21 August 2009
Media Statement

Minister must explain Job Ops botch-up

Paula Bennett must explain the rules around the Jobs Obs subsidy because it looks like she’s botched it, says Labour Social Development spokesperson Annette King.

“The New Zealand Herald today reported that two employers who are benefitting from the $5000 subsidy say they always planned to employ another worker anyway. They have understandably jumped at the chance to fill their vacancies with a $5000 wage subsidy from the taxpayer.

“Yet Work and Income is reported saying that the employers told it they would not have employed someone without the subsidy. It says it is now strengthening guidelines so that staff will now ask whether the employer was planning to fill the position anyway – despite the fact it claims these issues were canvassed in these instances,” says Annette King.

“This is fishy to say to the least and shows something is wrong. It suggests that in its rush to try and be seen to be doing something to tackle mounting unemployment, the Government failed to think the policy through.

“Labour has already asked a number of questions about the criteria around Job Ops specifically because the Government has never been clear whether the scheme is designed to create new jobs, which it should do, or will simply displace one group of workers in favour of another – which will do nothing to reduce overall unemployment rates.

“Confusion appears to have reigned in Government ranks from the beginning.
John Key, when announcing the policy, said ‘a small business owner may have enough work to justify a new entry-level worker, but may lack the will needed to hire and train a young person for the job.’

“Yet Paula Bennett said ‘it is not intended to be used by seasonal employers – the focus is on creating new positions for young people rather than using these people to fill existing vacancies.’ These statements don’t gel,” Annette King says.

“The Government needs to come clean and spell out the rules once and for all. While Mr Key talked about small business owners, Paula Bennett has said most employers including those in its Industry Partnership scheme are eligible.

“Big supermarket chains are in that partnership. I don’t believe that most New Zealanders think big supermarket chains deserve a $5000 taxpayer handout to subsidise the wages of someone they were always going to employ.”

ENDS

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