Reports in this morning's media that the Australian Industry Group wants to see the real minimum wage go backwards are concerning and based on voodoo economics.

The Government maintains that the introduction of a carbon price should not be a factor that affects the decision in relation to varying the national minimum wage. Nor is it the Government’s view that the national minimum wage should be used as an avenue for further assistance.

Business should not use the fact that the Government is doing the right thing by Australia's lowest paid workers as an excuse to do the wrong thing by them.

The facts are these:

The Government will introduce a carbon price from 1 July 2012. The $23 carbon price is expected to increase consumer prices by 0.7 per cent in 2012-13 as measured by CPI. Through the Clean Energy Future household assistance package, around 9 out of 10 households will receive some assistance through increases in payments and/or reduced taxes. In particular, low income households will be eligible to receive assistance that at least offsets the expected average price impact, with over 4 million households receiving assistance that is at least 20% higher than their expected average price impact.

Households will receive assistance through increases in pensions, allowances and family payments and income tax cuts. Under a $23 carbon price in 2012-13, it is estimated that, on average, households will see cost increases of $9.90 per week, but receive assistance of $10.10 per week.

The Government has also committed to provide assistance to entities affected by the carbon price. The ongoing Jobs and Competitiveness Program will provide $8.6 billion assistance over the first three years of the carbon price, targeted at companies that are emissions intensive but constrained in their capacity to pass through costs in global markets. In addition, $1.2 billion will be provided to help manufacturers reduce their carbon costs through investment in energy efficiency projects and low-emissions technologies, processes and products. The impact on the great majority of businesses is expected to be modest, with the expectation that increased costs will be passed through to consumers who will receive household assistance to manage increased costs.