Bradford Sue: Westpac New Zealand Bill — First Reading 
Bradford Sue: Westpac New Zealand Bill — First Reading 
[Volume:630;Page:2303] 
SUE BRADFORD (Green) 
: 
 The Green Party supports the introduction of the Westpac New Zealand Bill for the simple reason that our members believe the banking system operating in this country should be more under the control of this country. We support the policy of the Reserve Bank of New Zealand as noted in the explanatory note to the bill that systemically important banks should be locally incorporated in New Zealand. Although Westpac may find it necessary to make a giant leap in having to incorporate here including through this legislative process in reality this bill is only a small step in the long march for New Zealand to regain its economic sovereignty. 
I like many others was bitterly disappointed when the Trust Banks of New Zealand—with the exception of Auckland and Taranaki—were amalgamated and then privatised into Westpac’s grip. Those Trust Banks were synonymous with communities ordinary Kiwis’ mortgages and local economic development. Of course their assets continue to support the communities of this country but that is not the same thing as owning the bank and having some local control over local savings and investments. 
Let us see what has happened in the last 10 years since Westpac took over the Trust Bank network. In 2006 the prestigious Roger Award for the worst transnational operating in New Zealand went jointly to Westpac and the Bank of New Zealand. The judges’ report and supporting documents make sobering reading. Ten years ago Westpac—and Trust Bank which it later took over—employed 6760 staff. Today it employs 5004 staff. That is a reduction of 26 percent yet its profit of $617 million is 396 percent more than it was 10 years ago. So staff who used to make the bank an average $146000 operating income per year now need to make the bank $340000 operating income per year. Staff have been forced to become more than twice as profitable for their bank but their pay rates have risen by only 27 percent in those 10 years. 
The bank forces up its profits by setting sales targets for staff to meet. Those targets grow each year to match the bank’s greed for larger profits but the number of people employed to meet these targets falls. The number of Westpac branches has reduced in the last 10 years from 433 to 196 a reduction of 54 percent. This is despite Westpac’s total assets growing from $21 billion in 1994 to $42 billion in 2004 a growth of 100 percent. Net profit after tax for Westpac and Trust Bank combined grew from $155 million to $617 million between 1995 and 2005—a remarkable growth of 396 percent. 
One of the pressures on interest rates is banks such as Westpac using performance pay targets to compel their staff to sell higher and higher levels of debt to customers. The Governor of the Reserve Bank has expressed concern on this matter. Westpac chief executive Ann Sherry simply rejected the governor’s claims that banks are playing a role in fuelling inflation and suggested the bank was simply responding to customer demand. However Westpac customer service workers are set a target of 8575 points per year to meet performance standards. They get 10 points for opening a new account but an extra 25 points for selling a credit card. Westpac customer consultants are required to get 13305 points. They get 5 points for every $10000 of home loans they sell and 5 points for every $1000 of personal lending. No wonder we have an explosion of credit. 
At union meetings at Westpac over the last year workers have also complained of being unable to take holidays at the same time as their children and of being asked to return from holidays because their worksite was understaffed. Staff in entire offices have been working late or missing morning and afternoon tea breaks without compensation. There is a high workload causing stress and pressures on the families of workers. Workers are coming to work because of workload pressures despite their being sick. Bullying is not uncommon within Westpac. In one case a pregnant woman in the call centre was told she would have to make up time after work if she went to a specialist’s appointment. Her husband called her union FinSec distressed at this behaviour. A FinSec organiser subsequently informed the call centre team leader of that person’s responsibilities under the Parental Leave and Employment Protection Act. The team leader then demanded that the 20-week pregnant woman produce a doctor’s certificate to prove she was pregnant and that the specialist’s appointment was related to the pregnancy. 
Workers doing the late shift at the Phone Assist Call Centres in Auckland and Wellington do not get taxis home despite some of them not having cars and the fact that in Wellington there is no appropriate parking available anyway. Instead Wellington staff have been taxied to the train station at times despite the trains having finished running for the night. At one branch two staff members with outstanding performance records have gradually had their target review levels fall from five which is outstanding to one the lowest mark because they worked in a small town with a saturated market. They were put on performance improvement plans because of their low marks and threatened with transfer to another branch in a nearby town. Call centre workers are monitored so closely that when they make a 3-minute call to the union they have been threatened with having to make up that time after work at the end of the day. Call centre staff have also been spoken to for taking more than three toilet breaks during the day. If they spend more than 17 minutes not ready and available on the phone during the 8-hour day their quality assessment can be marked down thus potentially affecting their pay. 
The report of the Roger Award also outlined how Westpac along with all other big banks has used tax avoidance strategies to borrow overseas channel the money through New Zealand and re-lend it overseas. Through what the report described as a scam these banks are paying as little as 6.7 percent tax instead of the official company rate of 33 percent. This information came from Reserve Bank documents that were leaked to the media. Reliable estimates put tax owed by the “gang of four” at $1.63 billion dollars. The unexpected taxation windfall of $500 million announced by Dr Cullen prior to the last election is believed by some economic observers to have come from the major banks. 
Finally New Zealand Westpac customers of all political persuasions have to put up with the highly partisan and ideological comments made by Westpac chief economistBrendan O’Donovan. For all intents and purposes Mr O’Donovan acts as economic cheerleader for the National Party and is a constant critic of economic policies of Labour the Greens or any other of the Government support parties. There was blatant politicking from Mr O’Donovan prior to the election last year. To give one example before the election Mr O’Donovan attacked the student loan policies of Labour and the Greens and was subsequently forced to admit that some of the estimates he was using to cost the loan scheme were somewhat extreme. The then Minister of Education the Hon Trevor Mallard described Mr O’Donovan’s figures as inflammatory self-motivated garbage and stated that the bank had very selfish reasons for opposing the policy. Mr O’Donovan has also attacked the Working for Families package and strongly advocated unsustainable tax cuts. Recently he has even attacked the Government’s Buy Kiwi Made programme that I am responsible for before it has even been designed. 
I hope that select committee members take a good look at this bill when it reaches them. The fact that an Act of Parliament is needed to facilitate the incorporation of Westpac in New Zealand means that Westpac should have even more obligations to be a good corporate citizen and a good employer. Its corporate behaviour will have to change on a number of fronts. I urge the select committee to not just go through the motions of hearing submissions and reporting back on this bill; its members ought to have an obligation to determine whether the legislation will actually change the behaviour of this bank. If the bank will not change they should consider what amendments will be necessary to make sure that a bank relying on an Act of Parliament to incorporate in New Zealand actually does act as a good corporate citizen and a good employer.