Essential Information on an Essential Issue
9 November, 1995
Views on the October 1995 Government Jobs Package
- JOB PACKAGE FROM THE GOVERNMENT
The feed-back rolls in over the Government Jobs Package announced last month. As
employment activists and community groups get to grips with the `fine print' on the new policy
announcements, there are many disgruntled voices over the content of this package. The Jobs Letter
has surveyed a cross-section of our community and private-sector subscribers to get their views
on the government package. We print their feedback as a special feature in this issue.
- ABATEMENT RATES
Labour's Social Security spokeswoman Annette King says that the government has
deceived beneficiaries in their changes to the abatement system. While the allowable earnings
before abatement rates cut in had been lifted from $50 to $80 a week, the government has not
introduced the `low abatement' range between $80 and $130 that was recommended by the
Employment Taskforce. Instead, beneficiaries earning more than $80 a week would go straight on to a
70% abatement rate.
King : "National made a big song and dance about changing their current system of
abatement. However the fine print of their Focus on Employment document reveals the government
has only introduced half the Employment Taskforce recommendations on abatement for people
on unemployment, training or sickness benefits..."
Source - The Dominion 27 October 1995 "Beneficiaries deceived, King claims"
- Employment Minister Wyatt Creech is unmoved by criticisms of the new two-tiered
abatement system that means that unemployed people will receive less of their earnings than
other beneficiaries. Creech told the Dominion : " A totally different situation exists for the
135,000 people on unemployment benefits. Encouraging them to work part-time would be stupid.
They gain most by moving off the benefit into full-time employment."
Source - The Dominion 27 October 1995 "Beneficiaries deceived, King claims"
- STAND-DOWN RULES
Patrick Smellie, the NZ correspondent for The Australian, believes that the current
26-week stand-down rules for unemployed beneficiaries who fail the work test are perceived
by Social Welfare staff to be so harsh, that many of the bureaucrats have refused to
administer them. Writing in the Independent, Smellie quotes Social Welfare Minister Peter Gresham at
the Beehive launch of the package saying that "Its perceived harshness was contributing to
an ineffective work test. This less harsh graduated sanction is more likely to be applied..."
Patrick Smellie: "In other words, our own bureaucrats won't administer this policy, so
we're ditching it. However, it is something of a mystery as to why this current, dishonoured
stand-down policy will continue in force for another 18 months, until April 1997.
Source - The Independent 27 October 1995 "Bolger's first election salvo: A modest war on unemployment" by
- BROADENING THE WORK TEST
The Alliance leader Jim Anderton is highly critical of the government's
announcement that the spouses of certain unemployment beneficiaries as well as certain women receiving
DPB and Widow's Benefit will be required to seek work from April 1997. Anderton: " Hidden
away in the details of the government's responses to the multi-party Employment Taskforce is
this piece of National Government nastiness. This all their own work and was never part of
any agreement among the multi-party group."
Anderton says that the government is effectively holding the wife or husband of an
unemployed person responsible for their spouse's unemployment: "Take for example a person who
loses their job because the company they work for becomes bankrupt. The Government's response
to that is to attempt to force that person's spouse to enter the workforce. The spouses are to
be required by the government to pick up the costs of unemployment, when those costs should
be born socially."
Source - fax to the Jobs Letter 19 October 1995 "Anderton Critical of National Government Nastiness"
- BILL TO MAKE YOUTHS INELIGIBLE FOR BENEFITS
A week before the announcement of the jobs package, the government introduced
the Youth Income Support Bill, which will raise the age of eligibility for benefits from 16 to
18 years, while it increases family support for 16 and 17-yr old children of low-income
families, and amends the criteria for Independent Youth allowances. The changes will come into
effect on January 1st 1996.
Source - The Dominion 16 October 1995 "Labour rejects cut benefits"
- LABOUR'S EMPLOYMENT POLICIES
The Lampen Workchoice Day which introduces students to the workplace
is appealing for more companies to get involved with this initiative. The organisers are
planning for more than 15,000 students to get a taste of working life next April.
Source - The Dominion 13 October 1995 "Student hopes"
- CAREERS SERVICE ON TRACK TO PRIVATISATION
The Careers Service is going through a major re-structuring which will see it go the
first steps of a path towards privatisation. The service will separate into two entities, one of
which will have to survive in a competitive market-place for guidance providers. The careers
`information' services will be split from the careers `counselling and guidance `service. The
information section will be retained by the government which has already embarked on a
feasibility study on how to enhance their careers information systems.
The counselling and guidance resources will become a business unit by the middle of next
year, and this whole area will be subject to contestable funding in the future this means
other private sector providers of careers guidance will be able to bid for local contracts. Money will
be given to schools as part of their operational grants to enable them to buy careers advice
and guidance. These schools will have to produce a document of good practice in career
education, which will be audited by the Education Review Office.
Source - fax and research by Ian Ritchie October 1995
- LABOUR'S EMPLOYMENT POLICIES
The Labour Party tried to beat the government jobs package to the draw in announcing
its own refurbished employment policies just two days before the government
announcements. Labour believes that, even with economic growth, we will have the current levels of
unemployment until the end of the century. Labour also rejects what it describes as National's "any job
will do" philosophy, and will work to ensure that all those who want a job can not only find one,
but find one that matches their needs.
Under Labour, the dole would be time limited to six-months, after which people would
be given work, training or access to education. No-one who leaves school would become
unemployed, and the dole for people under 20 yrs would be replaced with a training wage.
Labour would increase public spending on infrastructure projects like state housing, and set up a
venture capital fund to encourage small businesses. It would set up set up community-based
employment enterprise schemes to undertake work which is socially beneficial but could be used to
employ long-term unemployed. Payment for this work would be at the equivalent of the dole. A
Green Jobs Unit would be set up to encourage the creation of energy-efficient and
environmentally friendly jobs, including encouraging the use of possum products. All employers would be
required to develop training programmes for their workers. The cost of the Labour strategy for full
employment: $125 million in the first year, $155 million in the second.
Source - New Zealand Herald 17 October 1995 "Labour pledges $155 million for jobs" by Patricia Herbert
- PLANS TO `RETHINK' WORKING TIME
Labour will also encourage more debate on `rethinking working time', as part of a
strategy to reform working hours. To this end, it has produced a discussion paper Rethinking
Work, which it hopes will lead a political discussion on the value of changes to working
arrangements. Labour will refrain from actually legislating for a four-day week, but plans to establish a
Rethinking Working Time (RWT) Unit that will research the issue, consult with businesses, and
develop policy for government. The unit would administer a small contestable fund which would
support workplace reform experiments.
Labour's Steve Maharey believes that `rethinking work' will be a major issue for families
in the 1990s. He says that this decade has seen more parents working longer hours, working
weekends, and doing more part-time and casual work. Maharey: "These changing work patterns
are directly related to such problems as child abuse and neglect, home-alone cases and problems
in schools. If, as a country, we are serious about raising children properly, parents must have time
to do a quality job. Parents need quality time, as well as quality time to raise children properly..."
Source - New Zealand Herald 24 October 1995 "Revamp work time: paper" and Labour discussion paper "Rethinking
Work" October 1995
- ITOS CLAIM UNDERFUNDING
The future of Industry Training Organisations (ITOs) are threatened after a lack of funds
is forcing many large training organisations to consider abandoning their operations, or
substantially putting up fees. The Building Industry Training Organisation was one of the first
established under the government's Industry training strategy, and has more than 2400 trainees. It says it
is critically short of funding, and while the government did raise its funding last year, the funding
on a `per-trainee' basis has fallen dramatically. Building ITO chief executive Trevor Allesbrook
says that of the $8 million it needed to run its courses, it only got $6 million from the
government. Unless it got the balance, it would have to double its fees, or close down a dozen courses. All
this comes at a time when there is a serious shortage of skilled workers in the building and
construction industries in particular.
At least three other training organisations the Society of Master Plumbers and Gasfitters,
the Motor Industry ITO and the Joinery ITO have also been reported as saying that
serious underfunding was throwing into doubt the future of their training courses.
At the heart of the ITO funding crisis is the government expectation that industries
must pick up any shortfall in funding. The trouble is there is no compulsion on industry members
to contribute funding, even though they benefit from the training. Most of the government's
contribution to funding is channelled through the government's Education and Training
Support Agency (ETSA), whose general manager Max Kerr told NZPA that there was no reason
why industry should not contribute to the training costs, even if it meant raising student fees. Kerr:
" The reality is that everybody else participating in tertiary education is contributing. Why
should they be any different?"
The Labour Party has introduced a private member's bill which would allow the ITOs to
ballot their membership and impose levies on industry employers where that is the majority decision.
Source - The Daily News 24 October 1995 "Industries seek cash for training" and New Zealand Herald 19 October
1995 "Lack of money puts training on the line".
"Opposition reaction is arguably the most interesting thing about the way the
Employment Taskforce has worked out. By engendering multi-party consultation, the government has
effectively bound Labour and the Alliance parties to most of its conclusions.
"Moreover, the government gains most of the political kudos from decisions which it
partly derived from the multi-party process, to the point of labelling the Taskforce announcements as
the first leg of the tax-cuts package..."
— Patrick Smellie, The Independent
"Strangely, nowhere in the entire 42 pages of the government's employment document could
I find a single mention of the Employment Contracts Act, still less is key role in job creation...
this suggests that few of the key figures in the government understand that it is restrictive labour
laws which largely create unemployment.
"If the government was serious about further reducing unemployment, instead of dreaming
up new job schemes it would press on to complete the liberalisation of the labour market which
the Employment Contracts Act began but did not finish... "
— Hames on Saturday, The New Zealand Herald
Source - - The Independent 27 October 1995 "Bolger's first election salvo: A modest war on unemployment" by Patrick Smellie; New Zealand Herald 4 November 1995 "Dreaming up jobs" Hames on Saturday column.
Top of Page
This Letter's Main Page
The Jobs Letter Home Page |
The Website Home Page
The Jobs Research Trust -- a not-for-profit Charitable Trust
constituted in 1994
We publish The Jobs Letter