From NZ Herald · · 2m
Labour says fiscal plan covers pay deals, National sceptical
Labour claims fiscal plan funds new pay deals; National says money already spent.
In brief
Labour claims fiscal plan funds new pay deals; National says money already spent. Labour says its fiscal plan can cover $8.5b in pay equity settlements and $1.5b health costs, leaving $300m for other public service costs, while National claims the $10.3b fiscal plan has been spent. Originally reported by NZ Herald.
Labour's fiscal plan
Labour says it can pay for industrial relations changes from within its fiscal plan.
Fiscal plan funding
The plan is worth $10.3 billion over four years, with $8.5b for pay equity settlements and $1.5b for health costs.
Remaining fiscal headroom
Leaving $300 million to cover non-health public service costs.
Fair Pay Agreements
Labour promises legislation to bring back Fair Pay Agreements within 100 days.
Fair Pay Agreements definition
Set industry-wide minimum employment standards like base pay rates and health and safety.
Previous Labour attempt
Labour legislated FPAs in 2022 but repealed them when coalition government took office.
National's stance
National says Labour's fiscal plan has already been spent and the $18 billion bill is unfunded.
National's savings
Scraping FPAs saved taxpayers $65 million in administrative costs.
National's concerns
Reintroducing FPAs would discourage business investment and hiring.
Treasury concerns
FPAs could reduce productivity growth and lower long-term GDP per capita.
OECD report
OECD says FPAs would likely reduce wage inequality but reduce productivity growth.
Crown employment costs
Total Crown employment costs are $38.8 billion, about 8% of New Zealand's GDP.
Labour's position
Labour says FPAs will improve workers' prospects without increasing Crown costs.
National's warning
Reintroducing FPAs would put obstacles in the path of Kiwi businesses.
Treasury paper
Treasury warned FPAs could increase Crown costs and reduce fiscal control.
Health sector concerns
Health agencies warn FPAs could exceed their affordability.
What happens next
Labour to introduce FPA legislation within 100 days; National to defend fiscal stance.
What it means
Labour says its fiscal plan can cover $8.5b in pay equity settlements and $1.5b health costs, leaving $300m for other public service costs, while National claims the $10.3b fiscal plan has been spent.
