Behind the spin: Bill English edition

Today Bill English, or more accurately his office, sent out a press release which says,

"After-tax wages continue to rise faster than prices, Finance Minister Bill English says.

The real after-tax average wage increased 2.5 per cent in the year to March 2011, after accounting for all consumer price increases including food prices and the one-off rise in GST last October."

Now if you look at Statistics NZ's information release for the March 2011 Labour cost index,  which details how much wages have grown, it says that for the year to March 2011 the before tax wages grew 1.9%.

I do not have the information to back up English's claim of 2.5% but let's take it as true. The after tax increase to 2.5% will be due to the October tax cuts.

English says that this increase is rising faster than prices. This is false. Let's look at two sets of stats, the food price index and the consumer price index.

The food price index information release says that in the year to March 2011 food prices have risen 5.5%. Shocking, I know. Due to the increase in GST in October there is an extra increase of about 2.3% on top of what it would have been without it.

Now the consumer price index, which is what Bill English is referring to in his press release. This is where the changes in cost to consumer goods is measured. In the year to March 2011 the CPI has risen 4.5%. Hmmmm, what do we have here? A lie from Mr English.

So how can Bill English justify this claim he made? Here's where the spin is, after tax wages have grown 2.5%, this is true. CPI has increased 4.5% in the year to March 2011, however in the quarter to March 2011 the CPI has only increased 0.8%.

That's the spin, he doesn't explicitly state it but from looking at the figures the only way I can see his claims line up is to say that he is comparing the yearly wage growth to the quarterly CPI.

So there you have it, another politician twisting the facts to suit.