Roy Eric: Minimum Wage (New Entrants) Amendment Bill — In Committee 
Roy Eric: Minimum Wage (New Entrants) Amendment Bill — In Committee 
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ERIC ROY (National—Invercargill) 
: 
 I have just been listening to the debate and I felt somewhat— 
Nathan Guy 
: Moved. 
ERIC ROY 
: Moved would be the word yes. I was going to say “angered” but moved will do. I felt moved to make a contribution to this debate because I can recall with great clarity the first debate we ever had about putting in place youth rates and that was by way of a private member’s bill moved by Michael Laws and Nick Smith in 1994. So this debate has gone on over time. The issues that were apparent then are just as clear today and I wish to draw attention to those issues. 
The first point is that this bill says that the best way we can help people to get involved in the workforce and to get rewarded for what they are doing is to have the Government say what they are worth. And I would say that that is a flawed notion. 
David Benson-Pope 
: There were 161000 people unemployed under that party. 
ERIC ROY 
: The member who is making a great fuss on the other side of the Chamber needs to consider these issues. I absolutely agree that people should be paid what they are actually worth but the history under this Government is that productivity in New Zealand has gone down and by every measure we are worse off now productivity-wise which means that we are less able to compete in the world market and ultimately that there will be fewer opportunities for young people. 
The question surrounding the minimum wage is whether there is a job opportunity and whether we rule that out by setting the barrier of a wage that is too high. I give members this example. In the petrol station where I get my car filled with fuel there used to be a person on the forecourt who filled up my car. But as soon as we put minimum wages up to a point that has an impact on the price of fuel I will go and get my car filled up somewhere else where I can pump my own gas. So when we set the bar too high it becomes a disincentive for employment because at the end of the day someone has to pay. So to think that we can resolve the situation of a low-wage economy—which I admit we have in New Zealand compared with all other countries particularly those above us on the OECD list—by just putting wages up can in actual fact work as a disincentive for employment. That is the first point. 
The second point is that when we start to dictate what a minimum wage should be and when that bar is too high then that sends a false message and locks in dependency because many young people think that that wage is as good as it can get. The moment young people step into a minimum wage without education and without any incentive they are locked into that for the rest of their lives. 
I want to pick up on clause 4 because this is the part that really starts to concern me. Clause 4 will enshrine in law a delegated authority to set what the wage is. So by passing clause 4 today we are saying by Order in Council that somebody can set the wage. 
Darien Fenton 
: Haven’t you read the Minimum Wage Act? 
ERIC ROY 
: My questions are—and I expect someone who is very vociferous on the other side of the Chamber to answer this—”What is the mechanism to be used by those people who make the recommendation to the Governor-General and who are they?”. I have only just picked up this bill and had a cursory read of it. Is it the Minister of Labour? [ 
Interruption 
] Well someone can take a call and respond because I believe that this is an issue we need to know about. What are not stipulated in respect of this delegated authority are the measures to be taken by the group individual or person making the recommendation for that minimum wage to be set and altered at any point without the intervention of Parliament. What criteria will they consider when they are using that delegated authority to set the minimum wage? So I have some serious concerns that by passing clause 4 as it stands we are locking in a mechanism whereby some people who are not specified in the legislation have a right at any time not determined in there—it could be twice a year or every 5 years; we do not know the specifics— 
Dave Hereora 
: Read the bill! 
ERIC ROY 
: Well someone can respond to that; I have had a quick look at it as I say. 
 Let me just restate that this is not a case of helping young people by locking them into a situation. If we want young people to be incentivised to be interested and to be taking opportunities then it is not a matter of encouraging them to lock themselves into a low and minimum wage. 
The CHAIRPERSON (H V Ross Robertson) 
: Before I call the next speaker for the benefit of my learned colleagues on my right I tell them that I would like them to look at Speakers’ ruling 57/3. It was a favourite of former Deputy Speaker Geoff Braybrooke and it is becoming one of mine.