Nick Efstathiadis

By ABC's Annabel Crabb

Holden has announced it will stop making cars in Australia by the end of 2017. Photo: Holden has announced it will stop making cars in Australia by the end of 2017. (AAP: Alan Porritt, file photo)

While the Coalition has blamed excessive salaries for taking down Holden, we know how Tony Abbott himself felt when he was given a pay cut in 2007, writes Annabel Crabb.

Subjectivity in the human brain is a marvellous thing, and nowhere is it more richly observed than in the matter of comparative value for money.

"I am underpaid," is how the universal conjugation of comparative remuneration begins. "YOU are fairly recompensed. But HE is taking the piss."

And so, this week, as the Parliament brawls its way toward Christmas like a gaggle of Friday-night office workers, several strains of thought emerge as to what constitutes a fair day's pay for a fair day's work.

Treasurer Joe Hockey - who has decidedly pro-market and anti-protectionist inclinations and on the matter of the Australian car industry is temporarily being allowed to indulge them - made it pretty clear yesterday that he blames the overpayment of automotive workers for the economic troubles that have since claimed the scalp of Holden.

"And why are we in a position today where the third manufacturer, Holden, is refusing to confirm it is around for the long term, even though there is an additional $1 billion on the table?" the Treasurer demanded in Question Time.

"I will tell you why. It is because the Labor Party has made it so damn hard to make anything in Australia. Labour costs are one great example."

Mr Hockey recommended that if Labor wanted to give the automotive industry its best chance of survival, it should immediately encourage Toyota workers to accept the cost-cutting package that company is currently offering.

This advice coincides with the strong feeling within the Government that other workers should also accept pay cuts; childcare workers, for example, whom Child Care Minister Sussan Ley hopes will hand back recent pay rises on account of the scheme delivering those pay rises having been maladministered by the previous Government.

"I'm asking these providers to think about the greater good of the sector," she said this week.

A realist might point out that there is about as much chance of childcare providers voluntarily handing back $62 million in agreed funding as there is of Bill Shorten telling Toyota workers to cop it sweet, or of Tony Abbott making Clive Palmer ineligible for paid parental leave.

People don't like pay cuts. It's a uniquely insulting process to have to go through, as it entails not only a decline in quality of life, but a broader judgment, keenly-felt by the subject, that the world does not value what they do. And that is not a nice feeling.

We know that this feeling is universal, because it's exactly how Tony Abbott felt, after losing 40 per cent of his income in 2007 when the Howard government lost power and he went back to a basic backbench salary.

"What's it called? Mortgage stress? The advent of the Rudd Government has caused serious mortgage stress for a section of the Australian community, i.e. former Howard government ministers!" he said at the time.

"You don't just lose power ... you certainly lose income as well, and if you are reliant on your parliamentary salary for your daily living, obviously it makes a big difference."

Mr Abbott was notoriously knocked-around by his change of circumstance, which obliged him to take out a $700,000 mortgage on his northern beaches home, and fostered a period of gloom and introspection in which he remained mired for more than a year.

When Kevin Rudd announced a salary freeze for all politicians in early 2008 - a decision greeted with bipartisan loathing around the corridors - Mr Abbott remarked that it was "all very well for politicians who have other sources of income or who have very high income from their spouses".

Mr Abbott's spouse, of course, works in the child care sector, which is notoriously under ... oh, stop me if I'm repeating myself.

He was not the only one to complain; quite a few former Howard ministers felt the sting of their reduced circumstances, and discreet approaches were even made to the new Labor Government to fiddle things so that shadow ministers might be paid more.

It never happened, of course. Governments are bastards like that, don't you find?

Annabel Crabb is the ABC's chief online political writer. View her full profile here.

Pay cuts hurt, don't they Prime Minister? - The Drum (Australian Broadcasting Corporation)

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