Douglas calls for flexible award system

Press, 11 April 1989, Page 5

Douglas calls for flexible award system

By

DAVE WILSON

The rigidity of the New Zealand labour market meant that economic growth in the 1990 s might not necessarily bring with it growth in jobs, according to the former Minister of Finance, Mr Roger Douglas.

Addressing a group of Christchurch business people yesterday, Mr Douglas said the enormous potential for employment growth in areas such as tourism was being blunted by an outmoded employment award system.'

He told the Institute of Chartered Secretaries and Administrators that a more flexible award system was needed, and an up-to-date definition of a 40-hour week. "In the case of tourism the award system is basically structured around 6 p.m. closing, which does not work today. There is enormous job creation potential in tourism, but people won’t come to New Zealand if a holiday here is too expensive. The rigidity of the award system is a real block to growth in that area.”

Mr Douglas’s style was low-key and offered few hints of a possible leadership challenge within the Labour Party, although political observers expect this to be signalled when Mr Douglas addresses another meeting in Christchurch today. His address yesterday was on the theme of what New Zealand needed to do to assure prosperity in. the 19905. Policies already in place would create the climate for growth, with low inflation, he said. The role of the politician needed to be defined. “If we are going to solve our problems the politician must understand his role, which is to establish the over-all framework, the goals and objectives,

and very little else. “Too many politicians lose sight of the objectives and the means become more important than the end objective.” Although politicians believed they ran the preS.O.E. departments, the truth was that politicians did not know what was really going on in these departments, or have the time or ability to get the departments on the right track.

Mr Douglas outlined the economic benefits from restructuring, quoting as examples Coalcorp, Railways and forestry.

The area of social policy still had to be tackled. “We have not necessarily got the framework and strategy right yet.”

Mr Douglas believed objectives for the health system needed defining. “The end goal should be to give adequate health care when it is needed.”

On wider areas of social policy he felt the social welfare structure needed an overhaul.

“We all want to help people in need, but help them in a way that encourages them to help themselves.

"The worst thing you can do is make people dependent on you, and the State does that. The present structure of the social welfare system places people in a poverty trap.

' “There are a lot of people in New Zealand who believe it is better off to be on the dole or the D.P.B. than trying to get a job.

“It is absolutely ridiculous that the highest taxed people are the lowest income earners. That, to me, is absolute madness and I tried to do something about it in the December, 1987, tax package,” a proposal cancelled by the Prime Minister. Mr Douglas said that the hallmark of the Labour Government had been its attack on “the bastions of privilege.” “The question for Labour now is whether we can deal with the militant Labour trade union and the soft social provider interest groups in the party, the sort who demand ever increasing sums of money from Government without being accountable for its use.”

Mr Douglas said these groups were “quite strong” in the party and it was important for the party to be seen to tackle the special privileges demanded by these groups.