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    Essential Information on an Essential Issue

    Letter No.66

    15 September, 1997

    A new report out by the Council of Trade Unions says that many Maori workers are being forced through a "revolving door" of temporary jobs and endless training schemes. The report, Stability and Opportunity, looks at the equality of employment opportunities for Maori workers. It concludes that the "foot-in-the-door" opportunities promoted through low minimum wages and restricted access to welfare benefits ... can lead to a "revolving door" which is likely to perpetuate cycles of short-term, low-paid work, followed by periods of unemployment. Says CTU president Ken Douglas: "I think one of the big questions NZ has to ask is whether any job is better than none..."

  • The CTU report shows that Maori workers are more concentrated in low-skill, low-paid jobs than non-Maori. And they are more likely to encounter higher unemployment rates, lower earnings and more "volatility in employment". The report also says that unemployed Maori are more likely to have left their last job because it was temporary.

  • CTU points to the Employment Contracts Act as one of the main culprits changes to the industrial legislation have made it easier to engage workers on temporary, casual or a short-term basis. CTU recommendation: the number of temporary workers should be kept to a minimum in order to keep employment "moderately stable" and to allow all sections of the workforce to have the opportunity to acquire more skills.
    Source The Dominion 11 September 1997 "Maoris in a revolving door of temporary jobs"

    Is the re-vamped Community Taskforce programme becoming a de-facto work-for-the-dole scheme? The NZ Employment Service is pushing the Community Taskforce in order to get numbers up to as many as 10,000 people involved, and this is seen as a first step towards the introduction of a work-for-the-dole scheme next year, as part of the coalition agreement.

    Alliance employment spokesman Rod Donald believes that this first step may in fact be all the coalition government needs to make in order to achieve a "work-for-the dole programme on the cheap". He believes that Employment Minister Peter McCardle is facing hurdles in bringing together his community wage and workfare proposals proposals that will require co-operation between Ministers over a number of portfolios like Social Welfare and Education, and involves traversing the sort of policy co-ordination and "patch protection" that is not being easily being worked through in the current coalition government climate.

    Donald says that instead of spending money on engaging Saatchi and Saatchi on a "feel good" advertising campaign, the Minister would be better off providing unemployed people and existing and potential sponsoring organisations with real incentives and support to make the existing voluntary scheme work better. Donald: "Instead, the Minister has turned his whole employment strategy into a propaganda exercise designed to make the unemployed feel bad if they don't work three days a week for nothing, and under-resourced community groups feel bad if they don't take on extra workers..."

  • The only thing stopping Community Taskforce from being a fully-fledged work-for-the-dole scheme is the issue of "compulsion". Rod Donald has released documents obtained under the Official Information Act which make it clear that legislation already exists to enable the government to direct its "clients" onto the Community Taskforce scheme.

  • Such a "compulsory" direction seems certain to backfire amongst the community organisations which are sponsoring the Community Taskforce placements. Many community groups are happy to participate on the scheme while it is a voluntary option and while the unemployed are genuinely keen to do their community work. But being sent unemployed workers who don't want to be there raises all sorts of questions of levels of supervision, increased costs from damages and carelessness, and also general client safety.

  • There is also a question of whether the existing community sponsors are being asked to participate on the scheme under false pretences, if indeed the scheme will later be converted into a "compulsory" option. TV1 News last week interviewed employer Peter Kohing who is part of the government-sponsored campaign to increase community participation in the scheme. Kohing: " I wouldn't like to see unemployed people being forced onto this scheme ... " One of his unemployed volunteers, Gina Williams, also has doubts about the government's intentions: "You just feel depressed if you are forced to work somewhere and it is all beyond your control ... it is slave labour if you are being forced to do it."

  • The "compulsory" direction also seems certain to also backfire amongst employers and the business community who are involved in the present Community Taskforce scheme, and will play a big part in the future Community Wage proposals. Rod Donald has also released details of a recent Colmar Brunton poll undertaken by the NZ Employment Service. It asked employers and Community Taskforce participants about the existing programme, and what they thought of the new scheme if it became compulsory.

    According to this research, employers identified that, under a compulsory option, participants would not care about the projects, have a bad attitude and not put their best into it. Also, the research shows that both employer and participant satisfaction is a key element in ensuring the placement of job seekers into the programme.

    Donald: "Without the support from employers the government's work-for-the-dole scheme is doomed to failure. This research shows that employers do not want to be jailers for the government's slave labour scheme. No employer wants to have to supervise unwilling, unpaid employees in their businesses. "

    Source phone calls and emails to the Jobs Letter from Rod Donald, and TV1 news item 8 September 1997, by Duncan Garner.

  • A review of benefit trends issued by Social Welfare shows that the number of people receiving benefits, not counting superannuation, has increased by 4% in the last year to reach 367,000 people.
  • Nearly one NZ'er in six of working age is reliant on social welfare for their income. When pensioners are added to the total, nearly one in three NZ adults receive weekly welfare payments.
  • The largest increase in the last year has been in Invalids Benefits (which is up 8.6%). Other increases were in the Unemployment Benefit (up 4.8%), Domestic Purposes Benefit ((up 3.3%) and the Sickness Benefit (up 3%). The only benefit to reduce was the Independent Youth Allowance (down 10.2%).
  • 5% of unemployment beneficiaries and 26% of DPB beneficiaries have been on a benefit for more than 5 years.
  • Spending on the DPB will reach $1.53 billion this financial year, (a figure which does not take into account the offsetting effect of child support payments made by non-custodial parents).
  • The numbers of people on various benefits at the end of June 97:
    Domestic Purposes Benefit : 112,395
    Unemployment Benefit : 137,854
    Invalids Benefit : 46,099
    Sickness Benefit : 34,371
    Independent Youth Allowance : 2,554
    Source The Dominion 11 September 1997 "One in three NZ adults gets welfare support".
    Social Welfare Minister Roger Sowry says the government has to make some difficult decisions to stop a tide of welfare dependency being passed onto the next generation. However, the government's "code of social responsibility" as announced in the Budget , will probably not be drawn up as proposed legislation until early next year.

    Sowry says the new code by its very nature will be like the fiscal responsibility legislation, and "broadly set the guidelines we will use for the new social development and spell out a set of responsibilities along with a set of rights we have in society..."

  • The New Zealand Herald reports that welfare groups are fearing that in response to the rise in beneficiary numbers, the government may cut benefits the invalids benefit pays $36 a week more than the dole and introduce tougher vetting of invalids and sickness beneficiaries.
    Source New Zealand Herald 13 September 1997 "Social self-reliance code nears" by Bernard Orsman

    The Human Rights Commission says that complaints received on the basis of age discrimination made up 10% of the formal complaints received last year. Brian Kirby, President of Auckland Grey Power, says that these figures show a rising bigotry against employing the elderly. Kirby: "Thousands of people aged in their 50s are being put on the scrap heap by employers who want to employ younger people at cheaper rates..."

  • In Wellington last week, a man was awarded $5,000 by the Disputes Tribunal after the TAB refused to give him an interview for a job. The Tribunal found that the 42-yr old man was not given the job interview solely because of his age.
    Source New Zealand Herald 11 September 1997 "Grey Power Attack on bigotry in the job market" by Chris Daniels

    The NZ government alarmed that the sharp fall in the number of immigrants will hurt the economy is considering changing immigration criteria in order to attract young, skilled settlers with capital. The latest immigration figures show that numbers are down to 15,900 from the 29,000 immigrants last year. The government was aiming for 35,000 immigrants a year.

    Finance Minister Bill Birch told a recent Rotary Club meeting he wants an influx of quality younger immigrants with high skills and preferably some capital. Birch: "Migrant energies and skills do not displace New Zealanders. They add a new dimension to the economy which helps to underpin high levels of growth ..."

    Source The Dominion 22 August 1997 "NZ needs young skilled settlers, says Birch" by Victoria Main and James Weir

    The State-owned Timberlands West Coast estimates that 2,500 jobs could be created from processing native beech if officials allow the trees to be harvested. They want to fell an average of one beech tree for every hectare of its native forests each year. In a proposal, to be presented to SOE Minister Jenny Shipley later this year, Timberlands says it will use helicopters to remove individual trees. It also contends that the beech logging will be sustainable ... something disputed by many environmentalists who want a halt to all logging of native trees in state forests.
    Source New Zealand Herald 28 August 1997 "Life's a beech for Timberlands West Coast" by Mark Reynolds

    The Children's Commissioner Laurie O'Reilly, who is terminally ill, has made his last planned public appearance at the Family Violence Symposium in Palmerston North. He used the occasion to urge more support for the Commission's Fathers Who Care: Partners in parenting programme.

    O'Reilly: " The most urgent thing now facing NZ is the issue of fatherless families we have to address and develop a new attitude to parenting, it is a shared responsibility. We have been so liberal and brave and modern in meeting our own needs as adults that we have overlooked our children and everyone has an obligation to see that changed..."

    Source Sunday Star-Times 31 August 1997 "O'Reilly still has his eye on the future" by Miriyana Alexander

    A new lobby group is being launched in order to give "an alternative view" to the Business Roundtable. Auckland businessman Dick Hubbard, of Hubbard Foods, is establishing "Businesses for Social Responsibility", a group modelled after an organisation with the same name in the United States. The new group will have a permanent secretariat and will publish research and reports. It will provide a forum for debate and discussion by business and a network to share ideas and lobby government.

    Hubbard: "The Business Roundtable sees businesses as totally focussed towards shareholder wealth. An alternative approach is stakeholder theory, which sees business as having a range of stakeholders, including not only shareholders but also employees, suppliers and the wider community..."

    Source Sunday Star-Times 31 August 1997 "New lobby group to put caring face on business" by Anthony Hubbard.

    The Royal & SunAlliance is one of the first companies in NZ to move towards "corporate volunteering" where businesses help their staff carry out community work under the company's banner. Example: employee Victoria Carpenter has recently spent a day a week for twelve weeks working for the non-profit agency Development Resource Centre.

    In the US, a survey of more than 450 companies has found that 90% encouraged staff to become involved in community activities. In Britain, a less representative study found that one in three large companies had employee volunteering schemes.

  • The Royal & SunAlliance secondments were organised by Wellington's Volunteer Centre. Darren Quirk, the Centre's regional manager, has just returned from a Winston Churchill Fellowship trip to Britain where he studied volunteer programmes in companies such as KPMG, Whitbread and Marks and Spencer. Quirk: "In the UK, it's not seen as fringy, it's seen as mainstream ... Corporates can make a significant impact with community groups, with people as well as money ..."

    The Dominion writer Anna Smith says there is a strong business as well as community case for corporate volunteering. Smith: "Most companies volunteer not so much as a public relations exercise, but as a way of developing employees' skills and broadening their experience. They also see it as a chance to build staff morale and corporate loyalty, attract and keep better employees and improve community relations."

    Source The Dominion 13 August 1997 "Good deeds can be good business" by Anna Smith

  • UPS STRIKE A WATERSHED FOR PART-TIME WORKERS Last month's strike in America by workers at the United Parcel Service (UPS) may prove to be a turning-point for many American employers over the issue of part-time work. After two weeks on strike, the Teamster's Union (which represents the UPS workers) won virtually all their demands, appearing to turn the tide on what the Teamsters has described as "the long campaign to casualise the American workforce..."

    Most US employers have realised in these days of "re-engineering" and "re-structuring" that full-time employees are expensive. They get pension rights and medical benefits, and they get paid more. Before the strike, the full-time UPS drivers got nearly $20 an hour. Part-timers averaged $11 an hour.

    The Teamsters rallied behind the slogan of "Part-time America doesn't work" and found a strong current of public support. The strike result: substantial pay rises for both part-timers and full-timers; sub-contracting of labour will be phased out, and 10,000 part-time jobs will be turned into full-time employment.

  • Part-timers in the US make up 20% of the workforce. 80% of them say they are choosing to work less than full-time, and they are more concerned with benefits and status in their jobs rather than their inability to move into full-time work.

    There have been several unsuccessful attempts to get bills through US state legislatures in order to protect part-time workers. The latest effort is in Massachusetts where a bill is being proposed to ban discrimination against part-time and temporary workers, requiring part-timers to receive benefits in proportion to hours worked, and capping the number of part-timers a company can employ if they receive state contracts.

    Source The Guardian Weekly 31 August 1997 "Teamsters prove unions can deliver" by Martin Walker; and US Star-Tribune 1 September 1997 "Other part-timers hope UPS gains have broad impact" by Maggie Jackson.

    Voice: "The Prince's Trust is the largest charity of its kind in Europe and it flourishes as never before. Its work is grindingly prosaic. It inhabits that economic underworld of grime, poverty, unemployment, drugs, crime and broken homes - a place where the paparazzi never gather. That is Prince Charles's style, and some of us actually like it ..." Jonathon Dimbleby.
    Source New Zealand Herald 9 September 1997 "Give Charles a Chance to shine" by Jonathon Dimbleby

    Chinese President Jiang Zemin has announced at a crucial congress of the ruling Communist Party that he will revolutionise the ownership of public firms. Observers say he is embarking on a strategy of privatisation for the ailing state sector, with the consequent widespread lay-offs of state employees.

    China will be also setting up a welfare system in urban areas by the year 2000 to help workers laid off from state enterprises adjust to the market-style economic reforms. The plan will be funded by local governments and apparently will not cover China's huge "floating" population of migrant workers from rural areas who have flooded the cities in search for jobs.

    Source The Dominion 5 September 1997 "China to set up urban welfare system"

    The French Employment Minister Martine Aubry has been given the go-ahead for measures to create 350,000 jobs in efforts to reduce youth unemployment. The jobs, in areas such as health, housing, education, security, culture and the environment, will be available to people under 26 years of age, and they will be paid the basic minimum wage. The French government will provide 80% of the funding with the rest provided by local authorities and community associations.
    Source the Guardian Weekly 31 August 1997 "French jobs get a boost" from Le Monde


    " In the `old welfare consciousness' they gave you something for nothing. In the new welfare consciousness we give them something for nothing ..."
    -- Community Taskforce worker.

    "Mr McCardle has met widespread resistance to his plans to extend work-for-the-dole schemes from both public servants and the community sector. He is now slyly trying to get around this opposition be trebling the number of unemployed people on Community Taskforce, preparing to launch his full work-for-the-dole scheme in 1998.
    "Community Task force is in fact slave labour. It is no different from periodic detention, except that unemployed people forced onto it at the risk of losing their benefit have no recourse to judge, lawyers or jury.
    "We hope that the organisations that employ Community Taskforce workers, such as schools and voluntary agencies will learn to understand that unwilling, involuntary labour is not only total exploitation of workers, but is also not good for the employing body or the people they serve ..."
    -- Sue Bradford, Auckland Unemployed Workers Rights Centre.

    "The most important lesson from the US welfare experiment and the most often missed is that "welfare to work" schemes soak up a great deal of money over a long period of time before they begin to yield savings.
    "US Congressional rhetoric is utterly deceptive on this point. Both Democratic critics and Republican supporters tend to focus on the cuts in spending and the harshness of the "guillotine" that will eventually cut off benefits entirely from people who do not work.
    "In fact the hidden truth of the experiment is that it is costing a fortune in childcare, training and other subsidies: between $10-13m in federal and state money for at least the next 5-6 years..."
    -- Bronwyn Maddox, correspondent for The Times.

    " The Treasurer and the government have yet to flesh out the "code of social responsibility" that Winston Peters proposed in the Budget. The fear is that Employment Minister Peter McCardle's well-intentioned but ill-conceived work-for-the-dole scheme is symptomatic of the approach to be taken. [...]
    Mr McCardle is the only government politician to have shown any sign of moving from declarations of intent to the practical. However, his work-for-the-dole proposals have many hurdles to clear before they can be considered viable.
    The difficulties come when politicians have to move from bumper-slogan bombast to the hard realities. The bill in the United States for "welfare to work" schemes so far is $10-13 billion a year, and the results have been spotty.
    Those who wish to change the welfare mentality and imbue the community with a sense of social responsibility should note the other lessons from the United States : there are no quick fixes and no cheap answers..."
    -- editorial in The Dominion 28 August 1997

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