Bridges Simon: Minimum Wage (Starting-out Wage) Amendment Bill — Third Reading 
Text is incorporated into the Bound Volume 
Bridges Simon: Minimum Wage (Starting-out Wage) Amendment Bill — Third Reading 
[Sitting date: 21 March 2013. Volume:688;Page:8860. Text is incorporated into the Bound Volume.] 
Hon SIMON BRIDGES (Minister of Labour) 
: 
 I move  
That the Minimum Wage (Starting-out Wage) Amendment Bill be now read a third time 
. It gives me great satisfaction to support this bill at its third reading. This bill delivers on the Government’s commitment to establish a starting-out wage to assist young people to gain a foothold in the labour market. I would like to thank the Transport and Industrial Relations Committee officials and submitters for their work on and contribution to this bill. 
The Minimum Wage (Starting-out Wage) Amendment Bill is part of the Government’s focus to create job opportunities for young people who are finding it difficult to get work in the current economic climate and who have not been helped by the minimum wage settings broadened by the previous Government. The youth minimum wage was abolished in 2008 by the Labour Government and replaced by a new entrants wage that was rarely used. Research commissioned by the then Department of Labour suggests the abolition of the youth minimum wage has resulted in the loss of up to 9000 jobs for young New Zealanders. The new entrants wage applies for the first 3 months or 200 cumulative hours. Businesses complain it is too complicated impractical and fleeting to bother with. Ministry of Business Innovation and Employment research indicates it is used by only 2 percent of employers. 
The starting-out wage will encourage employers to take on young people who will then have the satisfaction of earning money gaining skills and getting the work experience they need. The bill achieves this by providing the ability to set different minimum wage rates known as starting-out wage rates by Order in Council for specified groups of young people aged 16 to 19 years. These rates must be set at no less than 80 percent of the adult minimum wage. This bill encourages continuity with the same employer by providing that a young person on a starting-out wage must complete 6 months of continuous work with an employer before they are entitled to be paid the adult rate by the employer. With a steady work history behind them young people like other employees with a steady work history will be seen as less risky for new employers to take on. 
The bill also addresses the problem of young people who have been on a benefit for a length of time of 6 months or more and may face difficulty re-entering or gaining a foothold in the workforce. The bill will provide for a starting-out wage rate to be set for these young people and in so doing encourage employers to take on young people who have been out of the workforce for a while or may lack skills or experience. The bill also provides for young people aged between 16 and 19 years who are required to undergo training as a condition of the work to be paid the starting-out wage rather than the minimum training wage. 
This Government is committed to creating an environment that encourages economic growth. Part of this environment is providing a better balance to our labour market rules which focuses on helping businesses grow while ensuring workers’ rights and opportunities are maintained. Initiatives such as the starting-out wage will give young people the opportunity to get a foot in the door. This bill will provide a strong incentive for employers to take on young people. Once in work young people will gain the essential and necessary skills and work experience that will assist them throughout their working lives. This is a positive step for young people in New Zealand. I commend this bill to the House.