On the verge of an IR deluge

Yet another article that fails to nail the prime reason for the recent rise in industrial disputation. There are certainly issues of respect that need addressing, but the financial strain on the average PAYE worker is now at breaking point (On the verge of an IR deluge, November 24).
We've had fifteen years of massive credit growth and a CPI measurement that fails to truly capture real inflation. With wages often negotiated on the basis of ABS CPI, at two to three percent, the living standards of the average worker have been continually eroded against real inflation of in excess of five percent. It's an even bigger issue for those who have entered the property market in the last five years, a commodity whose inflationary impact just happens to be missing from the CPI.
What we're currently witnessing is proof that you can't cook CPI data and ignore basic mathematics in the long run.

The big sleeper in IR is productivity. We are much less productive as a nation today than we were ten years ago (On the verge of an IR deluge, November 24). This is not on the unions' agenda and in a collective bargaining environment that has been forced on us, hard to measure. Only when we have a Fair Work Act that is equal and fair to both parties will we see some progress. At the moment that is not the case.

The cost price index is based on the average cost of purchasing all goods and services available. Unfortunately there are variables which limit the effectiveness of the reality of the CPI. For example goods that you may purchase every 5,10 years etc being included in calculations every year. Some items you may never buy at all. Another example is the ticket size of the item you purchase. If this item has come down in price it potentially reduces the average (On the verge of an IR deluge, November 24).
I have always argued it has never been a true reflection of rising cost of living/inflation. That's why the gap between the cost of living and real wages is narrowing. A true test would be the inclusion of essential items only, but to define essential items would be impossible, due to varying life styles.
Would you include house prices as an essential item? Prices have dropped 10 per cent/20 per cent over the last 12 months, did you buy a house?
While I can sympathise with workers and their need to balance the household budget, every time they get a pay rise, we the consumers pay for it through higher prices. Than we get a pay rise to bring us up to par and on goes the cycle.
An interesting segment on ACA last night portrayed a international company allegedly price gouging by charging the Australian public up to 150 per cent above that paid for the same item in other countries.
If proven, we should be focusing our attention in this area. Our regulatory authorities need to be proactive. We have to stop being like a dog chasing its tail.