Guerin on Oram

August 23rd, 2011 at 2:00 pm by David Farrar

Tertiary education specialist corrects some errors by Rod Oram:

wrote an opinion piece on industry training yesterday that sets out some strong views on industry training but also has some enormous errors. I often disagree with Rod Oram’s prescriptions, mainly on pathways rather than outcomes, but he usually gets the relevant facts right.

First up, he seems to have taken hook, line and sinker the Labour myth that National destroyed industry training in the 1990s and Labour fixed it – check out the following quote.

Oram said:

Reviving industry training was one of the key planks of Helen Clark’s 1999 election campaign. The Modern Apprenticeship Act of 2002 was one of her government’s first major pieces of legislation. It created Industry Training Organisations, each tasked with developing government-funded programmes for its specific sector.”

Guerin points out:

First, were established by the Industry Training Act 1992, by National, 7 years before Helen Clark gained power.

Oram said:

But this was exactly the deeply damaging mistake the Bolger government made with the Industry Training Act of 1992. It radically reformed skills training, leaving only skeletal government support.

Guerin responds:

Second, there was no “skeletal” support for ITOs. They got substantial start-up grants to explore feasibility (which is partly why we ended up with so many ITOs) and then had funding transferred from polytechnics to purchase training. Everyone wants more money, but ITOs were not starved.

Oram said:

As a result, the number of people in formal workplace training plunged and skills shortages became chronic.

Guerin responds:

Third, workplace training did not plunge due to the Industry Training Act 1992. The table below shows that industry training numbers started falling in the March 1988 year, when Labour was in power. The drop is unsurprising given the huge structural changes being made in the economy, education and in labour markets over that period – an increase would have been surprising. Even though the decline started under Labour, it reached its highest percentage decline in the June 1992 year (the Industry Training Act became law on 22 June 1992, so can’t bear too much blame). The decline continued until the June 1993 year, after which numbers rose the next year.

In 1988 there were 28,240 trainees. This fell to 14,904 by June 1994. However by June 1999 it was 49,577 and June 2000 hit 63,102.

Guerin also points out:

Rod Oram also wrote that ITOs “offer a confusing array of 4600 qualifications at levels one to six”, whereas readers will know that the majority of qualifications are owned by providers, not ITOs.

It’s great to have had those myths dispelled.

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21 Responses to “Guerin on Oram”

  1. Elaycee (4,392 comments) says:

    Gee – another example of a ‘columnist’ telling porkies.

    Who’da thought?

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  2. Jimbob (641 comments) says:

    When are people going to wake up to the fact that Rod Oram’s opinions are not worth the steam off a fresh cow pat. He pretends to be a business commentator, but is just a commie attaching National, ACT, businesses and anybody else who are on the conservative side. His speciality to abusing farmers.

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  3. lastmanstanding (1,297 comments) says:

    Oram is a leftie Socialist with a bent for dissing farmers and business people in general. Jimbob is right and I despair the MSM give him oxygen. He is the perfect example of the Expert X is the unknown quantity and a spurt is like Oram a drip under pressure.

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  4. backster (2,171 comments) says:

    ORAM would never let facts hinder the opportunity to slam National so as to promote Labour if all it took was a little deliberate distortion.

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  5. flipper (4,060 comments) says:

    But folks, Oram is an “expert” because he emigrted from the UK. Oram, Hickey, Morgan (please increase my taxes!) – all peas from the same labour-aligned pod.

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  6. KiwiGreg (3,255 comments) says:

    I’d stop reading as soon as I saw Oram on the byline. He’s a puffed up lefty wind bag masquerading as a “Business” analyst.

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  7. KiwiGreg (3,255 comments) says:

    “Morgan (please increase OTHER PEOPLE’S taxes!)” – there fixed it for ya!

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  8. hmmokrightitis (1,590 comments) says:

    Why is Hickey provided with oxygen by the MSM? I really dont get it. Surely when he claimed that house prices would (note, not might, would) fall by 40%, which subsequently never happened, any shred of competence he had vanished?

    As for Morgan junior, if you want you can make voluntary tax payments – shut the fluck up and do so.

    Morgan senior, whilst I admire your economic thinking, to be honest, I would rather you channeled your efforts into better returns on your Kiwisaver product. 2/10, could / must try harder.

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  9. Frederick (39 comments) says:

    In 2008 Oram devoted every second column to attacking National and any economic policy they were promoting. The majority of the remainder of his columns heaped lavish praise on Labour and I got the impression that he was hopelessly in love with Michael Cullen.

    Move forward to 2011 and has he devoted any critical analysis to Labour. No. The exception being the CGT which naturally he hailed as bold and visionary. The remainder of the columns are just snide attacks on National.

    He was one of the few who did not find favour with Nationals 2010 budget ( along with Bill Rosenberg and Peter Conway of the CTU).

    The Sunday times has taken on a distinctly left wing stance and columnists like Oram and Hubbard are not even remotely objective.

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  10. Joseph Carpenter (214 comments) says:

    Guerin is correct, the biggest damage was done by the Labour government 1984-90. Five things in particular:

    1) Removal of the Apprenticeship Act and imposing uniform minimum wages. Up until 1987 a typical trade apprentice (for under 21y.o.) would start on 20% of the award basic journeyman wage rate, then 30% after completing 1000 hours, 40% after 2000 hours, etc. This was abolished and the minimum training wage rate was set at 90% of the minimum wage (currently policy is 80%). This was a major disincentive because it meant the first 1-2 apprentice years now had double the wage cost despite significant drop-out risk/losses and a huge supervision cost. (Shame on National for continuing this policy to this very day, supreme hypocrisy in wanting to do something for out of work youth).

    2) Removal of the Wages Protection and Contractors Liens Act – this absolutely rooted the income of trades and subbies in particular (i.e. no money for training), it got so bad Labour brought in the Construction Contracts Act 2003 (shame on National for not sorting this major problem earlier, protecting their big business mates in venal crony capitalism at its worse).

    3) A drive to “academise” trade training, up to the 80’s a typical 8000 trade apprenticeship would have a classroom/theory component of 1600 hours (20%), it is now typically min 3000 hours (38%) and arguably under NCEA/NZQA frameworks “process” rather than “outcome” based, e.g. ask some poor non-academic trainee to describe in a written essay (250 word minimum) how to set-out and jig up for welding a particular item rather than observe and question them on actually setting up and welding said item. (Shame on National for introducing NCEA/NZQA and still persisting with this load of shit particularly for vocational standards).

    4) Loss of State trading operations – the old MOW/SAC, NZR, PO, HC, NZED and NZFS trained a load of people. Also some of the old Government contracts to private sector contractors mandated a minimum training requirement (National could do this again particularly with the projected big civil infrastructure and ChCh rebuild spend).

    5) Loss of primary vocational training starting with Tomorrows Schools: most intermediates and secondary schools had specialist metalwork, woodwork, home ec, clerical work, technical drawing, agriculture etc classes – virtually all gone now. Plus they allowed a lot more part-time learning/industry participation work/vocational guidance for those who wanted to leave school (now belatedly being re-introduced).

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  11. Nick K (1,244 comments) says:

    Two reasons I cancelled my subscription to the SST.

    The first reason was Rod Oram.

    The second reason was Anthony Hubbard.

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  12. Lee C (4,516 comments) says:

    Frederick: “In 2008 Oram devoted every second column to attacking National and any economic policy they were promoting. The majority of the remainder of his columns heaped lavish praise on Labour and I got the impression that he was hopelessly in love with Michael Cullen.
    Move forward to 2011 and has he devoted any critical analysis to Labour. No. The exception being the CGT which naturally he hailed as bold and visionary. The remainder of the columns are just snide attacks on National.”

    Wow replace ‘Oram’ with ‘John Hamstrung of The Herald’ and it’s uncannilly accurate there, too……

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  13. Falafulu Fisi (2,179 comments) says:

    KiwiGreg said…
    He’s a puffed up lefty wind bag masquerading as a “Business” analyst

    Hehe, so true. I once had a chat with Mr Oram in a technology conference that I attended. In fact, I was at his presentation during the conference. He was talking nonsense all the way thru, but because the crowd were mostly technologists, they didn’t take note of the bullsh*ts Oram was delivering them in his talk.

    It appeared to me that Mr Oram didn’t know a lot in his so called area of expertise (ie, business, economics, finance) during our brief conversation at the conference. He asked if I’m an economist because he seemed not to know economic issues I raised with him and I told him , no, I’m a technologist, I just happened to read more economic publications and therefore more informed than him on issues.

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  14. david (2,557 comments) says:

    Don’t hold your breath waiting for a “mea culpa” from Oram either. Blatrant untruths published like this deserve equal opportunity retraction. Best you might get is a half column inch on page 15 saying that:

    “SST regrets a small number of factual errors in the article but both it and Oram stand by the principle thrust of the story. SST takes no responsibilty for errors inherent in contributor’s items”

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  15. Elaycee (4,392 comments) says:

    Nick K (123) Says: “Two reasons I cancelled my subscription to the SST. The first reason was Rod Oram. The second reason was Anthony Hubbard”.

    I cancelled too – I just got tired of reading the ‘same old’ lefty propaganda trotted out each weekend.

    And I don’t miss it at all. :)

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  16. BeaB (2,123 comments) says:

    Me too. I used to love it on Sunday mornings but in recent months it’s not worth the time, money or paper. I see their circulation has dropped.

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  17. rodoram (2 comments) says:

    I apologise for getting some facts wrong in my August 21 column. Thanks Dave for correcting them…so:
    – ITOs were established by the Bolger not the Clark government
    – Most of the steep decline in trainee numbers was under the Lange not the Bolger government
    – The 4,600 qualifications are owned by the providers, not the ITOs

    In trying to understand the real issues in skills training, Joseph Carpenter offers the most insight among the comments above. As he points out, it was the Lange government that began the big shift in the cost of skills training from government to business; and the Bolger government continued that.

    This did a lot of damage to the economy. As Dave’s figures show, the number of trainees peaked at only 28,383 in March 1987. That was an extremely low number, even for a small economy like ours. The number then dropped to just 14,904 in June 1993.

    Dave reckons that much of that decline was due to heavy restructuring of the economy, particular in government owned enterprises. While that was a factor, private sector companies should have taken up the training task.

    But they struggled to do so. Most NZ businesses are small. Many of them can’t afford the long-term commitment and cost of training, particularly during a long period of recession followed by slow growth; and others don’t value training enough or they take the easy way out of hiring staff others have trained.

    The changes the Bolger government made to training helped build the number of trainees to 49,577 in June 1999. But if the government’s support was not skeletal, it was certainly insufficient. That was still far too low a number for our economy. Back then, well before brisk GDP growth 2000-07, businesses were already citing skill shortages as a major impediment to their growth in the NZIER quarterly surveys.

    Changes by the Clark government helped the number of trainees reach 133,303 at the end of 2008, a 169% increase of the previous government’s peak. Yet businesses were saying skill shortages were an even bigger restraint on their growth.

    During the subsequent recession and period of slow growth, the number of trainees fell to 115,600 by last June. Yet the recession should have been the very time that more people were in training to equip them and their employers for a resumption of strong growth.

    But many companies have had to cut their training budgets during these tight times. Some skills are already in short supply. So clearly training requires well-integrated programmes involving government, business, polytechs and other providers.

    Currently these programmes aren’t performing as well as they need to. The government is right to work on them, as I said in my column. But as I also said, the government would greatly worsen skills shortages if it pushed more of the training cost back to businesses. It would stunt the economy’s growth rate.

    In addition, some of the above comments have factual errors. To correct a couple:

    – Frederic reckons I “devoted every second column to attacking National” in 2008. In fact, of the 46 columns I wrote that year, only eight were negative about National, while a further two made a mix of positive and negative comments about National.

    – Lee C reckons I “heaped lavish praise on Labour” in those 2008 columns, In fact of the 46 columns, four were negative about Labour; three were mixed positive and negative; and four were positive.

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  18. Paulus (2,627 comments) says:

    I stopped reading the back “business” page of the SST some time ago when Oram appeared.

    I expected to see him on Labour’s List, but I assume he is more valuable to Labour as a so called “columnist”.

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  19. 3-coil (1,220 comments) says:

    Oram has always been a grovelling Labour Party toady – and always will be.

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  20. Frederick (39 comments) says:

    Thanks Rod for making the effort to reply. I must say I haven’t kept all your columns so can’t quantify the apparent political bias that I believe was apparent. I appreciate that I was somewhat exaggerating but I still maintain that you are distinctly biased toward the labour party.
    However I have to accept your research and while I am slightly cynical I take at face value your findings. If only you had decried Cullen’s obstinate refusal to change the tax brackets and top tax rate (along with many other economists) I would be a little more sympathetic.

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  21. rodoram (2 comments) says:

    Frederick, I’m only trying to stimulate debate on the best solutions for the economy…wherever they sit in the broad centre of the political spectrum. For example, I’ve been very supportive in my columns of a number of big decisions by the Key government such as those on the ETS and water policy. So why will so few National supporters debate whether the government’s Economic Growth Agenda will actually lift the growth rate? Treasury’s forecasts to 2015 in this year’s Budget documents show it won’t. In fact Treasury, and the Reserve Bank, reckon the GDP long run growth rate is exactly the same out to 2015 as it was before the recession or change of government. Time to get this right is getting very, very short. All the best, Rod

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