Fourth Labour Government Research Articles

The myth of the shrinking state? What does the data show about the size of the state in New Zealand, 1900-2015

As every student knows, the economic reforms of the fourth Labour government after 1984 reduced the size of the state. One of the elements of the government’s programme of economic liberalisation was to exit from state trading activities by first corporatising and then privatising the activity. The trading activities in question ranged from telecommunications and banks to hotels, a printing business and a shipping line. In 1984 government spending was about 40% of GDP, and the government employed 31% of the workforce.

Beyond the Treaty of Waitangi: Māori Tribal Aspirations in an Era of Reform, 1984–2014

ABSTRACTNew Zealand's neoliberal reforms, ushered in by the election of the fourth Labour government in 1984, were almost completely unanticipated. But soon after the election, Labour's emerging ambivalence towards the State found an ally in Māori political aspirations. The government sought to devolve state responsibilities, while Māori leaders demanded a greater role for tribal organisations, seeking greater control over Māori social and economic wellbeing. The Treaty of Waitangi provided the justification for Māori autonomy and the assertion of tribal sovereignty. Māori accepted, however grudgingly and provisionally, the Crown's dominant role as policy maker and funder. Governments in turn increasingly involved Māori in the provision of services, partially recognising tribal identities and organisations as providers of services and in Treaty settlements. Proportional representation gave Māori greater influence within the executive and the legislature, reducing the importance of the Treaty of Waitangi and the courts, and marginalising the role of the Waitangi Tribunal.

Idealism and Realism in the Foreign Policy of the Fourth Labour Government

New Zealand’s fourth Labour government, in office between 1984 and 1990, is noted for abandoning traditionally Labour economic policies. An examination of its foreign policies, however, reveals a more traditional Labour party pattern. Like previous Labour governments, this one adopted a basically Liberal Internationalist approach to the world. Liberal Internationalism is characterised by emphasis on the promotion of human rights and democracy; support for international institutions; the encouragement of disarmament and the promotion of free trade. The fourth Labour government’s most notable foreign policy was one promoting disarmament; it showed increased support for the United Nations; it demonstrated concern for human rights in South Africa, China, New Caledonia and Fiji, and it encouraged free trade. However, the Liberal Internationalist emphasis was absent in some instances. Realism was the dominant approach to policy in regard to Iran and East Timor because important national interests were at stake.

Communication campaigns and the neo-liberal policy agenda

This article summarizes my recent investigation of the political debate, conducted through the media, over a crucial and defining policy in New Zealand's neo-liberal project (begun in 1984). The Employment Contracts Act (1991), representing an overhaul of New Zealand's industrial relations system, was introduced at a particular historical conjuncture. Conditions peculiar to the 1990/1991 period contributed to the passage of legislation which reinforced the construction of neo-liberal hegemony. These conditions were constituted by the `restructured' economy (financial deregulation, floating the currency, privatization of state assets), the prevailing ideological climate (anti-interventionism), the balance of political forces and the character of mediated information. Under the fourth Labour government (1984-90), opposition to the neo-liberal project was weakened or marginalized. The opposition National Party exploited anti-government disillusionment to gain power in October 1990. But the new administration set out to further the neo-liberal project through `restructuring' social welfare and industrial relations. The communications offensive launched by National to accompany its employment contracts proposal was largely successful. To clarify the factors contributing to this outcome, the article compares the passage of the Employment Contracts Act with a communications offensive which failed; namely, the British poll tax (as discussed by Deacon and Golding, 1994).

“A Means to an End”: Neoliberalism and State Processes in New Zealand

The New Zealand experiment is gaining international notoriety, simultaneously lauded by the Right and decried by the Left as an extreme example of neoliberalism and economic restructuring. The last decade has seen a dramatic shift from Keynesian welfarism to neoliberalism as the basis for state policies, and the transformation of a highly protected domestic into an open network economy oriented towards the economic flows of the Pacific Rim. The impetus for this transformation is found in the reform program initiated by the fourth Labour government (1984-1990).

The Ownership, Governance and Accountability of Tertiary Institutions in New Zealand

Significant changes have been made since the late 1980s to the funding, governance, and accountability of New Zealand’s public tertiary education institutions (TEIs). The new governance framework, which was introduced by the fourth Labour government in 1990, has been the subject of numerous criticisms. According to the government’s departmental advisers on tertiary education, the new regime exposes the Crown to significant ownership risks, provides insufficient incentives for sound financial management, gives too much power to vested interests, unduly limits the government’s capacity to intervene in the wider public interest, and leaves TEIs insufficiently accountable for their use of public resources. This article examines the merits of these criticisms, and assesses the various proposals for reform.

Contesting Symbolic Space: The Struggle over the Employment Contracts Act 1991

This article is based on research concerning the relationship between the neo-liberal project in New Zealand and the mass media since 1984. New Zealand has undoubtedly experienced a major shift in public policy orientation in correspondence with structural changes in the political economy. The assumed role of government under social democratic Keynesianism was questioned and restructuring of the state became central to the neo-liberal project. The resultant policies reorganised economic, political and social priorities were rapidly implemented and had a detrimental impact upon various sectors of society. Consequently, such policies had to be rationalised and strategically promoted in order to marginalise opposition and allay public scepticism. As neo-liberalism was being transmitted to the public, New Zealand's media system was undergoing changes in terms of the surrounding economic environment and media-government relationships. Such circumstances enabled both the fourth Labour Government and the succeeding National administration to routinely communicate their messages. This claim required illustration. To this end I undertook research on the debate conducted in and through the media over the introduction of the Employment Contracts Act (1991).

Leading from the Rear? A Theoretical Analysis of the Contingent Bureaucratic Conservatism of the NZCTU Leadership

Since it was established in 1987 the NZCTU has consistently failed to successfully oppose and defeat any of the major policy initiatives of the fourth Labour Government or the current National Government, even though these policies have clearly been detrimental to the interests of workers. In particular, during the period leading up to the passage of the ECA in May 1991 the NZCIV leadership failed to organise and lead the kind of generalised strike action that would, at the very least, have forced the National Government to substantially amend (if not withdraw) the legislation. In the industrial relations literature there have been remarkably few attempts (apart from the self-justifications of those involved) to address the key question which this raises: why has the NZCTU leadership acted in such a conservative and timid manner in response to economic, social and industrial relations policies which are essentially pro-capitalist and anti-worker? Explanatory accounts of the conservatism of the NZCTIJ leadership, if they are to be convincing, must combine theoretical analysis of the contingent bureaucratic conservatism of fulltime trade union officials in the industrial relations systems of advanced capitalism with systematic historical research which disentangles the concrete interplay of economic, class, ideological and political forces specific to any particular dispute. This paper outlines the theory of the contingent bureaucratic conservatism of fulltime trade union officials, considers some of the major criticisms of this theory, and then argues that a qualified version of this theory is essential to making sense of the role played by the NZCFU leadership in industrial relations.

Financial Management Reform: Principles and Practice in New Zealand

This article explores the nature and impact of New Zealand's financial management reforms introduced by the fourth Labour Government (1984-90). These reforms, which were given legislative backing via the Public Finance Act 1989, are of interest not merely because of their scope and scale, but because of some of the concepts and principles which have fashioned their design and implementation. In particular, the article highlights the importance which has been attached to the distinction between departmental outputs and outcomes, and the distinction between the interest that a government has as a purchaser of department goods and services and its interest as an owner of departmental assets, and explains how these distinctions have been used to fashion the new framework of accountability. In evaluating the reform programme, the article draws on the results of a comprehensive review undertaken on behalf of the National Government (1990- ) and published in late 1991. This reveals overwhelming support for the new policy framework amongst senior officials and ministers. It also indicates that the reforms are beginning to achieve their intended goals of improving departmental efficiency and accountability and facilitating better expenditure control. Finally, some of the issues which the new financial management regime has either generated or failed to resolve are explored.

Mainstreaming Education: The Role of the State Services Commission

The education reforms that began in New Zealand in 1987 have generated a huge literature. One of the features of that literature has been the attempt to relate the education reforms to the large collection of economic and political reforms set in place by the fourth Labour Government after its election in 1984. The first, and most radical, phase of these reforms occurred during the 1984-87 Parliament. They centred on a programme of widespread economic deregulation and the curtailment and/or commercialization of state activities. They were informed and driven by a neo-liberal economic theory, known locally as “Rogernomics” after its chief begetter, the Minister of Finance in the 1984-87 Labour Government, Roger Douglas (see Holland and Boston, 1991). In this phase there were no radical changes to the education systems. With the return of the Labour government in 1987 the reform impetus was extended to education. There were two strands to this impetus. One was the explicit application to education of the Rogernomics neo-liberal approach, this is set out in the second volume of the Treasury’s brief to the incoming government (NZ Treasury, 1987). The other was the setting up of the Picot task force on the administration of education whose report Administering for Excellence was published in April 1988. These two strands were distinct from each other. The Treasury brief distinguished between education as a public good and as a commodity (see Grace, 1989). The Picot Task force’s terms of reference were confined to the administration of education. Where the strands come together was in the presence of a Treasury representative on the Picot task force, whose activities on the task force were revealed by another of its members, Peter Ramsay, to have amounted to putting pressure on the Picot members to follow “the Treasury line”. These two interventions in education gave rise to what has been perhaps the most influential interpretation of the New Zealand education reforms, that they were led by a new right, neo-liberal ideology, that in essence they represented the extension of Rogernomics to education. This interpretation sees the education reforms as aimed at eventually privatizing education in line with the privatization of other areas of government activity. It points to the continuing interest of the Treasury in education, which it sees as being fuelled and supported by the Business Roundtable (BRT) and in particular, informed by the report the BRT commissioned from the neo-liberal writer on education, Stuart Sexton, (1990).

ASSESSING THE PERFORMANCE OF DEPARTMENTAL CHIEF EXECUTIVES: PERSPECTIVES FROM NEW ZEALAND

This article examines the new approach to specifying and assessing the performance of departmental chief executives in New Zealand introduced in 1988 by the fourth Labour government (1984–1990). Drawing on the findings of a series of interviews with ministers, chief executives and other senior public servants conducted between late 1989 and late 1991 by a number of researchers, the article outlines the origins and implementation of the new policy framework, and evaluates its strengths and weaknesses. From the evidence available to date, it appears that the new model has won the support of most of the parties directly affected, and that it has enhanced the accountability of chief executives to their portfolio minister(s). However, the implementation of the new regime has highlighted the inherent problems of assessing the performance of senior personnel in the public sector and of imposing sanctions in the event of substandard performance. In addition, various issues of a constitutional nature have arisen concerning the roles and responsibilities of chief executives, the balance of power between chief executives and their portfolio minister(s), and the proper role of the Prime Minister and Cabinet in the new accountability framework.

RESTRUCTURING GOVERNMENT NEW ZEALAND STYLE

The fourth Labour government (1984–90) has carried out a radical restructuring of executive government comparable to corresonding reforms in Britain. The changes described have been carried out in government Bepartments, state‐owned enterprises, the civil service, minister/civil servant relationships, regional and local overnment, and in the organization of the health and education services. The reforms folfow a consistent blueprint based on ideas of economists andublic choice theorists, especially those relating to agency theory and transaction costs. The themes of the New Zealand blueprint are ‘decoupling’ policy from service delivery, a PrinapaVagent model of managerial decentralization, new financial accounting systems, contracting for service provision and monitoring managerial performance. In implementation, where there are elected authorities but government is the main funding agent, there is uncertainty about the degree of discretion and appropriate accountabilities. Implementation has also illustrated the problems of defining desired outputs and outcomes and in malung them useable by professional workers and elected representatives.

Recent Trends in the Internationalisation of the New Zealand Economy

Over the last decade, but particularly since 1984 when the fourth Labour Government came to power, New Zealand has become something of an experimental test bed for the implementation of monetarist ideas of political and economic management. A noticeable outcome of the policy regime recently put in place has been a dramatic ‘opening up’ of the economy as markets are deregulated, protection barriers lowered, and restrictions on movement of capital in and out of the country removed One consequence has been a quantitative and qualitative change in the internationalisation of the economy. This paper traces the nature and extent of this process, and speculates on some policy implications. Four key dimensions of the internationalisation process are surveyed: the expansion of New Zealand capital off‐shore, increased levels of foreign investment in New Zealand, the impact of reductions in border protection, and closer economic relations between Australia and New Zealand.

Towards the Wagner Framework: Change in New Zealand Industrial Relations

New Zealand and Australia share a common heritage of compulsory arbitration. This article explores the way in which New Zealand has departed from this tradition. Three phases in the deconstruction of compulsory arbitration and reregulation of industrial relations are identified. The first is associated with the events that led up to the Industrial Relations Act 1973. That statute formally endorsed the growth of free collective bargaining and introduced the North American distinction between disputes of interest and disputes of rights. The second is identified with the fourth Labour government (1984-1990), which made arbitration voluntary in a climate of extensive economic liberalization and encouraged a shift from occupational awards to a mixture of industry and enterprise bargaining. The third is presently unfolding as the new National government begins work on its election pledge to shift the basis of union legitimacy from historical registration to employee choice. If completed, the third phase will ensure the substitution of centralization and compulsion with decentralization and voluntarism in the framework of collective labour law in New Zealand. The article concludes with a discussion of the implications for the parties of the emerging system of industrial relations, called here New Zealand Wagner'.

Nuclear free New Zealand and rogernomics: The survival of a labour government

Abstract New Zealand's fourth Labour government, elected to power in 1984, has become known most generally for two of its policies: a refusal to accept nuclear warships in New Zealand waters, and the vigour and consistency with which it has pursued market orientated economic policies. A post‐election near‐national survey of 1013 respondents is employed to measure the extent to which the two policies may have aided Labour's re‐election in 1987. Contrary to most interpretation hitherto, we find that defence and economic policy opinion were at least of equal importance. But there is further evidence to indicate that defence policy opinion was the more important It is concluded that the expression of “post‐materialist” values through anti‐nuclear politics may have perversely allowed a new materialism to conquer New Zealand politics.

Travelling together: Party identification and voting in the New Zealand general election of 1987

New Zealand has been experiencing a period of electoral instability, which has involved considerable vote changing in response to the presence of ephemeral or fluctuating third parties, and to the radical policies of the fourth Labour government. In these circumstances, one would expect to see evidence of partisan dealignment in the form of a loosening of the relationship between electors' party identifications and their votes. However, data from a post-election survey do not bear this out. Rather, rates of identification have remained high and in a period of political flux identifications and votes have remained coupled together, in a manner that suggests that the relationship between them is strongly reciprocal.

TRANSFORMING NEW ZEALAND'S PUBLIC SECTOR: LABOUR'S QUEST FOR IMPROVED EFFICIENCY AND ACCOUNTABILITY

Since its election in July 1984 the fourth Labour government in New Zealand has embarked upon the most radical and systematic reorganization of the state sector since the creation of a unified, non‐partisan, career‐oriented service in 1912. The reforms include the commercialization of many of the goods and services provided by state agencies, the turning of public trading enterprises into corporations, major administrative changes and the overhauling of state pay‐fixing arrangements. This article examines the theoretical assumptions underpinning Labour's strategy and assesses the extent to which the new arrangements are likely to achieve their intended purpose of improving the efficiency, flexibility and accountability of the public sector.