Letter No.80
18 June, 1998

23 May 1998

A restructuring report prepared by the Fire Service Commission implies firefighter staffing will be reduced from about 1,600 to 1,200.

The average ordinary-time pay rates of working NZers has risen 1.9% during the last year.

Between 8,000 and 10,000 Koreans are reportedly losing their jobs every day. It is estimated 1.5m people are now unemployed there. Unemployment is expected to reach at least 8% this year and some say it will go as high as 12%. Last year, Korean unemployment was 2.7%.

The Race Relations Office is investigating the legality of a newspaper ad that asked specifically for Te Ati Awa tribespeople to apply for Fletcher Construction jobs on the new stadium project in Wellington.

The kitchen staff at Wellington area hospitals have been given notice they will be locked out if they don't sign their contract by June 4th. John Ryall of the Service and Food Workers Union says that Spotless Catering, the contractor, wants to replace collective contracts with individual contracts. Ryall says the new contracts will have no redundancy provisions, no extra payment for working on holidays and no overtime until 12 continuous hours have been worked.

24 May 1998

Government agencies are planning to abandon ACC and go with a private insurance company. Melissa Clark-Reynolds of GMV Associates is putting together a package for 12 government agencies to "club" together for best rates to obtain workplace insurance for their workers.

The new contracts being offered firefighters include a clause that states there will no redundancy payments offered to staff if the fire service is sold or leased.

26 May 1998

Minister Roger Sowry tells parliament that 689 advertisement slots have been purchased in the "dob-in-a-beneficiary" campaign.

The Fire Service backs off the mass sacking of its work force. Staffing levels are still expected to drop but, as an apparent concession to NZ First MPs, fire fighters may be offered voluntary redundancy.

27 May 1998

The current account deficit appears to be here for a while. ASB economist Anthony Byett says Asian trade is down 27% on last year. Byett suggests the drop in the NZ dollar will not begin to have a positive effect on exports until at least next year.

28 May 1998

The number of staff has been doubled at Challenge petrol stations. Fletcher Challenge's Neil Cull says the need for increased staff numbers is a result of greater than expected sales by the new outlets.

The Global March Against Child Labour ends in Geneva. Marchers from the Third World, including the Philippines, India and South Africa and Latin America draw attention to 250m child workers.

1 June 1998

The first national case of mass "disestablishment" of health professional jobs comes as Taranaki Healthcare gives notice to 251 nurses at Taranaki Base Hospital. Nurses are told they may reapply for approximately 190 jobs.

2 June 1998

Indonesian Minister of Manpower says unemployment will reach 17% this year, or 15.4m people. The country's Bureau of Statistics says inflation will rise at least 85% this year.

3 June 1998

The Methodist City Mission in Hamilton sends Income Support an invoice of $2,700 for food parcels it has provided for people who have been refused emergency assistance. Mission manager Michelle Bevan says the Mission is down to its last parcel of food today and that the Anglican Social Services ran out earlier this week. Bevan: "We are feeding beneficiaries because new policies have tightened the criteria for special needs grants. The policies the government is implementing are dumping on the community and there is an unspoken expectation that we will clean up the mess."

A national student week of action is marked in Wellington by 300 Victoria University students. Protesters march to parliament through central Wellington behind a banner reading "Stop the Privatisation of Education."

4 June 1998

Wellington's Downtown Mission lodges a complaint with the Advertising Standards Complaints Board regarding Income Support Service's "dob-in-a-beneficiary" ad campaign. The Mission says the ads are misleading because the statistics of benefit abuse ISS uses in them include not just fraudulent claims, but also honest mistakes made by both beneficiaries and ISS itself.

An UMR Insight poll shows NZers are nearly 50/50 split between wanting to retain tariffs and wanting to discard them. Breaking the figures down shows that lower income people favoured retaining the tariffs while people earning upwards of $55,000 support dropping them.

5 June 1998

University Students' Association VP Sarah Helms criticises the growing student debt as changing the social fabric of NZ. Helms says students have become a generation of borrowers who, on graduation, cannot qualify for home mortgages and are putting off decisions to marry, have families or travel. Students now owe $2.7 billion, an average of over $10,000 per student.

7 June 1998

The Employment Service says it will not vet Community Wage workers. Employment Minister Peter McCardle promotes the scheme as benefiting schools and the elderly. But Nola Hambleton, president of the Principals' Association, says schools are under enough pressure already without also having to screen workers for criminal convictions. Grey Power president, Don Robertson, warns that elderly people will not want strangers in their house unless they are vouched for by an organisation that has gone thoroughly into their background.

Peter McCardle announces that while the amalgamation of Income Support and the Employment Services into a super department is on schedule. However, in some areas the one-stop-job-shops may continue to run from separate buildings. McCardle cites current lease arrangements make it too expensive for some offices to move until their leases expire.

The one-stop-job-shops are coming together more slowly than originally planned. A name for the service is yet to be finalised. The merged service does not yet have a chief executive. The number of one-stop-job-shops and the number and description of employment regions has not be determined. And the regional employment commissioners, planned to be appointed last December, are now expected to be named in October. McCardle's reason for the delays: "We don't want to rush it, we're doing it sensibly and methodically."

Employment spokesperson Steve Maharey says that if Labour is elected, it will scrap the work-for-the-dole scheme. Labour would use the benefit as a subsidy to get people into private sector jobs or as a top up for real wages.

The number of Americans employed rises by about 300,000 people in May. This is on top of a similar rise in April. Average wages have increased ten cents per hour over the last two months.

Minister Roger Sowry instructs the Children, Young Persons and their Families Services to pay the school fees for all children in their care. Sowry's action is in response to a complaint from a Whanganui area school that it was not getting fees from CYPFS.

Winston Peters tells NZers they are not saving enough and that we are living off the savings of overseas investors.

8 June 1998

As the NZ$ drops to US.51c. PM Jenny Shipley: "We are not to be alarmed it will self correct."

9 June 1998

Treasurer Winston Peters confirms that up to 450 jobs would be lost in the restructuring of the police. Mr Peters assures that most of the losses will be bureaucratic positions associated with the initiation of the Incis computer system next year.

David Russell of the Consumer's Institute says that the price of imports will not necessarily go up as our dollar falls. Goods from countries with weaker currencies than NZ should still be affordable.

PM Jenny Shipley preempts the publication of the report on the outcome of the Code of Responsibility discussion document by discussing the results of an UMR Insight telephone poll. The UMR poll asked questions similar to those in the discussion document.

The ANZ Bank job ad survey tallies 14% fewer jobs advertised in May as there were last year at this time.

Ngapuhi kaumatua Kingi Taurua says government is not doing enough for Maori youth. Taurua cites lack of training opportunities in the Far North and lenient immigration policies are driving the hope out of young Maori. Tribal elders agreed they need to be putting more pressure for change on the government.

10 June 1998

The New Zealand dollar ends the day's trading at $US.49c. This is the lowest level since 1986.

BNZ chief economist Tony Alexander; "The chances of a domestic recession have increased as a result of this most recent fall in the exchange rate. It is going to very difficult for the majority of people. The unemployment rate is going to be 8 percent and probably above it. There will be many firms that will fail. The greatest pain is going to be in the housing sector where prices are going to fall by 5 to 10 percent this year"

PM Jenny Shipley: "The economy is much stronger than those in real trouble. New Zealanders have got to think about what they do with their tax cuts."

11 June 1998

Japan's economy is defined as being in recession after two quarters of negative growth.

12 June 1998

Hong Kong's interest rates jump two percent as a result of the falling Japanese yen.

Former US Secretary of Labour, Robert Reich arrives in NZ for talks with the Labour Party regarding economic policy.

Waikato University professor Ian Pool predicts a serious skills shortage that will leave NZ unable to compete internationally in the near future. Pool says the punitive current form of the student loan scheme discourages people from completing their education. Lack of people with qualifications will result in fewer skilled workers replacing those retiring in the next five to ten years. The economy will suffer as high tech NZ companies will not have the capabilities to compete internationally.

13 June 1998

Electronics corporate Motorola announces plans to cut 15,000 jobs. Reacting to the likely loss of $2 billion in the coming quarter, president Robert Growney: "It is clearly time to accelerate the implementation of our renewal plan."

Police review team head Doug Martin announces the number of police jobs to be axed is likely to be around 750. This is in contrast to the 450 job losses Winston Peters acknowledged five days ago.

14 June 1998

PM Jenny Shipley calls for calm about the low NZ dollar. Shipley: "There is nothing I have seen at this stage that changes my view that NZ's economy has still got a strength in its underlying characteristics. We know the messages we have to take on board in terms of being innovative, producing more and trying to save. But they are medium term goals. We don't have to panic. We simply have to be smart and fleet footed in what is clearly a very difficult international time."

Export Institute deputy national president David Binning cautions that the recession in Japan will not mean an end to NZ exports there. Binning: "Japanese dependency on imported food is so high that NZ is in a position to be one of the lowest-cost suppliers of food in the world and I think from that perspective we will survive."

Sadao Iwaya, executive vice president of TDK Corp: "The Japanese economy is at sea. Japanese and Asian markets won't recover from this."

15 June 1998

Children, Young Persons and their Families Service begins an advertising campaign to recruit 65 more social workers. The ten week campaign is also designed to increase public awareness of the role of social workers.

The AMP shares are floated. The float is expected to release as much as $2 billion into the NZ economy.