8 Feb 2023

Watch: TVNZ/RNZ merger scrapped, income insurance and hate speech laws delayed

3:06 pm on 8 February 2023

Prime Minister Chris Hipkins has confirmed the TVNZ/RNZ merger will be scrapped and other policies including the income insurance scheme and hate speech legislation at least delayed.

RNZ and NZ On Air will receive a funding boost to strengthen its public media role, the biofuels mandate will be halted, while potential changes to the Three Waters project will be considered by Cabinet soon.

He has also announced a new $1.50 minimum wage increase to $22.70 an hour, which would apply from 1 April.

Hipkins made the announcement after today's Cabinet meeting, the first of his planned cuts to the government's work programme with the aim of refocusing on cost-of-living pressures.

"I want to be clear here that we hear from people that a lot of these things are good ideas and worth pursuing but now is not the right time to forge ahead with them.

"I said the government is doing too much too fast, and that we need to focus on the cost of living. Today we deliver on that commitment.

Hipkins said these would not be the last policy changes that would be made, "but they are some of the most substantive".

"Work will continue to explore ways to best address these inequities in the long term when the economy is better placed to make change. But it is off the table for now."

The decisions made today were likely to have saved somewhere in "the low hundreds of millions" over the four-year Budget cycle, he said.

They follow confirmation a week ago of the continuation of reductions on fuel tax, road user charges and public transport fares.

Merger scrapped

Hipkins said work on the TVNZ-RNZ public media entity "will stop entirely".

"Support for public media needs to be at a lower cost and without such significant structural change."

The government did not have a final figure on how much has been spent on the RNZ-TVNZ merger, Hipkins said.

"We will provide a financial breakdown of that ... there has been investment in it up until now.

"I don't want to look backwards, I'm looking forwards. There's no question that the broadcast media landscape has changed significantly. The private sector are experiencing that as well, so I think it is important that government looks to how we can best support making sure that there's quality New Zealand content available to a wide range of audiences.

"I think there's an easier way of doing that and ultimately that's the decision that Cabinet has supported today."

He said he was not "taking the easy way out" on a political decision.

"I've set out the way forward for the government, it's the way forward that I support. It's my paper that I took to Cabinet and so of course I support it."

He said RNZ was likely to need about $10 million to ensure it could be sustainable, and the broadcasting minister would bring further options to Cabinet for funding a way to reach underserved audiences.

"They have cost pressures to meet regardless of whether there was a reorganisation or not.

"Five and a half years is a long time, and during that time the media landscape has continued to change, so if you look at discussions other media players were having ... there's very different discussions happening now."

He said some of the funding reorganisation from the scrapping of the merger would not need to wait for budget processes.

Some of the options now the merger is off the table included issues around TVNZ's letter of expectations, and a charter had been tried in the past.

"I wouldn't discount those options as potential ways forward within the existing structures we've got."

Income insurance scheme

He said the social insurance scheme was "off the table" and would not proceed until New Zealand saw a "significant improvement in economic conditions".

"Work will continue to explore ways to best address these inequities in the long term when the economy is better placed to make change, but it is off the table for now.

"We have to recognise that there isn't the public support for this scheme at the moment."

Hipkins suggested changes to ACC could be another way of resolving some of the inequities the social insurance scheme would have aimed to reduce.

The government had launched a discussion document on the concept - which would have seen workers who lost their jobs paid up to 80 percent of their income for up to seven months - in February last year.

It would have been managed by ACC and funded through contributions from workers and employers of an estimated 1.39 percent of workers' income each.

The government never campaigned on the scheme during the last election. Instead it was designed in collaboration with Business NZ and the Council of Trade Unions after they came to the government requesting one - but the government proposal went further than the initial idea and Business NZ soon began opposing it.

National campaigned against it, saying it was a "jobs tax", while the Greens also opposed it on the grounds it risked embedding a two-tier system.

Hipkins said it would remain off the table at least until the next term of Parliament.

"There's an election between now and then, we'll have a manifesto and people will be very clear what is on or off the table during that process".

Hate speech laws

The government had already severely reduced its initial plans to change hate speech laws, with Justice Minister Kiri Allan last year announcing it would be restricted only to a change around incitement against religious groups, with other aspects referred to the Law Commission.

Hipkins today confirmed that would also be postponed and referred to the commission.

"This will allow the Law Commission the opportunity to consider a difficult and highly contested area of law in totality," he said.

"This decision allows them the opportunity to consider a difficult and highly contested area of the law in its totality. The Law Commission's got a good track record on developing guidance on difficult issues and often in the past helped to generate cross-party support for those issues and that's what we hope to achieve here."

Hipkins said the hate speech changes were a contentious area of law, and would have consumed the government's time and energy at a time when it needed to focus.

"I would rather we took a step back and tried to reach that political consensus that we have been able to reach on issues that the Law Commission has considered in the past.

"Anyone who's read the Royal Commission report following March 15 would have to acknowledge that there are some very legitimate issues that have been raised, but I don't want to have them mired in a debate which is going nowhere, which frankly is where the debate has been going."

Biofuels mandate

The biofuels mandate - which would have required petrol and diesel to contain a percentage of biofuel made from renewable sources - was also consigned to the flames of Hipkins' regulatory fire.

"Introducing a biofuels mandate will increase the price of fuel and given the pressure on households that's not something that I'm prepared to do at this time," Hipkins said.

"The government still has a comprehensive emissions reduction plan to reduce emissions across the economy and that will continue."

He said the government had work to do to try to fill the hole in the carbon budgets left by the decision.

Some environmental advocates had said it was merely "greenwashing" and New Zealand could not domestically source enough of the waste required to meet the demand.

The plan was first announced in December 2021 and had been due to take effect from April this year - until Minister Megan Woods delayed it by a year in November.

Three Waters

On Three Waters, he said the need for reform was "unquestionable" with recent flooding in Auckland demonstrating the limits of the infrastructure, but would need to be carefully considered whether the changes - some proposed, others already set down in law - would be fit for purpose.

"Cabinet has asked the new minister for local government to report back on options for refocusing the reforms and that will mean seeking further feedback from local government and from Māori."

He said it was fundamentally about infrastructure, the cost of living and the quality of life for New Zealanders.

"We'll work through those options carefully and that process is likely to take a few more weeks."

"All ministers will continue to review their work programmes to see if there's more tightening work that we can do."

Ahead of today's decision, Hipkins had largely refused to be drawn into ruling in or out policies so far - but said he would not be ditching Three Waters entirely.

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