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    Essential Information on an Essential Issue

    Letter No.101

    18 June, 1998

    The Maori Employment and Training Commission takes a critical look at the work-for-the-dole scheme.

    Summit Time. The annual Heads of State gathering of the G8 countries (Canada, France, Germany, Great Britain, Italy, Japan, Russia and the United States begins this weekend at Cologne, in Germany.

    The G8 Summit follows a meeting of the EU Council summit, also in Cologne. Besides German proposals for a European charter of human rights, the EU leaders have been trying to decide on an "employment pact".

    Martin Walker of The Guardian reports that now the controversial German finance minister Oskar Lafontaine known in the press as Red Oskar has resigned from office, the measures within the "employment pact" have changed considerably.

    Walker: "When Lafontaine was finance minister, the pact might have meant shorter working weeks, EU-wide public works projects and the kind of Keynesian policies that worry central bankers. But now that Red Oskar is gone, Britain has managed to get this recast as an employment and economic reform pact, with deregulated labour markets and greater job flexibility. The dream of leftwing Europe is fast turning into the reality of a Blairite Third Way..."

    The big issue at this weekend's G8 summit will be the question of addressing the massive debt-levels of the least-developed countries. The Jubilee 2000 campaign put together by an international coalition of church and community activists made a significant impact on last year's G8 Summit in Birmingham, and has worked hard to keep the issue on the agenda again this year. The campaign is currently running in over 50 countries around the world, and their goal is to bring tens of thousands of people and millions of signatures to Cologne on June 19th.

  • At an April 1999 G7 meeting, newly enthused world leaders gave moving pledges to the cause of debt relief and an end to poverty. US Vice President Al Gore, and German leader Gerhard Shroeder were taken aback by the strength of feeling generated by Jubilee 2000's campaign and the sheer number of people pressing for change. They reversed their previous positions on the issue and seemed to promise some real results. British Finance Minister Gordon Brown has also been pushing measures to raise the levels of debt that the G8 countries will be prepared to write off.

    But, like the "employment pact" of the recent EU Summit ... the rhetoric looks likely to fall very short of delivering real results. Our Media Watch reports that Gordon Brown has not had much support in his proposals from British PM Tony Blair. There is also Italian, German and Japanese opposition to "generous" debt-relief proposals.

  • Those countries defined by the World Bank and IMF as "Heavily Indebted Poor Countries" (HIPC) owe $216 billion and, according to the World Bank and IMF, are not making any payments on $100 billion of this. Realistically, this $100 billion will never be repaid, and Jubilee 2000 says that cancellation of these debts therefore will cost nothing because there is no expectation of repayment.

    The initial G8 promises were to cancel $25 billion of these uncollectable debts. The proposals from this weekend's G8 meeting in Cologne are expected to raise this to $50 or $70 billion. But none of this will go beyond that which is already not being repaid.

    The Jubilee 2000 campaign: "The G8 are still offering debt relief which is cost-free (because the debt would never be paid anyway). Such cost-free cancellation is also benefit-free. The G8 offer will make no inroads into the debt payments which currently displace spending on human development. Debt "sustainability" will continue to be defined as the level of debt service that the poorest countries can be forced to pay....

    "For more than 20 years now, debt reduction has proceeded in small incremental steps, from "Toronto" terms to "London" terms, "Naples" terms, "Lyon" terms to the latest HIPC initiative. Just as these "pigeon-steps" made little progress in dealing with this problem, so it appears that "Cologne" terms will not provide an exit from unpayable debts for the poorest countries.

    "The Cologne proposals for debt relief will send few new children to school, produce very few new hospitals and provide little hope of economic recovery for the most impoverished, highly indebted nations and their people. We will be no closer to the goal agreed upon by the G8 governments of halving the number of people living in absolute poverty by the year 2015..."

    The Jubilee 2000 campaign website is at

    Source _ Official summit website at; The Guardian Weekly 6 June 1999 "Cologne summit ducks the big issues" by Martin Walker; Letter of Jubilee 2000 campaign to G-7 finance ministers 10 June 1999 from the Toes97 internet conference.

    Back here in NZ, the Labour Party has announced that it will scrap the community wage scheme because of "... its total failure to deliver real jobs to the unemployed." Employment spokesperson Steve Maharey has seized on the damning Maori Employment and Training Commission report on the work-for-the-dole scheme, released earlier this week, as an opportunity to clearly state what Labour will do if it gains the government benches.

    Maharey : "The report confirms all our worst fears about the scheme. It fails to provide any long-term benefit for the unemployed. It fails to provide any real jobs, while at the same time the community is left to shoulder the burden of keeping people busy..."

  • Maharey also says the report calls into question the whole restructuring process that led to the formation of Work and Income New Zealand (WINZ). Maharey: "It is amazing that under National the word "employment" has disappeared completely. For example, there is no Minister of Employment, nor is there an Employment Service any more. Millions of dollars was poured down the drain to merge the New Zealand Employment Service with Income Support Services to form WINZ, with a prime objective being to oversee the community wage scheme. With the scheme now a documented failure, the whole restructuring process must be viewed as a waste of time ..."
    Source _ Press statement from Steve Maharey 14 June 1999 "Community wage will be abandoned: Labour"

    Meanwhile, government restructuring continues. Decisions relating to the structure of the new Ministry of Social Policy have now been confirmed by the Director General of Social Welfare Margaret Bazley.

    The changes are due to come into effect on 1 October 1999 when the Corporate Office of the Department of Social Welfare (DSW) and the Social Policy Agency become the stand alone Ministry of Social Policy.

    The restructuring follows on from last October's creation of WINZ from the Income Support Service and the NZ Employment Service. This was followed in January 1999 with the integration of the Community Funding Agency with the Children, Young Persons and Their Families Service to form the Children, Young Persons and Their Families Agency. This, in turn, will become the Department of Child, Youth and Whanau Services in October this year.

  • When all the restructuring has been completed, DSW will have moved from having a staffing of approximately 1800 permanent positions, to a Ministry comprising approximately 170 permanent positions.

    Approximately 85% of these jobs will be filled by staff transferring into the new Ministry of Social Policy. The remaining staff will go through "a reassignment process". Margaret Bazley expects that "a small number" of positions will become redundant as a result of the new structure. The number of positions will become clearer once the reassignment process has been completed.

    Source press statements from Margaret Bazley 11 June 1999 "DSW Structure Of New Ministry Confirmed."

    "Local solutions to local problems" is a catch-cry often heard today ... but the process of devolving real power to the regions is a continuing political challenge. A local government forum, held in Christchurch earlier this month, suggested that we might consider a radical change to our governance structures.

    The forum argued that the concept of "community governance" needs to be "re-invented" in New Zealand to become more flexible than at present, and to create an environment which is "...characterised by high levels of trust and mutual confidence between the government and the community."

  • The forum attracted 150 mayors and other local body leaders from throughout New Zealand, and was led by the Canterbury mayors and council chief executives. These leaders say that while much has been achieved by government reform over the past 15 years, this has focussed primarily on issues of ideology and efficiency regarding means of defining and delivering government activities. The outcomes themselves have received much less attention.

    The Canterbury view: " Better outcomes are needed. There are too many individuals and groups facing an increasing struggle to cope with the pressures of day to day living. There are important areas in which inadequate progress is being made to achieve environmental sustainability and, while there have been obvious successes, some are expressing increasing concerns about our performance in terms of creating wealth to be shared by members of the community..."

  • The Canterbury mayors and CEOs say that the concept of community has "atrophied" over the last fifteen years as we have put an increasing focus on the importance of the individual: "We contend that Canterbury people do not simply live alongside each other, but that they live with each other. They want a governance in place that provides a framework that takes account of the past and develops a vision for the future that recognises a sense of shared and distinct identity..."

    "Taking the Canterbury Communities into the New Millennium" is a discussion paper written by Christchurch City Manager Mike Richardson, and others, and used as the basis of the forum discussions. It draws on the work of Professor Michael Clarke of the University of Birmingham, who was one of the main keynote speakers at the Canterbury forum. Copies of this paper can be obtained from the Christchurch City Council email

    Source _ Jobs Letter editor vivian Hutchinson attended this conference as a speaker; "Taking the Canterbury Communities into the New Millennium The Role of Local Government" May 1999 by Mike Richardson, and other Canterbury local authority CEOs.

    British PM Tony Blair is planning to invite private companies to run the £110 billion UK benefit system, according to The Times. The British government believes that the current welfare system, under which people claim separate benefits from different agencies, encourages duplication and fraud.

    A confidential paper called "The Vision: A Single Work-Focussed Gateway" proposes instead that claimants make a single application for all their benefits and receive one cheque in return. Two American-based companies will begin pilot tests of the new system in November.

    Source _ The Times, quoted in The Week 8 May 1999 "Welfare Privatisation"

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