Many workers around the world, including those in key professions, have been forced to take a pay reduction with global economies taking a hit as a result of the ongoing Covid-19 pandemic. However those in high-paying roles, including politicians, have been criticised for continuing to pocket the same pay checks.
The debate heightened this week as New Zealand’s Prime Minister Jacinda Ardern announced that she, along with the country’s government ministers and public service chief executives, would voluntarily be slashing their salaries by 20 per cent over the next six months, in the wake of the global health emergency.
Ardern described the decision as one of “leadership” and solidarity with the public, and said: “If there was ever a time to close the gap between groups of people across New Zealand in different positions, it is now.
“I am responsible for the executive branch and this is where we can take action … it is about showing solidarity in New Zealand’s time of need.”
The wage reduction will see Ardern’s annual salary reduce by NZ$47,104 to $423,945, while Deputy Prime Minister Winston Peters will lose $33,473 and cabinet ministers will take a cut of $26,900. The salaries of government ministers who do not sit in cabinet will also be reduced by $24,983.
While Ardern’s decision has been widely praised, the debate around pay was already raging before Ardern’s decision, with The Australian’s Economics Editor Adam Creighton previously questioning whether the likes of Prime Minister Scott Morrison, and state and territory premiers, should impose similar cuts on themselves.
“Whatever the merits of the range of the extraordinary impositions on personal freedoms and future taxpayers, state and federal public servants, and the politicians who oversee them, should share some of the pain, especially since it’s government that has caused the economic collapse,” he wrote in a piece published earlier this month.
Creighton added: “It’s still too early to expect politicians to force pay cuts on themselves and their senior officials. The drip feed of horrific economic statistics hasn’t begun yet, providing rhetorical backing to the disaster facing millions of Australians, whose businesses and livelihoods have been turned upside down in just a couple of weeks … But morality will always trump economics in public debate.”
While columnist Garry Linnell wrote in The New Daily that we are “not all in this together”. He said: “If we were all in this together you might think our federal politicians, so sensitive to any change in the public mood and its voting intentions, might have joined as one and declared they were taking a pay cut … But no.”
It seems unlikely that Australia will follow in Ardern’s footsteps however, as Treasurer Josh Fyrdenberg seemingly dismissed calls for a similar salary cut Down Under, telling reporters on Wednesday: “We have frozen the pay increases for politicians here and for public servants.”
While Morrison – whose annual salary comes to $549,250 – previously implied the same, reports the Daily Mail. When asked if he was considering altering franking credits or making changes to ministers’ pay packets earlier this month, in light of coronavirus, he reportedly said: “No, we’re not reconsidering franking credits and these sort of things.”
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