In Part I
there was an indication that moves by the Government had changed
long-established institutions in New Zealand. In Part 2 we will look at
more major changes.
Between 1984 and the present time the government has restructured the
government departments and shed most of its business operations.
Subsidies have been removed and the guiding principles in the changes have
been the policies of User Pays and privatisation (called Rogernomics after
Roger Douglas, the Minister of Finance who initiated the changes).
Post Offices
The post office was regarded as the centre of every small town and a social
centre in major cities. Distances from city to city were measured from
Post Office to Post Office. The flag flew from the Post Office - at half
mast for the death of any important person. The New Zealand Post Office
had three major responsibilities - telephone communication, postal services
and a savings bank. It did all its own work. Nothing was contracted out.
It cost the taxpayers one million dollars a week, but it provided secure
and useful exmployment for 40,000 people.
In 1986 the Government began changing its trading activities to corporate
structures and the functions of the Post Office were split into three State
Owned Enterprises.
Telecom
In 1987 Telecom Corporation was set up to take over the telecommunication
functions. In 1988 the telecommunications industry was deregulated and
competition was introduced. Clear Communications entered the market
offering toll calls. This was a consortium made up of U.S. based MCI, Bell
Canada, the Todd Corporation, New Zealand Rail and Television New Zealand.
Competition led to a reduction in charges. As Clear offered an incentive
to new customers Telecom followed. It is now possible to make a toll call
within New Zealand in the evenings and weekends for five dollars, with no
time limit - whichever company you subscribe to.
In the year to April 1990 there were changes - 85% increase in
productivity, 47% cut in staff numbers, 300% rise in profits. The wait for
new phones was cut from six weeks to less than a week for most customers.
In June 1990 Telecom was sold for NZ$4.25 billion to a consortium of two
U.S. based companies, Bell Atlantic and Ameritech, and two New Zealand
based companies, Fay Richwhite and Freightways. One condition of the sale
was that free local calls for local customers would continue.
Postal Services
These were streamlined. In February 432 post offices were closed. 118
more have been closed since then. There are over four thousand Post Shops
where it is possible to buy stamps and post mail. The delivery of mail is
the only monopoly now left to NZ Post. Rural deliveries now cost country
people more. The possibility of deregulating the mail service is being
discussed at present.
Banking
The Post Office Savings Bank has been sold to the ANZ bank. After a
period of financial difficulty and help from the government the Bank of New
Zealand was sold to the joint ownership of the National Australia Bank and
the New Zealand Government in 1992. Trustbank has now been sold to
Westpac so there are no major banks which are wholly New Zealand owned.
There are ATMs (Automatic Teller Machines) available at most shopping
centres and shopping by EFTPOS (Electronic Funds Transfer Point of Sale) is
gaining rapidly in popularity. This is simpler for most customers and
saves the bank staff time, but of course will lead to redundancies in the
banking industry.
Shipping Services and Stevedoring
The New Zealand Shipping Corporation has been sold and the workforce on the
wharves cut by 50%.
Travel
Air New Zealand was sold in 1988 and is now a private company with???
Passengers flying within New Zealand no longer have to fly with Air New
Zealand. The Australian airline, Ansett, has been flying the main domestic
routes since 1987 offering competition and so increased services and
reduced fares for travellers. Free meals are now served on all flights.
Small private airlines offer travel between the smaller centres - a service
from which Air New Zealand has withdrawn except as a shareholder in some of
the airlines.
Train travel
The Railways Department was changed in 1982 to a Corporation with its own
board of directors. In 1986 it became a State Owned Enterprise. In 1990
there was another change. The Railways Corporation became solely
responsible for disposing of the former assets of the Railways Department.
It leased to New Zealand Rail Ltd the land it used. New Zealand Rail Ltd
was responsible for rail freight, passenger services, and inter-island
ferries. In 1993 it was sold to a consortium of Fay Richwhite and U.S,
based Wisconsin Central Transporataion and Berkshire Partners In its
early years as a corporation it was used to mop up unemployment and its
staffing costs increased its financial difficulties. The restrictions on
road use that had been in force to protect the railways were abolished and
railways had to compete for freight on the open market.
Since then there have been huge staff cuts (from 21,000 to 7,000) and
changes in the organisation and the services. Few passenger lines remain,
mainly on the main trunk routes or scenic lines like the trip from
Christchurch to the West Coast. The service to the passengers has been
stepped up with fast handling of luggage, a dining car and improved
comfort. Gone are the days when everyone scrambled out at the station
where there was a refreshment room and hoped to be served a cup of tea in a
hefty cup and a large sandwich and get it drunk before the train took off
again after about a six minute stop.
Travel by ferry
Since New Zealand Rail took over the ferries there have been fewer hold-ups
with strikes which so often seemed to occur at holiday time, and, in most
passengers' view, increased service, a higher standard of cleanliness, and
better quality food.
A fast ferry operates in the summer season, travelling between Wellington
and Picton in ninety minutes.
N.Z. Rail has just been granted a permit to build a ferry terminal at
Clifford Bay south of Blenheim, which would shorten the ferry journey and
the road journey to the south. It would mean a serious blow to Picton if
it lost the ferries and an appeal from the Picton people is be heard
shortly.
Deregulation of the taxi industry
With the deregulation of this industry there are many different cabs lined
up at the taxi rinks - so many that taxi drivers now have to work very long
hours to earn a living wage. It is usually much easier to get a cab even
at peak times.
Changes in bus transport
In Christchurch instead of the Transport Board controlling the bus services
the routes are put up for tender by the Regional Council and several
companies run some routes each. The familiar Big Red buses ply only some
routes. The services are less frequent.
The situation is the same in a number of other cities. In Auckland,
despite the fact that the system run by the Council has been so efficient
and successful, the system is to be privatised amid strong objections.
Education
The schooling system has been restructured under a programme called
Tomorrow's Schools which took effect in 1989. Elected Boards of Trustees
make decisions about staffing and expenditure and find themselves involved
in raising additional funds - easier in schools in affluent suburbs.
Since 1989 tertiary students have paid much higher fees, with more
increases likely.
Polytechnics have now been authorised to offer degrees.
The Housing Corporation
This department used to rent out the State houses under the scheme begun
under the Labour Government after the Great Depression. It also offered
low interest mortgages to first home buyers. In 1991 it was changed to
become Housing New Zealand, a limited company which must operate profitably
and efficiently, just as would a business in the private sector. Rents for
the state owned houses moved up to market rentals with Income Support
paying an accommodation supplement to those who were on benefits.
Sale of further businesses
The Tourist Hotel Corporation (along with the rights to the Milford Track
and Waitomo Caves), the Government Printing Office, State Insurance, the
Ministry of Works and Development, and the Rural Bank have all been
privatised.
Major changes in government control of electricity and forestry
There have been major and ongoing reforms in management of the electricity
supply with the main effect noted by consumers being regular price rises.
The New Zealand Forest Service has been totally changed with some functions
being transferred to the Department of Conservation and the sale of cutting
rights for a number of forests.
Major restructuring of local government
In 1989 this was restructured so that the smaller local bodies were
amalgamated with larger ones. Service Centres replaced the local body
offices. Smaller communities felt that they lost their identity and direct
involvement in their affairs.
Health Reforms
There have been so many changes in this area since 1980 with User Pays and
budget restrictions that it would not be possible to discuss them in an
article of this length. Suffice it to say that with the new policies the
result is long waiting lists for elective surgery and an increasing number
of people taking out private health insurance.
Prohibition of smoking
Following the Smokefree Environment Act 1990 the Health Sponsorship
Council: Te Ropu Whakatarairanga Hauora has been set up. To try to
discourage young people from smoking there have been sponsored young
people's activities such as the Smokefree Rockquest and the Smokefree Stage
Challenge. The Council has also organised Tobacco Replacement Sponsorships
so the tobacco companies are not associated with sporting fixtures.
Smoking is prohibited on all public transport and the workplace, and No
Smoking notices abound.
New Zealand based honours system
Honours are now awarded to New Zealanders under their own system of awards
rather than being based on British system of awards.
Human Rights
In 1986 the Homosexual Law Reform Bill was passed. Gay people now openly
state their sexual orientation and use the media to discuss any issue they
see as discrimination.
In 1993 there were anti-discrimination amendments to the Human Rights Act.
One evidence of the awareness of people with disabilities is the provision
of wheelchair access to all new buildings and in some parks and reserves -
which also helps people with prams and pushchairs.
Maori language
Kohanga reo (language nurseries) were established for the teaching of the
Maori language in 1982 and the number has increased rapidly.
There are news broadcasts in Maori on radio and television and bilingual
signs on public buildings.
The Waitangi Tribunal
In 1987 the Waitangi Tribunal was empowered to decide which Crown Land has
Maori claimants. Since then a number of claims from Maori tribes have
been settled, with the handover of land and money and the conclusion of the
Sealord Fisheries deal in which in 1993 the Government financed a half
share in Sealord to be handed over to Maori in exchange for Maori claims to
commercial fishing under the Treaty of Waitangi.
The Employment Contracts Act 1990
Under this act employer and employees are empowered to agree on mutually
beneficial terms and conditions of employment suited to the working
environment. This has led to more flexibility. There is a minimum code of
employment rights relating to disputes and personal grievances. Anyone
negotiating a contract is entitled to be accompanied by a union
representative, a lawyer, relative or friend to assist in the process
The position of women
In 1984 New Zealand ratified the United Nations Convention on the
elimination of all forms of discrimination against women.
Some New Zealand women have risen to positions of prominence. Dame Cath
Tizard was our first woman Governor General. Helen Clark was the first
woman to become Deputy Prime Minister. There are thirty six women MPs - a
record number. There are several women as Mayors of our large cities -
Vicki Buck in Christchurch, Sukhi Turner in Dunedin and Margaret Evans in
Hamilton. However, women's pay on the last available figures was still
only about 80% of that of men in comparable employment.
Anti-nuclear legislation
The non-nuclear legislation declared New Zealand nuclear-free, by banning
the establishment of nuclear power stations and the visits of
nuclear-powered and nuclear-armed ships. It became law in 1987 and many
Kiwis stand taller as a result. However, this will not necessarily be
evident to the overseas visitor.
Inflation
When Patti was in New Zealand in 1979-80 inflation was running between 15%
and 20%. With the Reserve Banks's new emphasis on price stability it has
been generally below 3% since 1990.
We are told that the economy is in good shape, yet the share market has
been fairly static, i.e. risen much less than the U.S., U.K. & Australia etc.
There is much more poverty and much more wealth.
The price of change
Staff reduction has been a recurring theme in this article. This has
resulted in greatly increased unemployment - 100,000 in 1988 (more than 5%
of the workforce) and beyond 200,000 by 1991 (more than 10% of the
workforce). In the most recent figures (August 1997) unemployment stood at
122,000 (6.7% of the workforce).
As a result of all the changes there is an increasing gap between the rich
and the poor.
Benefit cuts
In 1990 there were cuts to benefit payments because of the growth in the
number of beneficiaries. The result is suffering in the community and an
increased demand for help and food parcels from charitable organisations.
The end result of the changes
As one correspondent writes, 'Coming back after sixteen years Patti is
going to experience culture shock. What has changed? Just about
everything. I believe that the New Zealand character has changed and
become more aggressive. New Zealand is supposed to have come from twenty
years behind, say UK, to (some would say) ten years ahead. It depends what
you are talking about.'
We would like to know how you felt if you would write to us after your
return visit, Patti.
Read the next articles on poverty in New Zealand.
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