Scoop has an Ethical Paywall
License needed for work use Register

Gordon Campbell | Parliament TV | Parliament Today | News Video | Crime | Employers | Housing | Immigration | Legal | Local Govt. | Maori | Welfare | Unions | Youth | Search


Government loses plot on supporting Kiwi jobs

Government loses plot on supporting Kiwi jobs

Two announcements today show the Government missing two opportunities to preserve and build good Kiwi jobs, said the CTU. More Kiwirail rolling stock is being manufactured overseas, and the management of two Auckland prisons is being privatised, with likely job and income losses.

Kiwirail has announced that a $29 million tender for 300 rail wagons has gone to China CNR Corporation. Kiwirail’s Hillside workshops tendered for the deal but lost out. The future looks bleak for Hillside to supply any of the remainder of the 3,000 wagons needed, except perhaps to assemble from CNR components. Kiwirail has also ruled out their own workshops building or assembling any more locomotives.

Bill Rosenberg, CTU Economist and Policy Director said: “The work that unions and Dunedin City Council commissioned from BERL regarding the Auckland commuter rail rolling stock earlier this year showed significant benefit to New Zealand from building them here. It created skilled jobs, increased the tax take and reduced New Zealand’s international debt. It also built a base for possible diversification and exports.”

Hillside is experienced in building wagons, but this decision puts the viability of the workshops in doubt.

“It is crazy to put hundreds of skilled jobs at risk by this narrow approach to purchasing,” said Rosenberg. “Sensible government procurement arrangements which are used widely internationally would use this kind of purchase to build local industry and skilled jobs.”

Advertisement - scroll to continue reading

Are you getting our free newsletter?

Subscribe to Scoop’s 'The Catch Up' our free weekly newsletter sent to your inbox every Monday with stories from across our network.

The government also announced today that the transnational Serco has won a tender to manage the two Auckland prisons, the brand new Mt Eden and the Auckland Central Remand Prison (ACRP). “Internationally this kind of step has led to loss of jobs and lower pay,” says Rosenberg. “That is how the contractors lower costs. Labour costs account for most of the costs of running a prison.”

“Even then, we have yet to see whether there will be lower costs to the public purse. PPPs have a record in the UK of being a huge waste of public money.”

In the UK basic pay is 8-44 percent lower in the private sector than the public sector, and on top of that, private sector prison officers get fewer benefits such as superannuation and holidays. Staffing levels are also lower. A study of Scottish prisons concluded that private sector cost savings are also made by employing staff with less skills and experience.

“Once again, the government is showing no faith in publicly run operations, and is cutting jobs at a time of high unemployment.”


© Scoop Media

Parliament Headlines | Politics Headlines | Regional Headlines

Gordon Campbell: On The Government’s Smokefree Laws Debacle

The most charitable explanation for National’s behaviour over the smokefree legislation is that they have dutifully fulfilled the wishes of the Big Tobacco lobby and then cast around – incompetently, as it turns out - for excuses that might sell this health policy U-turn to the public. The less charitable view is that the government was being deliberately misleading. Are we to think Prime Minister Christopher Luxon is a fool, or a liar? It seems rather early on in his term of office to be facing that unpleasant choice. Yet when Luxon (and senior MP Chris Bishop) tried to defend the indefensible with the same wildly inaccurate claim, there are not a lot of positive explanations left on the table.... More

Public Housing Futures: Christmas Comes Early For Landlords

New CTU analysis of the National & ACT coalition agreement has shown the cost of returning interest deductibility to landlords is an extra $900M on top of National’s original proposal. This is because it is going to be implemented earlier and faster, including retrospective rebates from April 2023. More

Green Party: Petition To Save Oil & Gas Ban

“The new Government’s plan to expand oil and gas exploration is as dangerous as it is unscientific. Whatever you think about the new government, there is simply no mandate to trash the climate. We need to come together to stop them,” says James Shaw. More

PSA: MFAT Must Reverse Decision To Remove Te Reo

MFAT's decision to remove te reo from correspondence before new Ministers are sworn in risks undermining the important progress the public sector has made in honouring te Tiriti. "We are very disappointed in what is a backward decision - it simply seems to be a Ministry bowing to the racist rhetoric we heard on the election campaign trail," says Marcia Puru. More




InfoPages News Channels


Join Our Free Newsletter

Subscribe to Scoop’s 'The Catch Up' our free weekly newsletter sent to your inbox every Monday with stories from across our network.