Letter No.108
24 September, 1999

6 September 1999

NZ is producing fewer university degree graduates than other OECD nations. Auckland University professor and pro vice-chancellor Dame Anne Salmond believes that the NZ university system has been run down over the last decade. Salmond says she is frustrated as she visit universities in other countries and sees they are well funded and have serious roles as economic engines. She says the government's Bright Future package is a good idea but that it's only a toe in the water. She says we need to start benchmarking ourselves with other developed countries because we are falling drastically behind.

Wages in NZ have grown on average 2.3% over the last year, according to Statistics NZ.

PricewaterhouseCooper says that directors of NZ companies are not paid enough to attract top directors from overseas to sit on boards. A survey of NZ boards of directors by Korn Ferry says that on average, non-executive directors of NZ companies earn on average $1,300 per day while in Australia they average $2,400.

Unemployment continues to be a strong feature in Japan's current economic recovery. Unemployment remains at a record high of 4.9% while the economy is experiencing strong growth.

7 September 1999

Labour releases its industrial relations policy that would see the replacement of the Employment Contracts Act with the Employment Relations Act. The ERA would safeguard workers rights to organise and bargain collectively by allowing them to strike in pursuit of multi-employer contracts, it would require good faith bargaining by both employees and employers and it would give unions the sole right to negotiate collective agreements. Spokesperson Michael Cullen says the ERA would not reintroduce compulsory unionism or pressure workers to join unions. Labour PM Pete Hodgson says the new act would provide rights to workers whose employers circumvent industrial relations regulations by requiring them to sign five to ten year contracts. The policy will also see a strengthening of the Employment Tribunal to deal with bad faith bargaining and would allow unions easier access to workplaces.

The government, the Employers Federation and the Act Party condemn the Labour industrial relations policy as a return to a union dominated workforce and an invitation to industrial strife. In contrast, the Council of Trade Unions says the policy redresses the imbalances of the Employment Contracts Act.

8 September 1999

The current account deficit remains approximately static at around 7% of gdp. The deficit for the year is $1.7 billion, the largest in ten years.

Jim Anderton says NZ should put a 5% tariff on all imported goods, except those from Australia, in order to halt the balance of payments deficit. Anderton says the move would also encourage NZ industries and promote job growth. He says the cost to consumers would add less than 1% onto their grocery bill.

9 September 1999

The Alliance says it will halt interest payments on student loans immediately on becoming government and would hold an inquiry into how to deal with the outstanding student debt. He says that at between 7% and 8% interest, the current scheme is milking students and that in the UK and Australia students paid no more than the rate of inflation for their loans.

NZ University Students Association Karen Skinner says she is disappointed the Alliance has not followed through with its earlier position of scrapping the scheme altogether but is pleased changes are in the offing. Tertiary Education Minister Max Bradford says lowering the interest rate would only encourage more people to borrow and that the current scheme was less meddlesome, fairer and encouraged NZ'ers to study.

US Trade Representative Charlene Barshefsky says the single greatest threat to trade liberalisation is the lack of public support. Barshefsky acknowledges there is a growing distrust in both developed and developing countries about the impact of trade liberalisation on jobs and whether wages could keep pace with the needs of workers.

Unemployment rises is Australia from 7.0% in July to 7.2% in August. Overall, the Australian economic produced new 25,800 full time jobs in August.

Police initiate a breakfast programme at a community house in the Hamilton suburb of Enderby. Sergeant Tania Eden expects the programme to feed porridge to about 50 pre-teens a day and the healthy start will keep them from wagging school or committing petty crimes. She started a similar programme in Gisborne that now feeds about 30 children each day and has 15 volunteers working with police.

Foodbanks in the Waikato and King Country are experiencing huge increases in demand and they are not receiving as many donations as they need. Foodbank volunteer Jocelyn Kara in Otorohanga says recent redundancies at the local Works Civil company has seen many families facing a 13-week stand-down and didn't have enough money to buy food. She says Winz is referring an increasing number of people to the foodbank. Te Kuiti manager of Winz Simon Tepi says that unemployed people are shifting into the area from Auckland and Hamilton and these are putting strain on local resources.

NZ and Singapore agree to negotiate a free trade deal similar to the Closer Economic Relations trading relationship NZ has with Australia. The move is somewhat symbolic as Singapore only buys 1.6% of NZ's exports and 2.3% of NZ's imports come from Singapore and there is currently little by the way of trade barriers between the two countries anyway. The move is seen as an example to other countries to ease trading regulations.

10 September 1999

A community forum called `Unemployment _ A Community Response' is held in New Plymouth. It is organised by the Local Employment Committee and supported by Winz. LEC co-ordinator Elaine Gill says that government is increasingly looking at local communities to come up with their own solutions to unemployment. The forum is an opportunity to find out what is already happening and to start working as a community on what else can be done. Keynote speakers are community development consultant John Wise and The Jobs Letter editor Vivian Hutchinson.

Trade ministers at Apec agree to put bans on agricultural subsidies on the World Trade Organisation agenda later this year.

A Reuters survey of 10 economists says they forecast 2.4% growth for the NZ economy over the next year.

The NZ Dairy Board subsidiary NZ Milk (Ausapac) gives workers no notice as it closes its Melbourne pack house today. The sudden closure costs 89 Australian jobs.

12 September 1999

The Apec leaders summit begins in Auckland.

Public opinion in the US does not favour trade liberalisation. US Secretary of Commerce William Daley says that 60% of Americans fear for their jobs when they hear talk about trade liberalisation.

The ANZ Bank economists say NZ's export sector will continue to struggle this year but it would grow next year as the world economies expand.

13 September 1999

David Bale, resigned chief executive of the NZ Lotteries Commission, defends his $410,000 plus salary in an article in The Dominion. Bale says he has increased the value of the Lotteries Commission by 31 times over his tenure. He says his salary started at just under half of what it is today and increased between 2% and 12% per year over his twelve years there. Bale also says that as head of the Lotteries Commission he is not a public servant and there is no reason why his salary should be public knowledge.

14 September 1999

Winz is reported to have spent $3m on airfares during its first eight months of operation. Spokesperson Kate Joblin says the agency expects to maintain this level of travel costs as travel is required for Winz to provide its essential functions and train staff. She says that travel represents less than 1% of Winz operating budget.

Two reports related to Winz's $165,000 charter flights have not been made available. Labour's Steve Maharey has been denied both the report written by the detective Winz CEO Christine Rankin hired to investigate the charter flight spending and the report written on the affair by chief ombudsman Sir John Robertson. Maharey: "We've never had a proper explanation of who's responsible for the $165,000 chartered aircraft debacle."

One Apec spin-off is $3,000 of food supplied to needy families through the Auckland City Mission. The Park Regency Hotel gave the perishable food to the mission after the Philippines delegation changed hotels at the last minute.

Student debt protestors are arrested during a demonstration in Dunedin. After occupying the Education Ministry offices for two hours, seven of the 60 sit-in protestors were arrested on trespass charges. In all, 600 people took part in the students' anti-debt march in the city.

Social Service Minister Roger Sowry announces 55 social workers would be employed in schools. The social workers will be based in schools in the upper half of the North Island and in Christchurch.

Union membership declined 6% last year according to a survey produced at Victoria University's Employment Institutions project. Union membership has fallen by 53% between 1988 and 1998, the bulk of the fall being since the enactment of the Employment Contracts Act. For those surviving unions the trend has been towards two types of unions: large amalgamated unions and smaller `boutique' unions of less than a thousand members who are usually from a single workplace.

The new Northland prison will be built near Kaikohe at Ngawha. Northland MP John Carter is "absolutely stoked" the prison had gone to Ngawha as are many local business people who will benefit from the $10m per year the prison will add to the local economy. Many residents are not so happy. Farmer Merv O'Connor says 1,100 of Kaikohe's residents signed a petition this year opposing a prison there. Even before a block as been laid, the cost of the prison has escalated by 50%. The facility is now expected to cost as much as $70m. It will house 300 inmates and will employ about 175 staff.

Jim Anderton says his party will give all full-time tertiary students allowances equivalent to the unemployment benefit.

More redundancies at Carter Holt Harvey as the company's Case Division upgrades it packaging equipment. The new equipment requires 22 fewer full-time manual labourers. A further five jobs are expected to go soon at the same facility.