Media Statement
15 May 2000
ECA: Nine years of instability
The Employment Contracts Act, which came into effect nine years ago today, has played a key part in New Zealand's poor
international competitiveness, and increased rates of under-employment and joblessness through the 1990s, says Labour
Minister Margaret Wilson.
"The ECA, along with the last Government's broader economic policy, has divided New Zealand into clasess of 'haves' and
'have-nots'. It has rent a chasm between workers and employers and has hindered New Zealand's ability to compete with
other modern economies," says Ms Wilson.
"Under the ECA the number of jobless rose by 26 percent (175,900 in December 1990 to 222,200 in December 1999). The
number of people in part-time work seeking more hours has trebled to 148,600 compared with 48,800 in December 1990.
"In a scale of international competitiveness produced by the International Institute of Management Development in
Switzerland, New Zealand dropped from 11th place in 1996 to 21st this year.
"Increased casualisation of the workforce and trends towards more contracting out of work has left many workers in very
uncertain employment.
"According to Reserve Bank estimates, New Zealand's annual growth in Labour productivity averaged a mere 0.36% between
1991 and 1999.
"All this is in contrast to the extravagant claims made by former Labour Minister Bill Birch when he introduced the ECA
promising increased growth and prosperity and, later on, a more cohesive society.
"The ECA has been a calamity for many New Zealanders.
"No one should be surprised that thousands of submissions have poured into the office of the Employment Select Committee
offices supporting the introduction of a more balanced and forward-looking regime under the Employment Relations Bill,"
says Ms Wilson.
ENDS