A panel has been established to determine the Cook Islands’ new minimum wage, which was proposed to increase by $0.30 to $9.30 per hour this year.

The minimum wage was raised to $9 from $8.50 last year following a recommendation from the 2023 Minimum Wage Review Panel which also suggested an increase to $9.30 per hour in 2024.

The recommendations were guided by prevailing economic conditions in the Cook Islands; income distribution (in the community); the need for protection for low-income earners; work incentives; and public submissions.  

On Friday last week, the 2024 Minimum Rate of Pay Review Panel was formed comprising of members: Ministry of Internal Affairs (INTAFF) Inspector Labour and Consumer, Maru Mariri-Tepou, Tristan Metcalfe, Director of Economic Planning – representative from the Ministry of Finance and Economic Management, Eve Hayden, Chamber of Commerce (employer representative), Cook Islands Workers Association executive board member Helen Maunga and Simona Aumetua Nicholas, community representative.

According to INTAFF, the Government is mandated to conduct annual reviews of the minimum wage rate. The public is invited to submit their views on the minimum wage and the panel formed will review the submissions received from the public.

Key considerations for the review include post-Covid economic recovery, general factors, and specific concerns for workers, employers, and the government, the ministry said.

Responding to questions from Cook Islands News on the minimum wage expectations, Cook Islands Workers Association’s Maunga said the association will be conducting a survey and give their feedback to the panel this month.

She referred the newspaper to the panel for additional comments.

The report compiled by the 2023 panel said that the Cook Islands Workers Association submitted a restructuring of the minimum wage.

They suggested a student’s rate at $7 per hour; and the minimum wage rate at $10 per hour.

They also suggested a tiered tradesman apprenticeships rate starting at $10 per hour for the first year, $12 per hour for the second year and $15 per hour for the third year.

“It is the opinion of the CIWA that the panel cannot deny the right of the people’s need for a better affordable living given the alarming price increases both during and after the 2020-2022 pandemic especially on imported basic food, fruits and vegetables, meat and chicken products, electricity, fuel, telephone and internet and other commodities,” the report said.

“These escalated prices had an enormous impact on the purchasing powers on consumers especially when regulation of price control is minimal to zero.”

The report flagged CIWA’s proposal as something to be considered in the future.

“Discussion took place on the need for different minimum wage rates for Students and a tiered regime based on yearly experience. The productivity levels of experienced and inexperience are the determining factor the tiered regime,” the report says.

“However, more data and research are required to enable the introduction of the tiered rate regime recommended. To strike a balance between these considerations, the panel agreed that a universal rate should apply for now, pending more thorough research from an economic perspective.”

The report also recommended the Government develop a National Minimum Wage Policy that will be used to guide future minimum wage setting.

“Setting the minimum wage is a financial decision, and regardless of public feedback, the bottom line is whether the government and private sector can afford the wage. Recommendation from the public to have a better system in place with a formula to assist in determining the minimum wage yearly,” the report concluded.

Written submissions in Maori and English can be emailed or dropped off at the Ministry of Internal Affairs by 4pm, March 22, 2024. The Pa Enua residents can drop their submissions at the INTAFF office on their islands. Submissions can be emailed to maru.mariri@cookislands.gov.ck. Oral submissions are welcomed, with the closing date for all submissions also at 4pm, March 22.