Tauranga City Councillors shelved a guest speaker's push to pay a living wage to 51 per cent of council's staff paid less than $18.80 an hour.

Guest speaker Chris Lee, who is part of Tauranga's Closing the Gap group, presented a 10-minute outline at yesterday's council meeting on why city council should pay its lower-paid workers $18.80 per hour.

Guest speaker Chris Lee, from the Closing the Gap group, asks council to consider paying 51 of its lower-paid staff the living wage of $18.80.

Chris, who cited much of his information from the global charity UNICEF, says studies show increasing inequality comes with increasing societal ills – and a way to help lower-paid workers is to cut salaries of high-paid council staff.

But TCC councillors bit back, with most saying it is a central government duty to measure and implement a living wage.

With Closing the Gap's largest group nationwide sited in Tauranga, Chris put forward to councillors that TCC – with the upcoming 50-cent increase to the minimum wage to $14.25 an hour from April 1 – should look to increase its staff pay to the living wage of $18.80.

'Equality is a myth – but here is wider view that we all suffer effects of an unequal society and we all benefit from equality in society.”

Citing the book ‘The Spirit Level: Why More Equal Societies Almost Always Do Better' by Richard Wilkinson, Chris says it impacted on him in three ways.

'I saw for the first time how unequal new society has become; I sought proof of NZ's unhealthyness in society; and realised inequality gives reasons for society's ills.”

Chris says NZ features second to the bottom on a graph of notable countries with strong indicators between income and inequality.

Chris says more than 50 per cent of TCC staff have an annual salary less than $50,000.

'Challenge one is TCC should pay a living wage; and a challenge two is the gap won't close by just increasing bottom pay-rates.”

'We think in conjunction with increasing the lower pay-rates, and reviewing top pay-rates, council should come up with a policy to create a pay regime seeing a variance from the lowest to highest pay rates being 8:1.”

Chris says council has an obligation to do right for the community and lessening inequality is in reach by closing the income gap within TCC.

'The income of the higher level executives is out of control.

'Our suggestion is council write a request to staff to create a report for recommendations.

But TCC councillors weren't buying it, with councillor Steve Morris saying with the new minimum wage coming into force next month, NZ will have the highest in OECD as percentage of minimum wages.

'When you increase wages at the bottom level, it has nasty side effects of making some of those people redundant.

'You just have to look at Kmart and Bayfair with new self-service kiosks instead of staff.”

Steve says if council was to raise wages to $18.80 for the 51 per cent of TCC workers, 'due to the free movement of capital, people may be made redundant”.

Councillor Rick Curach pointed out TCC gets most revenue from a tax on properties.

'Many of these property owners are earning less than the living wage – how would they feel if TCC introduced a living wage?”

Councillor Catherine Stewart asked the group if they planned to engage with central Government on the issue.

Chris says so far attempts to do so have been unsuccessful, but the group has been coordinating with non-government organisations in NZ to gain support on the issue.

Councillor John Robson, who has read the spirit level book, says his concern is New Zealanders were much more equal in the past.

'The baby boomer generation seem to have been beneficiaries all long.”

He then went on to ask Chris if there is something wrong with this generation, in making decisions that supported governments under which inequality increased.

Chris says he doesn't think it is just a NZ issue, with all countries showing selfish capitalism.

'We certainly not doing good by any stretch of the imagination and I found out hell's bells we're actually really bad.”

Councillor Gail McIntosh asked for examples of other NZ councils taking on the living wage, saying council tackling the problem is transferring payments from taxpayers to ratepayers.

'Half of TCC ratepayers are self-employed, so 50 per cent are earning less than the living wage now.”

Chris suggested freezing the top end incomes, rather than just lifting the bottom.

But Gail disagreed, saying freezing top end incomes is a disincentive for talented people to move to Tauranga for work.

'I can't be in favour of something like that.”

Chris then suggested council disestablish its CEO position, and rotate the duty among the executive team, which did not heed a response from councillors.

Mayor Stuart Crosby thanked Chris for speaking, requesting he give council a copy of his presentation.