THE HAPS
Parliament returns after a three-month hiatus. The Coalition Government has its work cut out removing bad laws such as so-called 'Fair Pay' Agreements and the Natural and Built Environments Act before they do any more damage. There is a palpable sense of relief as New Zealanders feel they have a government committed to doing essential things well instead of wasting time and money with quixotic boondoggles.
DELETE
For the rest of the year Parliament will be focused on hitting the delete key. The previous Government, in its various Labour, Green, New Zealand First versions, introduced endless mad laws and projects that sucked up the country’s time and energy for little benefit.
This week Free Press digs into the madness set for deletion, starting with the so-called Fair Pay Agreements.
If New Zealand has one big problem, that sums up all the problems, it’s that too many people are forced to spend too much time on transactions instead of production. Every industry complains that getting permission, following rules, and ticking boxes drains away the time and energy available for doing their actual job.
Fair Pay agreements would have made this problem worse. Putting aside complications with personal grievances, holiday pay, and sick leave, New Zealand has pretty straightforward employment law by international standards.
Fair Pay Agreements, the brainchild of airport investor, unionist and former MP for Mt Roskill, Michael Wood, sure add to the complications. They allow tiny minorities of workers to force entire industries into nationwide contracts.
The contracts cost millions to negotiate and lead to absurdities. Butchers wonder if they’re covered by the hospitality code or the retail code. We can only guess it depends on how ‘prepared’ their meats are at the point of sale.
At the end of the day, are workers better off? Of course not, with or without these agreements, productivity is king. No worker can sustainably take home more than they produce, or they’ll send their employer broke. No employer can sustainably pay their workers less than what they produce, because sooner or later someone else will.
These kinds of facts escaped the previous Government, but not economist and new Workplace Relations and Safety Minister Brooke van Velden, who’ll be leading the work to delete this law before Christmas. No agreements are currently settled and those currently being negotiated will be deleted.
The Lake Onslow project, a dam in reverse where water is pumped up a hill when the wind blows so it can be released at other times, was always crazy. New Zealand has a world-leading electricity market where anyone can invest in generation and sell into the grid. It has led to massive investment in renewable energy by the private sector.
Lake Onslow would take $16 billion of taxpayer money for questionable benefit. Whatever benefit there is would be wiped out because private investors don’t want to compete with Government officials spending other people’s money. Deleting this project will restore clarity for the market so they can invest while taking a load off the hardworking taxpayer’s balance sheet.
Nobody can pull one lever in two directions at once, but that’s what the Labour/New Zealand First/Green Government asked the Reserve Bank to do in 2019. When they changed the Reserve Bank’s mandate from focusing on inflation to inflation and ‘maximum sustainable employment,’ they asked the bank to print money slower to kill inflation and faster to promote employment.
As the world learned in the 1970s, printing money can’t change employment in the long run. Extra cash stimulates economic activity for a while, then inflation drives up living costs and everyone is back where they started, with inflation to boot.
The new Government will send a clear signal to the market that price stability is the one and only goal of monetary policy. New Zealanders literally cannot afford another experiment like the last four years.
Perhaps the most expensive of all silly laws was the Natural and Built Environments Act, and the Spatial Planning Act, with their third sibling the never-passed Climate Change Adaptation Act (why was the government so hopeless at actually preparing for the climate emergency they declared?). These acts made up what David Seymour first described as ‘the RMA by three other names.’
Back then even he couldn’t have imagined the new bills could be worse than the RMA. They are much worse. They keep the overarching goal of sustainable development, an undefinable term that in practice means the council dictates what you can do on your property. They add a new goal of looking after ‘te oranga o te taio,’ which will take the courts years to interpret.
Councils are scrambling to make sense of the new plans. This Government will save them the bother by temporarily restoring the RMA then replacing it with a new resource management law that will mean less bureaucracy still.
The Clean Car Discount, also known as the Ute Tax, that taxes farmers and tradies to subsidise Tesla drivers, will be gone by the end of the year, too. Jacinda is gone, and we can freely choose our own cars again.