No.214 23 September 2004 Essential Information on an Essential Issue

of key events over the last few weeks.


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7 September 2004

The number of first-year university computer science enrolments has dropped to the levels they were in the early 1990s, according to Computerworld magazine. ICT enrolments plummeted after the dotcom crash in 2000 and the magazine says that the lack of skilled graduates coming through now may hold back the industry's recovery.

Finding volunteer workers is becoming very tough, according to the NZ Federation of Family Budgeting Services. Executive officer Raewyn Neilsen: "We are losing volunteers and really struggling to replace them on a national basis. People just seem to be working longer hours, more than one job, and don't have the time to volunteer."

Qantas Airlines' 4,000 flight attendants threaten to strike in mid-December, when the company plans to move 400 flight attendant jobs to London.

8 September 2004

A boat-building company that was part of Minister of Economic Development Jim Anderton's "jobs machine" has not created the number of jobs it forecast. Sovereign Yachts predicted it would have 350 staff by the end of 2003, but currently employs 75 staff and about 20-25 people employed by subcontractors.

There is a distinct correlation between employment status and suicide, according to the Australian Medical Association. President Bill Glasson says that in periods of high unemployment suicide rates have soared. Glasson: "In our society, men still typically see themselves as breadwinners and providers. When they cannot fulfill this role due to unemployment or underemployment, their self-esteem suffers."

9 September 2004

The Australian economy lost 6,600 jobs last month. It was the third drop in four months over which Australia lost a total of 39,800 jobs. The unemployment rate was unchanged at 5.7% because fewer people were looking for work.

The Reserve Bank of NZ raises interest rates to 6.25%, the fifth rate increase this year.

The Alcan aluminium refinery expansion will create 1,700 construction and then 120 permanent jobs in Gove in the Northern Territory of Australia.

Delta Airlines in the US will cut as many as 7,000 jobs in an attempt to avoid having to file for bankruptcy protection.

Westpac Bank's own social impact report - How We Measure Up - finds that its executive males earn over $55,000 on average more than its executive females. Westpac's male managers earn on average $14,673 more than women managers.

Volkswagen says as many as 30,000 jobs - about 17% of its Germany workforce - will be cut if it cannot reach agreements with unions to freeze wages and gain other concessions from workers.

14 September 2004

The Crown Solicitor has been asked to prosecute 32 groups that allegedly invented fake projects to gain grants of $150,000 through the Community Organisation Grants Scheme (COGS). A spokesperson for the Department of Internal Affairs, which administers COGS, says they believe they followed correct procedures in giving out the money but "there have been unlawful acts taking place" and the department is the victim. COGS distributes $12 million per year.

The Department of Labour is setting up a Pay and Employment and Equity Unit that is "committed to improving pay and employment equity in the state sector".

15 September 2004

Figures obtained under the Official Information Act show 560 people have been on unemployment-related benefits for more than 10 years. Five of those have been on the dole for 19 to 20 years. National MP Katherine Rich believes there would be many more people who have been on welfare for a total greater amount of time but are not in the statistics because they have had small stints in training or work.

Winz says that less than 1% of the people on an unemployment benefit have been collecting it for more than 10 years. Deputy director Ray Smith says it is harder to find work for some people because some have health, drug or alcohol problems, poor social or literacy skills, little work experience or cannot speak English well.

Most employers in the US say that about one-third of their workers don't meet the writing requirements of their positions, according to a survey by the College Board. Companies say solid writing skills are among the most sought-after skills, particularly when hiring and promoting salaried staff.

18 September 2004

Eastman Kodak, the world's biggest maker of photographic film, says it will close a plant in Victoria, Australia, cutting 600 jobs. The closure is part of the company's plan to slash its worldwide workforce by at least 12,000 over three years.

Italy's beleaguered state-owned airline Alitalia will cut 2,500 ground crew and freeze pay rates in an effort to keep the company operating. It is also shedding 289 pilots and cutting pilot pay by one-third.

20 September 2004

The Community Employment Group is officially dis-established.

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  • The first-ever comprehensive report on the state of human rights in New Zealand has concluded that children and young people are the most at risk from human rights abuses. The Chief Human Rights Commissioner Rosslyn Noonan says that while New Zealand meets most international human rights standards, there are some critical areas where we are failing. Noonan reports that some of the most pressing human rights issues in New Zealand are those relating to the poverty and abuse experienced by a large number of children and young people.

    The most pressing issues to emerge from the report are:

    — Nearly one out of three children and young people live in poverty, which restricts their access to medical care and education opportunities.
    — NZ has the fifth worst child death by maltreatment rate of 27 OECD countries and significant numbers of children and young people are abused or neglected.
    — Maori, Pacific and new migrant children, disabled children, and children and young people with mental health problems have difficulty accessing health, education and support services and have poorer life outcomes as a result.
    — Children and young people want increased respect for diverse groups within New Zealand and the elimination of all forms of discrimination against them and others.
    — Children and young people want increased involvement and participation in the decisions that affect their lives.
    — Young people want enhanced protection in the work place.

  • The Human Rights report includes a 16-page section on "The Right to Work". It points out that "structural disadvantage" still exists in the New Zealand labour market in terms of both participation and outcomes and this includes:
    — higher unemployment rates for Maori and Pacific peoples, even when unemployment is low;
    — difficulties faced by migrants in accessing appropriate employment;
    — prejudice influencing the appointment, retention and promotion of older workers;
    — difficulties faced by women returning to the workforce after time away from work for family responsibilities;
    — the enduring stigma and discrimination against disabled people in the labour market;
    — difficulties faced by young people entering the labour market.

  • Over five thousand New Zealanders contributed to the report in some way. When the Commission asked them about what they understood by human rights it became clear that while they endorsed human rights as important, most people, including public officials, had limited knowledge about human rights in any formal sense.

    The Commission acknowledges that the report has been written during buoyant economic times when the official unemployment rate was 4.4 percent, a 16-year low, and more New Zealanders (1,886,000) are in paid employment than at any other time. Yet the Commission warns: "There is a natural tendency during good times to minimise the impact of structural disadvantage in the labour market and inequities in participation and outcomes. However, the current strength of the labour market provides an opportunity for informed debate about how to improve outcomes through work for individuals, families, workplaces, the communities in which they are located and society."

    In December, the Commission would issue an action plan recommending practical steps that can be taken over the next five years to improve the status of human rights in New Zealand. The public are being encouraged to make suggestions about the shape and priorities of the action plan.

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    —Human Rights in New Zealand Today - Ngâ Tika Tangata O Te Motu: Chapter 16, The Right to Work - Te tika ki te whai mahi published by the Human Rights Commission (September 2004) can be downloaded (PDF 17pg, 427kb) here

  • ACT MP Dr Muriel Newman has slammed the Human Rights report as "political correctness gone mad". She argues that part of the problem is with the way that human rights laws are developed. Newman: "A desirable behaviour is elevated to the status of law — without the safeguard and scrutiny of the exhaustive Parliamentary process — then passed onto judges and the courts to monitor for compliance. Such backdoor law-making is bound to create controversy, and a deluge of litigation — as well as a stream of unintended consequences. "

    Newman points out that using the government's Social Report 2004 living standards scale — which identifies a low-income threshold as 60% of the 1998 median equivalent net-of-housing-cost family income — it is children living in sole parent families that suffer the greatest levels of financial disparity. Yet she says that there is a real difficulty with defining poverty in this way. Newman: "As average wages rise, so too will the poverty threshold and, under this scenario, there will never be an end to poverty in New Zealand."

    Sources - Human Rights in New Zealand Today report 2004, Press Releases from Human Rights Commission; Dr Muriel Newman commentary "Newman online" 6 September 2004 Human Rights, Poverty and Political Correctness Gone Mad"; Press Release Green Party 1 September 2004 "Human rights report criticises social exclusion"; The Dominion Post 1 September 2004 "One in three Kiwi kids `lives in poverty"; Press Release Action for Children and Youth Aotearoa 1 September 2004 " Give Kids A Fair Go"; Press Release Save The Children 2 September 2004 "NZ Must Work Harder To Uphold Child Rights"; Press Release Act Part Dr Muriel Newman 1 September 2004 "PC Report Side-Steps The Real Issues".


  • ceg-logo.gif - 3130 Bytes The government announced this week that the Community Employment Group (CEG) within the Department of Labour has been "dis-established". This agency has been the main channel for allocating $23 million in government grants to community organisations each year. Recently, the agency has been under the political spotlight after controversial funding decisions surrounding its Social Entrepreneur Scheme (see The Jobs Letter No. 204). The main points from recent announcements include:
    — The Ministry of Social Development (MSD) will now take up the role of being the lead agency in "developing and creating employment opportunities at the local level", and "co-ordination and engagement to get faster and more effective responses to employment issues at the local level".

    — A Transitional Management Unit will administer any ongoing and new grants and provide continuity for staff and communities as MSD establishes the capability required to take up its new functions.

    — Current CEG grants funding will transfer to MSD by 31 March 2005.

    — All the 120 former CEG staff have been transferred to the Transitional Management Unit while MSD and the Department of Labour work out how they can be "retained in jobs that utilise their skills and experience". Labour Department chief executive James Buwalda is confident that redundancies can be avoided ... but the Cabinet papers warn of a $2.6 million "worst case scenario" if CEG staff do not find other positions.

    — An immediate casualty of the changes is former CEG general manager Charlie Moore. He ceased working for the Labour Department two weeks ago, because his position has been "dis-established".

    — Among the funding effected is $5.7 million for "Maori and Pacific Island capacity building programmes which were allocated in this year's Budget. Cabinet papers show that these grants have been evaluated as "not achieving government outcomes". The money will now be given to MSD to train the unemployed to fill skill shortages.

    — Cabinet has also opted to transfer $2 million allocated for Maori women's development to Te Puni Kokiri.

  • Minister of Labour Paul Swain says that CEG has been a victim of the low employment rate. He told The Dominion Post that the agency had been established when there were too many people and not enough jobs. Swain: "We have now got too many jobs and not enough people."

  • Minister of Social Development and Employment Steve Maharey says the changes to the way community employment assistance is delivered is being driven by the need to better meet current employment and labour market demands, and to ensure clearer accountability from the delivery agencies. Maharey: "The government has decided that our current investment in community employment will continue, but it will be delivered in new ways to ensure it more effectively meets the labour market outcomes the government, businesses and the community are wanting."

    Maharey believes that there is not enough coordination of the different funding and delivery agencies involved in community employment, nor proper knowledge of what is happening in local and regional labour markets. In the light of recent investigations into CEG funding decisions, Maharey concedes that the organisation "has been struggling" and that, in some cases, poor processes have been followed. Maharey: "It looks like the process basically got sloppy. If you look at the file notes, in answer to a question like, "What will be the outcomes?" they'll say things like, `Heaps of jobs'. That is not what we expect from a public servant ..."

  • Maharey says that there will now be "widespread consultation with stakeholders" on the future of role and delivery of community employment services, and that this consultation will include the Mayors Taskforce for Jobs. Taskforce chairman, Christchurch Mayor Garry Moore, welcomes the opportunity to have input on what "the next version" of CEG will look like. Moore: "I think other Mayors in the Taskforce are also grateful that the Minister has acted in saving this resource. Our job now is to help shape what we want the next version of CEG to be in our communities, and to make sure that this money is being spent in a purposeful and effective way. "

  • The Public Service Association has strongly opposed the government's decision to dis-establish CEG, and has met with Maharey to express their concerns. PSA national secretary Brenda Pilott: "We remain unconvinced and opposed to the decisions that Cabinet has made. They are the wrong decisions. The arguments presented to us don't stack up as strong enough to create this level of disruption to people's jobs and to community organisations who get grant funding."

    Pilott says the PSA is now focussing on working with the Department of Labour and the Ministry of Social Development to ensure that every PSA member in CEG is retained in employment. Pilott: "Both of these departments are very large employers and we are expecting the two chief executives to place all CEG staff in suitable work which uses their skills. We'll be working closely with them on the change process. The PSA will be doing all we can to support and protect the jobs of our members at CEG and to support the delivery of essential funding to communities throughout New Zealand."

  • Green Party co-leader Rod Donald says that CEG has been the political casualty of the hip-hop grant fiasco. Donald: "I would have thought Mr Maharey would have a bigger vision. It's a very sad day that a Labour minister has destroyed the government's primary community employment initiative..."

    Green MP Sue Bradford says she holds grave doubts over the future of social enterprise after the decision to dis-establish CEG and divide its future role between MSD and the Department of Labour. Her concern is that it appears that any focus on community economic development appears has been lost in the re-shuffle. Bradford: "It's a great pity that the funding arm of CEG will be absorbed into Work and Income's dense bureaucracy where what remains is likely to focus on individual job seeker support rather than on developing community infrastructure. CEG was never just about jobs, it was about supporting the efforts of local people in disenfranchised communities to build their own community-based enterprises.

  • National Party Social Services spokeswoman Katherine Rich says that the government is "throwing the baby out with the bath water" in deciding to axe the Community Employment Group. Rich: "After making a huge song and dance about moving CEG from the Ministry of Social Development back to the Department of Labour, Steve Maharey's now going to spend a small fortune shifting it back again. Essentially he's admitted the whole exercise has been an abject and costly failure. The move to dis-establish CEG is a blatantly transparent attempt to shut down the political fall-out from the Government's appalling track record in this area. I believe the rules could have been strengthened without killing off CEG..."
    Source - Press Release NZ Government 20 September 2004 "Changes to community employment assistance delivery"; Press Release PSA Brenda Pilott 20 September 2004 "PSA opposes decision on CEG"; Press Release Sue Bradford Green Party 20 September 2004 "Communities will suffer from CEG scrapping"; Press Release National Party Katherine Rich 20 September 2004 "Baby thrown out with bath water in CEG axing"; Jobs Letter interview with Christchurch Mayor Gary Moore 21 September 2004; The Dominion Post 21 September 2004 "Plug finally pulled on hip hop tour funder" by Nick Venter; New Zealand Herald 21 September 2004 "Grant cash in doubt after agency axed" by Kevin Taylor.


  • One in two Australian companies are struggling to find skilled workers as a national manufacturing skills shortage worsens. An Australian Industry Group (AIG) report says there are nearly 22 vacancies for every 100 people who work in the sector. About one-third of the companies surveyed reported they had no applicants at all when they advertised for skilled labour. One-third said the applicants who did apply lacked qualifications and one-third said applicants had inappropriate skills and experience.

    AIG chief executive Heather Ridout says widespread skills shortages are costly and wasteful and undermine the competitiveness of Australian industry. Ridout: "If Australia is to compete effectively in what are expected to be more difficult economic times ahead, it is clear that federal and state governments and business will need to work together to address the skills gap."

    Although the take-up rate of apprentices is on the rise, less than 10% of companies nominate it as a likely response to skills shortages. Apprentice numbers — around 130,000 — are not believed sufficient to wind back the shortfall.

    Source - New Zealand Herald 16 September 2004 "Australian firms hunt for skills" by AAP.


  • A new British study reveals that a quarter of UK citizens spoil their Sundays by working, worrying about work, or stressing about the working week ahead. The British already work the longest hours in Europe and have the shortest holidays, and almost one in three say they are too exhausted at the end of a busy week to do anything on Sundays except watch television or catch up with household chores.

    The Guardian Weekly reports an ICM poll of a thousand adults which found that less than a quarter associate Sundays with having fun. Almost half of all 18-24 year olds said they were too exhausted after the working week to do anything except worry about what the new week will bring.

    Source - The Guardian Weekly 3 September 2004 "Sunday not restful for many workers"