For most New Zealander’s under about forty, the stories of industrial disruption in the 1970s and early 1980s seem like fantasy. The thought that a small group of members of the Boilermakers’ Union was able to hold up the construction of Wellington’s BNZ Tower or Auckland’s Māngere Bridge for years seems too far-fetched to be true. Yet it was, as was the regularity that the Cooks’ and Stewards’ Union or the Seamen’s Union were able to find an excuse to go on strike at various holiday periods, tying up the Cook Strait ferries and disrupting travel plans. And who would have ever thought a union secretary would be brazen enough to go on national television during such a strike to spit out “the travelling public can go to hell” as did the National Union of Railwaymen Secretary Don Goodfellow. Strange as it may seem now, this was all very much the way of the world then.

Thankfully, those days are behind us and a generally more reasonable industrial relations climate prevails today. But every now and then there is a return to a mild approximation of the old ways. Ironically, though, today it is more likely to be employer groups resorting to the tactics the media of the 1970s and 1980s would have screamed against as “bully-boys”, “stand-over tactics”, or “industrial muscle”. A recent example has occurred over a relatively innocuous Labour Party Bill to give more protection to contract workers in vulnerable situations. The Bill has been making its way through Parliament over recent months, with barely a ripple, but suddenly, the employers have noticed it, and they do not like it, so like the militant unions of old they have pushed the outrage button.

Of course, their means are a little different. Mass email campaigns from people put up by their bosses, having been told only a fraction of the story, and simplistic media bluster and derision are the modern forms of industrial bullying, but the intent is no less different from the unions of old – to get their own way, come hell or high water.

A reasonable person will quickly see the farce for the sham it is and ask the likes of the Employers and Manufacturers Association and Business New Zealand why the tub-thumping has been left too so late in the day. The truth in this instance is that both organisations have missed the plot altogether, have failed to understand or even take any notice of what was going on in Wellington, and have treated the Parliamentary process in a cavalier way bordering on contempt. After all, they are employers, and Parliament needs to bend to their will. So the fury overdrive had to begin at the eleventh hour. Consequently, they will have no credibility in the future when it ever comes to criticising unions for industrial behaviour, which seems foolhardy. It is also a salutary reminder that while conflict and bluster are easy to manufacture, which is why they resort to it, constructive engagement is harder and requires more effort. Ironically, again, that is the same argument employers have used to debunk union claims in the past, yet they see no shame in doing the same themselves when it suits them.

At least the militant unions of the 1970s and 1980s had a point of principle (albeit rather warped) behind their industrial arrogance – today’s employers are just more interested in covering their butts for their own ineptitude. Hardly a good look, nor a reason to take the future pronouncements of the EMA and Business New Zealand at all seriously.    

  

 

 

 

 

Last week’s flurry about whether Uber was complying with the law and should be shut down if it was not missed the point entirely. Of course, Uber should comply with the law of the land – that is a given for any business operating here – but that was not really the issue. The bigger point that no-one seemed even willing to acknowledge, let alone grapple with, was how businesses like Uber are changing business models across the world, and how inadequate current law is to deal with that change.

Companies like Uber, its accommodation equivalent AirBnB, the on-line retailer Ali Baba, even Babylon, the British on-line medical service are both everywhere and nowhere. They are everywhere in terms of their pervasive on-line reach across the world, but they are also nowhere in that they have no designated headquarters or tangible fixed assets. They operate literally in the cloud.

Yet our traditional business model is very different. Since the Industrial Revolution it has been the custom for businesses to operate from fixed sites, producing a range of tangible goods, that can be sold (and/or shipped) to merchants around the world, who then on-sell to local distributors to retail to the public. It has been possible at every stage to identify who the business was, where it was located, and for tax and customs authorities to extract their pound of flesh for national revenues accordingly. That is the premise on which the international trading system has been founded and still continues to operate.

The development of containerisation in the 1970s was probably the first chink in its armour because it allowed for the introduction of “just in time” production where goods were produced and supplied as needed, thus reducing the requirement for merchants to hold large inventories. This in turn led to the breakdown of tariff barriers, so that the role of the domestic wholesaler as the middle man with the large mark-up was steadily reduced. But the system still operated fundamentally as before, because of the constraints of shipping and communication.

As technology improved, and aircraft capacity dramatically increased, further cracks appeared. Warehouses the world over rapidly disappeared, leaving behind many derelict waterfronts, now being redeveloped as vibrant living spaces as a consequence. The development of the internet in the 1990s led to the rise of the e-businesses like amazon.com, or our own equivalent fishpond.com, and the rapid explosion of on-line retailing.

And then came the issue of how to tax these large on-line increasingly multinational ventures. The Google story, which frustrated governments the world over (including ours) because they paid so little tax everywhere, and gave rise to the creation of exotically named tax avoidance schemes like the Irish Wedge or the Dutch Sandwich, is  perhaps the classic, but by no means sole, example. And it led to the development of the OECD’s Base Erosion Profits Sharing programme in which New Zealand is playing a strong role to develop a fair and consistent way of taxing these multinationals across the world.

Uber and the companies like it are but the latest iteration of this dramatic change. And it will intensify. Business of the future will be as much the trade of ideas as business of the past has been the trade of commodities. New technology, the internet in particular, has broken both the tyranny of distance and the sanctity of national boundaries. Rigid national laws in New Zealand and elsewhere that try to enforce old ways of doing business are doomed to fail, as last week’s incident shows.

In Greek mythology, Sisyphus was pilloried for constantly pushing a heavy boulder uphill in a vain attempt to overturn reality. Today’s Sisyphusian equivalents are those regulators trying to make the likes of Uber fit the established business rules of conduct. It just will not work. For that reason alone, last week’s exchange should have been a significant wake-up call. Sadly, it seems it was just a regulatory irritant.          

   

  

 

 

 

 

Many of the 60,000 new New Zealanders each year deserve a better deal.

Numbers of them are forced to live in difficult circumstances; they are unable to fend for themselves, and no-one speaks up for them. Some are abused, others are assaulted or otherwise degraded. All are potentially vulnerable and we need to do better for them to avoid the opprobrium of the civilised world.

Already, the hackles will be rising amongst the racists and the xenophobes, the Trumpists and their acolytes in this country, who will be screaming in their ignorance why are we allowing these people to add to the pressure points they perceive to be already in our society, and why are we letting so many of them in every year. However, this group of 60,000 new New Zealanders a year is not made up of migrants or refugees, but is the number of children born in this country each year. Nearly 70% of them will grow up in a two-parent family; just under 20% will be raised in a sole parent household, and around 5% will have been born to a teenage mother. None of them will have any choice or control of their family circumstances, or how they will be raised subsequently, yet all of them will be profoundly affected by that environment.

Amongst these children are our future political, social services, academic and business leaders, our future sporting heroes and sadly, our villains. But whatever their destiny, they all have an arguably greater stake in the future of our country than we who have been around for a while. As a group, children under 18 years of age make up almost a quarter of our population. Yet few speak for them, and even fewer try to reflect their needs in policy formation.

That is what makes last week’s publication of a Children’s Covenant, under the guidance of Judge Carolyn Henwood, and Ngai Tahu leader Sir Mark Solomon so much more important. Their aim is as positive as it is stark – to “make a solemn and enduring covenant with our nation’s children, whoever they are and wherever they may be, in equal measure, those children who are born and those who are born in the future. We as New Zealanders undertake an unconditional duty to do all in our power to ensure that all our children are treasured, respected and enjoy a good life full of opportunity in a nation that is diverse and rich in culture and aroha.” Implicit in those goals is the recognition that every child has an equal right to access to opportunity in this country, every child has an equal right to access to quality healthcare and education, every child has a right to good housing and good prospects in life, and that the challenge facing all of us – and  that is what the covenant recognises—is to focus our efforts afresh on delivering those policies. It has often been said, but not yet achieved, that we have to put the interests of our children at the centre of government policies.

Against that backdrop, Parliament resumed this week to the usual cacophony of windbag rhetoric about housing and health, and all the hardy annuals, but amongst the shouting and the handwringing, the state of our nation’s children received no mention. Nor did the Children’s Covenant. Sadly, it seems, children are only of political interest when there is another horrific assault or murder, and an intemperate headline can be gained by strutting populists who can temporarily stop attacking other minority groups, like migrants, as the root of all our problems, to bang the law and order drum for a while. The cynicism is putrifying and sickening, yet incredibly there are New Zealanders prepared to lap it up. 

Our children simply deserve the best. We are failing them at present. The commitments contained in the Children’s Covenant are positive steps credible and responsible political leaders should willingly endorse, and seek to reflect in their policy deliberations. Yet so far, only three parties – the Greens, the Maori Party and UnitedFuture – have done so.

While the rest lag behind, our children suffer. For a country built on compassion for the vulnerable, that collective apathy is hardly something to be proud of

 

 

One hundred and forty years ago, in 1876, New Zealand abolished provincial government. From 1852, New Zealand had been governed through six Provincial Councils, similar to the Australian states of today, with the central government in Wellington having a much lesser role. However, while provincial government was abolished all those years ago in favour of a single national government, the inherent tensions between the provinces and the centre have never really been resolved.

Every now and then, they erupt into something stronger, usually associated with attempts by central government to “reform” local government in some way or another. At such times, the hostility and frustration each feels towards the other becomes that much more obvious. For example, a none too subtle subplot of the recent debate about the Auckland Unitary Plan has been a barely disguised central government view that the rigidity of the Auckland Council is a primary reason for the current housing situation, matched in return by an equally staunch view in Auckland that the problem rests with central government and its unwillingness to empower Auckland to deal with it.

Similarly, the currently rapidly erupting debate about central government plans to enable more shared services approaches to local service provision has local government seething that yet again central government is attempting to impose amalgamation by stealth on hitherto unwilling and unsuspecting local communities. For its part, central government sees huge potential efficiency gains in the delivery of local services being thwarted by the entrenched parochialism of local government unwilling to change. And so it goes on.

Worse, every government that takes office has local government reform high on its agenda. That reform is usually to undo the reforms of its predecessor, so local government is left caught in the constant tussle between those who seek to devolve more duties to them, and those who want to curb their activities to cut rates. So it was that the previous Labour-led Government introduced a power of general competence for local government, only to see that wound back by the current government, before it had really got off the ground.

This constant political tug-of-war has been the pattern since 1876, although there were signs of it from the outset of responsible government in 1852. It is as debilitating as it is petty, and its continuation is in no-one’s interests. It arises because from 1876 onwards, while there have been many reviews and Royal Commissions on the shape and form of local government, there has been no serious political attempt to define the relative roles of central and local government, or to establish any sustainable philosophical basis for that relationship. In the absence of that, nothing seems likely to change in the foreseeable future.

UnitedFuture is a strong believer in the liberal democratic principle of localism – which coincidentally underpinned the establishment of provincial government in 1852 and was tossed aside by its abolition in 1876 – whereby decisions are made at the point closest to where they have their impact. That is why we support strong and vibrant representative local government based on a network of community boards, territorial and district authorities, and regional councils. In turn, we see the need for a formal partnership agreement between central and local government, spelling out the roles and legitimate expectations and responsibilities of both, and a mechanism for resolving differences when they occur.

New Zealanders are understandably proud of our generally pragmatic approach, and the fact that rather than ruminate to the point of tedium over an issue, we just get on and resolve it. That is good and to be encouraged, although it does have the downside that sometimes our decision-making processes lack coherence and consistency as a consequence. This is especially so when it comes to our constitutional arrangements where their fluidity often means the process of government has a “look, no hands” feel to it. Moreover, our general national reluctance to confront conflict in any shape or form means we are past masters at avoiding problems if we possibly can, in the hope that a problem ignored is a problem diminished. All of these features have characterised the tension between central and local governments over the last 140 years.

Continuing to pretend that this tension “goes with the territory” is no longer acceptable. Both central and local government have significant but distinct impacts on people’s lives, so both need to be prepared to come to the table as equals, to agree their way forward. After 140 years, that discussion is long overdue.