New Zeland: Labour backtracks on union rights

The Labour-Alliance coalition government rode into office last year with relative ease on a modest programme of reforms.

Helen Clark is now the most popular Labour prime minister ever, outstripping the legendary Michael Joseph Savage (prime minister during the depression of the 1930s). Her party has surged ahead in the polls and could govern alone if an election were held today. Support for the left-reformist Alliance Party has dropped dramatically since the election.

Labour’s rising popularity is a result of keeping almost all of their election promises. The problem is that those promises amount to very little for New Zealand’s workers and oppressed.

Taking a leaf from Tony Blair’s book, Helen Clark released a "commitment card" before last year’s election. Resembling a credit card, it carried Labour's seven key promises. These included:

• Focus on patients not profit and cut waiting times for surgery.One million New Zealand dollars (about £300,000) went towards cutting waiting lists. But the real problem is not hospital waiting lists but primary healthcare. New Zealand has the unenviable position of the highest infectious disease rates in the developed world. Doctors’ visits and prescriptions cost the proverbial arm and leg.
  Currently, there are meningitis and whooping cough epidemics. New Zealand has the highest rate of tuberculosis of any English-speaking country (2.5 times that in Britain).
  
• Cut the cost to students of tertiary education, starting with a fairer loans scheme.
  Since their introduction in 1989 by the previous Labour government, fees have risen by 600 per cent. Collectively, students now owe almost a billion pounds in a country of four million people.
  Labour policy in 1999 became simply an interest write-off scheme. From this academic year, students can apply to have their interest written off, but this is neither automatic nor retrospective.
  
• Reverse the 1999 cuts to superannuation [pension] rates.
  This has been done but, again, the gesture cost the government little. Nothing has been done about the fact that pensions were already pitifully low. Many older New Zealanders live in dire poverty, and really need a big boost in basic payments.
  
• Restore income-related rents for state housing so that low-income tenants pay no more than 25 per cent of their income in rent. The government introduced the relevant legislation to Parliament on 25 May.
  On 1 December, the government will restore income-related rents to single people earning less than $225 per week and families on less than $347 per week (about £115). This excludes many people who struggle to pay market rents and means the government collects a further six months extra revenue in the meantime.
  
• No rise in income tax for the 95 per cent of taxpayers earning under $60,000 a year. No increase in GST [akin to VAT] or company tax.
  This was the first promise Labour kept when they passed legislation increasing tax to 39 cents in the dollar for those earning more than $60,000 (about £20,000). One thing will be obvious - wages in New Zealand are pitifully low. Ninety five per cent of people earn less than the equivalent of £20,000.
  Exempting company tax from increases means Labour will not challenge big business in any way. Workers will still pay for the bulk of any reforms.
  

The Labour-Alliance coalition government also increased the adult minimum wage from $7 per hour to $7.55 (£2.30 to £2.50). This weekly increase of $22 was considered hopeful by Labour supporters, but has since been gobbled up by interest rate and petrol increases.

This is a Labour government with very little to prove. New Zealanders were so relieved to get rid of Jenny Shipley’s National Party-led coalition that these crumbs have satisfied the vast majority of workers. In this sense, the honeymoon has only just begun. The claims of massive popularity are all true but it has taken very little to placate New Zealand voters. Why?

The previous government had all but completed the privatisation of New Zealand society. Workers have been under siege for the past 20 years, suffering a major defeat in 1991 when the National government passed the Employment Contracts Act (ECA).

The ECA has sent union density plummeting from 70 per cent to 16 per cent of the workforce in nine years. The country’s unions have taken a battering in some ways worse than that suffered by their British counterparts, but with much less of a fight.

The Labour government's replacement for the ECA retains many of its worst aspects. Though there is no legal right to strike, the union bureaucrats are happy because the new Bill enshrines their position as the contract negotiators and workers' representatives. In addition, Labour minister Margaret Wilson is in the process of watering down some aspects of the Bill after lobbying by the Employers’ Federation.

The Labour-Alliance coalition has failed to deliver anything but the most minimal reforms. But workers have been ground down so much by the past two decades that this feels like a huge victory. Just like Blair in the early days of his government, Clark has been made to look good because the National (Tory) government before her was just so bad.
The current situation does provide a window of opportunity that socialists must exploit.

Trade unionists need to seize on the liberalisation of the anti-union legislation to rebuild organisation. They must also boost support for a massive campaign to demand the full repeal of the ECA and its replacement with a positive set of workers’ rights.

Beyond this we need to press home demands, backed by militant campaigns, for free education and health care, massive investment in primary health and housing, and a massive increase in pensions and other benefits. All this must be paid for by taxing the rich and squeezing the profits of the large corporations.

But as workers do regain lost ground they will come into sharp conflict with the Labour government. And when they do Clark, like Blair, will prove that the world over, reformism will defend the bosses' system at any cost. Will Livingstone still describe it as a workers' paradise then?

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