All jobs not equal

Labour’s proposal to use the government’s $40 billion in buying power to create jobs and back local businesses by requiring suppliers to make job creation in New Zealand a determining factor for contracts might be good politics but it’s bad policy.

The government, like any other entity, should be guided by price and quality when buying goods and services.

Unless businesses can adding job creation while competing on both of those factors, the requirement is a subsidy by another name.

If a future Labour-led government pays more, or accepts lower quality, to purchase from a business which creates more jobs it will not be not using public money wisely.

It will  be spending more than it needs to and to do that it has to take more tax, some of which will come from businesses with which those subsidised might be competing.

It could also lead the businesses which get the subsidies into difficulty when the government funding runs out and they find themselves with more staff than they can afford.

All jobs aren’t equal. Those created by government requirement are more expensive and less sustainable than ones created by businesses through their own efforts.

As Bill English said:

“We wouldn’t be chasing around the unemployment number [every] three months to three months – what we want to do is reinforce and encourage the industries that are doing well to invest, employ more people and grow.”

English said it was “not that easy” for the Government to create jobs, and any intervention would be unlikely to get value for money. . .”

The Wellington Chamber of Commerce is taking legal action against the City Council over its decision to require contractors to pay their staff the so-called living wage.

Labour’s policy is in the same feel-good- theory, bad-policy-in-practice territory.

The best thing a government can do for employment is keep a tight rein on its spending and enact policies which enable businesses to prosper which will give them the confidence to employ more people without a subsidy.

71 Responses to All jobs not equal

  1. Dave Kennedy says:

    If people are not being paid a living wage and then families need to receive Government support to survive in the form of Working for Families. In 2011 it cost the country $2.8 billion and it is likely to be well over $3 billion now.
    http://www.beehive.govt.nz/release/fact-sheet-%E2%80%93-working-families-changes

    It would be much fairer to share increases in productivity across all workers rather than denying them some of the fruits of their labour and keeping wage growth well below the increases in productivity. Almost 50% of workers got no pay increase last year despite rising power and housing costs.

    I found it appalling that by Wellington City Council demanding that security staff be paid a living wage then their security guards would be 19% above the going rate. How could anyone justify paying security guards so little in the first place?
    http://www.radionz.co.nz/news/national/287806/security-guard's-death-shouldn't-be-in-vain-lawyer

    There seems to be the idea that workers are only business commodities and especially so with zero hour contracts becoming acceptable practice. Almost 500,000 workers are in insecure work where they can not rely on a regular income.

  2. Paranormal says:

    Rather than give government mandated handouts (welfare for families or living wage are the same thing) wouldn’t it be much fairer for people to live within their means and be incentivised to improve their situation.

  3. Dave Kennedy says:

    It would be reasonable if people could live within their means Paranormal, but food banks and budget services claim that more and more working families can’t. People aren’t becoming more incompetent, incomes are failing to keep up with living costs. There are also many who like their job but just want to be paid fairly.

    http://www.odt.co.nz/news/dunedin/311713/foodbank-demandhttp://www.stuff.co.nz/nelson-mail/news/68754740/Safe-budget-good-for-low-income-families-but-could-be-better
    http://www.3news.co.nz/nznews/equal-pay-battle-goes-to-high-court-2015081608#axzz3qzVVOnDk

  4. Paranormal says:

    My response above still stands.

    Wouldn’t the individuals be better off if they did something about it themselves rather than expecting government mandated handouts? If you think it through it is clear the individuals taking responsibility for their situation is more sustainable long term for the individuals and therefore better for the country morally, socially and economically.

  5. Mr E says:

    It is not surprising that Dave has taken a topic about Job creation using the Govts spending power to the Living wage.

    Predictable off topic trolling.

  6. Dave Kennedy says:

    Over the weekend I had a conversation with an Indian student and he provided a picture of New Zealand that wasn’t a good one. According to him a good number of Indian/Asian students pay large sums of money (much too agents employed to bring students here) under false pretenses. Many of the courses are not as advertised and they do not get what they believed they paid for. Many end up in financially difficult positions and find themselves employed in restaurants for wages as low as $3 an hour. This has been identified already as a problem but the extent is wider than many understand. New Zealand is known internationally as a country that allows anyone in to study in our tertiary institutions with no quality controls. Respected institutions have English language requirements but many here do not. There is no way that students can complete courses here properly without good English skills and we are treating international students as a cash cow and exploiting them as workers.
    http://www.radionz.co.nz/news/regional/279373/report-finds-some-migrant-workers-exploited
    http://www.radionz.co.nz/news/national/287242/'in-fact,-it's-common-practice
    https://www.tvnz.co.nz/one-news/new-zealand/restaurant-chain-facing-25-charges-for-allegedly-exploiting-migrant-workers-6279965

    I think you will find that many workers have little power now that only 20% of the workforce are members of a union and the relationship is very one sided. The market forces you support has led to a situation where worker exploitation is increasingly common.

    It is my belief that all people who are employed and work hard should be able to live comfortably on their wages without needing more Government support. It is also clear that the large businesses that employ the bulk of low waged workers can pay more, they just don’t have to. It is also interesting to not the court decisions that support the fact that many women are discriminated against when they work in female dominated jobs.

    Paranormal, I don’t believe that blaming workers for their low pay is fair when any efforts to collectively bargain, earn fair wages and work in safe environments have not been supported.

    Why haven’t wages kept up with productivity growth? Do you believe that increases in productivity and wealth be shared amongst those who produce it?

    Mr E, the Government is currently creating jobs by subsidising employers. If you and paranormal truly believed that workers should advocate for themselves then the $2 billion WFF subsidy should be stopped and we should wipe the minimum wage completely.

    Also do you believe that people should be employed on zero hour contracts where they must be available for work but never have certainty of hours or a consistent income?

  7. TraceyS says:

    “Respected institutions have English language requirements but many here do not.”

    Well, this respected one does…

    “English language requirements:
    All courses at the University of Otago are taught and examined in English. If your first language is not English, you must provide evidence of a satisfactory level of English language proficiency. You should include with your application a certified statement of results from an accepted English language test that has been taken within two years of the commencement of your proposed course.”

    So why are you talking down the entire tertiary sector with broad-brush statements like “New Zealand is known internationally as a country that allows anyone in to study in our tertiary institutions with no quality controls.”

    You will walk over anything and anyone to make your point won’t you Dave? Without any concern for the damage you might do.

  8. TraceyS says:

    “Mr E, the Government is currently creating jobs by subsidising employers.”

    And that is because Labour decided to do what was really in the domain of either unions or individuals (with the choice of representation decided upon by individuals themselves) to achieve pay increases.

    Labour took over this responsibility from both individuals and unions by stepping in with large hand-outs to increase incomes, basically, because the unions and some individuals had failed in this regard.

    We are now suffering the downside of that paternalism. Once you steal responsibility from people it is hard to give it back. Dependence becomes the norm.

    I believe that is the key message that Paranormal is putting across. Take responsibility away from people and we all lose in the long run.

    If you want to blame someone for neutering the power to achieve increases in incomes blame Labour. They made it a central government responsibility and everything that you say, Dave, emphasises that you feel the same way.

  9. Dave Kennedy says:

    “New Zealand is known internationally as a country that allows anyone in to study in our tertiary institutions with no quality controls.”
    Tracey, that was what I hear from international students. Remember that there are many tertiary providers in New Zealand and a number have been closed down already for low quality and exploitation. I am not causing the damage, tertiary institutions regarding international students as cash cows is doing it. I’m sure Otago and other universities set higher standards, but this isn’t consistent.

    I agree with you Tracey about Labour’s approach, Taxpayers shouldn’t be subsidising wages. Wages should allow workers to live in dignity and a living wage used to be part of the New Zealand culture and we lost this some time ago. New Zealand is regarded as a low wage economy within the OECD and we have amongst the most expensive housing and electricity costs and we pay more for our milk than those we export to. All workers working around 40 hours a week should be able to rent a good home and be able to feed their family comfortably, it used to be like that.

    -What responsibilities should employers have?
    -Should they be expected to pay a fair wage to anyone they employ?
    -If workers increase productivity should they expect some financial recognition for their efforts in increasing the profitability of the company?
    -Why do you support women being treated as 2nd class workers?

  10. TraceyS says:

    “…that was what I hear from international students…”

    That doesn’t make your blanket statement that this country is “…known internationally as a country that allows anyone in to study in our tertiary institutions with no quality controls. correct. (my bold)

    Are you just a mouthpiece repeating verbatim what you have heard? It is preferable to engage your thought processes before hitting the keyboard.

  11. TraceyS says:

    “What responsibilities should employers have?”

    Employers have plenty of responsibilities. It is seldom heard about when an employer offers intangible support for employees (which a great many do) and it is impossible to build a statistic around.

    “Should they be expected to pay a fair wage to anyone they employ?”

    Yes and what is “fair”, as with any matter of good faith, should be worked out between the employer, the employee, and any representative(s) they choose to bargain on their behalf. This must be within a basic framework of minimum terms and conditions as it is at present. That framework should prevent gross injustice but it should not, cannot, define what is “fair”. Nor should it try because that would be subtracting from the responsibility for good faith which belongs to the parties directly involved. That would be a slippery slope. See my earlier comment.

    “If workers increase productivity should they expect some financial recognition for their efforts in increasing the profitability of the company?”

    Not always. Productivity is subject to ebbs and flows which are not always within an organisation’s control. Wages, once raised, are difficult to reduce. A business which has built its productivity increases into balance sheet improvements is more solid and can withstand ebbs and flows better so can generally sustain higher wages. This takes time.

    “Why do you support women being treated as 2nd class workers?”

    I have a word for men who carry on like you, Dave, but it’s not publishable here.

    Why don’t you ask the men here the same question? My views are moderate compared to some. I clearly support the existence of unions for certain sectors, provided they are independently chosen by individuals as their representatives, and I have worked very well with them over much of my career.

    But why challenge the men on this when I am, as the lone female who regularly comments here, an easy target for you to paint as disloyal to the “sisterhood”.

  12. Paranormal says:

    DK in your political blinkers you have wilfully misrepresented what I have said. I never suggested we blame the workers. But hey that fits with your agitprop doesn’t it.

    What I said was if a worker doesn’t feel they’re getting a ‘fair’ wage they should do something about it themselves. They do have a number of options open to them. Relying on government largesse is not a viable, long term, sustainable option, no matter how much you talk it up.

    As for increases in productivity, yes a good employer can share them amongst staff, but they are not required to. If they don’t share the rewards (proportionately with the risk of course) then they run the risk of losing good staff. I have recently resigned from my current employer for that very reason.

    Workers have all the power they have always had and more with the legislation currently in force. They don’t need a dodgy over politicised union that is mainly focussed on their own power and ultimately ripping off the workers they’re supposed to be advocating for.

  13. Dave Kennedy says:

    Tracey:
    http://teu.ac.nz/2011/02/international-students-caught-in-pte-hit-and-run/
    There is evidence that supposedly reputable institutions are doing similar things. I believed what this Indian student was saying he was trying to stand up for other students who are afraid of complaining. Many exploited students and workers never complain because they are afraid of losing their job and getting labeled as a trouble maker. I know of those who get no work when the employer finds out they are a member of a union.

    Too many employers behave appallingly:
    http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=11432962

    Tracey every time we have had a discussion about the discrimination of many female workers you have defended the status quo and even said it was OK if women had to work twice as hard to achieve the same as men. Why do you take this position?

    “What I said was if a worker doesn’t feel they’re getting a ‘fair’ wage they should do something about it themselves.”

    Paranormal, many workers, especially women working in the care industry, have been trying to do something for years, what do you think they should do to earn a fair wage for their skills and experience?

  14. TraceyS says:

    Dave, there will always be people who behave badly – both employers and employees – always has been.

    In the dying days of the Labour Relations Act I was working in retail – a unionised industry as was everything back then. I spent hours and hours of my own time and materials on a project that won a nationwide competition. The prize, an overseas trip, was taken by one of the business owners and his daughter about the same age as me (16). I received a cheap silver bracelet from their travels to Bali. My hourly rate was $4.16 – not enough to live independently on. You have missed out on a large part of NZ’s labour relations history if you think that everyone once earned a so-called “living wage” and/or that bad employers are a modern phenomenon.

    I have still never traveled farther than Australia – once for a holiday and once on business. That Bali trip would have meant so much to me as I had no hope at that stage in life of ever being able to travel. Just surviving was tough. Funnily enough, now that I could afford multiple trips to anywhere in the world I would rather see that money go to building our business (including benefiting employees). So I still don’t travel.

    “Tracey every time we have had a discussion about the discrimination of many female workers you have defended the status quo and even said it was OK if women had to work twice as hard to achieve the same as men. Why do you take this position?”

    What rubbish. I have never said that ever.

    Do you think that women aspire to “achieve the same as men”? I do not aspire to achieve the same as anyone else – man or woman. I aspire to achieve my best and compare myself to no one. There is nothing positive to be gained by making such comparisons.

    How does one even know when they have achieved the same as someone else? Do you personally compare your achievement-to-effort ratio with that of others Dave? No? Then why should I (or other women)? If you do compare, do you find that all men have achieved the same outcomes for the same amount of effort and how do you measure “same”?

  15. Dave Kennedy says:

    Tracey, I believe that you are much younger than me, the move away from a living wage happened most obviously after Ruth Richardson’s Mother of all Budgets when she determined that keeping the unemployment rate at around 5%, changing employement law in favour of employers and cutting benefits would bring wages down. She was very successful and child poverty increased rapidly from that point to.

    I think you need to talk to Judith Collins about how hard it is to be a woman in the National Party
    http://www.nbr.co.nz/completely-neutral-URL
    and have a chat to an elderly care worker about their pay after many years of service compared to a male job with similar degrees of skill and responsibility. Also read the ruling in this court case:
    http://www.nzdoctor.co.nz/news/2014/october-2014/31/caregiver-wins-battle-over-pay-but-provider-says-there-is-no-money-for-a-raise.aspx

  16. TraceyS says:

    Many employees, on the starting steps of the old tenure-based wage scales in union awards, would not have been receiving a ‘living wage’. I wasn’t. Anyone starting out with little experience would have been in a similar boat.

    It would have been years, as I progressed through pay grades at the union-prescribed rate, before my wage was enough to live on independently. Because I couldn’t live at home, there was absolutely no choice but to work my way into a better job. The 1991 employment law change facilitated this for me. No longer was it necessary to progress in annual steps at the prescribed rate – it was now possible to negotiate on my own behalf. I acknowledge that it might not have worked equally well for everyone.

    It is not always easy to escape a poorly paid role. Poorly paid roles will always exist. But I would love to see more opportunities available for people move into better paying careers – if they want to – but it is also true that some people don’t want all that goes with that proposition.

  17. TraceyS says:

    “I think you need to talk to Judith Collins about how hard it is to be a woman in the National Party”

    Why should I? Because I am a woman myself? Because you automatically assume that all other women will find it “hard…to be a woman” and “achieve the same as men”?

    Maybe you should talk to her. As a much more successful politician than yourself she’d no doubt have a few tips for you on how to improve your effort-to-achievement ratio.

  18. Paranormal says:

    DK – TraceyS has picked where I’m coming from, but I’ll play your game. See if you can gain some understanding rather than reverting to your politics of envy.

    As we’ve discussed here previously with retirement village industry returns on investment at low single digits, they’re hardly creaming it. In fact with that level of return they will struggle to maintain investors interest.

    Given that, the pay staff are receiving is what the industry can currently afford.

    An individual needs to decide if that is the work they want to be doing. That decision is made on wider than just a monetary basis. They have a number of options available – improving qualifications, aligning with what the employer incentivises (promotions etc.) – or frankly leaving and going elsewhere for a job. If there was a lack of qualified staff then the industry would be forced to respond.

    I know more about this than you will understand. My mother finished her career working firstly as a nurse then as nursing manager at a retirement village. I made the mistake of asking her how her day was once. She told me it started off by holding the hand of a lovely lady as she died because there was no one else to help the lady through her transition. She then described the rest of the day as a nursing manager that also displayed the level of care, understanding and medical knowledge required. As I grew more active in our community I was constantly amazed at how many people I ran into that remembered my mother without my prompting. People regularly described their gratitude for her efforts in looking after their relatives. She was definitely not there for the money.

    What she showed was quite different to the evil grasping employer you would hold her out to be.

  19. Dave Kennedy says:

    Tracey, My reason for suggesting you talk to Judith Collins clearly passed over your head 😛

    “Given that, the pay staff are receiving is what the industry can currently afford.”

    Paranormal, you do not understand that many highly profitable industries pay the lowest wages. What an industry can afford should be rephrased as “what they are can get away with”.

    How you can be so comfortable with the fact that your mother’s good will was exploited by a highly profitable industry is beyond my understanding. Just because people view their job as a vocation doesn’t mean that they should be forced to accept wages well beneath their skills and experience. I am appalled at your callous attitude regarding your own mother (I’m sure even as a manager she couldn’t dictate the pay levels). The aged care industry is a highly profitable one and can easily afford to pay your mother what she is really worth.

  20. Mr E says:

    My 2 cents.

    Dave is claiming, some training organisations may have misled/ false advertised, and some employers may be paying less than the minimum pay rate (according to his source)

    And it seems he is saying the Govt is not doing enough. Only false advertising and minimum pay rates are controlled by legislation.

    I hope Dave you did the right thing by this student and directed him towards legal solutions.

    I get annoyed by people who complain yet do nothing to overcome the situation. I also get annoyed at people who misdirect their concerns.

  21. Dave Kennedy says:

    Mr E, you make many assumptions.

    I talked through many of the legal solutions and suggested approaching the local MP first before pursuing a concern through the Green Party. I am a strong believer in always attempting to deal with employment issues at the lowest level first and often have to advise people that they need to make their concerns known to their employer before taking a complaint elsewhere. Natural justice is an important principle for employer and employee alike.

    The student concerned was well educated and had lived in New Zealand long enough to understand how things work here. He had already attempted to get his concerns heard through all official channels and avenues but had goy nowhere. One of the main issues is the fear from foreign students that if they complain or make a stand that they will lose their job and income completely and after investing so much money already that they will have to leave the country with nothing to show for it.

    You are naive if you believe that those who are marginalised in New Zealand have easy access to support and feel comfortable in speaking out. If it was otherwise we wouldn’t have so many people being exploited. Having the legislation to protect people is one thing but having the means to ensure it is being properly applied is another.

  22. Paranormal says:

    As previously you don’t get it DK, but then again I’m not surprised. Understanding would only get in the way of your agitprop.

    The thing is you don’t understand ™, the retirement home industry is not “highly profitable”. Just because there are some big numbers bandied around does not mean they are “highly profitable”. Try using some of the advanced maths skills you allegedly have to work it out. Here’s a starter for ten – look at return on investment for a start.

    As for exploitation how do you justify the Greens interns pay levels?
    https://home.greens.org.nz/jobs/intern-kevin-hague

  23. Will Dwan says:

    Or the ‘woofers’ on organic farms.

  24. Dave Kennedy says:

    “the retirement home industry is not “highly profitable”. Just because there are some big numbers bandied around does not mean they are “highly profitable”.”

    Paranormal, quick tell Richie McCaw and Dan Carter that. They have invested heavily into age care because they believe it is one of the highest earning investments:
    “Craigs Investment Partners head of research Mark Lister said shares in aged-care companies had been the top performers over the past 10 years – with annual returns of 35 per cent in the case of Ryman Healthcare.”
    http://www.nzherald.co.nz/nz/news/article.cfm?c_id=1&objectid=11203208

    You obviously know something they don’t.

    Paranormal and Will, nice try, there are some people and organisations that exploit wwoofing and intern schemes but I don’t and the Greens don’t. Have a look at the Wwoofing site and see the feedback we have had from those who have stayed with us 😉

  25. Paranormal says:

    You obviously ™ have a great forgery DK. You can’t recall the post on this blog where you were ranting about Ryman I think it was and using the figures you provided it showed a less than 5% return on investment. Remember share price is different and is driven by a number of factors, including emotion. But then again you would know that wouldn’t you.

    So you are happy demanding others pay a living wage, but you’re comfortable exploiting workers yourself and as a party. There’s a word for that isn’t there?

  26. Paranormal says:

    Damned auto correct – “forgetory”

  27. Dave Kennedy says:

    Paranormal, you may not have trusted my attempts and showing how profitable Ryman was, but now you will have to argue the case with Craigs Investment Partners who are claiming annual returns of 35% (much more than I was claiming from memory). Richie and Dan should go to you for their investment advice, eh?

  28. TraceyS says:

    “Tracey, My reason for suggesting you talk to Judith Collins clearly passed over your head.”

    I don’t care about your reason, Dave. You live in a world where there are “male [only] jobs”. In my world there are few jobs which can only be done by men.

  29. TraceyS says:

    “Craigs Investment Partners who are claiming annual returns of 35%”

    Return on what and for whom? Where are your links to verify the claims made?

    I had a look at their 2015 annual report. Return (profit before tax) from total assets is 7.3% ($242,031,000 / $3,312,148,000).

    Curious as to why so little income tax paid ($113,000) which seems disproportionate to the profit. This is because running costs almost equal cash income. There is a large amount of non-taxable income. Note 4 to the financial statements says the “non-taxable income principally arises in respect of the fair value movement of investment property”. That would be from the capital residents transfer from their investment in their former home into the retirement village which serves to ensure they have somewhere to live that meets their needs.

    Shareholders benefit. I guess that is because the company needs shareholders to make it work. They should benefit. Anyone who wants to be in can buy shares I suppose. Also notice they have an employee share scheme.

  30. Dave Kennedy says:

    Tracey you are an expert at so many things, you should join Paranormal in telling Richie McCaw and Dan Carter to get their money out of elderly care quickly as you know better than their investment advisors 😉
    http://www.nzherald.co.nz/nz/news/article.cfm?c_id=1&objectid=11203208

  31. TraceyS says:

    No Dave, I got a “C” for Corporate Finance. It would not be hard to find fault with my analysis (noted you didn’t try though).

    From your link:

    “It’s been a lucrative investment space and I don’t think that’ll change over the next couple of decades. There would have been winners and losers but it’s been successful and it probably will continue to be.”

    Winners AND losers.

    Like I said, if you wanted to be in you probably could be. Put your money where your mouth is so to speak? You could even donate your gains to the staff club. Do something practical rather than just whining about the fortunes or misfortunes of others.

  32. TraceyS says:

    Watch the following video (esp. from 4:44):

    http://blog.craigsip.com/interview-ryman-healthcare-deputy-ceo-cfo-gordon-mcleod/

    In 2009 the fair value movement of investment property was $57,198,000 and the earning per share were 13.3 cents. In 2015 the fair value movement of investment properties was $217,624,000 and the earning per share was 48.4 cents.

    What does this tell you Dave? Do you think the driver of share price increases is improvement in employee productivity or something else, like supply and demand?

  33. Paranormal says:

    TraceyS – you’re wasting your time trying to educate politics of envy promotors.

    You could also have mentioned the share price has increased from $2.15 in Nov 2010 to $7.68 yesterday, and DK would have spewed more envy politics at you, completely missing that the share price is down from a high of $8.89 in May 2014. So clearly there have been winners and losers.

    But just look at the dividend yield based on current share price: $0.136/$7.68=1.77%. As an investor you are better putting your money in the bank at that rate. Investors are taking a risk with their capital to provide services, and yet the envy politics promoters want to screw them even more.

    However you skin it it doesn’t appear to be a “highly profitable” industry. That individuals are prepared to take a risk with their capital on the prospect of a future gain should be applauded, but sadly not in the Soviet Socialist Republic of Aotearoa.

  34. Dave Kennedy says:

    Tracey and Paranormal, you have lost the thread, my comments had nothing to do with envy, just fairness. If an industry is a highly profitable one there should be no need for a court decision that employees within that industry suffer from discrimination and wages that do not reflect skills and experience. The industry shamefully exploits workers.
    http://www.3news.co.nz/tvshows/campbelllive/elderly-care-workers-exploited-2012052816#axzz3rDUXpbEU

    It is shameful that Paranormal even defends the discrimination against his own mother and Tracey accepts the same against other women. It would be interesting to know who you support in the recent walkouts in Parliament, justice and fairness is something I value but it is something that you two have trivialised. Appalling!

  35. TraceyS says:

    Yes I could have mentioned the increase in share price (which it seems is underlain by the increase in demand for services and property). That people want and need the type of services they provide, and that there is no end in sight to that demand, is what makes it an attractive investment.

    I have recently been involved in a family situation where these services were not available in our area due to lack of supply and it is very worrying. In the video there is the comment that by 2018 demand will equal supply within the industry. Investors do invest their money looking for a gain, of course, but maybe some also recognise an essential need for these service and want to be involved in the meeting of those needs? Isn’t that a win/win?

    Maybe Dave thinks the operational side should give up on controlling wage costs, accept operating at a loss, and rely on investment property movement to prop it all up? But residents might not be very happy to live there anymore knowing that such a scenario would be very unsustainable.

    I will be extremely interested in Dave’s followup comments. Will they be rational and on topic for the thread-tangent which he started? I’m guessing a whole lot of links to news articles which only address issues on a surface level.

  36. Paranormal says:

    And with your political blinkers on DK you fail to see wider than your misguided beliefs. You’ve lost the thread yourself and can’t see what Tracey and I are
    saying. The industry is not “highly profitable by any normally used definition. However you seem to have found a way around normal accounting and economic measures to determine the industry is, in your mind at least, “highly profitable”.

    BTW how do you live with yourself – talking about discrimination and exploitation of others when you and your party are donkey deep doing the whole discrimination and exploitation thing yourselves? How can you see that as being in any way acceptable?

  37. TraceyS says:

    Paranormal is right that the industry is not highly profitable in an operational sense. Wages are operational costs. Increasing them (without a corresponding increase in operational income ie. fees) will make the industry less profitable operationally. That matters for obvious reasons.

    It’s a pity Dave thinks it necessary to be an expert in order to make rudimentary analyses of financial statements. It isn’t and you should give it a go, Dave, so that you can have a more comprehensive and worthwhile debate.

    “It is shameful that Paranormal even defends the discrimination against his own mother and Tracey accepts the same against other women.”

    I liken your persistence and level of argument to that of a fifteen year old boy, Dave. You know I do not accept discrimination against women and it is unfair for you to keep saying that just because I haven’t accepted your point of view. It will be seen, by most, as an obvious effort to manipulate. But if you do it again I will ask Ele to consider censoring those particular statements.

    I value justice and fairness too. But I am also considering the people who require the services who also deserve fairness, justice, and dignity. It would be a most unfair situation to have demand exceed supply and I cannot imagine the consequences. That could happen if returns to shareholder are not reasonable, leading to a lack of investment. Paranormal has recognised that fairness to investors is also part of the fairness equation. I don’t think there’s any getting away from that.

  38. Paranormal says:

    BTW DK – I realise you don’t know much about the retirement industry but stop for a minute and think about what the position of Nurse Manager does. You do understand, in your lexicon, my mother went from being one of the exploited to one of the exploiters?

    I haven’t mentioned it before but you might want to stop and consider just how offensive you really can be.

  39. Dave Kennedy says:

    Tracey and Paranormal, I am shocked that you continue to justify the exploitation of aged care workers in such a blatant way. Tracey suggesting that servicing the aged justifies low wages is a poor argument as that would also mean that nurses and doctors should not expect fair incomes either, which is patently ludicrous. I do not understand how you can defend blatant discrimination.

    Paranormal are you telling me that as a nurse manager, your mother dictacted the wages of those she managed? I really struggle to believe your argument, it appears that you are now exploiting your mother through misinformation, just how low are you prepared to stoop? Shocking.

  40. TraceyS says:

    Why do you always depart from arguing your case with fact, and descend into personal insults, whenever someone presents you with some challenging information?

  41. Dave Kennedy says:

    Tracey, I have already presented the facts, it is you who is making the personal attacks.
    Fact 1 Woman workers are discriminated against and court decisions have supported that and the aged care industry is one of the worst offenders.
    Fact 2 Under National the gap between male and female incomes has increased and working groups set up to address discrimination were dismantled.
    Fact 3 The aged care industry has made Ryman founder one of the richest men in NZ and the industry is being promoted as providing the highest returns to investors.
    Fact 4 Money provided by the Government to raise wages in rest homes has been invested in buildings instead.
    http://www.nzdoctor.co.nz/news/2015/march-2015/26/protesters-demand-radius-pass-on-to–workers-government-funding-increase.aspx

    “…if returns to shareholder are not reasonable, leading to a lack of investment. Paranormal has recognised that fairness to investors is also part of the fairness equation. I don’t think there’s any getting away from that.”

    The idea of keeping wages unreasonably low (as established by the courts and natural justice) so that investors can profit from care is abhorrent. What the Government has paid to cover wages should go to wages. I was also shocked to read Paranormal’s view that those who approach their work as a vocation should not expect to be paid well. I cannot support such blatant exploitation.

    Here is a quote from a 2011 report on rest homes:

    “However, we believe it is vital that there is greater accountability and monitoring of the taxpayer funding in the sector, and evidence of how public funds are currently being spent, before additional funding is given to the sector. For instance, the Thornton Review states that operating costs per resident per day is $78.70, yet the subsidy is $109 (p.9). This begs the question, where is the extra money being spent?”

    “The Nurses Organisation say they have been told by District Health Boards that providers are not supposed to use taxpayer funding for capital development. However, in their negotiations with providers they have frequently been told that extra money will not be spent on extra wages because the money is needed for refurbishing residential homes or for building new facilities.”

    Tracey, neither you or Paranormal have a factual or moral justification for anything you say. I can quote you reams of damning information from a number of reports on the staffing of the aged care industry and also quote from financial advisors on the returns being sucked from the same industry to investors.
    http://www.neon.org.nz/agedcareinquiry/stafftoresidentratios/

    I don’t know how many facts you need but I do know who has presented the most!

  42. Mr E says:

    This has been a hugely entertaining thread. Ill explain why.

    Can we talk about Wwoofers for a moment?

    According to the Wwoofer website, participants are expected to work for 4-6 hours a day in exchange for board. That is 28 to 42 hours per week.

    http://www.wwoof.co.nz/how-it-works/

    According to the IRD boarding fees of up to $254/person per week are exempt of tax. Assuming Providers/hosts dont pay tax and don’t want to be accused of tax avoidance, let’s presume that is the wage paid.

    $254/week divided by 28 and 42 hours is $6-9/hour.

    http://www.ird.govt.nz/income-tax-individual/different-income-taxed/rental-income/boarders/incometax-boarders-flyer.html

    If taxes were paid, the wage of $254/week is around $13K per annum. So let’s assume it would fit in the $14,001 to $48,000 tax bracket of 17.5cents in the dollar.

    According to these calculations, at best, the expected pay rate is $10.84/hr.

    http://www.ird.govt.nz/how-to/taxrates-codes/itaxsalaryandwage-incometaxrates.html

    Yet here we find ourselves being lecturered by a Wwoofer host, on the discrimination and exploitation of workers.

    It makes me laugh and laugh and laugh. Then frown.

    It appeared to me that Paranormal didn’t want to use the word hypocrisy for some reason. It was almost as though there was a fear of using the word. Can we put that word back into the vocabulary please?

  43. TraceyS says:

    Where am I making “personal attacks”, Dave?

    You repeated my fact “…if returns to shareholder are not reasonable, leading to a lack of investment. Paranormal has recognised that fairness to investors is also part of the fairness equation. I don’t think there’s any getting away from that.”

    Then you launched into this; “[t]he idea of keeping wages unreasonably low…”

    Whose idea is that? Are you trying to suggest it is mine?

    Well it is not and I have never expressed that idea but merely pointed out some of the very basic realities of the system within which aged care operates.

    I would love to see aged care workers paid more. From experience my personal opinion is that they deserve to be. But there is the question of where the extra money is to come from. I have pointed out that it is not sustainable to come from non-cash profits such as “fair value movement of investment properties” (which is where you find the large profits). Not all rest homes have independent living units for sale either. So if the industry has to suddenly pay higher wages without any consideration of the impact then the likes of Ryman might be OK but not-for-profits would definitely struggle.

    With supply and demand predicted to reach equilibrium in 2018 do you really want to see the not-for-profits disappear?

    Have you any ideas to solve these problems, or are you just content with complaining?

  44. Paranormal says:

    Sigh – DK you are welcome to continue to ignore the evidence TraceyS and I have provided. It simply continues to show your wilful blindness and ignorance of commercial reality. Perhaps the maths involved was too simple?

    You have yet again put words into my mouth that I did not say in your 9.17 comment. Again this just suits your agitprop, but bears no resemblance to reality. It just weakens your position when you construct your straw men to rage against.

    TraceyS and I have tried to point out to you the difference between share/capital value and operating profit here and previously. Can I suggest that if you want to have any credibility when talking about commercial subjects you do a bit of research before showing your ignorance.

    As for my mother, with all your obvious(tm) commercial experience can you tell us what her responsibilities as Nurse Manager may have involved? (here’s a hint – if you included responsibility for setting budgets and hiring & firing then you might be close). The real world is very different to the vaunted ivory towers of academe and the NZEI.

    So to sum up your comments DK, it’s ok for you and your party to exploit vulnerable workers, paying them nothing, but others aren’t allowed to actually pay what the industry can afford – according to you.

    Glad you’ve enjoyed the entertainment Mr E.

  45. Mr E says:

    Paranormal.

    Hope I am now part of the entertainment…..

  46. TraceyS says:

    I am personally concerned about a potential lack of rest home capacity because I have (temporarily) experienced the distress this can cause.

    The wrong combo of parties in government (provided Dave’s rigid one-track views are widespread within his party, and I have no evidence to suggest that they are) could lead to a very unhappy future scenario for families with relatives needing residential care.

  47. TraceyS says:

    Mr E – hello and welcome!

  48. Dave Kennedy says:

    Mr E, Nice try 😉

    As I said, look up our Wwoofer page and look at our reviews. Our Wwoofers generally stay for only 2-3 days at a time and get free accommodation and food (backpackers cost around $50 a night and daily food costs are probably around $10 a day too). We lend them bicycles as transport and give them maps and advice for exploring Invercargill. We generally take them out to our little crib in the Catlins and if the weather is fine they kayak with dolphins and check out the Yellow eyed penguins. I reckon they get great value for their 4 hours (never more and often less) of work a day. Check out our host page and the comments, our number is ID 43107

    I would say that their 4 hours a day gets at least $20 dollars an hour of services in return and that doesn’t include our recognised hospitality.

    We rescued one young German a few years ago who ran out of money after a job fell through and had been sleeping in his car
    for several nights before he discovered us. When he worked more than 4 hours I filled his car with petrol so that he could get to his next job in Queenstown.

    I hardly think that you can accuse us of exploitations when we are still in contact with many of our Wwoofers and have offers to stay with them if we ever visit their country.

    I am really impressed by your obviously detailed research in trying to discredit me Mr E. It’s sad that you expend so much energy for such little return 😉

    “It makes me laugh and laugh and laugh.”
    I really think you have become a little obsessive and your constant hysterical laughter is a real concern to me and others.

  49. Dave Kennedy says:

    Just incase you can’t be bothered visiting the Wwoofing site here is one of many comments:

    “Knowledgeable, caring, entertaining hosts”
    We stayed with Dave & Vicky for one week and had a wonderful time as they made us feel completely welcomed and appreciated in their cozy home. We learned a great deal from them about NZ green politics and creative tricks for urban veggie gardening. Meals were delicious and plentiful. Accommodation was private and comfortable in a furnished caravan. We enjoyed the range of tasks from weeding, planting, painting, to composting. They equipped us up with bikes so that we could explore the city sights and even brought us to Porpoise Bay to see Hector Dolphins! This is a great wwoof for anyone who is interested in urban gardening, environmentalism and sustainability. We’ll sincerely miss the Kennedys and Invercargill.

  50. Paranormal says:

    So DK, from that comment we can add a number of other crimes against humanity to the existing exploitation of the vulnerable.

    Slum landlord – won’t allow them under your own roof but force wwooffas to stay in substandard accommodation. CPAG have something to say about those who force the vulnerable into caravans: http://www.scoop.co.nz/stories/PO1508/S00182/poor-families-at-back-of-the-queue-for-decent-housing-cpag.htm)

    Not to mention political indoctrination and brainwashing.

    Here’s a smiley to soften the reality 🙂

  51. Mr E says:

    Dave,
    Predictably your comments are underwhelming and miss the point.

    You have been tarring an industry with a brush that is exploitation and discrimination.

    eg. “The industry shamefully exploits workers”

    And by doing so you assert that issues are wide spread.

    The evidence I presented above suggests that exploitation could be a common element in an industry that you are part of. If I was to use your nasty narrative I might say “The industry shamefully exploits workers”.

    You are part of that industry Dave, seemingly a willing participant.
    You might say your behaviour is different from those within the industry. And I think that is possible and I suspect probable. But it is hypocritical to ‘tar’ an entire industries with nasty brushes only to try and worm your way out of an industry in question.

    I would also point out your evidence to avoid ‘tarring’ appears to be based on a testimonial. If we are to use testimonials as evidence, some of your judgements of aged care providers would be wrong.

    http://www.rymanhealthcare.co.nz/careers/testimonials

  52. Dave Kennedy says:

    Paranormal, you haven’t even seen our amazing caravan but are passing judgements on it. Actually that was an older review because now our kids have left home our Wwoofers stay in our house.

    Do visit our Wwoofers page, I give them ample warning about my background too, most share my poltical philosophy so they have already been “indoctrinated”. 🙂

    Mr E, wwoofers/industry? Good grief!

    I would talk to those who have worked for Rowena Jackson’s in Invercargill if I was you Mr E, you are so gullible regarding spin 😉

  53. Mr E says:

    Dave,
    “I reckon they get great value for their 4 hours (never more and often less) of work a day.”

    Can I ask Dave, do you keep records of this?

    Keeping in mind the accusations of dairy industry worker abuse, after the MBIE sting.

  54. Dave Kennedy says:

    Interesting how you guys quickly shift the focus when you are losing the main debate, it is now all about my treatment of Wwoofers, good luck with that 😉

  55. Mr E says:

    Dave,
    Lets look at the math of your worker provision. I dont know where this will go, but let’s investigate.

    4hours * 7days = 28hours?

    Free accommodation (without avoiding IRD private boarding tax) =$254?

    Pay rate = $9/hour (tax free)?

    Shortfall in relation to minimum wage $14.75 – $9 *28hours = $161/week

    Does that sound right?

    And you seem to be saying you make up that shortfall with:
    “We lend them bicycles as transport and give them maps and advice for exploring Invercargill. We generally take them out to our little crib in the Catlins and if the weather is fine they kayak with dolphins and check out the Yellow eyed penguins”

    Don’t we have a thing called fringe benefit tax here in New Zealand?

    http://www.ird.govt.nz/fbt/fbt-index.html

    Aren’t you concerned about the Wwoofer industry? Arent you concerned that there is wide spread tax avoidance and worker exploitation?

  56. Mr E says:

    “Interesting how you guys quickly shift the focus”

    Dave,

    Seemingly you like to build glass houses in gravel pits. Are you surprised at the change in direction?

    I have to say I am surprised you have not got great answers regarding the Wwoofer industry. Given you are part of the industry, I would have thought you would have worked actively to reduce the threat of exploitation questions.

  57. Dave Kennedy says:

    Mr E, so busy with your wee calculator and manic laughter 😉
    Have you heard of Don Quixote? You’re just fighting windmills.

    I loved the opportunity to show how I promote our country and form friendships around the world, so thanks for that. I hope you did actually visit our Wwoofer page, what did you think of our garden?

    I must admit it doesn’t look as good at the moment as our hens have stripped our silverbeet and I need to mow the lawns with my petrol mower (note that I have given you something else to attack me on again) 😉

    Get out your slide rule and start plotting your next attack…

  58. Mr E says:

    I should correct a sentence.
    *Arent you concerned that there could be wide spread tax avoidance and worker exploitation?*

  59. Mr E says:

    Dave,
    I visited the website to view hours worked but not your testimonial pages. I think testimonials are of questionable value. You never know the basis for which they are made.

    “so busy with your wee calculator”

    So busy I seem to have you stumped for defence. Oh well, it was fun while it lasted. I do look forward to your focus change towards Wwooders now you appear to have admitted defeat.

    “I must admit it doesn’t look as good at the moment as our hens have stripped our silverbeet and I need to mow the lawns with my petrol mower (note that I have given you something else to attack me on again)”

    You could always swap glass house building for garden tending?
    My own lawn is looking great. My robot mower – tends it while I can laugh at glass house builders and merely calculate away. In its *eco friendly way it buzzes away. (*ignoring the lead acid batteries)

    I arose nervous this morning with a frost. Not fearful for my silver beet, but for my potatoes, and sensitive tomatoes.

    Looking now – all is well. I can calculate and laugh the day away.

  60. Mr E says:

    I also noted this.

    “Get out your slide rule”

    I’m not sure about you but I am sad that I don’t still use a slide rule. Up until a few years ago I had one. It was chrome and beautiful. Heaven only knows where it is now.

    It was such and elegant tool. I actually miss it. I belongs in my collection of historical measurement tools. Your comment has spurred me to find it or find a replacement.

    I must.

    Thanks.

  61. Paranormal says:

    DK at 1.12 – yes you are truly amazing. You’ve come here all on your own, argued logic, reason, economics, & maths – and overcome it all. Another great Greens victory.

    Mr E; more gold, thank you for brightening an already lovely afternoon in Taupo.

  62. Mr E says:

    Paranormal.

    Let me say, it has absolutely been my pleasure…..

    We have great sunshine here too….. I should be out but laughing somewhere else, but here has been too much fun.

  63. Dave Kennedy says:

    It is interesting how we each come to this place with our own agendas and leave claiming success 😉

    One thing that i do know that there is a world of trade that doesn’t involve money but goodwill and community.
    http://le.org.nz/local-money/55

    But if one is employed to earn a living and support a family then certainty of income and a fair pay is important. Wwoofers enter a known contract where there is a trade of mutual services agreed beforehand for a very temporary time. This is a lot different from a full-time or part-time job where the money is needed to put food on the table, pay the rent, heat the house and buy the school uniform.

    Here are the current rates for aged care workers:
    http://www.payscale.com/research/NZ/Hospital_Setting=Extended_Care_%2F_Nursing_Home/Hourly_Rate

    The Living Wage is currently calculated at $19.25 so that all aged care workers earn $1 to $4 dollars less than that apart from a registered nurse.
    http://www.familycentre.org.nz/Publications/PDF's/Living_Wage_2015_update.pdf?PHPSESSID=19981e542cbc1791a7fc0018059a0dcf

    It is just so exploitative and sad.

  64. Dave Kennedy says:

    Mr E, I have a nephew who still uses a slide rule and he can beat many with a calculator to work out complex problems. I forgot most of what I knew about them many years ago, but I still have one 😉

  65. Mr E says:

    Dave,
    I admire your nephews old school calculation abilities.

    The slide rule I refer to is a cylinder one. It lives(d) in a nice leather pouch.

    Here is a task. Throw a challenge down to your nephew….

    Ask him what is the fringe benefit tax on $20/hr – $9/hour =$11/hr

    Multiplied by 28hrs = $308/week.

    (hint FBT = 49.25% = $152/week)

    I am sure he will zip zap that out in seconds.

    What a great way to end a Friday. 🙂

  66. Dave Kennedy says:

    You’re a sad man, Mr E, to spend time working out a fringe benefit tax in an attempt to destroy a global community building and skill sharing network. On a sunny day too.

    I’m just finished the last touches to the organisation of Invercargill’s climate march, I’m having the banner professionally made, have had a very supportive meeting with the local police, sorted the traffic management plan and organised Wachner Place and the sound system. My designer son whipped up the graphics…It’s all go https://www.facebook.com/events/1154478347914269/

    Now off to Archdraught in Glengarry to support a fundraiser for the Youth Development fund, you should join us. Then it’s back to the lawns (I should have got a wwoofer 😉 ).

  67. Mr E says:

    “You’re a sad man, Mr E, to spend time working out a fringe benefit tax in an attempt to destroy a global community building and skill sharing network. On a sunny day too.”

    Who wants to destroy anything Dave? You’re off into your own little world again.

    The only thing I seek to destroy is tax evasion and worker exploitation.

    I hope you are not suggesting that the Wwoofer industry would not work without those two things? You’re not trying to say that are you? It sounds like you are – and that seems truly sad. Especially because you are part of that industry. As you keep reminding us, worker exploitation is bad. It should not be tolerated.

    If you were on your toes doing as an opposition politician should do, you would be rallying other Greens to look into ways to improve the fairness of the situation. Instead you keep hypocritically riding your high horse, around your glass house, in a rock quarry, lobbing stones at others.

    I’m busy this weekend so no I won’t be attending your fundraiser. Good luck with it.

    Leave your horse at home to eat your lawns. No workers will be exploited during that course of action.

  68. Name Withheld says:

    Leave your horse at home to eat your lawns.

    I’m pretty sure the horse is going to be needed to get to the “climate march” cause the Wwoofers didn’t bring the bikes back. And using the car is just out of the question.

    By the way what the hell does “I’m just finished the last touches” even mean?
    You didn’t teach English….Did you?

  69. Dave Kennedy says:

    “Finishing touches”? a colloquialism obviously not familiar to you. Interestingly have you noticed when i quote you I generally fix the spelling errors and typos for you and don’t say anything. You do need small victories 😉

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