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: How will Fair Pay Agreements help New Zealand businesses and workers to meet the challenges and opportunities presented in a rapidly changing world of work and has he taken on board advice if any during the development of the Fair Pay Agreement framework?Hon MICHAEL WOOD (Minister for Workplace Relations and Safety): I thank the member for the opportunity to speak about how the fair pay agreement system will help New Zealand workers to combat the challenges and embrace the opportunities presented in the rapidly changing world of work. I note that fair pay agreements were an important manifesto commitment of the Labour Party at the last election. We've worked since then on taking on board the advice of officials noting that our view was always that we should follow through on the commitments that we make. In respect of the first part of the member's question I draw his attention to a very useful quote from the foreword of the Fair Pay Agreements Working Group from the Rt Hon Jim Bolger who said It is vitally important that New Zealand tackles significant issues which are likely to affect other people's working lives in the coming years. I believe that a focus on lifting productivity and preparing New Zealanders with the skills to thrive in the future of work is vitally important if we are to succeed as a nation. Fair Pay Agreements could be a useful tool to address these important challenges." That's because fair pay agreements are about shifting the focus from competition based on low wages to competition based on the quality of products and services innovation research and development and the other things that actually build prosperity and productivity. I would however draw the member's attention to one other quote from the Rt Hon Jim Bolger who did note—DEPUTY SPEAKER: I think you have actually addressed the question.Hon Paul Goldsmith: How will fair pay agreements which could impose mandatory nationwide terms and conditions on certain industries and occupations make Kiwi businesses more agile?Hon MICHAEL WOOD: I draw the member's attention to the fact that we do have mandatory conditions across the labour market at the moment. Those are things such as the minimum wage such as minimum annual leave and minimum sick leave. They provide a basic floor for workers' terms and conditions and actually most decent employers believe that that's a good thing. One of the important things about fair pay agreements is that in the establishment of a floor they support decent employers who want to provide good pay and conditions from being undercut and those employers can therefore compete on the basis of those things that will actually drive greater productivity. That's what we've seen in many other jurisdictions overseas. Hon Paul Goldsmith: With regard to the advice from officials on direct costs of fair pay agreements in the range of $160 million to $620 million a year does he accept that some of those costs will be passed on to consumers adding to the cost of living crisis that Kiwi families are facing every day?Hon MICHAEL WOOD: There is a lot of similarity between the member's question and a comment made by the EMA yesterday which noted that the purpose of fair pay agreements is to increase the wages of workers. The only answer that I can give to that is yes. On this side of the House we believe that's a good thing. I'd ask the member to reflect on the fact that at a time in which his side of the House is talking a lot about the cost of living they seem implacably opposed to any measure that actually improves the wages of our lowest paid workers.Kieran McAnulty: What reports has he seen about other models like the fair pay agreement system around the world?Hon MICHAEL WOOD: I have seen reports from a range of different sources about for example Australia's modern awards system. Australia of course has had a higher rate of labour productivity than New Zealand in the period during which it has had a sector-based bargaining system similar to fair pay agreements as has Singapore and as has Germany one of the most successful innovating export economies in the world.Hon Paul Goldsmith: Did it worry him that Treasury advised in relation to fair pay agreements that "There has been minimal identification of empirical evidence for the problem or for the policy response" and did he think the Treasury officials were essentially saying that his bill is driven by ideology rather than any evidence?Hon MICHAEL WOOD: From time to time I have disagreed with the advice that has been provided by Treasury. What I do agree with is the advice and views that I receive for example from real Kiwi workers people like the cleaners who come into our offices here at Parliament every night who note that in order to try and live a decent life and pay the bills they often have to string two to three different jobs together. That is a legacy of the deregulation of the labour market that occurred in the late 1990s. I know that they were halcyon days for the member and those people that he idolises but on this side of the House and across most of New Zealand we have moved on and we want a decent labour market to support those workers.Hon Paul Goldsmith: Was the only advice that he listened to the advice that he got from his union official friends and former union official workers?Hon Members: Jim Bolger.Hon MICHAEL WOOD: No I've heard advice from a range of people—as we've just heard from the Rt Hon Jim Bolger and the working group that was convened several years ago. I've also heard advice for example from the OECD who note that New Zealand is one of the few countries in the developed world without a sector-based bargaining system and that the most effective labour markets do tend to have a mix of individual enterprise-based and sector-based collective bargaining.Kieran McAnulty: Has the Minister seen any other quotes from the Rt Hon Jim Bolger and if so what did it say?DEPUTY SPEAKER: Order! You need to make the question relevant to the primary question not to the answer—which you did not. So do you want to have a— Kieran McAnulty: Point of order. The answer to the previous question directly referred to statements by Jim Bolger.DEPUTY SPEAKER: Yeah well you can't just have endless supply of quotes. They have to be relevant to the—Kieran McAnulty: Can I have a supplementary?DEPUTY SPEAKER: Supplementary.Kieran McAnulty: Thank you. Has the Minister seen any other comments from the Rt Hon Jim Bolger in relation to fair pay agreements; if so what did they say?Hon MICHAEL WOOD: Yes I've seen a range of comments that the Rt Hon Jim Bolger made. He did an excellent job in terms of leading that working group which included representatives from unions and employers on it. He put forward in the foreword some of the arguments for a sector-based bargaining system. He did however also note that unfortunately there will always be some people "who always try to screw the worker" Mr Goldsmith."