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Rebuild better post COVID

Written By: - Date published: 7:00 am, May 2nd, 2020 - 46 comments
Categories: business, capitalism, class war, economy, employment, uncategorized, Unions, wages, workers' rights - Tags:

Guest blog from E tū Assistant National Secretary, Annie Newman

Author Arundati Roy has described the pandemic as a forced break with the past, “a portal, a gateway between one world and the next.”

If we are indeed moving from one world to the next, the question is, who will shape that new world?

The battleground of COVID-19 has done many things. One thing is certain. It has exposed failures in our fragile democracy. As a society, we need courage to face those failures and build something new. Ensuring that new is also better depends on including the voices of workers.

The COVID battleground left the voices of community carers out of the decision-making that would ensure safety for both them and us.

The battleground provided no just transition to much needed front line positions for workers made redundant in aviation.

It offered no protection for cleaners whose near minimum wage incomes were slashed to the 80% subsidy levels, creating deep hardship for families.

As our nation emerged from another battleground, between 1942 and 1949, an Economic Stabilisation Commission was put in place to recommend economic measures to Government, including industry development and transition to a post-war economy. This commission brought together the Secretary of the Treasury, a representative of NZ producers, and a representative of the union movement.

We have developed inclusive strategies in the past and, when we cross the threshold into the post COVID world, we can and must do it again.

The role of the state in safeguarding our wellbeing, the role of the funder of services in taking responsibility for the lives of those delivering services, and the role of workers in contributing to the new economy are all critical to real and positive change.

The state can act now to safeguard the wellbeing of workers. Our government can ensure a just transition for redundant aviation workers and a bright future for our national carrier. 

Currently our “Air New Zealanders” wait at the gates to see if the planes will ever fly again while the CE and his board scratch out their vision. A vison for what? A low-cost domestic airline where workers receive Walmart wages?

We can only safeguard the wellbeing of these workers by including them in the shape of the future of their much-loved airline. Doing so is good for them and all New Zealanders.

The state can ensure workers are given a voice through industry agreements that not only set standards for employment but which also ensure an inclusive approach to the development of sectors, such as cleaning and care work.

New Zealand has already started this discussion with Fair Pay Agreements. Workers have knowledge that can contribute to wise decision-making and if their voices had been heard in the current crisis, the battle for personal protective equipment in care and support services, for example, would have been resolved long ago.

Funders of services can start taking responsibility for the lives of those delivering services now. The thousands of contracted cleaners delivering “essential services” under COVID-19 can be valued with the Living Wage, instead of  abandoned by government in the contracted economy, paid 80% of their near minimum wage, and left to struggle to feed themselves and their families.

This can only be achieved in the post-COVID economy when funders of services are bolted to the supply chain for which they are responsible, with a policy of social procurement.

Transparent processes and inclusion of all stakeholders in the procurement arrangements of the state is what protects the most vulnerable on the frontline.

Democracy creates a space for the market, civil society and the government but it doesn’t guarantee a balance between these spheres.  That is government’s role. Right now, there is an opportunity for our government to do more than protect the future of business; it can address the imbalance in our democracy where the market dominates the agenda. It can value the contribution of ordinary people and their organisations to the future of our nation by seating them at the top table of business, industry and government.

Nothing is really future proofed in a democracy, given we vote every three years. But let’s prove that out of the ashes of COVID-19, there is a future for democracy and that we can create a new consensus around the role of the state.  That for all its faults, it is there to safeguard the wellbeing of the citizenry because that is exactly what we have looked to it to do in this crisis. 

Let’s have a consensus that a civilised society is one where workers’ knowledge is valued at the board table, where public money always provides for a Living Wage and decent work, and where government is responsible and accountable for those they fund to work on our frontline. 

Kindness is not absent in the current management of this crisis, but neither should it be absent in the construction of our future.

Kindness is not just a feeling though. It is action that delivers equity, justice and hope as we step though the portal between one world and the next.  Let’s rebuild better – and start now.

46 comments on “Rebuild better post COVID”

  1. Ad 1

    Great to hear a solid union voice here at TS. 

    I want to see this government build upon the consensus that they have started. 

    Even in the course of the last three decades,  many new enduring public institutions and frameworks have been formed which have improved New Zealand. There is no reason that there cannot be more – particularly for workers. 

    My concern with the commentary is that it leans too hard on the organizing capacity of the state. That's usual for left commentary. Business and civil society can and do organize themselves, coming up with movements and organization and plans that government needs to then respond to.

    If we want a new country out of this, it's up to us to organize.

    • Dennis Frank 1.1

      Dunno about the civil society bit, Ad.  Hasn't been much noticeable in my lifetime.  When I see the self-employed form a political org to represent them in the body politic I will believe you.

      "We have developed inclusive strategies in the past and, when we cross the threshold into the post COVID world, we can and must do it again."  That's the guts, really.  I totally agree with the sentiment, but the essay seems just a wish & a hope.

      Unions lack much relevance in the current political scene.  Even Labour merely pays them lip service.  Think of the huge portion of the electorate that doesn't vote.  Mostly lower class, right?  Not surprising that Labour pursues a middle class agenda.

      • G'day, Dennis, while I believe that all waged workers are working class, and have been since the Lange Government, I think you'll find that most union members are what you might well define as middle class. Many being home owners, with income at average or above. The biggest unions (with the worthy exception of E Tu) are in the public service.

        • Dennis Frank 1.1.1.1

          I guess you're closer to the action, TRP.  If that transformation has occurred, it has done so since the mid-'80s I presume.  Since progress is more likely to be driven by the middle class than the apathetic, the thesis seems valid to a point.  That point will be the hinge where those who make a psychological return to bau get out-numbered by those motivated to co-create a better world.  We await evidence of a zeitgeist produced by the weight of those numbers…

      • Ad 1.1.2

        Civil society is in good heart. People got together in all sorts of forms after the Christchurch earthquake, and the Kaikoura earthquake, and indeed right now. The entire medical and carer staff of New Zealand are being lauded for saving us – moreso than any NZDF manoeuvre has since WW2. Who would have thought that possible? We will never look at them the same. 

        That is just a new form of civic society standing up. 

        It's also grown massively online through people being sequestered at home. 

        Given that this government has managed to pass the biggest piece of tax relief through Parliament – unanimously – there's good odds that they can build on that. You can't get more inclusive than unanimity in Parliament. 

        Note also unions like the three teachers unions worked their asses off to get Labour in power, and they in turn were well rewarded for it in pay deals.  I'm all in favour of long term compacts that are rewarding. Deals bind us together.

        There's no shortage of ambition right across the governmental parties, as we've seen recently. Though with only four and a half months before election, I fear the Big Plan is going to be tested through the electoral manifesto rather than being brought together in the weeks after budget 2020.

        • Dennis Frank 1.1.2.1

          Nicely positive framing.  I just hope we do actually get to see a Big Plan.  Wouldn't surprise me if Labour makes its run without one.  What's missing is the leftist think-tank that ought to be producing it and lobbying for it.  Yeah I know Sue Bradford is meant to be doing that, but the years keep on rolling by with no result…

        • Craig H 1.1.2.2

          The public sector unions (including teaching and police in this) aren't affiliated with any political parties – no doubt a number of members are politically involved, but that is not the same as the union being involved. 

    • RedLogix 1.2

      Good OP and a fine response Ad. I can think of little to extend it, except maybe this. Absolutely COVID 19 has shifted the ground under us, and we had to change many of the settings that many people thought were set in stone.

      It's incredibly heartening to see just how well our small and relatively isolated society has adapted. We moved mostly in lockstep at just the right moment; it's been beautiful to watch.

      And it opens up the vision, one that I believe Annie is speaking to, that maybe we could keep this dance going. Maybe we can take this new found skill and build on it, as we navigate our way around what is going to be a very confused dance floor this decade.

      And maybe as we pay attention to this learning moment, we need to set aside the heat of our old quarrels and bickering, and with a singular focus learn to trust ourselves as a society at a whole new level. 

      OK so it's lazy Saturday morning  …. 

  2. bill 2

    Let’s have a consensus that a civilised society is one where workers’ knowledge is valued at the board table, …

    How's about the board table is simply turned into a dining one, and those involved with an enterprise or business all contribute to decisions in an environment that no longer contains the various narrow biases that come with our current vertical divisions of labour?

    • Ad 2.1

      Agree.

       

      Imagine all that $25b+ wage subsidy, "loans", and tax breaks turned into worker equity. And boardroom voting power.

      • RedLogix 2.1.1

        Worker equity is a theme I used to talk to here all the time, thanks for reminding me.

        In the 80's I worked 7 years for a mid-sized (>500 employees), family owned, US based company that did a genuine 10% annual profit share. Interestingly it excluded all executive staff and any sales people already on a bonus.

        One year I got a $7000k bonus. It worked incredibly well; there was always the thought in the back of my mind that every dollar I put on the company bottom line, 10 cents was going into my pocket.

        Profit shares are just one form of worker equity, but yes I see them as a very powerful tool uniting both the power of labour and capital in a manner that builds collaboration and trust.

        • Tricledrown 2.1.1.1

          Red Logic companies like the one you describe,Cadbury's,Stafford Ellison etc.Get bought out and gutted for more profit by vulture capitalist's.

          • Graeme 2.1.1.1.1

            Companies like RL described are structured in a way that the vultures can't get in because the shares are held within a family and there would be rules within the constitution that the shares can't be traded.  

            We have similar structures in New Zealand with co-operative companies, some of which are rather large in a NZ context.  Sure there's considerable pressure to open some of these up to outside capital, from both sides, but most function pretty well and are able to keep share ownership controlled within the group.

            • Tricledrown 2.1.1.1.1.1

              Looking back at history most get bought out by fair means but mainly fowl.

              Cadbury had a Nigerian scammer take millions taking reserves designed to stop a predatory takeover.Circling vulture capitalists will use any trick to get hold of these highly profitable companies.4 square shops  are an example in NZ of a cooperative being stolen from the cooperative owners.

  3. Wayne 3

    The recession will put huge pressure on wages. For the next two or three years, no-one will be getting wage increases. The biggest challenge will be just keeping people in work. Obviously the state will be involved in that with wage subsidies (on a reducing basis as a percentage) being required for up to a year.

    However, many people are going to lose their jobs, maybe 200,000 people. How are they going to be helped? Surely not just welfare.

    I actually like the Green package of $1 billion. However, at 7,000 jobs it is only 3% of the total likely unemployment. So huge amount of thinking yet to be done.

     

    • Dennis Frank 3.1

      huge amount of thinking yet to be done

      By all political players.  I envisage a political paradigm shift away from neoliberalism.  Market forces will continue to be the main driver of the macroeconomy, but resilience design will loom larger for small/medium business I expect, and for households and self-employed even more so.

      More political collaboration ought to be incorporated to reduce the toxic effect of partisan stances and beliefs.  That would transform our political ecology for the better.

      Ideology is likely to decline even further in influence.  Imagine someone silly enough to try & advocate the principle of small govt now:  "stop interfering with business!"  When businesses are getting govt subsidies to survive.  Poor old Roger, out of time.

      That said, an ideology based on sustainability could be a goer.  It would be more likely to succeed if the principle of equity participation is factored in.  Catering to the right by incorporating enterprise as collective motivation.

    • Nic the NZer 3.2

      How about a job guarantee, Wayne. In a job guarantee scheme WINZ collects up all the socially amenable demands for work from the community these are then given to anybody who wants a full or part-time job paying the minimum wage. This will soak up pretty much all the excess unemployment without relying on any estimates of how many jobs will be required and how much spending will generate that employment. When the private sector has work available again then this pool will shrink back again and rather rapidly as the people involved have an on going work history.

    • Incognito 3.3

      Initial estimates suggest it would create 6000-7000 jobs (FTEs) directly with many more through flow on support to local suppliers and contractors.

      https://thestandard.org.nz/green-party-covid-19-recovery-and-investment-in-people-and-nature/

      Obviously, this is not the silver bullet that will kill all unemployment.

      • pat 3.3.1

        @nic and incognito….the second could be part of the first …and it would remove unemployment.

        Only question is will business protest?…most gov work initiatives have to avoid impinging (or even the perception of) private enterprise which always restricts the options available. 

        • Nic the NZer 3.3.1.1

          The Green's infrastructure program should be a permanent part of the economy, not something which only kicks in responding to a recession. Though I would say that initially treating certain kinds of work as a temporary part of the program and then moving to make them more permanent might occur. The other issue is if we are asking for any level of expertise, training and skill for these Green infrastructure workers then they may warrant higher than the minimum wage.

          If the private sector wants these people employed its welcome to make them an acceptable offer at any time.

          • pat 3.3.1.1.1

            "If the private sector wants these people employed its welcome to make them an acceptable offer at any time."

            Lol..that would be my response however i simply recall the chorus of objections over the years whenever gov work programmes come up….it has historically been a productive political strategy that impedes implementation.

            Maybe things will be different this time….certainly if things get bad enough I can see those arguments being ignored

    • Poission 3.4

      There will be a large number of people losing jobs,many on temporary work visas,such as the tourism industry.There will also not be significant immigration into nz for non residents,or nz citizens.(170000 on temporary visas last yr)

      Agriculture has a shortage of around 50000 staff ,as does forest rehabilitation,and fisheries.Investment in human capital is required by the productive sector.

       

      • Craig H 3.4.1

        Hard to tell – students, working holidaymakers and partners make up a lot of visas and are largely unaffected by unemployment in terms of visa availability.

    • SPC 3.5

      There is also the unspent money in the PGF (water storage for drought years, safe water supply and sewage systems in the provinces). 

      I would suggest interest free loans to farmers (repaid on farm sale) to upgrade their farm environment standard – being rated first class in land and stock management is going to be important to exporters supplying the increasingly nationalist market place. 

      Management/refinancing of council debt would free up money for infrastructure renewal – waste water/pipes. 

    • Chris 3.6

      "However, many people are going to lose their jobs, maybe 200,000 people. How are they going to be helped? Surely not just welfare."

      No, you're dead right there.  Your lot fucked welfare well and truly a long time ago, so welfare helps very few these days.

    • Foreign waka 3.7

      Looking at my grocery bill right now I estimate that the cost has risen by nil (sweets, sugary drinks), 5-10% veges, fruit, bread, cheese and meat and curiously 20% or more for fish. From the ocean right in front of us no less. We have yet to look at local rates and utilities. At that rate it will not only be the people on any kind of benefit but literally everybody that cannot be classified as a millionaire that will be lining up at the Salvation army. This in turn can and will most likely show the underbelly of society with some serious social unrest to boot. It will be interesting to see whether we witness a return to 1900 or consensus by employers, government and banks to get a new balance worked out. Interesting times ahead. 

    • millsy 3.8

      I guess your dream of no wage increases for anyone ever, people working their whole lives on the same rate of pay becomes a reality.

      Just like when the ECA was imposed. Workers spent the next 10-15 years stuck on the same rate of pay,

  4. Bazza64 4

    The bit about protecting the laid off airline workers by ensuring they are part of Air NZ’s future is wishful thing at best. I have massive sympathy for all those people that have lost jobs at Air NZ, but if flights are down 90% & are probably going to be down for a while, then a lot of those people are going to have to find other work. They can’t just be kept on the payroll of a company that is now facing big financial losses.

    The government should offer the staff  support in retraining in other possible industry jobs, but the economic reality can’t be forced onto Air NZ. I agree we can’t just throw these workers on the scrap heap, they have to have government support for an extended period of time.

    And I know – what jobs are around at the moment!

    • Craig H 4.1

      Saw an ad on Facebook for Canterbury University engineering department offering fast-tracked degrees for airline staff with at least 3 years technical experience, so there's some good thinking already happening. 

    • RedBaronCV 4.2

      Some of the freight subsidies are being paid to airlines that are not Airnz. But I've been pretty disappointed in the government response to employment arrangements. As we have seen a lot of businesses think they can just basically ignore employment law as they have done for so long. Sure there has been a subsidy but it hasn't come with any "best behaviour " conditions or any consulting of the unions particularly. 

      It's also shown the lack of capacity, innovation or creativity of the overpaid management. Firstly most management have taken only a nominal dollar reduction. Few if any have tried to pro rata the cuts so that everybody has some work/income even if it is reduced hours on a defined pattern  so that staff can use the extra time to minimise costs or look at other income prospects and remain eligible for the in work subsidies and keep up skills.

      • Craig H 4.2.1

        Why does the government specifically have to say "don't break the law or breach employment agreements?" Seems self-evident.

        • RedBaronCV 4.2.1.1

          Enforcement of employment law depends on low paid (frequently) stressed individuals who often don't have the knowledge or background to take action. Plus if they had it rules then out for future jobs- discrimination over this is endemic. If it was part of the money hand out then the prospect of enforcement and loss of the subsidy from the government would help throttle back some of the employer excesses

          • Craig H 4.2.1.1.1

            It's a tough environment for that – cancel even bad employers' subsidies and it risks those companies closing down completely and making everyone redundant. Likewise taking ERA action – the risk of the company going under trying to defend it is higher than it normally would be.

    • millsy 4.3

      No point training people for jobs that don't exist.

       

      • SPC 4.3.1

        Given how many migrant workers we take in each year (and choose to give permanent residency to, or not), this may not be as severe an unemployment outcome as is feared. 

        One factor will be how many feel the need to return from Oz because of their unemployment and no welfare support (for mine there is a case for paying basic benefit $250/$400 couple etc so that they stay over there – if we pay foir this off the credit card and throw it away). 

  5. SPC 5

    Yep sure the government could/should have had a wage subsidy scheme where employers paid 80% of the wage, or the MW whichever was higher, to receive the wage subsidy. 

  6. georgecom 6

    Democracy creates a space for the market, civil society and the government but it doesn’t guarantee a balance between these spheres.  That is government’s role.

    nicely stated Annie. As well as ensuring the needs of  good business is sustained there is also a need for a post covid 'recovery' which pays close focuses on the good of the planet as well as a need to ensure that those who are thrust to the margins of society, or were already there, are adequately taken care of. There is also the need to ensure that those who have work are organised and have a voice. Building fair pay agreements might be delayed but shouldn't be forgotten.

  7. SPC 7

    I would suggest that welfare has its part in our recovery. 

    1. It is long past time to bring in individual entitlement to income support on losing a job (including leaving work to have children).

    The options range from one year only to open ended. From tax funded welfare tlevel support to a one year ACC level payment financed by Unemployment Insurance (the two could run alongside each other) – compulsory rather than optional Income Insurance. 

    2. A UI (low rate dole level) for those under 25 IF they are not working FT or in full-time study. This supports gig workers (part-time and casual and piece rate – uber drivers./scooter collectors), those in internships and less formal apprenticeships and would be entrepreneurs.   

    • Salsy 7.1

      AND..  how about use this break to allow women struggling in jobs where pay equity is just too much to bear to live on a UI until they are able to survive on freelance or build their own companies. Its a win win, we force organisations to take pay equity and pay transparency seriously and give women a chance to stand up for themselves.

      • SPC 7.1.1

        The first step would be to allow those on income support to earn a days pay ($160) before any abatement. This was the case in times past but the abatment level has not increased with wage rates for some time.   

  8. Thanks Annie! A great antidote to the endless market evangelism we get on commercial media. The invisible hand of the market will not save us. Free market Capitalism has a tendency to irrational ponzi schemes and crashes every 10 years or so, unless it's properly regulated

    • Poission 8.1

      The problem with the evangelists from the church of the hidden hand forget that Adam Smith said that higher profits,not higher wages are ruinous to the economy.

      “In regards to the price of commodities, the rise of wages operates as simple interest does, the rise of profit operates like compound interest.

      Our merchants and masters complain much of the bad effects of high wages in raising the price and lessening the sale of goods. They say nothing concerning the bad effects of high profits. They are silent with regard to the pernicious effects of their own gains. They complain only of those of other people.”

  9. millsy 9

    My great idea is to accept that there are some older workers are never going to be re-employed, so drop the Super age back down to 60. It really is unfair to expect 60-64 year olds to live on $250 a week.

    Any other ideas can be thought up by some kind of Post Covid taskforce or summit.

    • SPC 9.1

      And pay super to those 60-64 still working? 

      Better to pay super rate benefit for those unable to work 60-64 because of ill -health but not covered by ACC (and all those on disability 18-64 as well). 

      As for the unemployed 60-64 (a $25 increase already and a bump in the power income supplement to boot) it is a matter of cost down the line. And many will have KS accounts and some rentals as well as their home ownership.

      It's an option, albeit via means test, if there was non payment of super to those working over age over 65 to afford it. 

      • Craig H 9.1.1

        Agree, and I would expand ACC to include illness and disability from causes other than accidents.

  10. Janet 10

    Just Lift off with UBI

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