11 Dec 2023

100-day plan: Minister on repealing FPAs and extending 90-day trials

From Checkpoint, 5:42 pm on 11 December 2023

The new workplace relations minister says it is possible an enthusiastic supporter of the government's scrapping of Fair Pay Agreements (FPAs) is behind the leak of a sensitive Cabinet document. 

The new government had been together barely than a week when secret papers for Cabinet ministers' eyes only were leaked to the media.

The papers contained official advice from the Ministry of Business, Innovation and Employment (MBIE) that FPAs - put in place by the previous Labour government - would have benefited Māori, Pacific People, women, and young people the most.

MBIE is investigating the source of the leak, which Prime Minister Christopher Luxon told AM on Monday morning was definitely not the fault of a Cabinet minister.

"That's why you saw MBIE proactively, on its own volition, actually raise the issue with us and say it would commence its own investigation."

Workplace Relations Minister Brooke van Velden of the ACT Party told Checkpoint on Monday afternoon she agreed with Luxon. 

"No, I don't believe that it's our ministerial colleagues. But what we do know is that there is an investigation, and I will have some more details hopefully by Wednesday on what they find.

"But I also do want to stress that there are good people in our public service who are working very hard for this government, and I am disappointed of course that this leak has happened - but that's not going to stop us doing what people voted us to do.

"And I just take the point that maybe someone was so excited on our 100-day plan that they just couldn't wait to share it further."

She said whoever did it, whatever their motivations, they had let the public service down.

Van Velden also hit back at the Council of Trade Unions (CTU), saying she did consult with them before announcing the repeal of FPAs before Christmas. Parliament was set to go into urgency to get it done. 

CTU president Richard Wagstaff said van Velden had "categorically not" consulted with unions on the changes, but she maintained she certainly did.

"I disagree with that. I mean on your competitors channel on ZB last week, Richard Wagstaff said that I had mentioned to him that I was going to follow the coalition policy, and by his own admissions on his own website, he acknowledges that that was to repeal the Fair Pay Agreements.

"If you read the document, it says that we're repealing them by Christmas. So yep, you can say what you'd like about whether or not the meeting happened. I've always been clear the meeting happened, we let them know about our decision - to follow what New Zealanders ultimately voted for."

As for whether there was advice repealing FPAs could drive wages down, van Velden said "no". 

"What I have got here is advice that was part of the previous government for when Fair Pay Agreement legislation went through, I haven't received further advice from MBIE from that. 

NZCTU President Richard Wagstaff

Richard Wagstaff. Photo: RNZ / Samuel Rillstone

"But on that advice, MBIE recommended against going ahead with the Fair Pay system, saying that it would impose too many costs on businesses and it wasn't a good policy. So there isn't any further advice there."

MBIE's advice, released in 2021, also noted employees would be better off up to $600 million under FPAs, and that a ban on strike action during bargaining was a breach of international labour law.

Asked if she was "comfortable with the fact that Māori, Pasifika and women could be more disadvantaged" by the move, van Velden said repealing FPAs would give them more employment opportunities.

"Well, look, I admit that it is really tough for people. You know, we are hearing this time and time again from people who are struggling to make ends meet and with the cost of living as it is across the board, our government expects to make it better for all Kiwis to have a better cost of living. That is how we make it better for Kiwis.

"When we add more costs onto businesses without allowing for better outputs, we simply add costs to consumers and make it harder for businesses who may need to close. It is hard for people, it really is. It's also really hard for businesses to make ends meet as well. I always hear from businesses when I'm out in the community saying that they would love to pay their staff more, but every added regulation by this government (sic) makes it harder and harder.

"So, yes, we want higher wages, but it's just how we get there that's different from the previous government."