Mr Shand Gives Reasons For Wage Decision

Press, Volume CVIII, Issue 31729, 12 July 1968, Page 1

Mr Shand Gives Reasons For Wage Decision

(New Zealand Press Association) WELLINGTON, July 11. If New Zealand was to remain socially and politically the most stable country in the world the Government must always be cautious not to intervene dramatically or oppressively where there was a conflict between sections of the people, the Minister of Labour (Mr Shand) said in Parliament tonight.

. “In every country the way the system works is not really intelligible except to those who are directly involved in operating it,” he said. “In every country the relationship is primarily between employers and their employees.

“But in every country, no matter how far the Government avoids or is excluded from the actual process of bargaining—and in no other democratic country is the Government so deeply involved as it is in New Zealand—there is deep concern as to what may happen if the machinery breaks down so that there is confrontation,” he said.

This confrontation need not merely be between one or two unions and one or two employers. It could involve almost the whole industrial life of the country. “In every country this possibility has to be contemplated and in the last resort the responsibility falls on the Government,” said Mr Shand The risk of such a breakdown was never far from the mind of a minister of labour. “Perhaps this makes us excessively cautious to avoid the spread of dissent. Perhaps some people would say ministers of labour are too prone to compromise,” he said. The basic legislation on which New Zealand’s industrial negotiations was founded was the Industrial Conciliation and Arbitration Act Superimposed on this was the Stabilisation Act. under which general wage orders were promulgated from time to time. "Increasingly, in recent years, the actual wages paid by employers are negotiated separately, outside the system.”

Danger Of System However, the inherent danger of the system was that it was becoming increasingly difficult for the ordinary man to understand it. “When the Prime Minister said last night that the Gov-

ernment was willing and anxious to review the operation of the stabilisation regulations and the other legislation and procedures with which it is associated, he was only repeating something about which the Government had been becoming increasingly anxious over recent years.

“There is an urgent need for a better understanding of our system,” he said.

The surprised, and in some cases hostile, reaction to the recent decision of the Court of Arbitration was not so much against the actual decision, because most people realised the importance of keeping down the country’s costs of production at this time.

“The surprise springs more from a failure to appreciate the responsibility of the Court as defined in the act and in the regulations which set down the criteria which must guide the Court,” he said. Popular View “There has been a widespread popular belief that whenever a substantial increase has occurred in the cost of living, the Court is obliged to make an order restoring—or partially restoring —the position as it had pertained immediately after the making of the previous order,” said the Minister. “I am certain that had the position been properly understood, the reaction to the Court’s decision would have been very much more sober.” Mr Shand said that for some years he had been concerned that a time might come when the Court felt obliged, in the terms of its directive, to make an order which conflicted with the popular understanding of the purposes of the act. The decision by the Federation of Labour and the Employers’ Federation to recommend jointly an immediate and substantial amendment to the Economic Stabilisation Regulations would have permitted the Court of Arbitration to reconsider the recent application on a basis which more nearly corresponded to the popular belief than did the regulations as they stood. “Many people's reaction to such a proposal was that it amounted to changing the rules in the middle of the game because one side was dissatisfied with the verdict. “Many more were most uneasy because they had no means of assessing how great the change might be, or what it meant,” he said.

“These doubts in the public mind were certainly in my mind and in the minds of all my colleagues and were reinforced after hearing the reaction of other parties to the Court of Arbitration hearing. “Against this very legitimate objection to taking the course of action proposed we had to weigh the possibility of serious industrial strife.” The decision of the Government had been against precipitate action, he said. “The parties have been told that they should settle their differences within the accepted rules and then discuss amendment if they will.” Minister’s Duty Some people had said he must have favoured the proposals, or he would never have brought the parties to-

gether knowing that such a proposal might ■ have emerged, Mr Shand said. “Let me say at once that I would still have considered it my duty to bring the parties together in the way I did had 1 believed the probable outcome would be a proposal to which I myself was opposed," he said. The press had sought his reaction to the Government’s decision, but he had not given them “much joy". “I am Minister of Labour and in this role I have a very wide delegated responsibility,” he said. “But the responsibility for a decision of this importance must certainly rest with the whole Government and not with one Minister alone. “If my advice were in favour of accepting the offer, it would certainly have been on a balance of advantage only. “I certainly do not consider my judgment infallible and I can assure the House that a Minister of Labour must very quickly become accustomed to people refusing to take his advice.”