Anthony Albanese announces Labor will make wages submission to Fair Work Commission

Almost three million Australians should find out next month if they will get a raise that keeps up with the cost of groceries.

Anthony Albanese has indicated Labor will continue to support a pay increase for Australia’s lowest paid workers that keeps pace with the rate of inflation.

But the Prime Minister will not specify the rate to which the minimum wage should be raised, despite “absolutely” endorsing an increase of at least 5.1 per cent during the election campaign.

The Fair Work Commission is carrying out its annual wage review to determine whether to raise the national minimum wage for Australia’s lowest paid workers from $20.33 per hour

Mr Albanese on Friday said the newly installed Labor government would make a submission to the workplace umpire.

“The submission will be consistent with what I said during the election campaign: that people who are on the minimum wage can’t afford to go backwards (and) can’t afford a real wage cut,” he told the ABC.

“There won’t be a number in the submission. What there will be though, is the strong view that we have, that people who are on the minimum wage simply can’t afford a real wage cut.”

Almost three million people who rely on the review to determine their wages should find out next month if they will get a raise that keeps up with the cost of groceries.

Anthony Albanese says the Labor government will make a submission arguing that Australia’s lowest paid workers shouldn’t have their pay ‘go backwards’. Picture: Yuichi Yamazaki/Getty Images

Deputy Prime Minister Richard Marles said Labor’s submission would argue that people on the minimum wage “should not receive a real wage cut”.

“We are experiencing in Australia a cost of living crisis because of the failures of the former Liberal government,” he told reporters.

Labor is yet to make clear what it will do if the Fair Work Commission sets a wage increase that is lower than the rate of inflation.

The Reserve Bank noted earlier this month that wages growth in Australia has not kept pace with soaring inflation, meaning salaries are shrinking in real terms, in some cases noticeably.

The central bank is expecting inflation to be almost twice as high as wages growth by the end of 2022, meaning most pay packets will effectively be going backwards for another 18 months.

Mr Albanese conceded during a pre-election debate with Scott Morrison that he could not guarantee wages under a Labor government would rise faster than inflation.

But he said he could promise they would be higher under Labor than the Coalition.

“Our objective is to have real wage increases,” he said at the time.

Australian Council of Trade Unions secretary Sally McManus is leading calls for a 5.5 per cent wage increase. Picture: Liam Kidston

The Australian Council of Trade Unions’ submission to the Fair Work Commission calls for a 5.5 per cent increase in the minimum wage to $21.45 an hour, the equivalent of $42,385 a year.

After the commission hands down its decision on wages for the next financial year, most changes would usually begin on the first full pay period on or after July 1.

Some business groups including the Australian Chamber of Commerce and Industry have argued any increase to the award rates – in sectors including retail, tourism and food services – should be delayed because of “exceptional” economic circumstances.

The commission is next due to hold hearings for its wage review on June 3.