Parties join forces to probe 'jobs crisis'

Party leaders (from left) Winston Peters, David Shearer and Russel Norman put on a united front at yesterday's summit. Picture / Dean Purcell

Trio set up own inquiry, saying manufacturing is in dire trouble

Three Opposition parties have joined forces to set up their own inquiry into manufacturing after the National Government blocked one.

Labour leader David Shearer, Greens co-leader Russel Norman and New Zealand First leader Winston Peters fronted together at a "Jobs Crisis Summit" in Auckland yesterday to make the announcement.

The parties all believe manufacturing is in crisis after the sector lost 40,000 jobs in the four years to June.

MPs will receive submissions and hold hearings in several cities next month and publish a report in the new year. It will be chaired by an independent person.

Mr Shearer said the Government practised "ostrich economics", putting its head in the sand and pretending everything would be okay. "This is us taking notice."

The parties would be free to develop their own policies for the 2014 election but they hoped to reach a consensus on some ideas that could be implemented before then.

Asked if it could be a blueprint for a government of their parties, Mr Peters said the report "should be good enough to be a blueprint for any future government and, in fact, this Government if it would change its ways".

The three parties are finding agreement on monetary policy reform too, with Labour and the Greens set to support Mr Peters' private member's bill on Wednesday which would broaden the Reserve Bank's focus on controlling inflation to include "maintaining an exchange rate that is conducive to real export growth and job creation".

Mr Peters said the "neo-liberal idiocy" that had been in place since July 14, 1984 (the start of the fourth Labour Government) was at an end.

A bid last month to get the finance and expenditure committee to conduct an inquiry into manufacturing was blocked by the Government.

Yesterday's united front was not just among political parties either.

The summit, organised by the Engineering, Printing and Manufacturing Union, was attended by a New Zealand Manufacturers and Exporters Association representative, John Walley, and Productive Economy Council representative Selwyn Pellet.

Mr Pellet and Mr Walley were strongly critical of the Government's view that there is no crisis in manufacturing and said the view that there was no alternative to the current monetary policy levers was dead.

Mr Walley said people often talked as though the global financial crisis was over. "We are still living through it and it is going to get worse."

Mr Pellet said there was a moral obligation to have a balanced economy. If he had invested in the housing sector he would not have created one job. In the productive sector he had generated 300 jobs.

In a discussion about a financial transaction tax, Mr Pellet, who recently visited international economists on a trip with Labour finance spokesman David Parker, said that International Monetary Fund economist Olivier Blanchard had said the trouble with capital flows was that they were too efficient and that they needed to pour sand into them.

Mr Pellet said that if Europe adopted a financial transactions tax, "it might be a very good bandwagon to jump on".

Mr Parker said the focus on manufacturing was because New Zealand could not rely on the primary sector, and the service sector relied on the manufacturing sector.

In response to Spring Creek miner Trevor Bolderson, he said he could not promise that every mine could be kept open but a Labour government would not be preparing Solid Energy for sale and the dollar would be lower.