Minimum-wage increases could be talking point during New Zealand First negotiations

With Winston Peters preparing to start negotiations with National and Labour on Thursday, a rise in wages could be on the table for Kiwis.

New Zealand First wants to lift the minimum wage by more than 25 percent.

Preliminary talks will start with National leader Bill English, followed by Labour leader Jacinda Ardern in the afternoon.

The current minimum wage is $15.75 per hour, but New Zealand First wants it to rise by more than a quarter to $20 per hour.

That's much higher than the other parties want to see it - the Greens want it set at $17.75 per hour and Labour want it set at $16.50 per hour.

When asked if he would be happy to raise the minimum wage to $20 per hour, Mr English replied: "We'll deal with that later."

Ms Ardern says she wants to "leave the discussions to the negotiating table", but says she and Mr Peters "share a focus on lifting the wages of those who, at the moment, are struggling on the lowest wages".

While a 27 percent increase to minimum wage seems like a massive, almost impossible leap, New Zealand First has been able to get this before.

During their confidence-and-supply agreement with Labour in 2005, the minimum wage rose from $9 up to $12 in just three years.

First Union is on board, but surprisingly businesses are partially on board too, because the policy includes a tax cut.

If businesses are to afford the rise, New Zealand First would also cut companies' tax from 28 percent to 25 percent. It would be even lower for export-generated revenue, at 20 percent.

However, that would be a cost to government and both sides will have to search for room in their budgets to accommodate it.