This year my speech to conference as Finance Spokesperson is a bit different.
Normally I would regale you with the tales about Blasé Bill, our Finance Minister and Chief Accumulator of Debt.
And there is much to talk about when it comes to the economy.
Supposedly it is all going swimmingly well with growth at a bit over three percent. And some people are doing well.
But the truth is that what growth we have is really built on Bill’s sandcastle of unsustainable household debt, a grossly inflated property market and record population growth.
Many New Zealanders are not seeing the benefits of that growth. Wages are stagnant, while the cost of housing has increased massively. And we have a National government focused on the few at the top, and that is standing by as people live in cars and garages.
But as tempting as it is to go down that path, what I want to talk to you about today is one of the most ambitious projects that the Labour Party has undertaken in recent memory.
A project that is about what really matters in our economy. Decent work that gives security and opportunity, and a fair share for all in prosperity.
It is of course, The Future of Work Commission. And today we will launch the final report after two years, dozens of public meetings, hundreds of submissions and thousands of people telling us what work means to them.
Watch Grant's Speech:
At the outset I want to thank everyone who has contributed to the project, including many of you. I particularly want to acknowledge a willing group of MPs who you see here today who gamely took on leading our work across six workstreams. I want to thank them for their hard work and for only needing a gentle amount of nagging and a few minor tantrums to come up with your chapters.
I also want to make a special acknowledgement of the best researcher you will ever find. A man who carefully planned his wedding around milestones in the project. Rob Carr, you are an absolute treasure.
We quickly found willing partners outside the Party. We intentionally sought advice and guidance from a wide group of New Zealanders. Our External Reference Group of business, union and community leaders provided fantastic input. I want to note that Helen Kelly was initially on the group, and in mourning her passing I would like to think she would be pleased to see us at this milestone.
We are proud of this report, and we think that the 63 recommendations that are contained in it map a path that re-asserts in our centenary year the importance of our Party’s core values.
100 years on Labour is still the party of work and the party of workers.
So, what have we learned in this project. Well, a lot can happen in two years. When we started this project the world was a different place. The UK was staying in the EU, the idea of Donald Trump as the Republican candidate was a script for a bad reality TV show, Jeremy Corbyn was a UK Labour backbencher about to defy the Party Whip for the 489th time; and Australia was the number two ranked rugby team in the world.
So, we learned that a lot can change in a short time.
We may not be able to say with total precision what is going to happen in the future, but in Labour we are not prepared to stand by and simply let the market forces decide.
Our best approach is to prepare ourselves to be in a position to shape the future on the basis of our values and the outcomes we desire.
The pace of change in the world of work is undoubted. The uptake of technology in the digital age is at a pace estimated by McKinsey’s to be ten times that of the industrial revolution at three hundred times the scale.
The impact of artificial intelligence, 3D printing, sensors, algorithms, and robots has only scratched the surface of what is possible.
Higher levels of unemployment from rapid automation, and less full time stable work seem likely.
Along with technology, the other key factor driving change is globalisation. The movement of people around the world in search of work and security is unprecedented.
The movement of capital is similarly expansive. The combination of the two has seen the opening of markets and opportunities, but also the destruction and hollowing out of industries and jobs.
The fundamental premise of our Commission is that the Future of Work is not predestined, and it can be guided by our policies and our priorities.
Three major themes have emerged from our work.
The value of decent work
Throughout the Commission the importance that New Zealanders place on work has been reinforced. Decent incomes matter of course. In addition we need to recognise the importance of non-income benefits.There is a sense of dignity in work, and a desire for work that is fulfilling and part of doing good. This is what people value about their work – the skills they gain, the relationships they develop, the recognition they receive, and the autonomy that they are accorded. Decent work needs to include all of these.
We met a lot of people during the work of the Commission like Tiso Panapa. Tiso spoke at our Wellington seminar. He is a security guard at Work and Income. He’s paid not much more than the minimum wage, he does not have guaranteed hours. He struggles to look after his family. An unexpected bill could blow his finances apart. Tiso and his family deserve better - a higher minimum wage, actually a living wage and secure work.
We believe we must underpin all future working arrangements with the same set of values and principles regardless of their nature.
Let me be clear, strong and effective unions will, as they have in the past, play a critical role in making this happen.
Risk of growing inequality
The last two years have been marked by increased attention to the impact of inequality on our societies and our economy.
New Zealand is now the most unequal society it has ever been. Wealth has concentrated in the hands of a small group. This is wrong. It is unfair and it is not the New Zealand that Labour or any government I am part of will let continue.
Even the IMF and the World Bank are seeing that inequality is a drag on the economy!
The future of work runs the risk of increasing this inequality. As automation takes hold, there has been a hollowing-out of those ‘in the middle’ whose jobs have been associated with clerical or easily automated tasks.
Many of those in low-skill jobs have suffered the same fate with poor work conditions, low wages and high levels of insecurity.
At the same time, those with in-demand technical skills, and at management level have seen large pay increases. In New Zealand, the average chief executive salary has increased by 12% in the last year, compared with around 3% for average workers.
The lesson of this project is that the flawed logic of ‘trickledown’ economics has been fully exposed. What is now needed is a new approach that takes the opportunity offered by the changing nature of work to develop a new economic paradigm that values building wealth from the ground up.
The third major theme to have emerged is the balance between flexibility and security.
The changing patterns of work, driven by technology, are already apparent. From large workplaces adopting open-plan, ‘hot desk’ environments to flexi-time arrangements, few people would recognise their workplace from even a decade ago.
Many more New Zealanders are self-employed, managing a portfolio of work that is built around
Young people in particular, talked to us not so much about the jobs that they would do in the future, but rather the work that they would create.
Early on in the project two young first year university students who had received a prize from me in their last year at secondary school visited to tell me about their holiday plans. These consisted of establishing a fully fledged design company, with clients and business cards. And you know what. They did it. They saw no boundaries or limits to what they could do in the future of work.
We have met many people, young and old, who are seeing enormous opportunity through social entrepreneurship, shared value creation and less hierarchical business models to create decent work.
The Commission is recommending that a future government support these new models of work. At the same time we must ensure that there is a balance between supporting the innovation that comes from flexibility with the right to secure and fair conditions of employment.
A path forward – inclusion, resilience and adaptability
After two years of work, I can say that predicting whether a particular industry or job will exist or what will replace it is fruitless.
What the Commission has done is map a path that gives New Zealanders the confidence to face and lead the change.
We need to be inclusive, offering opportunity and harnessing the talents of all.
We need to be resilient to deal with the changes and shocks that are coming our way.
And we need to adapt to be able to lead the change and shape it in line with our values of fairness, sustainability and innovation.
The Future of Work Commission is proposing a new social partnership between business, government and workers that places decent work and a good standard of living for all people as our priority.
There is not time today to go into detail of all the recommendations, but they come under five
A Just Transition
We owe it to all those affected by the rapid change in the world of work to support a just transition.
We are proposing active labour-market policies not seen before in New Zealand.
We believe that every person who has their work disrupted or eliminated in the changing world of work needs to be supported to be trained and re-trained.
The absence of skilled workers was the number one issue that the business community raised with the Commission. We can’t rely on the market to provide, or immigration alone, to import our solutions.
We want this to be delivered through a partnership of government, business and unions to identify training needs early, and deliver on those continually, to support people into new and meaningful work.
Our specific proposal is that the government will initially fund up to six weeks of free full time training per year to workers who lose their job or have it fundamentally disrupted by technological change. This is of course in addition to the entitlement to three years free post school education and training that we have already announced.
Over time we would like to see this develop as it has in countries such as Denmark to be available across the workforce, and for it to be funded in partnership with business.
We are recommending that consideration be given to specific skill training levies in industries where businesses are not stepping up to train the next generation of workers.
Equally, for a just transition in a world where full-time paid work may become less certain, we will need to think again about income security. Part of this is in short-term income support measures, and a genuine commitment to lift minimum wages and support a living wage.
We are also recommending recognising unpaid and voluntary work as fulfilling work obligations, and further consideration of basic income provision.
The phrase just transition is of course borrowed from the environmental movement. Climate change and its global impact was ever-present in the work of the Commission.
In our report we are calling for decent work that supports our move to a low-carbon economy. We will support a just transition for those communities and workers who find their livelihoods under threat. We are backing an Independent Climate Commission to drive the shift to a low carbon economy that still delivers high wage work.
The Future of Work must also be one where we address the unjust aspects of the world of work that already exist.
Labour needs to be the party that says once and for all that we will not stand for a world where women are not valued equally to men in the world of work.
In this project we have also tried to ensure that we have responded to the calls we have heard.
One of the loudest is for the abolition of secondary tax. For people, especially younger low paid workers, two or three jobs are essential to make ends meet. It is within our power, and it is our recommendation, to get rid of this relic of a past era.
Learning for life
We live in a world where the notion of completing your training and educational journey at the end of high school is wholly inadequate.
That is why the first major policy announcement from the Future of Work Commission was for three years of free post-secondary school training and education. This is a clear statement that we want all New Zealanders to build their knowledge and skills throughout their lives. As part of this we must value far more non-university training and education, through greater support for trade training and apprenticeships.
We are recommending a focus on developing the attributes young people need in a changing world – creativity, collaboration, connectedness. We recognise the importance of science and technology, but these are only part of the picture. We need to invest in humanities, the arts and design too.
We are proposing changes in the focus of our education system to unlock the potential of every student. We need to focus less on rigid standards and assessment processes and more on the individual interests and learning needs.
This includes a strong partnership between schools, businesses and the community to support every student to have a plan for their career, for careers guidance to be an integral part of their educational experience, and for programmes that mix school and work-based learning to be available.
We are recommending the adoption of a school leavers toolkit that includes digital and financial literacy, a drivers license and the skills to be a good citizen.
We need to provide the maximum range of opportunities for training and skill development beyond school. The importance of appropriate and targeted opportunities for Māori and Pasifika communities to do this has been recognised and accepted by the Commission.
Building wealth from the ground up
The opportunity exists in the Future of Work for working people to have greater control over their economic destiny.
We need only look to the UK and the United States to see the sense of alienation felt by those who have not benefited from globalisation. This is a driving force of political change, division and instability worldwide. If New Zealand is to avoid falling victim to these forces, we need to an economy that gives everyone a stake in our success.
A core plank of this has to be a new employment relations framework that is focused on strengthening collective bargaining and enabling effective unionisation. We need to expand the rights of contractors to ensure those who would otherwise be an employee still have the right to be paid a minimum wage, join a union and participate in collective bargaining.
We are recommending a greater sense of ‘workplace democracy’. In our project this was exemplified by Air New Zealand and E Tū and other unions in their High Performance Engagement process. HPE is built around teams made up of equal number of management and workers solving problems and making plans by consensus. Once an organisation that was riven with industrial dispute, HPE is contributing to Air New Zealand being a more productive, inclusive working environment with better pay and conditions. We want to support other workplaces across New Zealand to adopt new models of workforce engagement.
New Zealand is already a nation where small and medium businesses dominate our landscape. It is also a place where innovation has thrived in our garages and workshops. We must now take the opportunity to develop this further.
We are proposing to remove the barriers to growing these types of work whether they are poor regulations, skill deficits, or a lack of capital.
There is a generation of socially minded entrepreneurs and creators of value who will make New Zealand proud if we are prepared to support them. That is why we have already announced a Young Entrepreneurs Programme to give 100 young New Zealanders the opportunity to develop their smart and innovative ideas.
We want to support every New Zealander to have opportunity in the future of work. That’s why we are proposing a goal of digital equality across all divides by 2020.
No matter where you live or what your background is, we must ensure that all our people have access to technology and the ability to understand how it can act as a tool to create better lives.
Our young Māori and Pasifika communities should be at the forefront of growing our prosperity. The message received by the Commission from these communities is that a heavy investment in education, and a partnership to support indigenous and grassroots economic development is essential to harnessing these opportunities. We accept that challenge and the desire for a partnership to make it happen.
An active and capable state
Just as the clock has turned on the failed notion of ‘trickledown economics’ so it has on the idea of a hands-off state being able to deliver a prosperous and decent future of work. Leadership and innovation in government are core requirements to a successful transition to the future of work.
The government as an active partner in economic development is essential. Throughout our project we have heard that communities and regions can see potential for their residents to live good and fulfilling lives. They are not looking to be told what to do by central government, but they do want to know that we are all in this together.
The government must use the levers it has to partner in every region in New Zealand to support sustainable and decent work. In this report, we propose business clusters as an example of how this can happen. In general, we see the need for strong regional development projects and investment in our infrastructure around New Zealand.
Similarly in all of the interactions between state and citizens we need to be looking to develop the social partnership further. For example, we are recommending culture change at Work and Income so that it is not just be a processing and transacting agency for beneficiaries, but a central point in supporting people to train, work and thrive.
Inventing the future
Our productivity and prosperity as a nation requires us to not just accept the change, but to get in front of it. To support the aspiration of future generations we need to substantially lift our game in science, research and innovation.
You know every time we held a Future of Work Conference Simon Bridges put out a release about a pizza delivery robot or drone. That is not good enough. We must not simply be just the test-bed for others’ ideas and inventions, but be the designers and inventors.
We are proposing that ICT become our second largest contributor to GDP by 2025.
We are going to reform government procurement to give Kiwi firms a fair go. No more Hillside Workshop closures.
We are recommending a sustained and significant lift in our investment in research and development in the public and private sector if we are to lift productivity. This will include an investment in basic science, research, better collaboration between government and private sector, and a shared vision for how to harness all of that to create decent work.
Delegates, this is a big agenda. It can not all be implemented at once. It requires a long term view. At our conference last year I quoted the words of former Australian Prime Minister Gough Whitlam, when he said his country was faced with a choice between the fears and the habits of the past and the demands and opportunities of the future. Through the Commission, we have laid out the framework that embraces the demands and opportunities of the future of work.
I urge you to read our report. There are some copies available today- and you can find it on our website. Share it with your friends and family. You will not find any other political party that is stepping up to the challenge of plotting a path through this rapidly changing world. It is our historic mission - to build a better and fairer New Zealand. We will do that by investing in people and giving them the confidence to face the changing world.
There is reason to be optimistic about New Zealand’s future and the future of work generally.
If we are prepared to make clear and positive policy choices.
If we are prepared to renew a social partnership.
If we support a business sector that is innovative and inclusive.
And if we give workers a stake in their future and the opportunity to build wealth from the ground up.
One hundred years on from the women and men who banded together to give political voice to the hopes and aspirations of working people, through this Future of Work Commission we are re-asserting Labour as the party that has the vision for decent work that gives New Zealanders a sense of purpose and a chance to shape a prosperous future for them and their families.