The 9 day fortnight
March 10th, 2009 at 1:00 pm by David FarrarStarting to see some details around the vexed question of who pays for the 10th day if workers go on a nine day fortnight.
Obviously the business can’t still pay staff for the tenth day, when the whole idea is to help businesses survive by reducing their costs. Having them pay the same wages for one less day’s work would make things worse, not better.
So that leaves either the workers not getting paid for the tenth day, or the Government paying.
As usual, John Key looks to be heading towards a pragmatic compromise, according to Tracy Watkins in the Dominion Post:
The Government has ruled out a wage subsidy on the grounds of cost, but is considering an allowance based on a “benchmark”, such as the average or minimum wage.
Government sources say a 100 per cent wage subsidy for the lost day’s pay is too expensive and would send the wrong signals to business, which might see it as an opportunity to trim wage costs by getting the Government to pick up the tab.
The minimum wage is $12.50 an hour which is $100 for an eight hour day. So the Government would be paying around $2,600 a year to a worker on their day off. If 100,000 workers go onto this scheme, then the cost is $260 million a year plus admin costs.
Some unions have said they want it higher, such as the median wage. The problem with that though, is some employees who earn less than the median wage will actually get paid more by having the tenth day off for training, than is otherwise the case.
In the long term is is silly to think a sustainable business model is to have the Government pay 10% of the wages of every worker, to save businesses model. If that is a good idea, then why not have the Government pay 100%.
So the key is that it has to be temporary and targeted. It arguably is not economically efficient – but if it can avoid unemployment hitting double figures, that will reduce the downstream effects in terms of crime and benefits etc.
I am nervous about the ability of the Government to target it only to firms that really need it. They team that has to implement this will need to be very good.
March 10th, 2009 at 1:16 pm
“Obviously the business can’t still pay staff for the tenth day,”
Then susbsidise each business to teh tune of 10% of their wage bill seems to eb the obvious.
Getting people to dick round with their routine to do what they will view as some make work BS government training course for a day will not be a big seller and most people will see it as a day off. Thats the very few who work a 9-5 mon to fri job. Virtually no one in fact.
As before Key has a massive disconect between where he is and where most of us are. This proposal is a nice idea, not a good one.
Vote:March 10th, 2009 at 1:16 pm
Sigh I do understand why you and others refer to the ‘government” when talking about who pays but can we please now get a reality check and move to the TAXPAYER PAYS
In the new paradigm it is imperative that we get the no thinking citizens out of this wacky idea that GUMINT pays for anything
They dont they never have they never will BECAUSE THEY RELY ON THE TAXPAYER FOR THE MONEY.
So repeat after me THE TAXPAYER PAYS NOT THE GOVERNMENT
Vote:March 10th, 2009 at 1:17 pm
GD took the words right out of my mouth.
The govt pays for nothign in the scheme. The taxpayer… i.e those who are productive… are forced again to fund the unproductive, simply to keep them in jobs (on their day off).
DPF, you would be much better to stop usign Labours language, and acknowedge that in every scheme of the new governments, it is the taxpayer and noone else who foods the bill.
Vote:March 10th, 2009 at 1:19 pm
We need more more taxpayers and less tax spenders. Lets work on the second problem first instead of creating more of them.
Vote:March 10th, 2009 at 1:19 pm
I just cannot believe that this utterly dickheaded suggestion is under serious consideration. For fucks sake, we need more productivity, not less. Why the fuck is there so much confusion over such a simple bottom line??? Jeeezuz…!!!
Vote:March 10th, 2009 at 1:27 pm
This whole idea is just nuts, nuts, nuts, n.u.t.s. !!
Red’s got it – the issue is productivity. Futhermore, individuals aspiring to higher productivity and being prepared to invest something of their own time and passion to achieve that increase is what we need… not another taxpayer-funded handout to ‘motivate’ workers to upskill.
Vote:March 10th, 2009 at 1:36 pm
I have to agree with the righties on this one – I’d love to get a day off per fortnight to sit on my tuff collecting part pay, but if every employee in the country was doing it then where is the money supposed to come from? The Gummint’s magic money bin in the sky?
If times are tough and your employer needs to reduce your hours by 10% from 80 per fortnight to 72 per fortnight in order to keep afloat (because there is only 90% of the work available to do) then any intelligent person should be able to see that is better than taking a 100% pay cut because you are now redundant. Fortunately you should soon be able to re-mortgage at a very much lower interest rate than what you were on a year ago. While those of us who are renting, just have to deal with it!
(PS: Some of us are already working 9-day fortnights – we just manage to fit in as much work as anyone else doing a normal 10-day fortnight, by making them 9 days of 9 hours each!)
Vote:March 10th, 2009 at 1:36 pm
Gd’s on to it, so who pays for the nine day fortnight?. Idiots like myself who work a 14 day fortnight. For fucks sake JK how can the “government” pay for the tenth day when the “government” plans to give me back some of my tax. It doesn’t add up JK or am I missing the big picture here. And another thing, why should my taxes pay for the wages of a competing business to stay in business?. If a business only requires a worker for 3, 5 or 7 days it’s up to the employer not the fucking government.
Vote:March 10th, 2009 at 1:38 pm
Yep – was about to mention the productivity issue, but others did first.
Direct subsidy of the business still isn’t a good thing, but at least its better than just handing out cash for people to take a holiday.
Vote:March 10th, 2009 at 1:40 pm
Ratbiter, you’re really a closet pseudo-rightie aren’t you?!?. out you come laddie….
Vote:March 10th, 2009 at 1:41 pm
These are the kind of policies that make the Nats lok so bereft of ideas. Hare-brained lunacy that cannot be supported.
Vote:March 10th, 2009 at 1:50 pm
So you’d all rather close down the businesses and put the staff onto the dole? Just ignore the words ‘temporary’ or ‘targeted.’
Thank God none of you ever will get near the levers of power. Tucked away in a back cupboard, relishing your 1.5% poll rating is where you will rot for the rest of your lives.
Vote:March 10th, 2009 at 1:52 pm
Suddenly, the clouds parted and light, clear, bright light, streamed in.
Vote:March 10th, 2009 at 1:52 pm
Isnt the point that is there is not a fantastic opportunity for productivity if no one is buying the products – If it was just about productivity then the govt could just offer to subsidise a productivity bonus for workers. Same hours, same pay – more work -more product – but recession so same of less customers
This is about making the same product volume – by sharing the amount of productive hours around isnt it? or am I reading this wrong?
what Im struggling with is how you’d get someone to attend training on a non or reduced days pay?
Vote:March 10th, 2009 at 1:53 pm
Well, it is a stupid policy. Yes. But stupidity is a relative thing. It is less stupid than paying the median wage, or attempting to pay the full wage for that worker. It is also (marginally) less stupid than just running around showering money on people so they can spend it at the Warehouse on imported Chinese goods.
I can see some sort of argument that it is better than having those people unemployed. If not doing this meant the company went bust, and everyone lost their jobs, the cost to the gummint (the taxpayer) of all those people unemployed would be much higher than 1 day in 10 of minimum wage.
But, it is a pretty standard tenent on the right that you don’t try to stop companies from going bust – the whole point of the market is creative destruction. Keeping companies alive that should be dead will be a drag on their competitors – they’re now competing against a government subsidised organisation. It stops the market from shaking out, it stops new entrants that might otherwise come in, it stops new technologies. It is classic “protecting the buggy whip makers” type thinking. There may be an argument that this current point in time is different – that those companies are viable and it is just international turmoil that is causing the problems. Thing is, how will we know where to draw the line?
And, DPF’s “the team that has to implement this will need to be very good” comment is a polite way of saying “this will never work.” FFS, they’re govt employees. They won’t be very good. That is why we don’t let government get involved in stuff like this.
Vote:March 10th, 2009 at 1:54 pm
I couldn’t believe my eyes when I read that JK was suggesting the government pay a 10th day for unionised workers only.
http://tvnz.co.nz/business-news/nine-day-fortnight-details-expected-week-2528675
WTF?????
Vote:March 10th, 2009 at 1:59 pm
I dont want to keep harping on but one the best things I hope will come out of the current economic mess is that across the Western world there is a wakeup call for ALL governments that they can no longer treat their citizen tax payers like a bloody ATM machine
That those days are gone and never to return
This means that the pollies and civil servants must find ways of living within THEIR INCOMES the same as they keep raving on to us about
If Ive heard it once Ive heard it a thousand times from especially Socialists how Ive got to learn to live within my INCOME.
Well excuse me And at the same time their sticking their grubby hands into both my hip pockets to extract ever more of my hard earnings.
No Pollies and civil servants
This time its YOU that have to learn to live withing your means and deliver to me the services I require at the price I demand
If you cant or wont them just FOXTROT OSCAR
Vote:March 10th, 2009 at 2:08 pm
Messy innit? Adolf’s comment’s spot on.
I generally agree wage subsidies are a problem, they get locked-in too readily – look to Australia where there’s a range of subsidies payable for people depending on what qualification they’re enrolled in. Makes the labour market clunky (and it’s clunky enough given the volatility of IR regulation). But then what to do hey? If there’s a risk of significant increases in unemployment, then purely on fiscal grounds, some subsidy might be a better prospect, particularly if it retains and even upskills workers. And here’s the real bind, there’s serious and credible commentary suggesting some firms should be left to fail – low wage, low value added firms particularly – but that the workers should not be unreasonably penalised. One solution is to fund structural adjustment training to position workers to get new jobs when the economy picks up… well that’s an option being pursued in Australia anyway.
Vote:March 10th, 2009 at 2:10 pm
This is comedy gold gd. This crisis is the private sector’s making. The global crisis is about leverage, banks massively over exposed and reliant upon toxic assets. That you don’t understand this and think it’s Gummint fault is laughable.
Vote:March 10th, 2009 at 2:16 pm
My understanding is that the poor employer is not going to be paid for lost production or assisted with freebies to stave off bankruptcy.
Certainly no-one has offered me a handout to cover the 50% reduction in earnings I’m experiencing.
Why should employees be treated better than employers?
Vote:March 10th, 2009 at 2:18 pm
How about nobody paying anything for the work that isn’t done?
The whole point of the nine-day fortnight idea is that it is a better alternative to a zero-day fortnight. Any worker who objects to getting only nine days pay for nine days work is welcome to go get another job.
For taxpayers (point taken, gd) to pay for training I can accept happily. This should ultimately raise productivity. And any worker who refuses training and wants to spend the day at the beach, well that is between them and their employer. Such a choice is not going to help your future career or put you in a good place on the list if redundancies do end up being required after all.
People need to grow up and stop looking to the Guvmint (ie taxpayers) to take responsibility for everything and solve every problem.
Vote:March 10th, 2009 at 2:18 pm
First they’ll start with ten percent, and pretty soon they’ll pay everything.
And you know what that’s called…
[DPF: Exactly!
]
Vote:March 10th, 2009 at 2:21 pm
Neville Key sells out National supporters once again, the gov’t is going to pay the 10th days wages for union members only.
Can we please get rid of this man.
Vote:March 10th, 2009 at 2:23 pm
I heard John Key on radio New Zealand suggesting that Union Members may be the first to benefit. Good on him for being the first National PM ever to do something for the Trade Union movement.
I think the proposal is a good one and find myself in agreement with Key (gasp). However most workers cannot afford to take a 10% tax cut and many employers cannot afford a 10% tax hike in wage costs.
The Government should cancel the proposed tax cut that will only benefit the wealthy and use this as a fund to pay for supplementing the wages of those forced to work less. THis is the only way to make the scheme work.
Should I hold my breath?
Vote:March 10th, 2009 at 2:26 pm
“This crisis is the private sector’s making.”
Thanks for that opinion Mr. Williams. You are of course quite free to express it, but please do not mistake it for a fact.
Nine day fortnights are just yellow backed bullshit.
Here’s what needs to be done. Right now, or you’ll need to take much worse medicine in six months.
Cut all taxes on companies and other taxes that have a negative impact on commerce. (petrol taxes for example) Unload 75% of the bludgers who are only on the government payroll because they agreed to vote for Labour.
Shut down all government spending on issues that can be postponed. Keep hospitals and the police and military and emergency services afloat but reduce staff in all other departments to the extent where the massive amount of money flowing from the private sector is reduced to a trickle.
Sure – people will be out of work, but a lot less than if we do not take these measures, and those out of work if the above steps are followed will mostly be Labour voters and therefore the greedy lazy envy driven bastards who brought this upon us.
The pity is that some of them will be the poor ignoramuses who voted Labour because they never understood. They believed the false promises and lies of the washed up power obsessed ivory tower academics. Too bad for them.
What has to be done must be done. This is one case where the leftist mantra “for the greater good” can be rationally applied.
Vote:March 10th, 2009 at 2:28 pm
Ok, here’s a bloody good idea, and I challenge anyone to tell me the downside of this:
A government sanctioned scheme whereby firms can tell workers that they need to reduce labour costs to survive, and as a group they can either risk massive layoffs (to which any individual may or may not be subjected, based on performance) OR, as a kind and gentle alternative, they can take one day out of every fortnight and work for free.
In other words, in order to secure their jobs, they continue their normal production but don’t get paid for one day in ten, until it is clear that such measures are no longer necessary.
Vote:March 10th, 2009 at 2:31 pm
Red, happy to see you adduce evidence to show how the collapse of the stock and commodities markets and the failure of banks were in fact the result of something other than a failure of private sector leaders…
And as Adolf said, I’m happy that you and your mates have buckley’s chance of running the government… here you go Mr Hide, here’s your packed lunch and your movie tickets, now off you go and play with your friends and we’ll see you soon… in three years.
Vote:March 10th, 2009 at 2:33 pm
I agree with Christopher, workers should be offering the tenth day for free if it is going to secure their jobs.
Vote:March 10th, 2009 at 2:34 pm
Paul Williams
Do you really believe that public sector workers should be immune from cuts in pay or cuts in staff numbers?
Vote:March 10th, 2009 at 2:38 pm
“Red, happy to see you adduce evidence to show how the collapse of the stock and commodities markets and the failure of banks were in fact the result of something other than a failure of private sector leaders…”
It is not what this thread is about. If you want to read my views, go here-
http://www.kiwiblog.co.nz/2009/03/obamas_troubles.html#comment-541145
(Make sure you watch the video)
This is about whether a nine day fortnight will help stave off further economic collapse. It won’t.
I am amazed such an idiotic suggestion has actually got political traction. Its trying to defy gravity.
Worse, its a measure of just what a bunch of fuckwits we have in parliament in NZ, and it makes it clear that if we look to these unbelievably dumb bastards for salvation, we’ll be only tightening the noose around our own neck.
Vote:March 10th, 2009 at 2:40 pm
Could be an interesting step towards a nationwide goal of the two-day working week.
Vote:March 10th, 2009 at 2:40 pm
Paul Williams You miss the point I make. I am NOT talking about the private sector causing the problem Of course they did have a big hand in this and Ive posted here and elsewhere and written articles in several publications about the reasons and whose to blame.
What Im referring to is Governments using Tax Payer money to bailout the bad guys and using the situation as a stalking horse to raise more taxes and nationalise banks and businesses, they will use any excuse to raise more taxes and spend more of our money
Witness Gordy and the RBS etc. Obama et al.
What I dont want to see is the Government taking even more control over my and other taxpayers lives by using fiscal policy to further rape and pillage us
IMHO the governemnt should be less than 20% of the economy. And the less the better.
Governments are the worst form of delivery of goods and service. Witness the Soviet Union in the past and Nth Korea now if you need any more evidence.
Vote:March 10th, 2009 at 2:40 pm
How about workers accepting personal responsibility for THEIR livelihood. Sit down with the employer and workout what works for both of them. There aren’t that may scenerios to work through. Employer goes broke, productivity increases, wages fall etc. Why not let commonsense prevail or do employees have some God given right to having no risk associated with selling their time and skills. The government should just be on the sidelines observing the free market at work.
Vote:March 10th, 2009 at 2:43 pm
“Could be an interesting step towards a nationwide goal of the two-day working week.”
Fuck. Why stop there? Lets all do what the core Labour voters do and work for no fucken days a week.
Vote:March 10th, 2009 at 2:43 pm
The elephant in the room is the minimum wage, do away with it, or reduce it to around $8-$10 per hour and you may be able to save some of these jobs.
However Redbaiter is right, the main thing that will drag us out of the crap is productivity, until we can convince these brain dead union fuckiwts of this we will never grow as a nation.
Vote:March 10th, 2009 at 2:44 pm
Effectively the same as what Christopher was suggesting.
Vote:March 10th, 2009 at 2:50 pm
Thank goodness somebody else can see the sense of workers being paid nine days wages for ten days work.
While it is harsh on those losing a days wage surely it is better than losing their job, it is also better than me having to pay the wages of some low life union scum simply because Neville Key does not have the balls to tell union members to piss off.
Vote:March 10th, 2009 at 2:51 pm
No, I don’t think that.
I think that the focus should be on quickly restoring sustainable productivity. If this means some low-productivity firms fail, then as regrettable as this is, it’s possibly in our longterm best interest.
I do think we need to avoid unemployment wherever possible. Any amount of unemployment generally erodes skills and leads to longer period of unemployment (though I’m not of the any work is good work camp). If this means paying training subidies then I think we should. NZ has one of the best, if not best, workplace training infrastructures in the world and now’s when it must surely prove it’s worth.
That’s not what this is about. This is about what short-term measures might assist us to quickly recover. A 9 day working fortnight is something worth examining. Well at least the Jobs Summit thought so but then they didn’t have the benefit of your foresight hey.
Bad guys is kinda hard to assess but I don’t disagree. Targetted funding/support, where it’s possible, is preferred.
One word. Externalities. The rules around commercial collapse prefer some creditors over others. Workers are often the last on the list, sometimes even missing out on statutory rights/benefits (e.g. superannuation). Government is the security net of last resort and so has an interest in avoiding avoidable redundancies, liquidations etc.
Vote:March 10th, 2009 at 2:53 pm
“the Jobs Summit thought so”
pfffffftt..
The Jobs summit
Yeah, they’d know.
Mostly a collection of fat cat cronyists too damn blinkered to know its their endorsement of government playing such a huge role in commerce that caused this mess in the first place.
FFS.
Vote:March 10th, 2009 at 2:56 pm
Problem with that is that currently, in order to do so, they’re bludging off those of us who do work. Having one group’s laziness paid for by another group’s work is essentially a form of slavery. (I’m referring to those people who could work, but choose not to, by faking medical issues, etc, rather than people who genuinely can’t work and therefore need help.)
Vote:March 10th, 2009 at 2:59 pm
So you’d rather go to welfare for everyone, but no one funding welfare? Wake up and smell the reality. Everyone is going to have to carry this can. Only those that actually break the law and go for it will survive. That’s what has to be done. Not just a total rethink of minimum wage, but a total rethink of our company and tax laws. This is not a failing of capitalism, but a failing of the version of regulated capitalism we use. That it’s good for some and not others just doesn’t work over the long term. The market must be FREE.
But two things must first be confirmed:
the true extent of the effect of a global recession on NZ’s economy. I don’t believe it is anywhere as bad as the Government hot air would say it is. The reason is because none of the measures to date address the problem. They simply aren’t serious about shock proofing the economy so it can’t be that dangerous. It’s looking to me much like a GW religion for rightwingers rather than a real and true economic danger.
Secondly, does John Key have the politcal balls to do what has to be done and free our markets completely? Will he begin privatising our SOEs immediately? Will he continue the schedule of tax cuts? Will he do what has to be done? Will he at least make an attempt before losing the next election? Does he put his tenure above the economy of NZ?
I think we all know the answer to that. So sit back, chill out, the recession is not here, yet, if it’s coming at all. Smart businesses will take this cry-wolfing as an examination of how their businesses must adapt to the future and begin now. It’s all in the individual’s hands now.
Vote:March 10th, 2009 at 2:59 pm
Red, you’ve forgotten your in the tent now, pull your zipper up and stop pissing on your mates.
Vote:March 10th, 2009 at 3:11 pm
Jesus, if you think this is about protecting your “mates” you really are impervious to redbaiters ideas. It must be drongo day.
Vote:March 10th, 2009 at 3:23 pm
goodgod, I think Red’s a professional curmodgeon who’s impervious to ideas generated other than by Anne Rand… I think the fact that National now have to govern, messy and difficult as it is, will infuriate him and anyone else who’s been fooled into thinking it’s easy, prescriptive and doesn’t involve complex trade-offs.
I’m happy to watch the crazy right bemoan this reality, denounce their elected officials and disappear into a vapour-trail of irrelevance. That clear enough now?
It’s not drongo day, it’s the day when you and your’s realised all that gnashing and wailing of the last nine years amounts to nought!
Vote:March 10th, 2009 at 3:29 pm
No that day came about a month ago when the first mutterings of discontinuing tax cuts started. As an ACT voter at the last election, I was always uncertain about National, though i hoped for the best – never a good idea in politics. Now I’m sure that the ideas are not new and not useful and no one’s going to look for an alternative.
I assume you propose that Labour immediately take the reigns and implement tax increases and increased government bailouts and spending.
I’m all for it. National have left the ship already.
lets run this bitch onto the rocks, survivors take all. Only way to sort the fuckwits from the fit to live. See you on the rocks, boy.
Vote:March 10th, 2009 at 3:31 pm
Hmm, are you sure? Doesn’t seem to go with our incredibly poor standing in productivity improvement. How to we measure how good a workplace training infrastructure is – by whether people tell us that, or by whether it works? And if it worked, surely we’d have productivity improvement?
Vote:March 10th, 2009 at 3:32 pm
Woah there horsey
Employees are actually the first preferred creditors! Unpaid wages are the first thing that gets paid when a company collapses.
I don’t know where you got the idea that they miss out.
Vote:March 10th, 2009 at 3:36 pm
I am trying to think of a stupider economic policy than paying people to not work in vulnerable firms, as a way of ensuring that people continue to have vulnerable firms to work in.
My only hope is that this scheme is so fucked-up that it will actually be impossible to implement and that the economy will have come right in time for the grateful Finance Minister to announce that due to the wise stewardship of the government, this scheme is no longer needed.
Vote:March 10th, 2009 at 3:37 pm
Paul Williams IMHO this is a time when we must leave our LEFT RIGHT prejudices outside the door.
We are in a situation when we must insist the pollies and civil servants work towards establishing simple workable policy that allows the citizens to be the ones that deliver the solutions.
And means curbing their desires to extract more tax money out of our pockets.
SMEs are never going to survive let alone thrive unless they have the cash to finance their business and the customers with cash to buy their goods and services.
And that WONT happen if we let Jk BE et al take more money.
Gumints of all colours will always over promise and under deliver Look at Barry Gordy Kevvy All 3 making promises they can never ever deliver on.
Snake and oil salesmen the lot of them
And the guilable smucks lapping it up not understanding its their children grand children and great grand children who wilkl be picking up the tab for these bozos lies.
Give the citizens their own money JK BE and let them not you decide how they will spend it,.
Give them real choice real value for money Go on i know its a novelty but do it anyway
Vote:March 10th, 2009 at 3:38 pm
You’ve got me on my pet subject PaulL, but it’s a good point; what’s the metric? Multi-factor productivity ought to be the measure and by this, I agree, we’re not as good as you’d expect given my statement but that’s partly explained by our dollar, low-capital intensity and trade in agricultural commodities (at a macro-level of course). Straight return on investment might be another and there’s a fair bit of that around/published industry-by-industry.
Industry training covers close to 80 per cent of the workforce and is low-cost, fast and highly effective. I don’t have figures to hand, but the Industry Training Federation’s published lots on return on investment. By comparison with Australia, NZ trains far far more people on the job which is a more authentic and productive learning environment. There’s low dead-weight costs, no wage subsidies and strong participation and completion (including by groups with lower levels of workforce participation). By comparison with almost every other country I’m familiar, including most OECD nations, NZ system is superior.
My argument is that this infrastructure is in place and supplemented with institution-based training ought to be a major component in government’s strategy to re-skill and reposition for the inevitable upswing.
I could go on but perhaps it’s not necessary for the moment – happy to elaborate on- or offline.
Vote:March 10th, 2009 at 3:40 pm
Wages yes, other entitlements no – what of Long Service Leave and Sick Leave? If I’m wrong on this, I’ll happily stand corrected.
Vote:March 10th, 2009 at 3:42 pm
goodgod, I apologise for the remark above, it was gratuitous. We disagree about stuff, but I needn’t have been so rude.
Vote:March 10th, 2009 at 3:42 pm
I’ve got an idea – How about a zero day fortnight for union members?
Vote:March 10th, 2009 at 3:46 pm
Paul Williams
Those people who look upon sick leave and an entitlement and something they should be paid out on if they do not use are the very reason we have such poor productivity, sick leave should be there for emergencies not to be used up or saved to be exchanged for money.
As for long service leave, do we still have this ancient and silly tradition in our workplaces?
Vote:March 10th, 2009 at 3:46 pm
big bruv (2957) Vote: 1 0 Says:
March 10th, 2009 at 2:33 pm
I agree with Christopher, workers should be offering the tenth day for free if it is going to secure their jobs.
Will this be a substitute for, or in addition to, the unpaid overtime that is often done? Its not unpaid overtime, its theft!
Vote:March 10th, 2009 at 3:48 pm
Jack
If workers want to do over time for free then good on them, I would have thought that it might be a good idea if it secures their jobs.
Vote:March 10th, 2009 at 3:52 pm
bigbruv, taking an employer’s property is theft by an employee and should be prosecuted.
Taking an employee’s labour and not paying for it, is theft, and should be prosecuted.
The only thing missing from your bluster is a revamped Masters and Servants Act, and no doubt you’re working on that now.
Vote:March 10th, 2009 at 3:54 pm
The proposal sounds a bit too much like the French compulsory 35 hour week, which was supposed to create jobs by making people work less. It failed, mostly because it was the sort of idea that insane people would think up.
Vote:March 10th, 2009 at 3:55 pm
The argument I’ve put forward is that government should try to keep people in employment because the split of costs/responsibilities/burdens is not simple and firms can externalise some costs. Secondly, there’s a question about whether or not some entitlements are paid to workers as secured creditors or not. I think some aren’t and therefore this is another reason why governments might intervene in various ways (others are the welfare cost and the reduction of individuals’ employability which has a longer-term impact on productivity). Finally, we get to you your comment that sick leave is not an entitlement and that somehow the NZ workforce is the reason NZ’s not as productive as it should be… frankly, that’s bizarre.
You carry some kinds of unpaid leave and other entitlements as a costs on your accounts because under NZ IR law they can be debts owed to the employee. What do you think about super I wonder? That’s just another namby-pamby benefit paid to workers who’d otherwise be so much more productive? I thought you were a small business owner?
Vote:March 10th, 2009 at 3:58 pm
Jack
Who is talking about theft?
If the workers of NZ are of a similar mind set to you then they are doomed, all workers need to adopt an approach of cooperation, having idiots demanding more money than the business can afford or idiots refusing to do an hours overtime is not going to save anybodies job.
Co-operation is what’s needed Jack, it seems you don’t know the meaning of the word.
Vote:March 10th, 2009 at 4:38 pm
Paul Williams, I am glad that productivity is a favorite subject of yours.
That comment of yours about “the private sector” being “responsible” for the economic crisis, therefore the employees of the private sector, including factory workers and cleaners, must “pay”, while highly paid public sector employees who exist on the taxes paid by those factory workers and cleaners, can live life business as usual; that comment says a lot about your mentality.
Do you not see that the finance sector and the productive sector of the economy are separate branches to each other just as much as they are to government? I believe that the old adage about the finance sector needing to be handmaiden to industry, is spot on.
Both government and finance do not create weath and we all depend for this on the productivity of the productive sector.
It is certainly true that governments had a significant hand in causing the financial crash, from the promotion of subprime mortgages to guarantees of institutions like Freddie Mac and Fannie Mae that led to lack of due diligence all round; to failure to enforce existing regulations. A significant problem including in this country, was that politicians basked in the glow of a false boom and healthy revenues that they could spend, and refused to listen to wiser heads of which there was no lack. In the USA, those same politicians enjoyed massive financial support from Wall Street, Democrats much more than Republicans; and the Democrats in particular enjoyed kickbacks from the subprime mortgage operators that were their particular babies.
Another significant problem is that investment in productive activities has long ceased to be worth the trouble, with high taxes, high regulatory burdens, massive regulatory delays, punitive employment law, and deepening impositions of all those things. Add to that, that finance for productive activities was being crowded out by demand for finance for speculative activity, and you have more ingredients for the perfect storm.
I think we now need to face up to the significant distortions in our economy. The boom years we have had have been false, and to the extent of 10% or more, inflated by the cashing out of unreal asset values. We need to imagine the economy reset at true values, and then decide whether we could truly have justified a whole lot of the burdens we have imposed on the productive sector had we known what we know now. It is just absurd to be debating 9 day work weeks and bailouts of businesses now when we imposed 4 weeks annual leave, and maternity leave provisions, and punitive dismissal regulations, among other things, only a few years ago when we thought we could afford such niceties. We couldn’t. We need to admit that now. Not only “we couldn’t”; we now have to claw back our 10% plus, fake boom based spending right through the economy including the government spending that has been based on this level of extra revenue.
John Key’s recent comments about improving our productivity are spot on, but we seem to have a disconnect so far about how this is going to be achieved. It is not going to be acheived by increasing the burdens on the productive sector or even by leaving the existing burdens unlightened; it is not going to be achieved by the finance sector getting clever with inventing new financial instruments and new ways to gamble on outcomes; it is not going to be achieved by bailing out and rewarding sharks; and it is not going to be achieved by government spending financed by borrowing that merely crowds the productive sector out of obtaining the finance THEY need. The borrowing of the US government alone, on world finance markets, will probably lead to worldwide crowding out of productive activities.
Where do you stand on company taxes? Do you see it as helpful to shift the taxation burden OFF operating profit and onto distributed profit? I cannot for the life of me see why the idea of taxing company profits per se, ever got off the ground, given that reinvested profits (as opposed to distributed profits) are like a main source of economic growth and increased productivity.
Where do you stand on the expensing of capital items?
I think that we need to confront the Trade Unions inability to run with policies that are in the best long term interests of the whole country; productivity gains are captured far more by wage earners as wage rises, than they are captured as higher dividends for business owners. Employers in the productive sector are NOT “the enemy”; they are people that YOU should be pleading the cause of, in your own best interests.
Another thing you lefties should be waking your ideas up on, is that urban limits and all that stuff, played a prime role in driving up the costs of housing and causing a bubble. You are meant to represent the poorer people, not be imposing regulatory regimes that make housing unaffordable for them. Allowing developers to freely build just as many homes as they can sell, is something that you should be fighting FOR, not against. Builders labourers badly need work right now. Practising the politics of hate against the people who provide the jobs, is destructive to the long term interests of the very people you are meant to represent.
Vote:March 10th, 2009 at 4:41 pm
BB: if you start from the premise that all work is paid for by the hour, then you logically end up with Jack ends up. If you start with the premise that people are paid to do a job – to get a particular thing done, then you get quite a different answer.
Vote:March 10th, 2009 at 4:50 pm
You’re right Paul, my comments were about those most likely to suffer under the 9 day fortnight – the hourly paid.
However, if you pay a man to dig a ditch, and he can dig that ditch quicker than you expected, that’s the old concept of “job and finish”.
Vote:March 10th, 2009 at 4:59 pm
PhilBest, it might’ve if I’d said it… but I didn’t and it’s a false premise you’ve constructed. My comment was that the current financial crisis was bourne of failures on Wall St and Chicago, low-doc loans and insance commercial practices designed to hide the toxicity of assets. Yes there were regulatory failures, some in NZ and Australia (naked short-selling for instance) but they’re not what’s caused the liquidity crisis, they’re small beer by comparison.
As for your questions re company tax, R&D and expensing capital, I’ve not expressed a view. Perhaps we could head in this direction as I’d be interested in your views about LAQCs? You want to increase investment in productive assets, lets see tax breaks on real estate ended? What about a capital charge?
Alternatively, we might return to the issue at hand, a 9 day fortnight, and how Key will make it work. It might in fact be a useful short-term intervention or does my interest, as a so-called leftie, render it crazy?
Vote:March 10th, 2009 at 5:12 pm
Thanks for that, Paul Williams. The trouble with capital gains taxes on land and houses, is that they do not stop housing bubbles happening and it is not in the government’s interest to stop housing bubbles happening as it nets them a handy revenue stream. I agree with capital gains taxes in the context of freed up land supply that prevent a bubble from getting going in the first place. I could provide links to a lot of analysis that shows that this is what has in fact happened in the different areas in the USA.
Let’s make a 9 day working fortnight one of many voluntary arrangements that employers and staff can opt for, eh?
Vote:March 10th, 2009 at 5:15 pm
This is perhaps the very worst idea to have to enact.
Government can’t afford it.
Business can’t afford it.
The troops can’t afford it.
My sister in law is a civil servant in the UK.
They get weekends off, Bank holidays off, Inset days for training off(10), 30 days holiday entitlement, and this is the killer for me.
15 days sick leave, that they are EXPECTED to take. Plus they can apply for unpaid leave for Funerals etc.
No wonder she needs a Sat Nav in the car.
Vote:March 10th, 2009 at 5:17 pm
Unpaid overtime? Jesus christ, you pathetic socialist cunt, get your stupid fucking head out of the sand.
My father is a dentist. Nobody pays him overtime to do the hours of paperwork this bullshit bureaucracy requires.
You’re paid to do a fucking job. If that means doing work outside “office hours”, then that’s what it takes.
Fuck you annoy me, you useless fucking prick.
[DPF: Cunt is not an acceptable term in referring to other people. 20 demerits]
Vote:March 10th, 2009 at 5:24 pm
BTW, Paul Williams, a guy called “Kieran” and I had a lengthy debate HERE about the land speculation issue:
http://www.interest.co.nz/ratesblog/index.php/2009/03/06/new-zealand-could-go-bankrupt-within-next-5-years-markets-believe/
One of the points that came up, was the ring fencing of property related losses. I do not believe that this would have the slightest effect on house price bubbles which by necessity occur because everyone is expecting to make a profit on the property speculation, not a loss.
Vote:March 10th, 2009 at 5:28 pm
For years we’ve thrown scorn on the EU for paying farmers not to produce. We know that that “system” breeds inefficiency, creates unfair trade, and blunts market signals.
Yet for some inexplicable reason we choose to think that paying workers not to work for 10% of their standard hours will somehow be good practice? It’s a fallacy from the outset.
If an employer’s output has become too great for market uptake, it’s for the employer and its employees to work out how best to cut their cloth. There are potential benefits to both sides in working out a sensible, local, customised solution.
Having the Government anywhere near this present proposal (given Government’s normal propensity to devise mass “solutions” using taxpayers’ money) is to create another welfare scheme at the expense of the more efficient taxpayers. It’s called wealth redistribution, and it will be another deadweight cost on the economy.
Vote:March 10th, 2009 at 5:35 pm
Your father… you’re bringing your father into a conversation? F’real?
How about you make an argument from your own experience rather than telling us what Dad does? Incidentally, if your father doesn’t factor in administration as a small business owner, you better hope you finish school before he can no longer pay the fees.
This is the thing about wages, wages are paid in terms of hours worked. Lots and lots of people work unpaid overtime, they do so because they care about their work and their clients. They do so ’cause they want to do a decent job. Good will works both ways however and some of the attitudes here are positively Victorian… fortunately I’m guessing the aggro commenters here are full of it.
PhilBest, I’ll check out the debate. It’s very political, housing, and it needs attention but it’s not about access to business finance.
Vote:March 10th, 2009 at 5:39 pm
In summary – 9 day fortnights is an idea thats been floated because there isn’t enough work for 10 days, however it is better to have all staff receive 90% of their pay than 10% of the staff get the sack.
The bottom line is that in the current deflationery cycle – pay rates must come down. Must. No Govt handouts please. No need for oversight, choosing industries etc. Just give all employers the right to reduce work as they see fit, with the coressponding reduction in take home pay. Too easy.
Vote:March 10th, 2009 at 5:43 pm
“Unpaid overtime? Jesus christ, you pathetic socialist c**t, get your stupid fucking head out of the sand.”
Thanks for the smile. Enjoy your passion. Its long past time for these socialists to experience a bit of honest contempt.
Bad luck about the demerits though
Vote:March 10th, 2009 at 5:45 pm
Yeah, us socialists whither at being called names, by the sons of dentists no less … ouch, ouch, stop it, it hurts… oh I give up, where do I sign up for SOLO?
Vote:March 10th, 2009 at 5:46 pm
How about Public sector work a 5 day fortnight. We recruit twice the amount of Beuracrats to take up the slack of the work unable to be completed.
Private Sector to work a 12 day fortnight to compensate. And shed 20% from the extra efficiency to be able to work in the Public Sector, after 5 years on full pay at Uni to learn how to file stuff.
Frankly when you transpose the Pensions burden going forwards this is exactly where we are headed.
The only game in town is for everyone that can produce, to pay for indexlinked, gold plated pensions unaffordable in the private sector.
Government does not work for us, we all work for the priveledged, secure, unsackable Sir Humphreys. And its going to get a LOT worse.
Vote:March 10th, 2009 at 5:47 pm
Open your mouth Paul W, I’ll fix your toothache with a sledge hammer (joke Sir Farrar), as if I need more demerits.
Vote:March 10th, 2009 at 5:56 pm
“oh I give up, where do I sign up for SOLO?”
Wrong again. I am held in contempt by those who frequent SOLO. (Suck On a Long One)
I’m banned from Not PC.
I’m a traditional post War of Independence American style Conservative.
A traditional Conservative.
The Liberqueerians are mere modern day interlopers and poseurs.
Read this- it will help you understand:
http://fee.org/nff/not-yours-to-give/
A speech made before the Liberqueerians were ever even a sparkle in Ron Paul’s eye.
Vote:March 10th, 2009 at 6:00 pm
Land and property is easy.
One interest rate for first residential property. Long term fixed rate of 7%. 10 deposit required. Max 3 times main earnings plus 1/2 for the partner. Doesn’t vary ever through time.
Competes directly with the rental market.
Subsequent properties. Interest payable at 14% fixed, 20% deposit, and earnings on review. But should be no more than 2 times earnings less other mortgage commitments.
Cash can buy anything.
Capital Gains Tax at 30% on all non main residence houses.
Commercial Property. 5% Fixed Interest rate. 25% Deposit on valuation/price. Earnings/Underwriting for funder approval.
CGT of 30% on Commercial Property.
This is a capitalists way of wealth distribution.
The two speed housing market here is wrong, and I further advocate the ability of State House Tenants right to buy their property as per proposal one. But with a 5% Deposit.
Vote:March 10th, 2009 at 6:04 pm
Red, “liberqueerians”, I shouldn’ta, I really shouldn’ta but that made me laugh so much coffee came out my nose! I’ll also read the link.
cheers, p.
Vote:March 10th, 2009 at 6:14 pm
Glut – who imposes all this? Looks like a lot of government regulation to me. How about this for a deal:
– buy what you want if you have money and someone wants to sell it
– buy what you want if a bank will lend you money, and someone wants to sell it
– tax shifted from income to wealth. Tax is on total asset value, current valuation, a percentage of your wealth every year
– increase on consumption tax as well – say 20% GST
– no, or almost no, income tax. The rates would have to be fiddled to give a similar net take as today
Impact – you are rewarded for working, and rewarded for creating income. You are taxed if you have lots of wealth, and taxed if you have lots of spending. Many people who are currently outside the system suddenly come into it – a lot of it inherited wealth that never worked a day in their lives. The middle and upper middle class, who work their arses off for a salary, and never accumulate all that much in the way of assets, get a break.
Vote:March 10th, 2009 at 6:19 pm
Red, it’s a great story and an important point. Government’s ought to have only those powers necessary to do their jobs. We might disagree on the nature and scope of that job, but not on the need to zealously guard against mission-creep.
Vote:March 10th, 2009 at 6:31 pm
The regulation is easy. Can be done on a sheet of A4 for all the mortgage funders.
CGT is still on the statute books, and is part of the self declaration.
However I agree that Income tax should be Zero to 30K and then flat at 25% above.
Delete WFF.
Income tax of 50% on long term rentals (over 93 days) Income tax at 25 % on Tourist rentals.
GST should be 16%, and no tax on food, beverages, And childrens clothing.
GST should be just 6% on all Tourist style activity. All Restaurants, fast and slow. Motorhome rentals, accomodation, attractions.
GST should be 25 % on booze and cigs. RTD’s 50%.
Wealth tax is plain wrong and there is far too much temptation to avoid it. The French and Spanish hate it.
Vote:March 10th, 2009 at 6:49 pm
GST should never be at variable rates. I’m involved in some of the Australian Tax system changes, and the pain that is caused on small businesses because of differential tax rates is enormous. In NZ you take your total sales, divide by 9. Done. In Australia, you have to have complete records of everything that you sold to determine whether it was taxable or not. People keep talking about stuffing this up, and I don’t know why. It works fine the way it is, it isn’t causing any pain. Presumably the reasoning is to help low income people – but if you want to do that, then just help low income people. Exempting some items from GST adds cost to businesses, and has leakage to people that you weren’t trying to help.
Vote:March 10th, 2009 at 6:53 pm
PaulL, completely agree. I understand, urban legend, that the reason GST went from 10 cents to 12.5 cents was ’cause the administrative costs were so great, they ate into the revenue. I’d hate to see the cost of compliance with Australian GST… it’d be many times greater. In fact, the entire Australia tax system – Commonwealth and State – is significantly more complex, I don’t know anyone who doesn’t have tax agent to manage it for them.
Vote:March 10th, 2009 at 6:57 pm
I owned a company that had to deal with:
Exempt VAT
Zero VAT
8% VAT on Emergency Parts
!7.5% VAT
VAT on profit Margin on Used Vehicles
17.5% VAT on 10% of Internal Fittings.
In one year. No sweat.
I agree that the simpler the better. But if all Restaurants charge 6% what is the issue? Etc. Etc.
Vote:March 10th, 2009 at 6:59 pm
PaulL – agree on consistent GST. There is that legondary example of how Chicken does/doesn’t attract GST in Oz. I could’t find the reference I was thinking of, specifically the different rates applied to cooked vs fresh vs restaurant served chook… but this reference is in the same space:
Vote:March 10th, 2009 at 7:04 pm
Unpaid overtime, what like the bloody time I spent in doing the bloody Nat and Labour governments GST returns.
Nope Key is wrong in taxpayers paying for other employees to take the day off.
Extra unpaid training or a days work elsewhere is a better idea .
Yes there will be some who argue they know it all and have no need for any training.
Still work available in doing casual milking etc,etc.
Vote:March 10th, 2009 at 7:06 pm
The BBQ chicken example is one, the most famous is the Willesee/Hewson birthday cake. It cost Dr Hewson, then leader of the Liberals, the (unlosable) election and his job. Some of it’s here: http://en.wikipedia.org/wiki/Birthday_Cake_Interview
Vote:March 10th, 2009 at 7:28 pm
OK, drop Income tax, and raise GST.
There is much more freedom of choice then.
Accept the KISS principle. Although the variable rate isn’t as hard to do as the chicken example. Chicken is food. Hot or Cold.
That is Canberra being fin stupid.
Vote:March 10th, 2009 at 8:14 pm
Yes, good on dropping income tax and raising GST. Strictly speaking GST is regressive (in that poor people save a smaller proportion of their income, so they disproportionately pay GST). So you also need to fiddle tax thresholds and benefit rates. But not overly so – and I’m all in favour of a large income tax free threshold – say, $25-30K. Move around WFF and all that other junk to suit.
Vote:March 10th, 2009 at 9:06 pm
What’s wrong? Annoyed that a student might dare have an opinion that isn’t socialist? Unlike the great unwashed masses of students who are too pigshit ignorant to know their arses from their elbows, I am an educated man. True thinkers can never be left wing.
And yes, I brought my dad into this conversation. My father is quite possibly the best man I have ever known: a truly self-made man. He is intelligent, erudite, and works harder than anyone I’ve ever seen despite the fact that he turned 60 this year.
In short, he is everything that socialist guttersnipes like you can never hope to be, you pathetic sack of shit.
Vote:March 10th, 2009 at 9:08 pm
the nine day fortnight is a stupid idea, A paid day off at minimum wage, what an insult, i haven’t gotten myself trained up and good at my job for minimum wage, a day’s training, oh lovely no doubt it’ll cost too supersize your student loan anyone, employers won’t want to pay for this training, not to mention from your measly minimum wage day you will no doubt have to pay for your own transport to the training, and yes you got it the $100 they’re on about will be taxed too, probably at the rate you pay now not at the lowest as it should be. if you are lucky enough to have a company car you can bet you won’t be able to use that to get to your day off training. and obviously not everyone will be lucky enough to get that day off as a friday. the government to keep jobs and people epmloyed, then drop the personal tax some more so we can spend a little more, keep the business open. Or here’s a bombshell how about completely freezing repayments on student loans, sticking the intrest rate on them at 0%, seeing as the debt it’s generating through the interest alone is spiraling out of control. Don’t you just love the government muppets.
Vote:March 10th, 2009 at 10:20 pm
Why don’t they just reverse the changes to the holidays act that was put through a couple of years ago, and put the holidays back to 3 weeks not 4.
That would improve company productivity without costing employers anything.
I always loved the way the Labour party spun that one – how “The Government” was giving the workers an extra week holiday so they could share in the wealth created by their labour. What a crock. My employees all work less than me and earn more. And it’s not the government that gave the workers the extra week, the government simply forced employers to pay for it, such costs to obviously be passed on to consumers and employees in terms of negative pay pressure.
Finally at least we have a govt that doesn’t believe that costs can be put onto business without them being transferred to somewhere else (usually consumers and employees).
Vote:March 10th, 2009 at 10:31 pm
“I really shouldn’ta but that made me laugh so much coffee came out my nose!”
Wow, someone who appreciates my sense of humour.
Vote:March 10th, 2009 at 10:46 pm
No that’s not it, it’s just… oh never mind. True thinkers don’t box themselves into corners Christopher. I knew plenty of students who weren’t socialists and whom I liked/like. I know few “socialists”, seems to be a term you use rather broadly to describe people who don’t agree with you but plenty of social democrats (actually, I know a handful of socialists too, don’t agree with everything they say but respect their integrity).
Fair play to him and he’s lucky to have such a proud son. Just easy on the hyperbole hey.
Vote:March 10th, 2009 at 11:06 pm
adc – remember the re-introduction of o/t rates for public holiday work? Supposed to make things ‘fair’ .. Right?
Well within 6 months of this legislation being passed a cafe near us decided to close on all public holidays. The increased cost passed to customers lowered patronage and lowered revenue, against increased staff costs… so the owners decided bugger it – they’d close and have the day off. Result of this fairer system was to leave bunch of students without a full day of cafe work.
Given the choice of o/t rate for zero hours or normal rate of 10 hours you can guess what they would have preferred (I spoke to 3 of the 4 staff impacted… so assuming the other felt similarly)
Vote:March 11th, 2009 at 12:18 am
Hope John doesn’t go down the subsidy route however its dressed up. I was unfortunate enough to start a manufacturing business in the UK in 1991 unaware that the following year the country would be in recession – workforce was 8 and all good workers even if they were un/semi skilled and being Liverpudlians easily provoked to be bloody minded so when the decision to declare redundancies arrived we asked for volunteers. The answer was no one wanted to be redundant and instead they suggested we pay them what we could afford and stay in business and they would work whatever was required to produce the orders. We survived and prospered as our competitors evaporated – 6 years later we were employing 49 and making serious cash and the staff were making good peace work bonuses and management of staff was a breeze as those who remembered the tough times sorted out the idle and incompetent in ways management would never dream of. Their later request for an early friday finish so they could prepare for a weekend of booze bingo and other unmentionable activities was granted on the basis that finishing time was the later of 2pm or when all orders were completed and despatched – I dont recall the staff being in the factory after 2pm and as for Monday absence due to being hung over – those who tried it soon discovered how much more unpleasant it was to be sent to Coventry eating burnt toast and ignored by those whose peacework bonus was reduced by their lack of self discipline-tough, maybe but boy what a great place to work in once the rules had been established and best of all management was pleasant – cooperation and understanding the other guys problems and helping him to find a solution that works for him.
Vote:March 11th, 2009 at 4:48 am
Does sound like there is plenty of potential to waste taxpayer money with this proposal.
Vote:March 11th, 2009 at 8:31 am
MyNameIsJack (309) Vote: Add rating 0 Subtract rating 8 Says:
March 10th, 2009 at 3:52 pm
bigbruv, taking an employer’s property is theft by an employee and should be prosecuted.
Taking an employee’s labour and not paying for it, is theft, and should be prosecuted.
………………………..
If you give something, how can you call it stolen?
Vote:March 11th, 2009 at 8:44 am
[DPF: Cunt is not an acceptable term in referring to other people. 20 demerits]
Cunt is an excellent way of describing a cunt.
Far easier than asking, “Have you seen your gynaecologist lately?”
Ha ha!
Vote:March 11th, 2009 at 9:01 am
Get your blinkers off.
Who’s survival are we talking about?
The governments.
Global.
Some are going to self destruct in their panic, some (ours?) will make it.
Vote: