Return to Jobsletter Home

To the last Jobs Letter

To the next Jobs Letter

To this Letters Diary

To this Letters Features

To the Index







    Essential Information on an Essential Issue

    Letter No.79

    27 May, 1998

  • BUDGET 98
    Following the money

    Treasurer Winston Peters released his second Budget earlier this month. It consolidated many of the welfare and employment programme changes that have been progressively announced this year. We include an essential summary of the main Budget decisions as a special feature in this Jobs Letter.

    The latest registered unemployed figures total 188,809 people at the end of March this year, according to the NZ Employment Service. There is an increase of 36,098 a 23.6% rise on the number of registered unemployed for the same period last year.

  • NZES has decided to move to a quarterly basis of reporting the number of registered unemployed. It has previously been done on a monthly basis. NZES general manager Tony Gavin says this is to align the figures with those of the Household Labour Force Survey, the official measure of unemployment. (This showed unemployment had risen to 7.1 per cent in the March 1998 quarter, with about 129,000 people).

    Mr Gavin says the change in reporting will reduce the incidence of NZES information being used inappropriately as a "de facto measure of unemployment". It will also align NZES with Income Support, with which it is due to merge operations on October 1st.

    Gavin says NZES statistics are becoming less meaningful as a historical indicator of unemployment levels. Law changes in April for some Domestic Purposes Beneficiaries added about 15,000 new beneficiaries to the unemployment register. Benefit reforms announced in the Budget will have a similar effect in October and February. Also, many NZES clients are already doing part-time work, which is not reported in their statistics.

  • The new NZES statistics team are still ironing out the "new data retrieval and reporting system" which means the latest figures did not include numbers of vacancies at NZES, nor how many people were on the various government employment programmes. They may be available for the next NZES statistics release date: 12th August.
    Source _ The Dominion 22 May 1998 "Registered Jobless now total 188.809"; The Christchurch Press 22 May 1998 "Jobless numbers up 23.6% in first quarter" by NZPA

    A leaked ministerial memo to the Prime Minister has revealed plans to chop police numbers. Last October, police confirmed that 540 jobs would go over three years, mainly in administrative areas, as a result of expected improvements in productivity and less paperwork with the new computer system Incis. But Police Commissioner Bob Mathews said then that there would be no redundancies and the jobs would disappear through natural attrition. He also said the jobs earmarked to disappear would be in middle management and "backline" areas.

    But now it appears that Police Minister Jack Elder is to authorise redundancies. According to the leaked memo (from Elder to Shipley), there are "early indications that the external review of police now in progress could result in a reduction in management and administrative costs in police This is likely to involve the redundancy of sworn police officers and non-sworn civilian staff." The memo recommends negotiations to get redundancy provisions into contracts for sworn staff.

  • The Police Managers Guild president John Reilly says that about 1,650 people could fit into the category of staff being targeted for redundancy.
    Sources _ New Zealand Herald 12 May 1998 "1600 police in redundancy net" by Tony Wall; The Dominion 11 May 1998 "Leaked memo tells of police job cuts" by Karen Howard

    The leaked Elder memo also advises postponing discussions of redundancy with the Police Association to avoid bad press in the wake of the Fire Commission's announcement earlier this month that the country's 1,575 firefighters will be sacked and have to reapply for fewer jobs.

  • When the firefighters announcement was made, it was believed that the total job losses to the fire service would be about 100. Now a fire service management report has surfaced which recommends slashing professional firefighting ranks by a quarter _ from 1,600 to 1,200 people.

    The "Proposed Work Patterns" report also recommends fewer firefighters on overnight duty _ a time when most fire deaths occur. Under its proposals, all Auckland fire stations would lose staff, and some would lose appliances. Overall, Auckland's 120 firefighters on duty at any one time would reduce to 80, and even fewer overnight. Northland, Waikato and the Bay of Plenty services will also be cut by 30%.

    Latest: Pressure from NZ First has seen the Fire Service back down on its plan to sack all firefighters. Instead, they will be offered voluntary redundancy.

    Source _ New Zealand Herald 23 May 1998 "Fire jobs will be slashed by a quarter under proposal" by Sue McCabe

    Jim Wallace, projects manager for the Todd Park Resource Centre servicing redundant Mitsubishi workers, is concerned that the level of support given to car importers and assemblers in the Budget. The businesses were given significant compensation for the early removal of tariffs, but Wallace notes that this is not being mirrored by any such assistance to the workers being made redundant for the same reason.

    Wallace: " The workers are not only being taxed on their redundancy payments, but if they have not used sick leave or holiday leave and are being paid for it by their employer, this results in having an extra "stand-down" period before they can obtain a benefit.

    "For the government to give money to businesses and importers particularly of used Japanese vehicles, while taking money from the workers, is somewhat unfair to say the least. Given that importers of used Japanese vehicles have played a major role in the demise of our assembly industry makes the situation even more unfair"

    Wallace is presently lobbying government to obtain some form of compensation for the redundant workers.

    Source _ copy of letter from Jim Wallace to MP Graham Kelly 20 May 1998

    The national network of Local Employment Committees (LECs) will remain in place until June 1999, pending final decisions on the role of LECs in the new super-Department.

    These committees exist in nearly 40 areas around NZ and have about 750 members drawn from government, local body and community agencies. They are seen as a key element in the "local delivery" philosophy of the coalition employment strategy, and seek to increase the co-operation, co-ordination and collaboration of local agencies.

    The future of the LECs will become clearer once the network of Regional Commissioners is finally in place. These commissioners will have the opportunity to judge for themselves the effectiveness of their local committees.

    LEC manager Brenda Radford says that the committees have the potential to form the basis of a regional advisory network to assist the Regional Commissioners. Radford: "They represent a substantial resource of expertise and knowledge which will be available to the new department. It is important to retain the support, goodwill and shared understanding built up in our communities during the two years that LEC has been operating. LECs can make an ongoing contribution by protecting and enhancing the relationship between the three integrating units (NZES, CEG, and Income Support) and the 27 or so other member organisations"

    The decision means it is now possible to contract LEC co-ordinators for the whole of the 1998/99 year. Radford says this will give a sense of continuity to the groups, and will enable the members to keep working together through the changes in bringing together the new department merging NZES and Income Support.

    Source _ Transition Talk Issue 21, 22 May 1998

    The Upper Hutt Employment Trust _ the project on which the community wage scheme has been modeled _ is experiencing difficulties and is in limbo while management irregularities are being investigated.

    The Trust manager Trevor O'Brien has resigned and the trust has suspended operations. NZES Upper Hutt manager Alan sanders says he requested an audit of the trust after "one or two irregularities" were found. He would not say what the irregularities were. Trust chairwoman Heather Newell told NZPA the suspension was for two weeks and could be extended following Mr O'Brien's resignation. She says the trust has not been mismanaged and the suspension would not be permanent.

    The Upper Hutt Employment Trust has been operating since 1993. It has a budget of around $1m a year, mostly from NZES and the Upper Hutt City Council. It employs about 80 people four days a week.

    Over the last five years it has provided work in the Upper Hutt community for 1,039 people. Of these, the Trust says around 40% have gone on to "real jobs". At present Upper Hutt has 1,600 registered unemployed.

    The problems come at a sensitive time for Employment Minister Peter McCardle, who started the Upper Hutt Trust, and is now busy trying to get the community wage scheme operating throughout the country.

    Question: In the development of the community wage programme, was any independent research done on the Upper Hutt Trust to find out whether more local people are in "real jobs" now, than before it began its operations?

    Source _ The Evening Post 28 April 1998 "Model for community wage scheme"; The Daily News 19 May 1998 "McCardle defends model work scheme" by NZPA.

    The NZ Council of Christian Social Services has produced an information pack for community organisations on the Community Wage and Community Work programmes being promoted by the government. The aim of the pack is to help community organisations make informed decisions about becoming involved in the scheme. The pack outlines the government initiatives and also their analysis of the implications for community groups. It lists key points that these organisations may like to consider in determining the extent to which they get involved with the scheme.

    NZCCSS: "We do not oppose, in principle, the existence of community work and training programmes or an income support system designed to create incentives for people who are able to work to do so. However we do not support the scheme the government has announced. We are concerned that the government has spent a lot of time and money developing a scheme that will not lead to more people getting jobs and instead has a high risk of harming those most in need "

    Copies of the information pack are available from NZCCSS, P.O.Box 1937, Wellington phone 04-437-2627 fax 04-473-2624 email

    Source _ Information Pack from NZ Council of Christian Social Services

    The launch of Australia's much-heralded competitive job-placement system last month was marred with people getting bogged down or simply lost in the new phone system, and in some cases not even being told where the nearest new Employment National office was located.

    Andrew Masterson of Melbourne's The Age reports that on opening day a combination of 311 private, government and community agencies were meant to burst into life. The new system, known collectively as Job Network, replaces 293 Commonwealth Employment Service (CES) outlets with more than 1470 shopfronts and centres around the nation.

    One of the largest service-providers in the new network is the Government's own Employment National. Being a national, integrated, company, Employment National has only one phone number for the public - 133 444. - a button-operated computerised system where callers have to navigate their way through various menus, and where it's no good asking a question - such as "Where is my nearest Employment National office?" - because no one is listening.

    The menus give callers several options: how to get a social security PIN number, how to fill out an application form, how to find out about unemployment benefit or pensions, for instance. At no stage does it give the option of finding out where you have to go. Instead, callers have to hang on until the end and, when all other options having been exhausted, a human being comes on the line. The Age reporter had several attempts to get through redirected to a message: "We are having some technical difficulties at the moment - please call back later"

    Once he did get through, he still didn't get a correct answer to his simple question. He was referred to a vacant shop-front that had, up until 30 April, housed the local CES. They couldn't refer him onwards The 2,500 CES workers nationally have lost their jobs and it seems they didn't need to be told where the new offices were.

    Source _ The Melbourne Age, 3 May 1998 "For the unemployed, the first job is simply to find a place to find a job" by Andrew Masterson

    Our last Jobs Letter contained an interview with Youthskills NZ chairman John Fraser, and included his enthusiasm for Group training Schemes. Here's more:

    In a Group Training Scheme, the Industry Training Organisation (ITO), employers and unions co-operate to establish a stand-alone agency which employs and trains apprentices and then leases these apprentices out to employers for a small premium. This system enables smaller employers to take on apprentices without having to make a long-term commitment to a specific individual being trained.

    The scheme has the potential to;
    -- increase the number of apprentices and trainees available in a given region or industry
    -- widen the scope of training available to those apprentices and trainees
    -- provide an alternative to traditional apprenticeship systems for employers who would like to contribute to employing and training young people

    Hundreds of apprentices in NZ are currently being trained and leased out in this way. Fluctuating work demands often prevent businesses and tradespeople from being able to guarantee a longer-term indenture commitment to a young person. But employers say they like the Group Training scheme because it enables them to choose when, how long and how often an apprentice is placed in their company.

    How does it work? The Group Training agency is the legal employer of the apprentices. The agency places employees with a company for a mutually agreed period of time, and then relocates them with another participating company.

    The company pays the agency for the time the apprentice works. This charge usually carries a premium for other costs such as holiday pay, sick leave, ACC levies, polytech fees, and tools and clothing expenses. The agency often offers employees counseling support and liaison with government authorities.

    Voice: "Small Open economies are like rowing boats on an open sea. One cannot predict when they might capsize; bad steering increases the chances of disaster and a leaky boat makes it inevitable. But their chances of being broadsided by a wave are significant, no matter how well they are steered, no matter how seaworthy they are "
    -- Joseph Stigliz, World Bank economist
    Source _ The Listener 16 May 1998 "Counter Culture" by Margo White, as recommended by Joan Chapple

    Voice: "Working in a voluntary welfare agency I have fielded a number of complaints about the benefit crime advertisements from beneficiaries who are living manifestly decent lives and raising happy, healthy children (for the nation) on extremely limited incomes.

    "The advertisements misrepresent reality because they include no statistical data _ the actual percentage rate of significant , proven fraud among the various categories of beneficiaries. They imply that all beneficiaries are guilty or potentially guilty and non-beneficiaries must be warned of the danger.

    "A small proportion of individuals in every walk of life will occasionally deceive. However, in view of the spate of sensational frauds among lawyers, accountants and high public officials in recent years, what would be the reaction of their representative bodies if a similar series of advertisements stigmatising these professions went to air?"
    -- Robyn Brown, Avondale, Auckland.

    The general Synod of the Anglican Church, in Auckland earlier this month, passed a motion saying that further reduction of welfare benefits in NZ will be damaging to the health and well-being of invalids, sickness beneficiaries and single parents. The church is protesting over what it calls "intolerable" levels of poverty and social breakdown in NZ. They propose that in the Spring they will march in a "Hikoi for Hope" from North Cape to the Bluff. It will be led by three Anglican Bishops, who are calling for support from other Christian denominations, and the general public.

    Bishop Hui Vercoe: "This is militancy with Christian love. The idea came dramatically from the floor of the synod, and once people caught the vision of what was being asked of us, then people became enthused with it"

    " We are doing this on behalf of the poor and identifying ourselves with them and the terrible situation we find ourselves at the moment here in NZ I think this is showing that on behalf of people we are saying enough is enough. No longer are we to pass pious resolutions and motions about our concerns we are asking now to arouse the church to show our commitment for all NZ'ers."

    Bishop George Connor: "We used to be a caring society. We don't seem to be any more. If we can convince enough people to show that they care ... then politicians will listen and they may even change something ..."

    Source _ Radio New Zealand Morning Report 14 May 1998 Interview with Bishop Vercoe by Gary McCormick

    To the Top
    Top of Page
    This Letter's Main Page
    Stats | Subscribe | Index |
    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