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Beehive Bulletin – 22 December 2006

Beehive Bulletin – 22 December 2006

Minimum wage increases

Workers earning the minimum wage will receive a 9.8 per cent pay rise from 1 April 2007. The minimum adult wage, for those 18 years plus, will increase from $10.25 to $11.25 an hour ($450 for a 40 hour week) - the largest increase since the Labour-led government was elected in 1999. Labour Minister Ruth Dyson also announced an increase to the minimum youth rate - for workers aged 16 and 17 years -from $8.20 to $9 an hour, to stay at 80 per cent of the adult minimum wage.

Ruth Dyson said the higher minimum wage will allow lower paid workers to share the benefits of economic growth, encourage workforce participation and protect some of New Zealand's most vulnerable workers. Around 110,000 adult (mostly women) workers, and around 9,200 youth workers stand to benefit from the increases. The government aims to get the adult minimum wage to up to $12 an hour by the end of 2008, if economic conditions permit.

Resilient NZ economy

Finance Minister Michael Cullen said the New Zealand economy was more resilient than first predicted, with the expected downturn proving to be much milder. His comments followed the release of the Budget Policy Statement and the 2006 Half Year Economic and Fiscal Update. Treasury has revised its Budget forecast growth in the March year to 1.8 per cent, up from 1 per cent in May. This was thanks to continued strength in the labour market, domestic spending and favourable commodity prices.

Higher tax revenue and an upward revision of tax forecasts meant the cast deficits forecast in the Budget over the next four years have almost halved in total from $7.4 billion to $3.8 billion. Dr Cullen said the improved position meant about $1 billion extra will be available for Budget 2008 on top of the $2 billion allowance that was set in Budget 2006. This would cover the cost of a business tax package. Dr Cullen said he was mindful of inflationary pressures and any further tax measures would be conditional on cost and the macroeconomic environment. He reiterated that the government's wise fiscal management provided the flexibility to allow New Zealand to manage economic shocks and better respond to challenges in the future.

Tackling climate change

The government released a discussion document, Sustainable Land Management and Climate Change, which outlines policy options to address the risks and opportunities of climate change in the land management sector. Agriculture and Forestry Minister Jim Anderton and Climate Change Minister David Parker said the government is seeking feedback on the document, and proposals for agriculture and forestry, as it seeks to address the threat of climate change. A significant forestry-planting programme involving thousands of hectares is one of the options being put forward to reduce New Zealand's carbon footprint. Involving the land management sector was important to achieve tangible reductions in greenhouse gas emissions while ensuring vital sectors continue to survive. Meetings on the document will be held nationwide in February, and submissions are due by 30 March 2007.

Tougher standards for import vehicles

A proposed restriction on imported vehicles with older technology, was announced by the government as a way to help reduce vehicle emissions. Associate Transport Minister Judith Tizard said the Labour-led government is serious about reducing harmful emissions, which contribute harmful emissions and transport greenhouse gas emissions. Vehicles will be required to meet a new vehicle emissions technology standard before they can be imported. They would be tested at the border to ensure the standard is met. Cabinet has given the green light for the Ministry of Transport to draft a Rule outlining options for entry restrictions on vehicle imports. The draft would be released to industry and the public around March. The Rule would set out a series of steadily increasing standards that used vehicles would have to meet and it would also update emission standards for new vehicles to ensure they meet current international standards.

Buy Kiwi Made grants open

Applications for grants under the $3 million Buy Kiwi Made Regional and Sector Initiatives Fund were opened this week. Government spokesperson for Buy Kiwi Made, Green MP Sue Bradford, said the fund is part of the government's $11.5 million Buy Kiwi Made Programme. Established last month, it aims to support regional and sector proposals that demonstrate economic merit and that are consistent with the Buy Kiwi Made objectives. Projects eligible for the fund must be New Zealand-based and focused, and consistent with international obligations. They must also fall outside the criteria of existing government assistance programmes.

Happy Holidays!

Beehive Bulletin takes a well-earned break for the holiday season. Best wishes to all our readers for a happy and safe Christmas and New Year. The Bulletin will be back in January 2007.


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