Kinleith intervention to stop wage spiral — P.M.

Press, 28 February 1980, Page 2

Kinleith intervention to stop wage spiral — P.M.

PA Wellington The Government had intervened in the Kinleith wage settlement to stop a further wage-price spiral, said the Prime Minister (Mr Muldoon) yesterday. “This is the reason why the Government is intervening — not a question of 2| or 3 per cent, or not a question. of wanting to be difficult or prolong a strike,” he said. “We are stopping a further wage round which would go right through industry — first Auckland, then the rest of the country, and thus a continuation of the wageprice spiral.” Mr Muldoon was speaking at a specially called news conference. He said some aspects of the Government’s action were not clear and had not come out clearly. If the settlement between N.Z. Forest Products and the unions reached at the weekend had been allowed to stand it was very clear that unions believed the Auckland core rate of about $4.46 an hour would be affected, Mr Muldoon said. The core rate had traditionally been tied to forest industry rates. Mr Muldoon said a union advocate, Mr J. Butterworth, was alleged to have said when the settlement was reached: “This is the end of the Auckland core rate.”

The $4.69 which N.Z. Forest Products had offered up to Friday was the Auckland core rate plus an allowance of about 5 per cent for extra production through working 363 days a year, he said. This figure, which the Government is insisting on instead of the $4.81 reported to have been the final figure agreed on, was logical and meant the Auckland core rate was not affected, Mr Muldoon said. “That is the logic of the $4.69 settlement and it would overcome any suggestion that now the Auckland rate has got to be brought up to the forest industry rate,” Mr Muldoon said. The trade unions were well aware that the Government had acted to stop a further wage spiral, he said, adding: “That is what is behind a good deal of the posturing that is going on at present.” Mr Muldoon said he had heard Mr Butterworth on the radio “rather mildly disclaiming his association with the Socialist Unity Party.” Mr Butterworth was • a foundation member of the S.U.P. in 1966 and a member of its committee, although he was probably not a financial member at the moment, Mr Muldoon said. “He is a publicly self-con-fessed Marxist and Communist and has been working closely with Andersen and his people in this issue and - indeed leading . it.” he said.

A statement by the managing director of N.Z. Forest Products (Mr D. O. Walker) that the company had no warning that the Government would intervene was incorrect, Mr Muldoon said. The Minister of Labour (Mr Bolger) had spoken to Mr D. H. Wylie, the company’s advocate, who had confirmed that the Minister had talked to him about possible Government action early last week. At the same time, Mr Bolger had talked to the president of the Federation of Labour (Mr W. J. Knox) at the request of the Cabinet and told him that if there was a “lush” settlement the Government would have to intervene and make a regulation, Mr Muldoon said. “Mr Walker is not correct in saying they did not have warning,” he said. “It was not to him personally. It was to Mr Wylie, the one who has been doing most of the negotiating; and I think Mr Walker’s statement is quite unfortunate. “He may have made it in ignorance but he did not need to make it at all.” Answering questions about the earlier, higher Kawerau settlement, Mr Muldoon said this was 10.4 per cent above the core rate and was the percentage that had gone right through the wage round. “The damage at Kawerau

was done last year,” he said. The Government had considered intervening in the Kawerau settlement but did not think it was justified in doing so because the settlement in itself did not affect the Auckland core rate. Mr Muldoon said regulations cutting back the Kinleith settlement would be approved when they were drafted and printed, perhaps today. Asked if there had been any reaction to the Government’s intervention, he said the National Party’s Waikato divisional executive on Tuesday unanimously decided that the Government “had 100 per cent support.” The resolution was significant and welcome because the division did not “quibble about expressing dissent from Government policy.” Mr Muldoon warned again that the Government was getting “very close to the point” where it would end free wage bargaining. “I don’t want that to happen,” he said. Mr Muldoon, replying to questions on the S.U.P. role in the Kinleith dispute, said the party saw the dispute as a means of getting itself “off the hook” over the Sofinsky affair and its support for Soviet intervention in Afghanistan, and as a means of getting back “on side” with the trade-union movement.