The Labour Party is launching its election campaign with a policy to expand an existing subsidy available to employers who hire people "at risk of long-term unemployment".
It’s committing to making a one-off multi-year investment of $311 million in the “Flexi-wage” subsidy, introduced by the previous National-led government. This is different to the wage subsidy offered because of Covid-19.
Under the scheme, employers who want to hire staff at risk of long-term unemployment can negotiate a rate and duration of the subsidy with the Ministry of Social Development.
The value of the subsidy reflects the investment necessary to increase the employee’s skills so that they can retain the job.
Unemployed people who want to come off a benefit and start a business are also eligible to receive the subsidy.
In 2019, 6,000 employers received a Flexi-wage subsidy at an average of $3,500 per person hired.
Labour is aiming to increase this to $7,500 by making the scheme's criteria more flexible. It isn't clear exactly how this would be done.
Under a new criteria (and with unemployment expected to increase) Labour expects the subsidy would be available to 40,000 people.
It would also ring-fence $30 million for recipients who want to start a business.
The maximum subsidy per person would remain $22,000.
The Party said the scheme hadn’t been receiving the funding it needed. In 2016/17 funding fell by $10 million to $29 million.
Funding for the scheme would come from un-used Covid-19 wage subsidy funds.
Labour’s policy is similar to National’s “JobStart” policy.
Under JobStart, National has committed to paying businesses $10,000 for every new fulltime, permanent employee they hire.
The payment would be capped at $100,000, or 10 new employees, per business.
A key difference is that JobStart would be available temporarily between November 1, 2020 and March 31, 2022.
Whereas Labour’s proposal is to better fund an existing permanent scheme.
The Flexi-wage subsidy is also more targeted than JobStart, which is available to employers regardless of who they hire.
National is pledging to help unemployed people start their own businesses by enabling them withdraw $20,000 from their KiwiSaver accounts.
Here is more on the types of Flexi-wage subsidies available:
Flexi-wage (Basic/Plus): Flexi-wage is a hiring subsidy paid to employers to hire disadvantaged job seekers. The subsidy can be for up to one year and be no more than $22,000 in that year. The level and duration of the subsidy depends on the characteristics of the person and the requirements of the position. The person must stay in employment for at least the duration of the subsidy.
Flexi-wage Self Employment: Flexi-wage Self Employment provides financial assistance for people on income support to start their own business. This includes grants to cover capital costs or the initial establishment of the business until cash flows are large enough to support the person. The Flexi-wage Self Employment subsidy can be given on its own, or in conjunction with the Self-Employment Start-up payment.
Flexi-wage in Training: Flexi-wage Plus is an additional training subsidy with the option of using some funding for other assistance that employers need, such as training, mentoring or in-work support. This can be used to subsidise training required by people on a Flexi-Wage basic subsidy.
Flexi-wage Project in the Community: Flexi-wage Project in the Community is a subsidised voluntary community-based work experience programme. The programme is designed to allow people to experience project-based work where they can develop work habits and general on-the-job skills through community or environmental projects that would not otherwise be undertaken. Flexi-Wage Project in the Community can cover support and mentoring, but not training. A wage subsidy can be paid per person per week up to the annual maximum of the current adult minimum wage (at 30 hours per week).
For more on the Flexi-wage subsidy, see this fact sheet and this one.
72 Comments
And by 'its people' I'd suggest that it be quarantined to NZ citizens and those who are here right now.
Encouraging more workers into the country to take advantage of these schemes, when we are flat out re-employing and supporting those we already here, will be enough of a financial challenge for us.
And by 'its people' I'd suggest that it be quarantined to NZ citizens and those who are here right now.
Encouraging more workers into the country to take advantage of these schemes, when we are flat out re-employing and supporting those we already here, will be enough of a financial challenge for us.
Completely agree. However, you understand what that potentially means. The NZ economy has been surviving on immigration. How would it rub if immigrants were allowed to come here but not able to participate in the workplace? This couldn't work and it would be labelled as discriminatory.
Global govt debt on course to fresh ATH. Debt/GDP ratio has reached almost 90% at the end of Q1 this year. Q2 numbers, when available, are highly likely to show, that global sovereign debt/GDP has reached a new high, surpassing the previous WWII peak of 104%, BoA says. Link
Could you care to explain what you mean by socialist government? The context seems to be defined by the use of the word tentacles, implying that you think it is bad, maybe you oppose "it"- a quick definition from google says this - "Socialism is an economic and political system. It is an economic theory of social organization. It believes that the means of making, moving, and trading wealth should be owned or controlled by the workers. ... Socialists believe that everything in society is made by the cooperative efforts of the people and citizens."
Is that REALLY what you believe is happening here? No party in New Zealand is even remotely close to this definition, so come on, some effort to engage would be better I think. We have problems, as does the rest of the world, that need immediately addressing through policy that helps the majority of new zealanders.
It looks to me like this is another gross exaggeration to negate any kind of policy that doesn't conform to the status quo of trickle up neoliberalism.
"Flexi-wage (Basic/Plus): Flexi-wage is a hiring subsidy paid to employers to hire disadvantaged job seekers. The subsidy can be for up to one year and be no more than $22,000 in that year. The level and duration of the subsidy depends on the characteristics of the person and the requirements of the position. The person must stay in employment for at least the duration of the subsidy."
"Characteristics of the person"? What might those be? Are we about to get a nationwide "affirmative action" programme via racially targeted wage programmes? Certainly would seem a possibility given the angle taken in the announcement.
The three month probation period National introduced gave some protection against those circumstances and at the same time gave employers some confidence to employ when they may not have done so otherwise. The Labour government tripped over itself in almost obscene haste to remove the ability. Still WP stepped in and it was retained for employers of less than 25 in number? Some protection still there then?
it still exists for companies with under 19 employees (so pretty much for SMEs) https://www.employment.govt.nz/starting-employment/trial-and-probationa…
Yeah the 90 day trial is still current. However to gain the full subsidy (22K) there needs to be employment for the full term. I personally have experience of employees who were exemplary through the 90 day trial period and subsequently turned out to be nothing but an ongoing liability.. theft, drug use, poor time keeping, absenteeism etc.I'm glad I sold the business and now have a much less fraught lifestyle. Employment of low skilled and "disadvantaged" employees is not to be taken lightly by an employer.. no matter how altruistic they may be.
Indeed, and especially in a smallish firm, where that one new hire may be 20% of the workforce, a compulsory one-year term is gonna be a showstopper. Small teams need cohesion and nicely balanced skills, work habits and productivity. Hiring a 'disadvantaged' person into such a team is simply a massive risk to the entire enterprise....
Yes, that's right, it's a deliberate trap for SMEs so that we can all sit back and laugh as they get caught with those hapless jobseekers. You know, like those pilots. Or the hundreds of other skilled industries who have struck trouble in these recent times.
Because it would be really bad to give people a hand up right?
And yes I'm being sarcastic, it's the only way I can express rolled eyes on here.
Haha.. nice try at a sweeping generalism. The article spoke of disadvantaged or potentially long term unemployed. I very much doubt pilots or other skilled workers fall in to that definition. Recent redundancies have often been from industries in the tourism and hospitality sectors which it is well accepted are not a hotbed of transferable skills. These people DO however have an existing work ethic so will be readily employable, the disadvantaged and long term unemployed not so much.
The disadvantaged and long term unemployed are exactly that - disadvantaged, it's definitely not a level playing field. But not everyone is cast in the same mould. So equally it's a generalisation to assume that there is no work ethic outside of those you've mentioned.
There will be other needs and assistance required to help people back on their feet, it is after all, a complex problem with a complex set of issues. And there will be those that may well be unreachable.
You see what I'm getting at here right? Complexity requires a nuanced solution that addresses the root causes.
Yes I certainly agree we are facing a complex situation which as you say calls for nuanced solutions. My point was originally that there is a core of unemployed that wish to remain unemployed. Decades of tinkering and cajoling have failed to shift those numbers much. With the borders closed to "normal" immigration we hopefully will see industries hiring more locals. Maybe spending 311mil on meaningful training would help, coupled with "job matching" where people are trained to fill positions offered. IMO there shouldn't be a labour shortage and a burgeoning unemployment tally able to exist at the same time and place
So in other words, they want to help keep the struggling renters paying their enormous rents to the overstretched rentiers so that the house prices do not crash and the over exposed banks do not fail. The greedy risk taking rentiers will be propped up at all costs at the expense of the people who can not afford the insanely high house prices. Nothing new to see here.
It's a lot bigger than simply landlords. NZ as a whole doubled down on the property bubble a long time ago. Furthermore, people need to start to get it into their heads that the domestic consumer economy is the single most important sector of the economy. The less disposable income to spend into that sector, the greater the negative feedback loop into the real economy, which further rips into the housing market.
You cannot blame the govt for trying to do something. The alternative is to let people fend for themselves a la Mad Max. The meth market would be more bouyant than it already is.
IMHO the decisions to lock down and consequent wage subsidy schemes are the most catastrophically stupid madd by a Kiwi government since invading the Waikato.
Multiple studies including a recent one in the Lancet and plain common sense show lockdowns do not work. Where was the holocaust of Covidian death in Japan, Sweden, Belarus etc etc.
Man you truly need to swap the record.. constant carping about "evil landlords" is getting pretty tiresome. If people can't afford the admittedly ridiculous prices in Auckland then leave Auckland. If they want to stay there then pay exorbitant rent/house prices but stop bleating how hard done by they are.
Capitalism is essentially parasitic... the assumption that it should be possible to make a living from ‘an investment’ if you have a large enough sum of capital... a staggering sense of entitlement behind it really. Problem is that we’ve baked that assumption in to so many things that it can’t be unwound, hence the spectacle of ‘socialist’ governments intervening to defend the value of private investments...
If the payment is available for 40,000 people to a maximum of $22,000 per person, doesn't that add up to $880 million? Is it going to be first come, first served?"......... by making the scheme's criteria more flexible. It isn't clear exactly how this would be done." Sounds like Kiwi build over again.
God help us all. Another freakn subsidy. Borrow NZs way into complete subservience to offshore credit suppliers. Labour is probably aware that the 2023 election won't go their way so loading up debt now to shackle next 2 decades of taxpayers with unsustainable debt repayments so they can say "we were better managers" through our current issues but conveniently ignoring the downstream effects they created.
After 3 years these guys have no idea.
Rather they just take other peoples policy.
- take out the carbon act/ climate change as all being greens Shaw was writing PMs speeches for her.
The PM just doesn't have the cattle, nor the wit to devise policy (committee this, committee that).
True that Henry, although it did keep a bunch of shiny arsed paper shufflers in business. Something successive Labour govts have refined to an artform. Under the Clark govt bureaucracy expanded exponentially with no gain to NZ Inc. Seems JA & Co have just continued to sing off the same song sheet with the same results.. dithering, obfuscation and lack of delivery. Glad I have my tax affairs structured so I'm not financing them any more than is absolutely unavoidable
Quite telling that you feel the need to "translate" for others. Given I started my working life as 17 yr old orphan and am now financially secure with early retirement in my grasp, having lived and worked in some very deprived rural areas I feel I have every right to my observations. The difference between me and most of my classmates was simple.. an education (which we all had) and the drive to self improve (which many lacked). Nothing remotely attributable to any govt policies over the last 40 yrs but totally attributable to my solo mother's ethics. Something sadly lacking in today's parents of many of our youth.
Hook, these two things can be true simultaneously: that you had the drive to self improve and worked hard; and that some of your financial success is attributable to government policy. And if you own property and have done for some time, then part of your financial success is attributable to 40 years of government policy which has inflated asset prices to the benefit of older asset holders and to the detriment of younger wage and salary earners. Acknowledging this does not take away from your drive, ambition, hard work etc. But people not being prepared to acknowledge this contributed (justifiably) to the resentment a lot of people feel towards the beneficiaries of those government policies.
Why NZ Borders will be locked forever
Sweden has opted for herd immunity which means their entire population will be carrying the Covid-19 virus plus an anti-body. Should they travel overseas from Sweden they will be carrying both the virus plus the anti-body. Will the virus be completely inert or will virus still shed?. Probably
Herd immunity doesn't mean nobody has the disease - it means that there are enough immune people in a group, to prevent epidemic spread. Immunity only arises from infection (or from immunisation). In the case of Australia, there would have been some people infectious with measles on a voyage, and enough others who were not immune, to carry measles through the 3 months or so of the voyage there. Those with an active measles infection would have spread it to native Australians on their arrival.
Guess what? The markets are still free. Your individual rights are still there. Responsibilities...now there's an interesting one. Under neoliberalism social responsibility is ignored in both professional and private matters. Obligation is another.
For example - Rio Tinto have an obligation NOT to pollute new zealand with tailings from their smelter that they have profited from with taxpayer funded electricity. They have a RESPONSIBILITY not to do that, only under the current framework that is not enforceable.
As for parent/nanny state - more tired old right wing tropes. We all have responsibility as a nation and society, as equally we have rights too.
Oh for goodness sake , there is not a single Kiwi who is not "at risk " of losing his or her job , not a single one of us , from a waiter in a restaurant on the minimum wage to the journalist working on this site , to teachers , bankers , pilots , whatever you do , even those of us who think we are bullet -proof in the professions .
We are all at significant risk of things going wrong that we could not have seen coming
If Covid -19 has taught me nothing else , it is that we are a very vulnerable human race on a lonely planet, and we should expect the unexpected to arrive at any time and turn our world upside down
This so called "policy " is nothing of the sort , its simply emotional manipulation of our concerned and vulnerable population .
And someone should call it for what it is
Right now I feel like an American voter must have felt in 2016 .
Crooked Clinton or Donald -the - Rogue .
The choices for me are terrible , I may just boycott the election in disgust or protest
Winston is dishonest and cannot be trusted
National is all over the place
Labour have no depth , she is a dishonest, smiley leader who wants everyone to be " kind "
The Greens are such a nightmare I need to take my Restoril (R) to help me sleep at the thought of them forming the next Government .
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