Estimates Debate — Vote Labour

The estimates debate on Vote Labour provides a really good opportunity to do a performance review of the work in the labour portfolio and the work of the Minister of Labour, who is now 6 months into the job. He may be new, and he has certainly learnt his lines extremely well, but there is something deeply antiquated about the Minister’s approach to labour relations and the labour portfolio. In 6 months he has delivered a 25c an hour increase in the minimum wage—a miserable 25c an hour. He has also cut young workers’ pay and brought back youth rates for the first time since last century. He has revived a stupid piece of legislation that has languished on the Order Paper for 3 years because it was so hopeless and is so mean that it will cut basic rights to meal and rest breaks. And now he has sent to the Transport and Industrial Relations Committee the nastiest piece of proposed labour law that we have seen since Jim Bolger was the Prime Minister.

This is going to be a very testing time for employment relations in New Zealand. It is going to be a testing time for the Minister as opposition to his employment law ramps up, and as everyday Kiwi workers begin to understand exactly what the agenda of this National Government is about. It is hard enough to get a job, let alone one that pays the bills, but employment law changes that are being proposed by Simon Bridges and this National Government will have a knock-on effect to every wage and salary earner in New Zealand, and they will entrench Kiwis in a low-wage economy. By taking away workers’ rights to fair wage bargaining and standard setting, Kiwi workers across the board are going to see their wages fall.

What did we see this week? We saw an Australian company that is bringing a call centre to New Zealand. Do you know why it is coming here? Because wages here are 30 percent cheaper. Kiwi workers are 30 percent cheaper. Australian companies are bringing jobs here—

💬 Hon Tau Henare: How many jobs will there be?

—and at what price? So does Tau Henare think Kiwi workers are not worth as much as Australian workers? We have the maddest situation at the moment where New Zealanders are going to Australia to get better pay, and Australian employers are coming to New Zealand to get lower pay. That is a crazy situation.

Every change that this Government is proposing—from allowing employers to walk away from negotiations into why people have been sacked to taking away the right to a tea break—is taking us backwards to those ideas that we saw last century that were tried and miserably failed. We should not be feeling proud, and Tau Henare should not be feeling proud, that we are attracting Australian business on the basis of being a cheap economy, on the basis of being a low-wage destination. That is shameful—that is shameful. It is interesting to me that we never ever hear any mention now of closing the wage gap with Australia. That goal has gone. That has disappeared. The Government has given up on it. Instead, it is actually increasing the wage gap with Australia. That is the way Steven Joyce thinks we create job opportunities.

But back to the Minister of Labour’s performance. I am very generous, so I am going to give him a five out of 10 for health and safety. He has got a bill in front of the select committee now and there is going to be another one coming. But his department has badly botched the change process from moving the old Department of Labour to the new agency—it is a change process called Lifting Our Game, and the health and safety inspectors are so disillusioned with it that they call it “Shifting the Blame”—and in the process the department has lost numerous experienced health and safety experts. We cannot afford to do that with our health and safety record.

The Minister, too, I have to say kindly, has exhibited some stubbornness and a tendency to think he has all the answers, especially in forestry, where the death toll this year is now at six. It is now at six. The families who have lost those loved ones are desperate. They are calling on the Minister and they are calling on the Transport and Industrial Relations Committee for an independent inquiry. In fact, even the forestry owners are now asking for help. But, of course, this Minister says he has all the answers.

I give him a four out of 10 for responding to concerns—[Bell rung]

The CHAIRPERSON (H V Ross Robertson): The member has run out of calls. I call the honourable—

I raise a point of order, Mr Chairperson. No, we have not.

The CHAIRPERSON (H V Ross Robertson): You have not?

No, I think we have got one more call.

The CHAIRPERSON (H V Ross Robertson): OK. I have got a record here that says 26 calls.

I thought we had 27. We get 27.

The CHAIRPERSON (H V Ross Robertson): Well, we need to get this sorted, because if the member has another call, I am happy to give her the call. I need to find out what is right. I am sorry, but the information that the Clerk’s Office has is 26.

💬 Chris Hipkins: I raise a point of order, Mr Chairperson. The allocation that we were given by the Government whips’ office shows that this being an 8-hour debate—I can run through the numbers for you if you wish to be assured—the Labour Party gets 28.09 percent of the calls, which in raw minutes is 134.83 raw minutes and when rounded to number of minutes is 134 raw minutes. Therefore, that equates to 27 calls.

The CHAIRPERSON (H V Ross Robertson): Well, all members are honourable, and the member’s word will be accepted. I call the honourable member Darien Fenton.

As I was saying, I was about to give the Minister four out of 10 for his response to concerns about the exploitation of migrant workers. Yes, he is making the right noises, along with the Minister of Immigration, Michael Woodhouse, but he has still failed to explain how he is going to deal with the increasing exploitation of migrant workers, where they are being employed on sub-minimum wages, with just 35 labour inspectors throughout the whole country. The Minister of Labour told us during the estimates process that the way he will do that is to free up inspector time by not enforcing Easter shop trading legislation. That would free up just three inspectors, when inspectors are actually spending 54 percent of their time on migrant worker exploitation. So that is not going to cut it.

Also, I do have to ask the Committee why we pass laws. The Easter shop trading legislation has been subject to conscience votes. Seven times, I think, since I have been in Parliament, members have used their conscience to pass a law to say that there should not be shop trading on Easter Sunday. And this is a law that I have supported because I do not want to see workers forced to work on Easter Sunday. Why have a law if the Minister can then just decide that he has got the right to ignore it?

I do have to get to the bottom end when I am talking about scoring the Minister. It is a two out of 10 for the employment law changes. I know he is doing the bidding of his political masters, I know he is the puppet or the king of the rebirth of the right-wing branch of the National Party, but he does have to watch it. This Minister is getting a reputation for being a little bit economical with the truth. First of all, there was the thing about the ILO, where he said he was going off to the ILO to ask it about his law. When he got there he bottled it and refused to meet with the Secretary-General of the ILO.

💬 Dr Rajen Prasad: Really?

Yes. Then there was the story about the forestry workers, where he claimed that the forestry workers were completely on side with his revised code of practice, when, in fact, Helen Kelly was there and was able to say that that was not true. The bottom line is that the Minister has been warned and warned again about the severity of his changes to employment law. He has been warned by his officials, by the ILO, and by numerous organisations that they will result in workers’ wages being cut, that collective bargaining will be undermined and diminished as a result, that litigation will increase over the petty changes to partial strikes and notice periods, and that vulnerable workers such as the cleaners who work in this Parliament and clean his office will be exposed once again to being the meat in the sandwich between voracious tendering processes where the cost of labour is the only competition. He has been warned that these changes will expose New Zealand—

💬 Hon Tau Henare: By who? Oh, that’s right, by you.

—in Cabinet papers, by his officials, and by the ILO—to international embarrassment through a complaint of breaches to ILO Conventions 87 and 98. This is a Government that is trying to secure a place on the United Nations Security Council—we are supporting that—but it has to do it on the grounds of being a good international citizen. You cannot stand up in international fora and say that you support something, and then break the laws at home. Interestingly, in the free-trade agreement signed with Taiwan just a couple of weeks ago, right in the body of the document, it talks about complying with ILO Conventions 87 and 98 as a core part of our commitment to that free-trade agreement. But here we are planning to breach those very conventions in our own country.

I think the financial year 2013-14 will be very interesting. It will be an interesting year for Vote Labour and for the Minister. It will become pretty rocky. Can I assure you that we in Labour will be taking the message out to workers and their families up and down the country that Labour is standing up for them. We will do everything we can to defeat these backward-looking changes that the Minister and this Government are proposing. They are backward-looking changes because they will do nothing to grow our economy. They will do nothing to create jobs. They will take us back to a low wage. They will increase the low wages in this country. They are tried and failed policies.

“They will do nothing to grow the economy.” Well, I have got some good news for that member, Darien Fenton, because the economy is growing at more than 3 percent. In fact the New Zealand economy is growing at a greater rate than the Australian economy, and they are all coming back, Darien. They are all coming back, Darien.

The CHAIRPERSON (H V Ross Robertson): Order! Order!

Sorry, Mr Chair. They are all coming back, so that is why we do not hear too much about the people leaving for Australia, because that is right, they have all worked out that they should be coming back here, and so they are.

The Government’s priorities, in particular around growing the economy, have centred on managing the Government’s finances and building a more productive and competitive economy. If we look at “New Zealand Inc.”, what we know as a nation is that we have so much to offer, but we need to offer it to the world in a competitive manner, and in a way that people want to get hold of our products, and so that we are the go-to country. That actually is something that has been heralded by many around the world, including Obama’s previous financial adviser, who said that the New Zealand economy is the one economy in the world in these challenging environments that is getting it right, paying down debt and investing for infrastructure, and investing for growth.

What we know about business is that ultimately New Zealand is made up, largely, of a multitude of small businesses. What we know from a macro perspective is that getting the Government’s finances in order and managing the country in a manner that grows a competitive and more productive economy is something that will flow through to the small businesses out there, which will then take the risk to invest and grow their businesses. When they grow their businesses, they employ people. They will employ people when the settings are right.

The secret ingredient to growing a business and to growing the economy—something that the Labour Party is not too up to spec on, and certainly members from the Green Party have got absolutely no idea about it—is to be able to produce a product that either no one else is producing, is a better product than someone else’s, is at a more competitive price than someone else’s, or is provided in a way that is better than someone else’s out there in the market. It is about being able to do that for less than what it costs to procure that product or deliver that service.

When we get those settings right, the companies make profits and the ability exists for them to then invest, take a risk, and grow. That is the quintessential nature of business, whether it be in a micro perspective of the economy, from a small business employing two, three, or four people, or right through to what we are trying to do as a nation. Those settings are right. As much as this country has been through some enormous challenges in recent times, the economy is growing because the settings are right in the labour market for employers to invest and employ. That is the crux of the matter.

What are we doing around that? In this vote we talk about the 90-day trial period. Well, there have been 13,000 jobs come into the market as a result of that. We see the starting out wage for the 16 to 19-year-olds. One thing we know is that many employers will want to employ youngsters, but when they are lined up in a situation where you have got someone very low-skilled, or possibly someone with even no skills and has never been in the workforce, versus someone who has been in the workforce for many years and has experience, and the employer has to make a decision about whom they will employ for the given dollar, unfortunately a lot of those youths will miss out. We have to make sure that the settings are right to employ those young people. That will bring about 2,000 jobs over the next 2 years. Actually, I believe it will do a lot more than that, because this economy is starting to move, and employees out there are starting to realise that they need to hop on. They need to get out there and get working because otherwise they will be left behind. That is exactly what they are doing.

We are unravelling the red tape of the Employment Relations Act. We are doing a lot, and we will be completely reforming the health and safety side of the workplace. In short, what we are doing is “we are doing”. There are three sorts of people in this world: there are the “never do’s”, there are the “gonna do’s”, and there are the “do’s”. My question to the members on the Opposition benches is what are they doing? They talk about “gonna do” something from time to time, but mostly it is just to criticise what we are doing and to offer no alternative vision.

Vote agreed to.

Honourable members, the time for this debate has expired. Given that 8 hours were allowed, there are still a number of votes that I will have to put the question on, but, of course, there is no debate on them.

The question was put that Vote Food Safety, Vote Courts, Vote Customs, Vote Lands, Vote Statistics, Vote Senior Citizens, Vote Women’s Affairs, Vote Immigration, Vote Veterans’ Affairs - Social Development, Vote Revenue, and Vote Māori Affairs stand part of the schedules, and that the preamble, clauses 1 to 12, and schedules 1 to 7 be agreed to.