Roche Denise: Minimum Wage (Starting-out Wage) Amendment Bill — Second Reading 
Text is incorporated into the Bound Volume 
Roche Denise: Minimum Wage (Starting-out Wage) Amendment Bill — Second Reading 
[Sitting date: 14 March 2013. Volume:688;Page:8586. Text is incorporated into the Bound Volume.] 
DENISE ROCHE (Green) 
: 
Tena koe Mr Assistant Speaker Tisch. Tena koutou katoa. The Green Party opposes this bill the Minimum Wage (Starting-out Wage) Amendment Bill in its entirety. It is ironic—it is totally ironic—that the second reading of this bill should come to this House 20 years and 1 day after the Rt Hon Don McKinnon on behalf of the New Zealand Government signed the United Nations Convention on the Rights of the Child. Yesterday I would remind the House this House unanimously supported this motion: “That this House notes that today is the 20th anniversary of New Zealand ratifying the United Nations Convention on the Rights of the Child”—UNCROC—“that it is the most well-supported human rights treaty in history that it committed this country to consider the best interests of the child in all activities and make children’s rights known as a priority and that the House recognises children as full citizens of our nation deserving of our most ardent attention to make the world fit for them to inherit.” In 1993 we committed to bringing our laws into line with this convention. That convention applies to all young people who are under the age of 18. So why are we today attempting to pass a law that allows for some of our young people—those aged between 16 and 20 who may be on a benefit—to be discriminated against in their pay rates? 
The explanatory note in this bill right at the beginning says: “Minimum starting-out rates of wages are designed to support young people entering the workforce including those who have been on a benefit and young people who are undertaking industry training for their work. Starting-out wages provide an incentive for employers to take on young workers at a reduced rate of pay while foundational work skills experience on the job or training is gained.” We do not believe that this bill will support young workers. What it is is a new take on the carrot-and-stick approach. The employer gets the carrot and the young worker gets the stick. Paying low wages is an incentive for employers to keep wages low. The only incentive that young workers new to the workforce will get from this law will be the incentive to join the 50000 or so New Zealanders every year who leave this country for Australia for better-paid jobs. Certainly in this bill I see no incentive for a young worker to get a job especially when they are going to be paid poverty wages. But then this bill is more in line with the Government’s approach to punish young people especially young people who may be receiving State support. That includes the young mothers and other young beneficiaries who now have less decision making around their own finances and it includes university students who are being increasingly shut out of allowances that would enable them to finish their studies. 
If we are looking at incentives in this bill then we need to look at what this bill offers employers. I agree with the Council of Trade Unions which said in its submission that this bill will incentivise poor employment practice: “There is a clear encouragement for some employers to sack young staff after 6 months—and they can do so at 90 days without any justification—in order to continue to get labour at a 20 percent lower cost.” The Council of Trade Unions was one of 529 submitters on this bill. Of them only nine submitters were in support. Surely that tells the Government something. Of those nine submitters in support seven of them came from employer groups and industry organisations—that is parties with a vested interest in keeping wages low. Among the 520 submitters who opposed this bill were parents unions community groups charitable organisations NGOs the Human Rights Commission and hundreds and hundreds of young people many of whom submitted in person. And I might add some of them were not treated with the respect that they deserved by the chair of the Transport and Industrial Relations Committee. The chair of the— 
Hon Members 
: Oh! 
DENISE ROCHE 
: The select committee heard from economists. We had reports from economists. There was conflicting evidence from economists and I was reminded while I was looking at the evidence and the different opinions from economists that economics is not a science. There were even two submissions from employer groups who did not think that this bill would help with the unemployment rate either. We could be doing more. 
As for the young people we heard from they were really worried about reducing the wages from one category of worker and displacing the work for others for those in the next age category the 20 to 24-year-olds. Those ones are at least protected at the moment by the minimum wage although it is very paltry I agree with Darien Fenton. Really we did not hear any concrete evidence or promises for that matter from employer groups that this bill would increase jobs. We did not get that assurance. The way to get young people off benefits and into work is by creating jobs. Simply lowering the price of labour does not do it. Creating a low-wage economy does not alleviate poverty and it brings absolutely no new ideas into the mix. 
It has been proven that the way to reduce the number of people on the benefit—and that is whom this bill is targeting—is to get them into jobs and jobs where they have a decent job and can support themselves. In 1999 there were 160000 unemployed people. By 2007 that figure was down to 17000. Why? Because there were jobs. Forcing wages down under the guise of doing young people a favour by getting them into work where frankly they will be exploited does not help the economy as a whole. Doing something for the manufacturing industry in this country where 40000 jobs have been lost in 4 years would help. The Government could assist by diverting some of its resources away from offshore interests that demand law changes in exchange for a few thousand short-term and low-paid jobs and into local industry that is struggling with the high exchange rate. The Government could also help by ensuring that local companies get Government contracts because that creates local jobs. 
We reject the notion that this bill is needed because young people are a risk to businesses. That is discriminatory. All bosses take a punt on any new worker. We do not need this bill. We have sufficient legislation in place to mitigate that risk. That is what the 90-day rule is all about. It enables employers to deal with substandard workers and it reduces their liabilities. For employers who are genuinely—genuinely—offering training to young workers there is already the training rate which gives an 80 percent pay rate to young workers in training. We could be doing more for our young people to get them into work and training. The Government could be following the lead of the Mayor of Otorohanga Dale Williams who has with his entire town created a wraparound service that mentors and supports young people into work. This model is also working in Buller and it could work everywhere else too. I note that the speaker from ACT the Hon John Banks was the Mayor of Auckland City and was one of only two mayors in New Zealand during his term in office who declined to join the Mayors Taskforce for Jobs. That was a shame. 
This bill sends a really really negative— 
Colin King 
: Positive signal. 
DENISE ROCHE 
: —really negative—signal to young people that they are not valued that the Government will not invest in them and that the Government is willing for them to be exploited and discriminated against.