Red Alert

Archive for the ‘Household income’ Category

Equal pay : What would you do about gender pay discrimination? Labour Leadership Q&A #4

Posted by on September 11th, 2013

14 Questions for 2014

Virtual Hustings Meeting – Question 4

Equal pay : What would you do about gender pay discrimination?

Explanatory Note: From September 10th to 14th 2013 as part of the official selection process for a new leader the New Zealand Labour Party is holding a “Virtual Hustings Meeting” hosted by Red Alert and organised by Scoop Amplifier. Over 7 days questions were solicited from eligible voters in the election. The questions and answers are now being posted as a set of 14 posts at the Red Alert Labour Party Blog starting yesterday (Tuesday 10th September), till Friday 13th September. At Red Alert all-comers are welcome to discuss the answers in the comment section of the blog. The three candidates are expected to participate in these discussions at times over the five days till Saturday 14th September.


Question : Gender pay discrimination in NZ is a reality. The recent ruling in the Kristine Bartlett/SFWU case gives some hope. How would your leadership promote progress on achieving equal pay for work of equal value?

Submitted by : Lesley Soper, Invercargill



Answer from Shane Jones

The previous Labour Government made progress in this area.

It increased the wages of nurses.

I will use my position of leadership to ensure that the States resources are spent to give concrete improvement towards pay equity.

This is a core feature of Labour Party strategy and will not be neglected if I am leader.


Answer from Grant Robertson

I am really proud of the work of SFWU, Kristine and her lawyer Peter Cranney in getting that ruling.

It offers the prospect that equal pay will now become a matter of common law, and we will not need legislation to ensure it.

But we must be vigilant. National has no commitment to equal pay, and if legislation is needed, just as previous Labour governments have done we will pass it.

An immediate increase to the minimum wage, scrapping the Youth Rates, support for the Living Wage campaign and re-establishment of the Pay and Employment Equity Unit within government are also important parts of ensuring that we achieve equal pay for work of equal value


Answer from David Cunliffe

I believe we need to lead by example. National has not been ambitious for women. When National took office, there were 1153 women in boardroom positions. Today, there are only 1059, and falling. Government has a role to play in setting a leadership example, that is why I am committed to no less 50 % of the Labour caucus being women by no later than 2017.

Labour has a strong record of working to address gender pay inequality.

I am committed to investigating legislative and policy changes to close the gap based on the work of the Human Rights Commission and the Pay and Employment Equity Unit. This includes, recognising the right to equal pay, a positive duty to advance equality, and a mechanism to determine work of equal value.

I am also supportive of ensuring information about pay rates are made available so that comparisons can be made and unfair inequalities in pay rates between men and women are revealed.


It is happening around the world

Posted by on April 22nd, 2011

The final decisions on the last Key/English budget were taken earlier this week. I’m told the cuts are massive, going right to the core of what we value as New Zealanders. But we are not alone. Manny Herrmann of the AFL-CIO writes :-

On April 15, nearly every House Republican voted to give massive new tax cuts to corporations and the rich while demolishing services for seniors, children and low- and middle-income Americans.

This isn’t a budget bill—it’s a political payback bill that raids Medicare, Social Security and education to reward corporate CEOs with massive tax cuts.

BUDGET 2010: Jigsaw Pieces Click

Posted by on June 1st, 2010

The jigsaw pireces of the Budget are starting to click in the public mind if recent polls are any indication.  In the last week :

  • The IMF described NZ’s savings gap and net international indebtedness as “among the largest of any advanced nation”
  • Analysis shows a $9.2bn additional fiscal hole in the Budget by 2023 arising from the tax changes
  • Budget documents show expenditure as a % of GDP falling from 33% to 28%
  • Bill English floats Kiwibank sale as one example of a number of SOEs ripe for partial privatisation.

In other words: give away taxes up front (very largely to their mates); run an out year deficit (deliberately); compress spending (as ‘prudence ” then demands); and flog off what is left of the family silver to fill the remaining gap (dressed up as mum and dad savings products, of course).

What does all this mean for the average Kiwi?

  • despite the govt spin, they are worse off for the next four years at least due to the toxic cocktail of GST, inflation, other govt charges and taxes, and slow wage growth;
  • public services like Heatlh and Early Childhood Education will be slashed as new spending lags inflation ($300m short in Health) or deliberate policy changes bite;
  • the outlook for public services gets dramatically worse as the National Party tries to resize the state to 28% of GDP – although they won’t want to talk much about that before the election;
  • the underlying economic problems reamin unresolved and get more intractable over time.   There is no credible plan for growth and jobs.

Moral of story: do NOT let National get a second term   Stop the malign juggernaut before it does irrepairable damage.

ECE Budget cuts focus of Dunedin meeting today

Posted by on May 24th, 2010

Cuts to early childhood education could have one of the big impacts to our economy as thousands of parents weigh up whether they can afford to have have both parents working.

I’ve been told by Dunedin ECE centres that parents of children under three will be hard hit by the Government’s Budget and face an increase of $42.50 per child per week.

I was approached by ECE providers a few weeks ago concerned about the imminent budget cuts.  Today Labour will hold a community meeting to discuss the  cuts attended by Dunedin’s Labour MPs and our Early Childhood Education spokesperson Sue Moroney.

The Budget cuts will hit working families who rely on quality childcare. The impact will be enormous throughout the economy as parents weigh up whether they can afford to have their children in childcare.

These fee increases will more than eat up any tax cut received by parents. On top of that they will face increases in GST, ACC and increased inflation.

In Dunedin, there are more than 8000 children enrolled in ECE services. Parents with children aged three and four will also be hit as fees go up across the board and centres are forced to employ lesser qualified staff to remain viable.

We have estimated that when inflation and a rise in early childhood education (ECE) fees are taken into account, the average family, with 2 children will be at least $55 a week worse off.

And that’s just one issue. Currently ECE centres are encouraged to have 100 per cent registered teachers, but from early next year, the funding rate for registered teachers will be lowered and will be given only for up to 80 per cent of a provider’s registered teachers.

The result is there will be little incentive for providers to have more than 80 per cent registered teachers.

Just before the Budget was announced, both Anne Tolley and John Key attended the NEiTA teaching excellence awards in Parliament.

Both Sue Moroney and I attended that ceremony alongside St Clair ECE teacher Karen Brown (from my electorate) who won an excellence award.

It’s ironic that the PM and Minister of Education attended a ceremony that celebrated excellence in teaching, an hour before they announced cuts which would compromise excellent teaching.

Public meeting: 10am Mornington Presbyterian Church

BUDGET 2010: Pass the Berocca

Posted by on May 21st, 2010

After the beehive-spin induced euphoia wears off and the hangover sets in, middle New Zealand will reach for the Berocca and try to work out what the Budget really means for them.

Not to add to the inevitable headache, but here are a few of the facts of life for the morning after.

  1. For at least 3/4, and maybe 90% of the country, by the time they eat a whopping 5.9% inflation next year (Treasury Budget forecasts, not NZLP numbers!) they will be worse off until at lesst 2012/13.   For a family with 2 kids on $72k for example, $55 a week worse off.
  2. That inflation will feed into mortgage costs and rent rises.  It will result, quite rightly, in pent up wage demands from workers who have gone without wage rises for the last two years. 
  3. While its ok that the middle income brackets got some income tax relief, and would have likely got more relief from us, the tax cuts are way too skewed to the top.  You just can’t get around the fact that someone earning a $million a year gets $1000 a week back.  That is going to make the haves/have nots gap wider.  And that gap will inevitably worsen over time, undermining the Kiwi dream and taking us further from the “fair go for all” kind of place we want to be.
  4. That is made worse by the underlying agenda of shrinking the state and the services it can provide.  We have already seen home help for the elderly branded “low quality” spend and cut.  Health’s new money in the Budget is, we reckon, about $270 m short of standing still given next year’s inflation forecast.  That means more cuts to the services and more pain for the vulnerable.
  5. My personal gripe is early childhood education.  What has the Govt got against quality preschool education?  Why is it swiping $100m pa from that?  Labour will lead in this area and every family with young kids will hear us. 
  6. Rebalancing the econmy is way undercooked.  Take away the smoke and mirrors of the tax switch, and we are still left with residual taxt incentives for property and LAQC avoidance mechanisms.   Proof:  LAQCs sheltered $2.3 billion of taxes in 2008.  The tinkering in the Budget trimmed only $70m p.a. of that.  
  7. There is STILL no credible plan for growth in this Budget.  The National Govt seems intent in relying on “passive” instruments. I have no problem with dropping the company rate – provided the fiscal balance can support decent public services (personal view – see “About” on the blog site) – but that cannot be enough to get the export sector going on its own.  What about the R and D tax credits?

The strucutral problem remains: we don’t export enough, we don’t save enough, and we don’t innovate enough.  As an economy we are short on capital, technology, skills and IP.  Budget 2010 does not fix that.  Time is short and the job is urgent.  When NZ wants positive action, Labour will be ready to lead.

As the bubbly wears off in the Beehive and the Berocca gets passed around the country; the poor, the forgotten middle class and the structural problems of the economy have not been moved forward by this Budget.

It remains a suger-coated tax swindle.

It remains a step back, not a step up, and certainly not a step change.

Finance Team Budget Discussion

Posted by on May 18th, 2010

On Thursday evening at 8.30pm, I will be hosting a discussion with other members of the Labour Finance team about the Budget. This will be filmed and streamed live at:

There will be the ability for those watching to chat with others around New Zealand who are also tuned in. We will be monitoring the comments and will hopefully be able to answer some of your questions during the session.

If this works well, then we hope to turn it into a regular feature.

If you’d like to be automatically reminded prior to the event just fill in your email below.

Beware English Bearing Greeks

Posted by on May 5th, 2010

In terms of the daily cut and thrust of the House today, Bill English backfired (IMHO).  Comparing the New Zeland economy to that of Greece was wrong on every level.

First, there is no comparison.  Greece is far and away one of the most indebted countries in the OECD.  NZ is in the bottom third or quarter by various measures.  Greece has gross crown debt of 115% of GDP.  NZ had net crown debt of zero % under Labour in 2008, rising to 5% by election time due to the GFC.   NZ gross crown debt today is about 29% .    

Second, to the extent that NZ hit troubled waters in the GFC, most of that is on National’s watch.   That is not to blame them for the international crisis, but then theycannot blame Labour either – the whole argument is silly and circular, and patently so.

Third, NZ stacks up very well on the other aggregates too:  Greek unemployment nearly 11%.  NZ now 7.3%   NZ under Labour 3.4%.

Fourth, a Minister has no responsibiity for opposition policies anyway, and especially when he is simply making them up, as Mr Speaker confirmed.  That is simply outside Speakers Rulings. 

So what exactly was Bill English’s point?

Underneath this attempt at deflection is of course a deeper issue:  English is desperately trying to convince Kiwis they need to swallow savage service suts in health and education because the alternative is “Greece on steroids”… Really?  Or isn’t that just a teensy bit exagerated, Bill?

Of course prudent fiscal managment matters.  We have always said so.  Labour’s record on this is unimpeachable: Gross debt cut in half, net debt to zero; historic lows in unemployment; higher average growth over the decade than under National; the longest post war expansion on record etc etc etc.

Point is: fiscal prudence is a necessary but not a sufficient condition for a coherent economic strategy for good jobs and living standards and the other things that really matter to ordinary Kiwis.  That’s why labour is challenging National at the heart of the economic debate: on jobs and growth.   Why we are emphasising the need to close the other deficits in exports, savings, innovation and social issues.  On boosting valued added and clean technologies.

See the post below (Building to the Budget) for more detail.

Food for Thought

Posted by on April 8th, 2010

Over Easter I had a chance to get into our vegetable garden.  Harvested the last of the tomatoes, some chillies and got things tidied up for planting more cauliflower, broccoli and broad beans.   Most of my life I have had a vegetable garden and have been able to grow some of the food I eat, an enormously satisfying experience I worry is increasingly less common.

Fruit and vegetables have come up quite often in recent conversations.  I hear about (and see) the good work happening in a number of our schools where vegetables are grown and compost bins tended.  A budget adviser told me that in England there is a requirement for schools to have fruit trees to give students access to fresh fruit.  I’m not sure how this works but it didn’t seem to be a bad idea.  Both of these approaches provide fresh healthy food to young people (for some, from families struggling to make ends meet and where food is scarce, this is a practical help)  and show young people that food is something you can grow (not just buy in the supermarket). 

In fact in a country like New Zealand with a natural advantage in producing food we should maximise opportunities to encourage people to grow food.  Even those with limited space can grow produce like tomatoes and salad greens in containers.

It is scandalous that fresh healthy food which we can grow easily is as expensive as it is.  It is not the producers who are making huge profits from fruit and vegetables but supermarkets are a different story.   I was interested in a feature in the Sunday Star Times particularly the comments about industrialised (processed) foods, the food industry, natural foods and about the importance of cooking (another skill that is not as widespread as it once was it seems).  

Food is one of our fundamental needs.  Despite this as a result of poverty too many people globally including some in New Zealand do not have  an adequate and regular supply of the food they need.   Food is something that is huge business.  If you look at the worlds largest companies food producers and retailers are right up there – huge, profitable global corporates with enormous purchasing and marketing power.

For all of these reasons (and for our health) lets ensure we hold on to the skills of growing and cooking  food.

On the local and immediate, one final request following a conversation with a local food bank – if you have surplus fruit or vegetables give it to the food bank.  They are generally unable to provide fresh food and some of the food that goes to waste (think ahead to the forthcoming feijoa season) can make a difference.

Household income makes tax cuts fair..? Ahh no.

Posted by on February 16th, 2010

Yesterday David Farrar put up an interesting post at Kiwiblog titled ‘all theory no reality’ ‘(  He critiqued a post by No Right Turn on income distribution on the basis that it “gives us a great example of the difference between an academic theoretical analysis, and understanding the real word.”

David wrote: “You see in New Zealand, we have these things called families and households. What No Right Turn sees as a mass of poor people who will be unaffected by tax cuts, are spouses, older children, many students and even parents of those who do earn more than $23,000 a year, or even $48,000 a year.” 

“If a family has one parent earning $60,000 a year, and one on $15,000 part-time, they both benefit from a change to the 33% tax rate. Because they are a family!! …. So ignore the stupid stats and graphs about individual incomes. They are relevant to academic theory, rather than the real world. Household Family income is what affects most people. Now as of June 2009, the median household income was around $64,000. 30% of households have income over $93,000.” 

The medium household income is actually closer to $60k David.  This means that over 800,000 kiwi families are living on a combined household income of $60k or less; out of which has to come food, rent/mortgage, clothing, school uniform and books, telephone, petrol, rates, repairs, doctors etc etc (which will all increase due to GST rising). 

The tax cuts floated by the National govt with give PM Key an extra $500/wk in-the-hand and the CEO of Telecom an extra $2,500/wk in the hand.!!!  I suspect those families surviving on $60k household income will see the inequity and unfairness of the proposed tax cuts, even if Mr Farrar can’t. 

Household income deciles Number of households Percentage on or below this income
1 – 10K 20,300


10 – 20K 149,200


20 – 30K 188,400


30 – 40K 163,500


40 – 50K 146,500


50 – 60K 138,900


60 – 70K 111,300


70 – 80K 104,200


80 – 90K 93,900


90 – 100K 72,100


100 – 110K 61,300


110 – 120K 60,900


Total Number of Households 1,609,100  

I also love this line from David in the same blog: “..But if you are retired and earning just $25,000 a year, that doesn’t mean you are against tax cuts, because you are happy that your adult children will benefit from them.”  Of course, that’s right David – mum and dad can shiver through winter (powerbills have GST, and we know how high they go), but if the kids are lucky enough to be one of the 9% in the top tax bracket, then all will be fine because they can now afford that winter holiday in Fiji…!  What about the parents whose children are one of the 800,000+ kiwi families struggling on $60k household income.?  Suspect they also will see the gross inequity and unfairness in the govt’s proposed tax changes…

So perhaps Mr Farrar should take his own advice.  Stop worrying about the theory, and focus on the real world.