Roger Partridge: Why fair pay agreements were never going to work

The demise of the last Government’s Fair Pay Agreement legislation is a cautionary tale for policymakers. Death and taxes are sometimes called the only certainties.

But so, too, are the iron laws of economics. Governments ignore them at their peril.

As I wrote last year in this column, the FPA policy has always been a lemon. It was born of wishful thinking. Labour's idea was that the government could improve the country's productivity and prosperity by introducing compulsory collective bargaining to increase wages above market rates.

Point of Order: Buzz from the Beehive - 14/12/23

Three Waters legislation will go down the plug early next year – but new govt is still distributing corporate welfare

Going, going – gone.

Or flushed down a legislative plughole, in the case of Three Waters.

Point of Order: Buzz from the Beehive - 12/12/23

Ministers set about easing up on labour laws and speed limits – but suppliers of building goods must watch what they tell consumers

Don’t get the idea the new government has declared war against all compliance costs.

Some compliance costs, no doubt, will be headed for the dustbin when ACT’s David Seymour gets down to work as Minister of Regulation.

Mike Hosking: The leaks shouldn't be happening this early

The investigation is underway as to how Treasury advice was leaked around the Fair Pay Agreements.

One headline suggested the Government were shaken by it.

I wonder if that is slightly overstating the case, but you would at least be surprised that something like this happened so soon after the country decided you were “it” for the next three years.

Robert MacCulloch: Newshub and NZ Herald report Misleading Garbage about ACT's Van Veldon not following Treasury advice

In their rush to discredit the new government (which our MainStream Media regard as illegitimate and having no right to enact the democratic will of voters) the NZ Herald and Newshub are arguing ACT's Deputy Leader Booke van Veldon is not following Treasury advice regarding the coalition's desire to repeal Fair Pay Agreements.

Mike Hosking: Fair Pay Agreements confirm Govt doesn't understand simple economics

The fair pay law is another of those ideas that has come to fruition that in and of itself won't swing a vote.

It's sort of like the media merger. You might not think much of it but you are not going to protest or swap your vote because of it. It's no Three Waters.

And to be fair to the government, it is the sort of thing you would expect them to do. They're promoting unions and unionisation is a very Labour pastime.

Roger Partridge: Minister’s new Fair Pay Agreements claims don’t compute

Persistence looks set to pay off with one of Labour’s 2017 election manifesto promises: to reintroduce compulsory sector-wide collective bargaining across the country. Dubbed “Fair Pay Agreements,” the Government’s plan is to take New Zealand back to the system of awards that dominated industrial relations for most of the 20th century. 

Yet, try as they might, successive Workplace Relations and Safety Ministers have been unable to make a credible case for Labour’s radical FPA proposals. 

Back in 2018, the terms of reference to the FPA Working Group from then Minister, Ian Lees Galloway, argued there were multiple “problems” with New Zealand’s labour market settings. There was just one issue with the former Minister’s claims. None of them stacked up. 

Heather du Plessis-Allan: Is this government listening to itself?

 

Is this government listening to itself? 

In an unbelievable move, it has just announced that it’s going ahead with Fair Pay Agreements. 

Now I’ll run you through the details in a tick, but the main gist of it is that the government is re-introducing collective bargaining.

So that, if enough workers in one sector, let’s say cleaners, agree to a pay and conditions deal with their employers, then that will be binding on all employers of cleaners. 

Even if the employers weren’t part of negotiations and didn’t say yes to the pay increase, even if they can’t afford it.