By Peter Tritt, an experienced manager, lawyer, writer and former CEO of the CCNZ (Contractors’ Federation), and director in the postgraduate legal education and training sector in New Zealand, Australia and Asia.
Having lived overseas for more than seven years and for nine of the last 11 years, it’s been great spending some time back in New Zealand over the past seven months catching up with what’s happening.
Reading a print copy of Contractor magazine (after years of digital-only reading) has been a nice way to catch up on what’s happening in the civil contracting industry.
As always, Contractor provides extensive coverage of our civil contracting industry and of CCNZ, which this year is celebrating the 80th Anniversary of its founding in July 1944. Eighty years on, 2024 is going to be another important year for CCNZ and New Zealand.
A change of government and dealing with a new set of changes is grist for the mill for an organisation like CCNZ. It’s one of its reasons for being.
When you’ve been around for some time, you wonder sometimes whether “the mill” just keeps going full circle. That vague “haven’t we been there and done that?” feeling. Perhaps the problem is that government has grown so big and has so many people working for it nowadays that it’s always going round in circles?
But for many, what’s happening is all new.
The “who, what, where, when and why” of any new government’s funding (taxation and borrowing) and spending priorities are always the main event and May’s budget revealed how that’s going. Plus, there’s the hardy perennials of dealing with a government’s “new and improved” approaches to employment law, education and training, health and safety, resource management and infrastructure.
There’s some inevitably about employment law undergoing a “sea change” as governments change from left to right and vice versa. So it’s no surprise that the new Government moved quickly to repeal the Labour Government’s Fair Pay legislation (a union promotion scheme) and restore 90-day work trial periods.
It’s hard to believe there was once a time when CCNZ’s forebear, the New Zealand Contractors’ Federation (NZCF), was a union – an Industrial Union of Employers. Federation annual conferences used to have a fun race to beat the previous record time in how quickly its union’s AGM could be done. Seven minutes was the record.
The NZCF union negotiated with other unions to establish industry-wide awards. It was an industrial relations regime that dated back to 1894 and, although much tinkered with, wasn’t dismantled until National’s 1991 Employment Contracts Act. The NZCF’s union was wound up.
Ever since 1991, the Labour Party and its allies have been attempting to resuscitate elements of the old regime, especially its central role for unions. Helen Clark’s Labour Government delivered Mecca, if not nirvana, with its Multi- Employer Collective Agreements (MECAs) in 2005, plus a host of other landmines for employers.
The last Labour Government’s solution was Fair Pay Agreements. But the old regime, where industry unions ruled the roost, was never to return.
There are similar histories to tell in the policy areas surrounding education and training, health and safety, resource management and infrastructure. This time around some ideas will be new, some will be old, some will be borrowed from overseas and some may even come out of the blue.
One of the most striking historical parallels with today is perhaps the 1980s and “Think Big” – the much-maligned (if you believe mainstream media) national development programme of the 1975-1984 Muldoon National Government. Today, the new National-led Coalition Government also wants to get on with building and doing things, without being bogged down by environmental “green tape”.
It’s important to remember that the Muldoon Government embarked upon Think Big as a response to the second 1970s global oil supply crisis, sparked by the 1979 Iranian revolution that overthrew the Shah of Persia. Energy self-sufficiency (self-sufficiency in many other tariff-protected industries was the norm back then) was seen as the way to go – and New Zealand’s abundant supplies of natural gas, coal and water were there to be exploited in the name of energy self-sufficiency. Other government policy responses to conserve fuel included the joys of carless days and reduced highway speed limits.
Critics of Think Big usually focus on its huge debt burden (rather than on what was spent) and that debt’s contribution to the government’s overall economic mismanagement. Critics (then and now) also disliked very much the National Development Act 1979 that was passed in December 1979 to speed up the Think Big initiative. The Government and its supporters claimed the legislation would allow it to plan and act decisively and to ‘cut through red tape’ to enable development. Just like the new Government’s Fast-track Approvals Bill.
It’s worth noting that, at the time, New Zealand was home to the World’s first environmental party, the Values Party. It contested elections from 1972 (reaching 5.19 percent in 1975) until 1987, and later evolved into the Green party. Environmental concerns had been growing during the 1960s and climaxed with The Save Manapouri Campaign – a campaign to prevent the higher raising of lake levels at lakes Manapouri and Te Anau, as part of the Manapouri Power Project. So, environmental-based opposition to Think Big was also very big.
The eight Think Big projects were: (1) Construction of a synthetic-petrol plant at Motonui, to convert the offshore Maui natural gas into methanol and petrol; (2) Construction of a methanol plant at Waitara, to produce methanol for export; (3) Construction of an ammonia/urea plant at Kapuni; (4) Electrification of the North Island Main Trunk Railway Line from Te Rapa to Palmerston North; (5) Expansion of the Marsden Point Oil Refinery; (6) Expansion of the Glenbrook Steel Mill; (7) Expansion of the Tiwai Point Aluminium Smelter, with a third reduction line; and (8) Construction of the Clyde Dam. A proposal to build another aluminium smelter at Aramoana near Dunedin failed to survive strenuous environmentalist opposition.
So, the physical legacy of “Think Big” is not bad – as any visit to the Clyde Dam and Lake Dunstan will show. The bad rap “Think Big” gets has more to do with the Government’s economic mismanagement, coupled with its huge debt, than the worth of the “Think Big” projects.
The Muldoon Government resorted to dealing with high inflation by commanding (through regulations) that it go away. Wages, prices and even interest rates were all brought under Government control by regulation. This was New Zealand before the Reserve Bank took control of managing inflation and before its dollar was floated. Our country, back then was the most controlled economy in the Western World, prompting Muldoon’s successor David Lange to liken it to “being run like a Polish shipyard.” The Lange Government’s whirlwind of change would soon turn us into the World’s most free economy.
The Labour Party’s response to Think Big, following its 1984 landslide election win, was to repeal the National Development Act 1979 and start work on its new Resource Management Act – that only became law in 1991 after being passed by the new Bolger National Government that had swept Labour from power in the 1990 elections.
The oft-reviewed and much-maligned Resource Management Act has been with us ever since, or at least until the last Government replaced it with its absurdly named Natural and Built Environments Act 2023. Only to have that act quickly repealed by the new Government.
It’s no surprise, therefore, that the Government’s Fast-track Approvals Bill is meeting with the same strong environmentalist opposition that confronted the National Development Act back in 1979.
The Fast-track Approvals Bill represents an opportunity to get New Zealand back to “getting things done”. It will allow for new infrastructure development to proceed, without being bogged down in lengthy consent processes and court proceedings. It will also help kick-start new business ventures to take advantage of New Zealand’s abundant natural resources, while at the same time protecting the environment.
It’s time again for bigger thinking about what our country can do and to get on with doing it. Who knows, we may even get back to the days I remember as a child when we got things done and had the highest Gross Domestic Product per capita in the World.
With wealth like that, a nation can afford to buy a lot of the things that people want its government to provide.