hancock AO, Glenelg, SA

Former Senior Deputy President John MacBean AM, Annandale, NSW

Former Justice Keith Marks, Armadale, Vic

Former Justice Paul Munro, Mosman, NSW

Former Justice Deirdre O’Connor, (Commission President 1994-97), Centennial Park, NSW

Former Senior Deputy President Joe Riordan AO, Cronulla, NSW.

Australian Financial Review (85,Fri 08 Apr 2005), Edition: First