28 Feb 2009

Nine-day fortnight floated as way of saving jobs

9:40 pm on 28 February 2009

A major one-day jobs summit has produced a list of 20 ideas, one of which would see workplaces operating nine-day fortnights as a way of saving jobs.

About 200 representatives of business bodies, companies, local authorities, unions, banks and the Government attended the summit at the Pacific Events Centre, Manukau, on Friday, seeking ways of saving the New Zealand economy from the global crisis.

Reducing work-hours to nine days a fortnight was one idea put forward. On the 10th day workers could do training, with the Government picking up half that day's pay.

Prime Minister John Key told Checkpoint that he saw benefits in the move: rather than see workers laid off, the Government would consider providing funding for training.

"It can keep a lot more people employed, but it can also make sure that when we come out of the recession we've got an economy that has a workforce that's better skilled and better prepared to cope in the modern economy," Mr Key said.

Business New Zealand chief executive Phil O'Reilly said there was strong support for the idea at the summit, but warned that it would cost the Government a fortune if every employer did it.

The big issue, he said, was how to design a system to rescue some businesses without penalising others.

National Distribution Union secretary Laile Harre said that if the idea was implemented the Government would have to offer workers some compensation for lost earnings.

Two-thirds of workers earn less than $15 an hour, she said, so any drop in income would drive families into poverty.

The Government will start costing the top 20 recommendations on Monday, with final decisions likely to appear in the Budget in May.

Reserve Bank view

Reserve Bank governor Alan Bollard spoke of the economic situation as the biggest ever destruction of global wealth, with costs running into trillions of dollars.

In his address to the summit he outlined the slump in growth experienced by New Zealand's trading partners, and said the Reserve Bank will be doing its part to ensure that monetary policy is "appropriately stimulatory".

Dr Bollard said New Zealand banks have done very well over the past few years and now have a key role to play in the tighter economic times.

Mr Key praised the ingenuity of bankers who suggested an investment fund for struggling businesses made up of government and private sector money.

Participants said it would help otherwise sound firms squeezed by late payments, as well as provide capital for investment.

Tourism, compliance cost proposals

Other proposals put forward included reducing compliance costs and a moratorium on standards for water and air quality.

Local Government New Zealand president Lawrence Yule said that would also keep people in jobs.

He said the nearly $1 billion that councils needed to spend from 2013 on upgrading water supply schemes would be better used on other infrastructure, because it would create more jobs.

Some delegates, including tourism operators, suggested a $15 departure tax to generate an additional $60 million to help market New Zealand.

Summit a success, says union

The Engineering, Printing and Manufacturers Union hailed the summit as a success, saying there was good discussion about issues facing the workforce.

One idea thrashed out was the ability for employers and workers to agree to unpaid annual leave without Government intervention.

EPMU national secretary Andrew Little told Checkpoint there are several issues in the proposal to consider.

Mr Little said the biggest risk is that employers could get agreement from some workers, but not all, which would lead to unfairness and inequality problems.

Call to employ more Maori

Maori who attended the summit called for public and private sector employers to make a deliberate effort to employ Maori staff.

Business Roundtable chairperson Rob McLeod, of Ngati Porou, told Waatea News that continuing a situation in which the Maori unemployment rate is more than twice that of the general rate is bad for the country's long-term prospects.

He said locking Maori out of the workforce is a recipe for more crime and welfare spending.

Maori Affairs Minister Pita Sharples said he was impressed that people were prepared to set aside their own sector interests and work with others at the summit on finding solutions.

One suggestion was a $600m fund for Maori development. Maori Party president Whatarangi Winitata said the Government spent a lot of money on Maori, yet little of that was under Maori control or direction.

Associate Maori Affairs Minister Georgina te Heuheu said the summit highlighted the need for Maori to improve their educational performance.