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Brash: Association for Migration and Investment

Don Brash MP
National Party Leader

28 July 2006

Address to the annual conference of the New Zealand Association for Migration and Investment, Auckland.

Anyone who finds time to follow international news these days will know that immigration is possibly the hottest topic of politics in the United Kingdom, France, Australia, the United States and many other countries. The rights and wrongs of current and past policies are debated openly and fundamental questions routinely asked.

In Britain today, many question whether multiculturalism has failed as an ideal. Many now feel that we should be putting more emphasis on what we have in common - especially the shared values which act as a glue to bind our communities - rather than over-emphasising our cultural and ethnic differences.

While immigration is a favourite topic of conversation around many New Zealand dinner tables, it remains strangely under-discussed at the political level.

In part, this reticence reflects our recent history. Winston Peters’ handling of the topic in the 1990s left a very bad taste in the mouths of many New Zealanders.

And in New Zealand, by contrast with the experience in Europe, we haven’t yet had to deal with large unintegrated and at times hostile populations in our midst.

In fact, we have been fortunate that immigrants of all cultures have mixed fairly readily with locals. You only need to wander through university campuses in Auckland to see countless couples of different origin hand in hand. This is a good tradition we’ve had in New Zealand for at least two centuries, since the first meeting of Maori and European.

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We are, after all, an immigrant people, and owe much of what we are to very recent immigrants, or the descendants of immigrants from a wide range of countries. At the last census, there were 700,000 people living in New Zealand who had been born overseas - that’s one in six of us.

Former chief justice Sir Thomas Eichelbaum was born in Germany. Andrew Mehrtens and Irene van Dyk were born in South Africa. David Tua, and a significant fraction of the All Blacks were born in the Pacific. In the New Zealand Parliament, Michael Cullen and Peter Brown were born in the UK, and Pansy Wong was born in China. We rightly regard all of these people as New Zealanders. Even most people who regard themselves as Maori New Zealanders have several recent immigrants among their forebears.

In my own case, I regard myself as a fifth generation New Zealander, and one of my ancestors did arrive in Dunedin 1848, but one of my grandparents was born in Australia and another in the UK.

The muted political discussion around immigration also reflects the fact that both major political parties, and most of the population, understand the benefits of immigration, and welcome migrants to our country.

Most understand that, at a minimum, we need migrants to offset the large and growing outflow of Kiwis. When you lose to foreign shores the equivalent of nearly twice the population of Wanganui each year, you’re obliged to actively seek out replacements.

So long as we have a continued large outflow of Kiwis, our immigrant flows are going to need to be high, and over time that has the potential to substantially change the cultural make-up of our society. Accordingly, immigration policy - its objectives and its risks - must be an important topic of discussion.

Today I want to give you an insight into our current thinking on the topic.
The case for on-going immigration is straightforward and largely uncontroversial. Essentially, it boils down to three points.

I’ve already stated the first: we need immigrants to replace the New Zealanders we lose.
A related point is that, in common with most other developed countries, our birth rate has fallen below replacement rates. I’ve done my bit with three children, but on average New Zealanders are not replacing themselves. Even with no loss of Kiwis overseas, we’d need a steady flow of immigrants to maintain a stable population.

But National believes we should do more than just aim to hold our population stable. So my second reason for supporting on-going immigration is that, for primarily economic reasons, a moderate growth in our population is desirable: there seems little doubt that business investment is less risky - and therefore more likely to occur - with a gradually increasing total population than with a static or declining population.

There is a third argument for an immigration programme. Immigrants benefit New Zealand in a great many ways which are much broader than the narrowly economic ones - think, for example, of the contribution which those from the Balkans have made to our wine industry, or the contribution which those from Asia have made to the quality of our restaurants and to our rapidly growing trade with Asia.

Of course those examples are fairly obvious - in fact, they are stereotypes. It’s all too easy to forget the breadth of contribution immigrants have made by virtue of entrepreneurial, intellectual, artistic or sporting flair.

Consider, for example, the remarkable story of a Chinese immigrant who arrived in New Zealand in 1866. This man, Chew Chong, became one of Taranaki’s most visionary characters who, almost 80 years after his death at the age of 92 in 1920, was inducted into the NBR Business Hall of Fame. He was a remarkable entrepreneur, and a key figure in helping to develop the region's dairy industry, especially in the making and refrigeration of butter. He was even responsible for producing one of New Zealand's most recognisable food items - the iconic pound of butter.

I’m sure we could go on endlessly with such examples. I certainly don’t pretend to be an expert, but my kids tell me that the New Zealand music scene would be much less dynamic without the likes of Nesian Mystic and Che Fu, and of course Asian names are heavily represented in the finals of every classical music competition.

So for these good reasons, the National Party supports an ongoing immigration programme.
But we’re not uncritical cheerleaders for ongoing immigration that’s poorly thought out or poorly implemented, and we understand the limits to what immigration can do.

New Zealanders have been fed some myths about immigration. It’s often argued, for example, that we “need” a large flow of immigrants because we currently have such a shortage of people to staff our factories, our hotels and our orchards.

Bringing in a skilled person from overseas can often fill a gap for an individual company, and indeed it may be the only effective way of filling that gap in the short-term.

But it’s an illusion that bringing in thousands of people will ease a general shortage of people. Why? Because when immigrants first arrive in the country, they need a roof over their heads, they need to buy furniture and sometimes new clothes; their children will enrol in school.

In other words, in the short-term new immigrants add more to the demand side of the economic equation than they do to the supply side, and so can accentuate the economy-wide pressures that you might otherwise expect increased immigration to relieve.

Certainly, when I was Governor of the Reserve Bank we regarded a very strong surge in net immigration as a reason to be on the lookout for inflationary pressure, not a reason to expect reduced pressures in the labour market.

New Zealanders have also been told repeatedly that increased cultural diversity is automatically a good thing. And yes, we are enriched by having among us people who enable us to experience different cultures directly, including their music and dance, their cuisine, their festivals and somewhat different approach to life. These all contribute powerfully to the benefits of our multicultural society.

But while we celebrate that diversity, it’s equally important that as New Zealanders we share bedrock values that are crucial to New Zealand society.

And the bedrock values I see as fundamental to New Zealanders are an acceptance of democracy and the rule of law, religious and personal freedom, and legal equality of the sexes. If you don’t accept these fundamentals, then New Zealand isn’t the place for you.

Put another way, we should not welcome those who want to live in New Zealand but reject core aspects of New Zealand culture.

It is, of course, very difficult to assess the values that a would-be immigrant possesses. It’s impractical, beyond some basics, to screen people for what they believe as they enter the country.

We can ask and expect people to fit in, but the reality is that many migrants to New Zealand in recent times, and indeed to the West more generally, have come from cultures that don’t share the bedrock values that New Zealanders take for granted.

In this situation, the sensible response is one of caution. We cannot be indifferent to whether migrants are likely to share our bedrock values. We can’t just hope it’ll work out fine.

In most respects, it’s a question of quantity and of balance.
Diversity is a bit like red wine: a certain amount is good for one’s health; too much too quickly alters your personality and can be thoroughly bad.

Most New Zealanders like New Zealand the way it is. They value the social cohesion we have built up over many decades. I certainly don’t detect a desire to change our cultural make-up fundamentally over the next 20 years, especially in the absence of a considered debate, let alone a conscious policy decision.

The practical realities reinforce this instinctive caution. It’s a commonsense observation that Australian migrants fit into New Zealand society more readily than those from elsewhere; Aussie children are swallowed seamlessly by the New Zealand school system, their parents’ qualifications are accepted without question in the workforce - in short, they understand our culture and share our values. They even speak a similar language!

So, how are we going?
The most striking aspect of immigration in New Zealand is its scale. This country welcomed nearly 54,000 immigrants last year (excluding Australians). That number represented around 13 migrants for every thousand current residents.

Compare that with Australia: 133,000 migrants (excluding New Zealanders), which is around 7 for every thousand residents; or the United Kingdom with 140,000 migrants from non-EU countries, less than 3 migrants for every thousand residents.

If New Zealand were a company, observers would say our churn rate is significantly higher than that of our competitors.

As I’ve already indicated, the main driver of New Zealand’s disproportionately high immigration rate is our disproportionately high emigration rate.

We should be worried about the extent to which the outflow of Kiwis is accelerating. In the year to January 2004, for example, a net 10,000 New Zealanders left for Australia. In the year to January 2005, there was a net loss of 16,000. In the year to January 2006, the loss was 21,000. And this at a time when, to hear Helen Clark tell it, the New Zealand economy is doing well.

Already, a quarter of tertiary-educated New Zealanders live overseas.
There are, of course, many factors that encourage New Zealanders to go overseas permanently. Some are angered by the trend to racial separatism implicit in much of the nonsense talked about the Treaty of Waitangi. Some are fed-up with the over-weaning political correctness of the nanny-state which Labour has been hell-bent on building. Some simply want the challenge of proving themselves on a much bigger stage. But many leave to get a better standard of living for themselves and their families.

That’s why the broader question of New Zealand’s attractiveness as a place in which to live and raise a family is so crucial to the immigration debate.

As I’ve said many times, when the Labour Government came to power in 1999, the average Australian took home 20% more than the average Kiwi - a gap which was little changed since 1984.

But by last year, after six years of Labour, the average after-tax income in Australia was not 20% but 33% above that in New Zealand. And since the tax reductions that took effect in Australia at the beginning of this month, it’s estimated that the gap is now 37%. Alas, there is every prospect of the gap getting still wider over the next few years, as the New Zealand economy slows down and the Australian economy continues to grow more strongly.

So the chances are high that more and more Kiwis will head overseas in the next few years, and as a result we’ll need to keep immigration levels high if we are to avoid going into reverse gear.

A new National Government’s top priority will be to improve the attractiveness of New Zealand to hard-working New Zealanders and potential migrants by such policies as letting people keep more of their own money and asserting equality before the law, regardless of race.

If we can retain more New Zealanders, we will take the intense pressure off immigration to plug the gaps.
But even with substantial improvement on that score, New Zealand will still require a substantial number of immigrants. And a better performing economy will be a magnet for quality migrants.

The critical question which has been little debated or discussed is - what kind of people should we be encouraging to come to New Zealand?

Setting aside the issue of refugees, family reunification and special Pacific arrangements, most people would want the government to attract only migrants who have something to contribute: be it skills, capital or, in certain circumstances, a willingness to do manual labour.

We’d expect them to have either a good command of English or a determination to learn the language within a reasonable period, and to be young enough to contribute some taxes before going on the pension - or wealthy enough so that they can cover their own healthcare needs and income in retirement.

We need to be sensible about the English language requirement. As your chairman noted earlier this week, we have experienced a disastrous collapse in the investor migrant category in the past few years, from over 1,000 a year in 2001 and 2002, to only 39 in the first six months of this year. In this category, if somebody can’t speak English they can hire themselves a translator if they wish - that would be one job created for starters!

Our policy at the last election for business immigrants was to focus on their capacity for job creation, not expensive business plans or enforced investment in government schemes for a lengthy period.

We also need a more disciplined approach to the administration of immigration policy. Not discipline of the petty, bureaucratic, kind that makes life miserable for applicants who have an unblemished record of hard work, the sort of people that any interview would reveal as desirable citizens. But discipline around limiting access to welfare and healthcare for an extended period, and swift repatriation in case of serious criminal conviction.

Ideally, we would want our country to be something like a top university, where lots of people apply but only good quality candidates get in. But for now, we have to realise there are other destinations that we are competing with for quality immigrants, especially in the business and investor category.

We must ensure that our immigration policies contribute to our competitiveness, to our country’s attractiveness. And in some respects, particularly surrounding the business and investor category, current policies clearly do not contribute positively to this goal. We still have some important advantages when it comes to attracting good quality migrants. We are a very sparsely populated country with incredible natural beauty; we are a stable democracy; and, while terrorism is an ever-present risk for all countries, we are some distance from the trouble spots of the world.

But these attributes are seldom enough on their own to make up for the gap between take-home pay in New Zealand and take-home pay in Australia and other competing destinations.

Currently, around 60 per cent of the migrants to New Zealand come in as skilled migrants. Many of them are highly qualified and would be welcomed in any country.

Incidentally, it’s worth remembering that the overwhelming majority of employed immigrants are regarded favourably by their employers - according to a Labour Department survey released in February, 81% of the 804 employers surveyed rated the job performance of their migrant employees as good or very good, with only 4% rating them poor or very poor; and 56% of employers felt that they had benefited more from hiring a migrant than they would have done if they had hired a New Zealand resident.

But we would be kidding ourselves to think that New Zealand is maintaining consistently high standards for the skilled migrant category.

Indeed, only a few weeks ago the Government announced that it was lowering the standard for skilled migrants to get in the door.

The danger is that the Labour Government is more preoccupied with trying to stimulate a flat economy by bringing in a few more migrants for a short-term boost in activity than it is in ensuring that our migration policy is in the nation’s long-term best interests.

Meanwhile Labour’s tax policies, and its total failure to do anything to increase our standard of living relative to that in Australia, are steadily making New Zealand a less and less attractive destination for skilled migrants.

The true measure of good government in New Zealand is that the standards for entry to this country should be rising, in tandem with increased demand.

Determining who gets the right to be a New Zealand resident is arguably one of the most important responsibilities of the government, yet we continue to leave this as the province of a third-rate department populated by too many incompetent bureaucrats.

Far too many people who should be enthusiastically welcomed to New Zealand have huge difficulty getting in, while some who seem to have little to offer are allowed in and allowed to stay.

You may recall the case of the wife of Dr Dean Kenny, former All Black, reported in the media last year2. He complained that the Immigration Service had initially turned down the application of his Welsh-born wife even though they had been married for nine years and had two daughters, both of whom had New Zealand passports. The Service had asked for photos of him and his wife together, copies of letters, proof of shared income, shared bank accounts and evidence of public or family recognition of the relationship. The Asian spouses of New Zealand citizens routinely encounter the same problem.

Or the case of Mrs M Taylor, described in a letter she wrote to the Listener3. New Zealand-born herself, she decided after 20 years overseas to return to New Zealand. She described gaining residency for her non-New Zealand husband as “an appalling trial, financially and emotionally. Married for 12 years and now with three children, we sent our wedding certificates, children’s birth certificates and family photographs to immigration, only for them to be returned and we were told that we hadn’t fulfilled the requirements of our application and further proof of the validity of our marriage was required, not less proof that we were sexually exclusive during our marriage…. It’s understandable that there needs to be a rigorous system”, she wrote, “but why are born-and-bred New Zealand passport holders put through this? Do you want us back in the country or not? You had my heart, but somewhere along the way, while I was dealing with yet another irritating and pointlessly discriminating piece of legislation and form-filling, you lost it.”

Or the case of the Dutch citizen, expert in growing hydroponic tomatoes under glass - desperately needed to ensure the commercial viability of an operation employing hundreds of people, but kept waiting for months and months with his Dutch wife and young New Zealand-born children while the Immigration Service pondered whether to grant him permanent residence.

Or the case of the 12 East Europeans arrested for not having work permits while employed at the Takaro Lodge in Te Anau. Clearly, they were in breach of the law and should have had work permits. But why were they denied work permits? It’s almost impossible to get staff for hospitality industry jobs in the Queenstown/Te Anau area, and all sorts of non-New Zealanders are getting work permits to fill the gap. Takaro is isolated and its requirements specialized, and they just can’t get any suitable local staff.

And there are other government agencies which make life a misery for would-be immigrants. The New Zealand Qualifications Authority recently refused to recognise a 36-year-old Englishman as a qualified teacher, despite his having a bachelor of science degree, a master of science degree, a post-graduate teaching certificate in further education, and four years teaching experience in the UK, and despite Morrinsville College - where the would-be immigrant teaches physics - being desperate to retain him.

So we make it inordinately difficult for some immigrants who appear to have the very characteristics that we want in immigrants, and yet allow some ratbags to enter and stay. There have been some appalling cases of crimes committed by would-be immigrants and too many of them seem to have deportation orders against them overturned by the Deportation Review Tribunal. Non-New Zealanders who commit serious crimes should be automatically and immediately deported at the conclusion of their prison sentences.

It’s important to recognise that there’s an implied contract between New Zealand and would-be citizens: New Zealand offers you citizenship with all the rights and privileges of being in every respect a Kiwi, but in return you owe New Zealand your loyalty and commitment. You can’t be a New Zealander and seek to undermine New Zealand. You can’t be a New Zealander and claim that some other law takes precedence over the law of the New Zealand Parliament. You can’t be a New Zealander and write to foreign newspapers urging a boycott of New Zealand exports, as one would-be citizen did recently in reaction to the publication by two newspapers of some cartoons satirizing Mohammed.

The National Party favours an immigration programme designed to benefit all of us - those born in New Zealand and those born abroad.

Our vision is of New Zealand as one nation, with many peoples to be sure, but with shared fundamental values.


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