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Labour Party: Productivity Policy

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A successful sustainability agenda implemented effectively should assist productivity. The main elements of increasing productivity are skills and infrastructure.

Skills

Human capital is the main input in a modern economy. To build on the major work already undertaken:

Labour will develop and implement the Schools Plus programme.

Labour set out a big vision for the future of secondary education to improve young New Zealanders’ chances of success. Under Schools Plus, we want our schools to be able to respond to the full range of abilities of our teenagers – and to make education relevant and personal to all our young people.

By 2011 we will have youth apprenticeships available in every high school in New Zealand for students from Year 9 onwards.

From 2011, every student from Year 9 on will have their personal education plan – agreed between them, their school and their family.

From 2011 there will be an education or training leaving age of seventeen, and from 2014 of eighteen.

Not all those students will be in school – but they will still be learning in work or in training.

This will provide a varied and attractive set of pathways for teenagers to move from school to work or further education.

Labour will resource and implement the New Zealand Skills Strategy so as to equip all our people with the skills necessary for full participation in a modern economy.

Labour believes that New Zealand must take a more strategic approach to skills development, both in terms of enabling more of our young people to be in a position to access it, and through improving the skills of people already in the workforce.

With industry and unions, we have developed a unified skills strategy to lift the skill base of the existing workforce, and therefore their contribution to New Zealand’s productivity.

The New Zealand Skills Strategy will not only lift skills levels across the workforce, but will also equip our workers with better management and leadership skills. This will ensure that firms can better harness the skills young people learn through industry training and modern apprenticeships.

We will fully implement all components of the skills strategy. This includes language, literacy and numeracy; improved management and leadership capability in organisations, awareness raising, skills plans and streamlining the government’s firm capability programmes with those in the private sector.

Labour will ensure that polytechnics give priority to their task of assessing employment needs and facilitation of regional tertiary education sector responses, and are supported to carry this out.

Over the last three years, Labour has significantly reformed tertiary education to improve the sector's ability to deliver on government priorities, and meet the education and training needs of students, employers and communities on a regional as well as national basis. We need to build on this further.

All New Zealanders must have the opportunity to reach their full potential – and have the chance to fill the skilled job slots available in the economy.

In the near term, the prospect of fall out from the international crisis also requires us to have new plans for workers whose jobs might be affected.

Labour will introduce a new retraining allowance, on the same basis as a student allowance, but with no spousal income test, for workers who have been in the workforce for at least five years and have been made redundant.

In the modern world, skills are increasingly important, both for individuals and for the economy as a whole. Careers are also becoming more complex with people more likely to change jobs and even occupations over the course of their working life. That will often require a period of retraining.

In other words, learning is now lifelong. It is not something that stops when we leave school or finish an apprenticeship. Labour recognises this and is putting in place measures to support workers to gain new skills throughout their working lives.

Labour will also introduce a retraining allowance available to those who have been in the workforce for ten years and wish to upgrade their skills or retrain in a new area.

This will provide an alternative to the Student Allowance for people who have used their 200 weeks Student Allowance entitlement.

These allowances will be available for up to a year for enrolment in a recognised full time course. The course will generally need to be of at least twelve full-time weeks duration. The Unemployment Benefit (in training) is already available for courses of up to twelve weeks.

Labour will outline further measures to support workers in changing times in our other policies.

Labour will strengthen programmes to attract overseas New Zealanders to return to work in New Zealand.

Expatriate New Zealanders can be viewed as another part of the pool of talent that New Zealand can draw on to fill labour market gaps. The movement of skilled migrants between countries is now a global norm, with comparable countries such as Australia experiencing similar trends to us.

We do not want to discourage young New Zealanders from doing their traditional “OE”, or overseas work experience, because these people generally return to New Zealand with valuable work and life experience.

However it is important that we maintain contact with skilled New Zealanders overseas so that we can continue to promote their eventual return home.

Like the rest of the world, New Zealand’s population has become increasingly multi-cultural during the last decade, and that has had an overall positive impact on our economy, society and families. Migrants enhance our economy by reminding us to think and act globally. They drive innovation, give our businesses international connections and provide a range of skills to transform our economic landscape.

With record low unemployment rates, we have adapted our immigration policies to help meet labour shortages and ensure New Zealand has people with the skills we might otherwise be lacking. Over the past five years, migrants have accounted for 60 percent of the growth in the national workforce. Much of that growth has occurred in skill shortage areas — areas that are vital to the basic functioning and future growth of our economy.

New Zealand has benefited from consistently positive net migration over the past seven years. However the global immigration environment is changing and becoming increasingly competitive in terms of skilled migrants. We must change with it so that we maintain our international competitive advantages and continue to attract the migrants with the skills New Zealand needs for our economic growth.

Labour will continue to emphasise the attractions of skilled migrants as the main element of our immigration policy.

We will also examine mechanisms to assist in moving good business management into world-class business management, so that our most promising business people are given the support needed to become the best. This will be done in partnership with Business New Zealand.

Infrastructure

Labour is committed to strong investment in essential infrastructure. The overall picture of this decade is one of significant rebuilding and unprecedented levels of investment. We expect to invest $5.4 billion in physical infrastructure this year, a 180 per cent increase since 1999. Annual funding for roading has more than doubled to over $1.9 billion this year. This has seen new highways and motorway extensions built throughout New Zealand, including the Wellington Inner City Bypass and the Auckland Central Motorway Junction.

We believe that having undergone a major rebuilding of our nation – with record investments in hospitals, schools, roads and other infrastructure – we have a once in a generation opportunity to chart an ambitious course for New Zealand.

Labour will maintain a twenty year plan for sustainable infrastructure development in New Zealand.

Specifically, within that 20 year plan, Labour will:

* Set a 90% renewable electricity generation target.
* Work with local government on measures to address priority infrastructure needs at the local level
* Put in place comprehensive plans to lift New Zealand’s water quality and ensure that our water usage is consistent with long term sustainability objectives.

Labour will keep New Zealand’s rail in public hands. We believe that with our rail system back in public ownership, we can make the strategic decisions and investments necessary for rail to play its full part in building a more sustainable New Zealand. Over time, we will be able to move more freight off our roads and onto rail. Rail will also play a bigger role in public transport in our major centres. Labour will invest $1 billion or more in the next ten years in modernising KiwiRail as our economy confronts the sustainability challenge.
Labour will support the creation of an electrified rail network for Auckland, including the North Shore and beyond.

In terms of expanding our tools for future growth Labour is committed to improving New Zealand broadband. Over the next five years we will invest half a billion dollars into broadband, as part of our ten year plan for a fast broadband future. We will use this funding to accelerate broadband investment and high speed rollouts to businesses, local authorities, universities, schools and hospitals in urban centres. It will also be used to extend broadband into under-served regions, particularly in rural New Zealand.

Labour will lift the New Zealand telecommunications system into the top ten in the world.

Labour’s much-increased level of spending on infrastructure needs to be maintained until the nation has fully undone the damage caused to its productive capacity through under-investment during the wasted decade of the 1990s. Labour will broaden the funding options for infrastructure development in two main ways:
Labour will issue long-term infrastructure bonds which have a tax-free inflation-indexed element.

Infrastructure Bonds are specifically linked to long-term investment in infrastructure, to make the link clearer between revenue and investment.

Issuing Infrastructure Bonds allows us to accelerate our efforts to make vital transport improvements for the long-term benefit of New Zealand

Labour will support the rational use of public/private partnerships for large scale infrastructure developments where these can deliver more effective solutions for communities at lower cost to ratepayers and taxpayers.

Labour changed the law to allow for public/private partnerships and will continue to explore opportunities in this regard on a case by case basis.

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