9. Question No. 9—Workplace Relations and SafetyHon PAUL GOLDSMITH (National) to the Minister for Workplace Relations and SafetyQuestion No. 9—Workplace Relations and Safety9. Hon PAUL GOLDSMITH (National) to the Minister for Workplace Relations and Safety: Does he agree that flexible labour markets are one of the foundations of New Zealand's economic progress in the past three decades?Hon MICHAEL WOOD (Minister for Workplace Relations and Safety): Well-balanced flexibility in the labour market can support economic and social progress. For example the flexibility provided to employees to manage their health through 10 days of sick leave has provided many benefits. I note that the member and his party voted against that. While New Zealand's economy has made good progress in a number of respects including 3.2 percent unemployment under this Government there are also real weaknesses in our labour market that hold us back. A longstanding mismatch between wage growth and productivity is not economic progress. Suppressed wages and inflexible working conditions is not economic progress. Working two or three jobs just to put food on the table at night is not economic progress. On this side of the House economic progress is a high wage high productivity economy that delivers for workers and businesses alike. That's what we're committed to delivering and on that note we very much look forward to the first reading of the Fair Pay Agreements Bill very shortly.Hon Paul Goldsmith: Sorry does he believe in flexible labour markets or not?Hon MICHAEL WOOD: As I just described we do believe that well-balanced labour markets that have appropriate flexibility for employers and employees are important. What I do note is the very strong international evidence that labour markets that have a mix of individual bargaining collective bargaining and sector-based bargaining are the labour markets that function the most effectively the most equitably and which have the highest rates of labour productivity.Hon Paul Goldsmith: Does he agree with the proposition that the fair pay agreements regime he is introducing today is less about fair pay and more about imposing mandatory union deals on Kiwi workplaces? Hon MICHAEL WOOD: No I don't accept that characterisation at all. I do accept the characterisation that I've heard from some major employers who point out to me that at the moment they are held back from offering better terms and conditions for their workers that they would wish to because of the race to the bottom nature of our existing labour market.Hon Paul Goldsmith: Does he care about BusinessNZ's view that Fair pay agreements couldn't come at a worse time than now as businesses face mounting pressure from runaway inflation labour shortages fast rising costs supply chain issues and the Omicron response"?Hon MICHAEL WOOD: In response to those comments I would note two things. The first is that the passage of fair pay agreements will see fair pay agreements not coming into effect until next year at the earliest. The second point that I would note is that there is in fact a no more apposite time for us to be considering this issue given that some of the very people who have helped our country through the global pandemic—the likes of cleaners who have kept our workplaces our schools and our hospitals safe and hygienic; our retail workers who have kept us stocked with food and other goods—have been the people that have helped us to get through but are very often the people who have been left out in the cold of the labour market conditions that we currently have.Hon Paul Goldsmith: Does he still think that the Government can add to the cost structure for small and large businesses with no consequences either for their international competitiveness or the cost of living and if so can he please explain how this works?Hon MICHAEL WOOD: As we have canvassed in this House previously on this topic the member and I have a very different view about these matters. The member seems to think that there is a straight out trade-off between fair and decent pay and conditions for workers on one hand and good economic outcomes on the other hand. On this side of the House we actually believe in a better and more progressive vision of labour relations one in which investment in workers investment in skills and training and valuing people can actually build value and productivity in the long run. That is why for example Australia which has had a form of sector-based bargaining in place for most of the past 40 years has a higher rate of labour productivity than New Zealand with its largely individualised-based bargaining system."