NZ Report Card Reveals Much


The New Zealand Institute is a privately funded "think tank" that claims to be politically neutral and appears to be largely supported by New Zealand's business leaders. The report is based on readily available  data and internationally accepted assessments to compare New Zealand's performance in 16 key areas with other developed nations within the OECD. The report card is intended to prioritise the areas most needing our attention and encourage discussion around potential solutions. I have referred to the report in an earlier post but given the fact that we have re-elected a National Government for another three years I thought it timely to revisit it.

Given its mainstream economic background I would have thought the Institute's findings would be taken seriously by our government and the areas where we are performing worst should get the most focussed attention. Sadly it appears the reality is to ignore those aspects that are particularly dire and look at major reforms of those that should require the least attention.

We received our 2nd highest grade for education (where we are ranked 5th in the OECD) and while we should aspire to be at the top, we should only need some minor adjustments to a generally well performing sector.

The areas where we received the lowest "D" assessments were regarding our CO2 emissions per capita  (where we rank 26th out of 30 nations), our income inequality (ranking of 25th) and our household wealth (24th). It would seem logical that these areas would deserve immediate action and strong leadership from our government in addressing them.

Strangely this National Government is bent on initiating and carrying through some major reforms in the education sector. The reforms have no basis in research and the outcomes of similar reforms overseas have had mixed results and in many cases negative consequences for children. To top it all the Education Ministry that is charged with driving the reforms has been reeling from funding cuts and a recent parliamentary review which found it bordering on dysfunctional.

The Government has chosen to further delay the slow process of dealing with our CO2 emissions and will subsidise our largest emitter, agriculture, for another 3 years. Obviously with no incentives to change agricultural practices little substantial will happen with the levels of emissions in this sector until 2015. Instead of a strong focus on alternative and environmentally sustainable energy sources the government has also embarked on opening our country up for oil exploration and coal and lignite mining, with few assurances of safe practice or how we will deal with any emissions. Rather than improving our bad grade for CO2 emissions there has been a concerted effort to make our grade in this area even worse (a Leave the Coal in the Hole festival has been organised in an attempt to focus on the foolishness and long term consequences of the government's approach).

The consequences of income inequity and falling household wealth is being seen in our appalling child poverty statistics. We now have 1 in every 4 children living in relative poverty and basic expectations for children living in a developed nation are not being met. Third world health issues such as rheumatic fever and general poor child health are becoming more common. The long term consequences and cost to the country of ongoing health and educational issues for this group of children as they progress into adults will be huge. The government's choice to introduce more draconian measures and gatekeepers when our struggling families apply for income support and forcing mothers of young children into low waged employment (around 65% of mothers with children less than a year old already work) will only exacerbate an already dire situation.

Income inequities are being actively increased with the huge tax cuts to the rich being maintained, despite a $2 billion annual loss in revenue, and wage increases are being kept at minimal levels. The current industrial stoush between the Port of Auckland Limited (POAL) and the Maritime Union of New Zealand (MUNZ) is a sign of things to come over the next three years. The government and many employers are keen to see our workforce de-unionised and casualised and job security and collective bargaining will become increasingly rare. Treating workers as expendable commodities will ultimately remove workers from feeling they are a valued and essential part of the industries they work within and this will probably reduce our already low productivity even further. By not investing in R&D and education to the same extent as higher performing economies (i.e. Denmark, Singapore) we will be relying even more on our competitiveness being based on a low wage, lower skilled workforce and exporting raw materials and commodities with little added value. Already 25% of our university graduates head overseas as there are few opportunities for their qualifications in New Zealand.

Based on current performance and priorities one can only predict that the next report will see a considerable decline in grades and, considering the major areas of concern require immediate action, the following government may find themselves in a near hopeless situation. We only need to look at Barack Obama's Presidency to see how difficult it is to repair the damage inflicted by two terms of neo-liberal ideologies and pandering to the wealthy elite.

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