Letter No.98
27 April, 1999

22 March 1999

NZ'ers rate unemployment as the country's second most serious issue, behind health, according to the National Business Review - Aetna Health Poll.

Many polytechs are facing reduced enrollment numbers and administrators say changes in government policy are contributing to the decline. Taranaki Polytech has experienced a 12% drop in student enrolments this year. Chief executive John Billinghurst says that the policy change that forced students to find the cash to pay course fees is deterring students. Until recently, qualifying students could use their training incentive allowance to pay much of their fees. Billinghurst says that while students can take out loans to cover course fees, many were opting out of tertiary education altogether.

23 March 1999

Britain's former welfare reform minister Frank Field leads protests against the Welfare Reform Bill. Field, who resigned from the British Labour government nearly a year ago, says that the Welfare Reform Bill, which has been promotionally spun as providing opportunities for disabled people, is actually designed to trim $NZ2.25 billion off the British welfare budget. The bill abolishes the severe disablement allowance, a fallback benefit for people who can't qualify for an incapacity benefit. Disabled people are also means-tested so that if they have any private insurance, their state assistance is abated. Protesting disabled groups have been joined by as many as forty Labour backbenchers.

24 March 1999

Beneficiaries who received family support last year received one extra payment due to a computer error. Income Support was aware of the overpayment but was unable to adjust their computer software and stop it. Now the IRD is recovering this payment as the beneficiaries file their tax returns. People who received family support payments last year who do not file an income tax return because they earned under $20,000 last year will not be required to repay the money.

WINZ is asked by parliament's social services select committee for an urgent report to explain the problems it has had processing student allowance applications and what was being done to solve the problems.

A variety of Palmerston North social agencies have complained in The Dominion that their local WINZ office is intimidating and obstructing beneficiaries. The complainants include Gail Monro, director of the Methodist Social Services; Schizophrenia Fellowship field worker Christine Zander; Palmerston North Housing Advice Centre co-ordinator Jude Marshall; Drug Arm worker Lew Findlay; the Palmerston North Disabled Persons Assembly and the Manawatu IHC. WINZ spokesperson Penny Rounthaite says she is concerned about the comments and calls for a meeting with the social agencies to set up a regular forum to discuss and resolve problems.

25 March 1999

ACT NZ leader's Richard Prebble's claim that poverty does not exist in NZ is disputed by Charles Waldegrave of the Poverty Measurement Project. Waldegrave says that by every first-world standard, poverty does exist in NZ. Poverty is measured by things like the demands on foodbanks, the amount of income beneficiaries pay out for rent, (currently in NZ between 40% to 50%), and if beneficiaries can afford to see their doctors and if they do, if they can afford to have their prescriptions filled.

26 March 1999

The economy has shown overall growth during the last quarter of +0.7%. The leading growth areas of the economy are household consumption and investment. Investment growth was lead by the importation of the new Cook Strait ferry Aratere and non-residential construction. Manufacturing and agricultural production declined during the period.

28 March 1999

Foreign information technology workers may soon find it quicker to get visas to work in NZ. The Information Technology Association is compiling a list of IT skills that are in short supply here. The list is designed to speed up the working visa application process by designating skills shortages areas in the labour market. This information will pre-answer some of the research the Immigration Service is currently required to do for each individual case.

Student incomes have dropped 29% on average since 1996. A CM Research survey points out concurrently university fees have increased 30% and polytech fees increased 50% over the last two years.

30 March 1999

The Ministry of Women's Affairs publishes a report on a cause of the gender gap in earnings. The report titled Performance Pay Systems and Equity says that one reason women earn just 84% of what men earn is the indirect discrimination of performance pay. Performance pay is a bonus that is additional to ordinary pay and is based on the perceived contribution a worker makes towards the success of their firm. Senior staff and technical staff tend to be awarded higher amounts of performance pay than other positions. Senior and technical staff are two areas in which women are poorly represented in industry.

Unemployment in Japan rises to a record 4.6%

The human the cost of the Asian economic crisis is seen as the United Nations Children Fund reports that about 50% of Indonesian children under five years old are underfed.

31 March 1999

The Employment Contracts Act is opposed by 44% of those canvassed in the latest National Business Review - Compaq poll. Only 34% of NZ'ers support the Act.

UnitedNetworks announces plans to lay off up to 80 management and administration staff in NZ. The US-owned UnitedNetworks is the company that purchased 30% of all NZ power lines when the government legislated that power generation companies could not also own line networks.

1 April 1999

Changes to national superannuation come into place today. In September 1998, the government announced that the minimum pension level would decrease over the next five years from 65% of the median average ordinary time weekly wage to 60% of the average wage. The immediate effect is that the country's 475,000 pensioners now receive roughly $5 to $6 less per person than they would have under the previous policy. The savings to government will be $39m this year. The 65% of the average wage figure for pension incomes was set in 1993 by multi-party accord.

2 April 1999

The first new houses to be built in Northland's flood-ravaged township of Panguru are to be built by the Cooperative Housing Association. Walls and trusses are built in a factory in Auckland and shipped to the Hokianga to be erected. Long-time affordable housing campaigner Bill Murphy says each house costs between $20,000 and $25,000. The money for the houses is being provided by donations received by the Mayoral Relief Fund, the Bishop's Fund and the St Vincent de Paul Fund.

4 April 1999

Unemployment is now officially 4.2% in the US, the lowest in 29 years. Some economists are saying that the US has run out of labour and there are not enough workers there to fuel a continued high paced expansion of the economy.

5 April 1999

Statistics NZ says the millennium bug is a key factor in the huge growth of NZ's information technology industry. The IT industry grew 1.5% in 1997 but in 1998 grew 15.4%. IT is one of the only industries in NZ that will not have enough qualified job applicants to fill the job vacancies this year. Mobile phone and PC sales were also contributing to the boom.

Indonesia's economy is expected to decline -3% to -4% this year according the Development Bank of Singapore. Indonesia continues to be the worse hit of the Asian countries.

6 April 1999

WINZ embarks on a newspaper promotional campaign to explain what it does. Spokesperson Glennys Elliott says full page ads will run three times per week for six weeks in 22 daily papers.

Successive NZ governments have deregulated the economy faster than any other country in the world, according to economist David Henderson. In his book, The Changing Fortunes of Economic Liberalism, he analyses economic deregulation trends in 54 countries over the period 1975 - 1995. The chief areas contrasted are the opening of financial markets, dropping of currency controls, cross border capital flow, direct foreign investment, privatisation of public services, price controls, tariff reduction and subsidies for industries. Over the period, NZ had deregulated quicker than every other country and, by 1995, had the second most uncontrolled economy in the world, behind Singapore.

7 April 1999

Social Services Ministry says that there is a review being carried out by WINZ, the Labour Dept and the Dept of Social Welfare to evaluate the impact of last year's tightened eligibility criteria for benefits. There is no deadline for these reports to be presented to the minister.

The Australian economy continues to expand as advertised job vacancies were at the highest level in ten years. One key area of economic growth is in information technology preparing for Y2K. The National Australia Bank expects spending to combat the Y2K millennium bug will reach $A7 billion.

Housing NZ reports a profit of $68m, most of it from house sales. The government will receive $30m of this. Labour housing spokesperson Graham Kelly calls the profit a scandal. Kelly says Housing NZ is spending less money on maintenance and then claiming it had to sell the rundown properties. Kelly also points out that the high-profile rent reductions of between $5 and $20 per week have not advantaged beneficiaries. He says the real beneficiary of the rent cuts is government. Government is saving $10m per annum on accommodation supplements since Housing NZ reduced rents.

ACT NZ has opened a website to debate welfare dependency. The address is http://forum.act.org.nz/

8 April 1999

Newspaper jobs ads have increased in most regions. In March 99, there was an increase of 2.1% over February 99 and a 8.6% increase over March last year.

9 April 1999

The Corrections Department would like to see the criteria for the release-to-work scheme widened. There are currently only 16 inmates on the scheme but a department review says that over 1,500 or 29% of prison inmates could be working outside prisons. The review by the department is also considering the definition of work, allowing inmates to do part-time, over-time and shift work, as well as self-employment.

13 April 1999

There will be further changes to the Department of Social Welfare this year. Minister Roger Sowry says that by October 1999 there will be a new stand-alone agency called the Department of Child, Youth and Whanau. Sowry says that moving CYW out of the DSW will help clarify that it does not just assist the children of beneficiaries. Sowry also says the DSW is in decline. He says that within the next three to five years the DSW will cease to exist. In it place will be a social policy ministry the likes of which he says will rival Treasury.

The government says that, if refugees do arrive from the war in Kosovo, they will be entitled to similar social welfare and housing benefits as any NZ'er.

14 April 1999

Minister of Maori Affairs Tau Henare introduces a report that addresses unemployment among Maori women. Henare says that while Maori women are overly represented in unemployment statistics, this is not just a factor of the unavailability of jobs or low skills levels. He says that Maori women take on enormous community and whanau responsibilities plus they have larger families and are more likely to live in rural area with extended families. As a group, 19% of Maori women are unemployed.

18 April 1999

ACT's welfare campaign takes on new life as social welfare spokesperson Muriel Newman highlights the case of country's highest paid beneficiary. The person legally receives $87,875 annually to raise 14 children, several of whom have disabilities.

20 April 1999

Inflation in NZ is at its lowest since 1946. The Consumer Price Index showed a March quarter rate of 0.3% and a rate of 0.1% over the last twelve months. The Economist says that NZ's inflation, or deflation, rate is the lowest in the world's 15 industrialised countries.

Students borrowed $668m last year through the student loan scheme. The scheme is expected to loan $746m this year, rising to $1 billion per year by 2005. The total outstanding debt by students to the scheme was $2.4 billion last year and is expected to rise to over $3 billion this year.

The Disabilities Training Services Trust in Napier has achieved the international ISO 9001 certificate for excellence in achieving training standards.

21 April 1999

WINZ chief executive Christine Rankin apologises to students over the delays in processing student allowance applications this year. Rankin admitted the agency made mistakes and was unprepared for the enormity of the task it was given but it had learned its lesson.

Aotearoa Polytech Students Union president John Barkness says his organisation warned WINZ about assuming students would be easily prompted into enrolling early and about the complexity of the 15 page application form that contributed to many applications arriving incomplete. Barkness says he felt his organisation had only token consultation with WINZ.

Co-president of the University Students' Association Karen Skinner says that WINZ had not been truthful when, in the middle of the debacle, it said it had matters in hand when thousands of students were badly affected by the long delays. Skinner says that WINZ should not be allowed to take over administration of the student loan scheme as is planned for later this year.