STATEMENT OF INTENT 2006/2007

PART A – STRATEGIC DIRECTIONS

OUR OUTCOME AND HOW WE PLAN TO ACHIEVE IT

OUTCOME

GOAL 1

GOAL 2

GOAL 3

GOAL 4

OUTCOME:

Productive work and high-quality working lives

The Department aims to achieve productive work and high-quality working lives for New Zealanders.

In this ideal future environment, participants will be well equipped with the skills they need to participate in the labour market in the ways that they want to, and employers will have a suitably skilled labour force to meet their needs.

Workplaces will be sufficiently appealing to attract and retain the skills and talent they require to be sustainable and to grow:

Refined goals and priorities

In reviewing and re-orienting its work over this past year through strategic planning process, the Department of Labour has refined its long-term goals and priorities. The application of a new operating model to the Department’s work, together with a new prioritisation approach, resulted in a revision of what we see our primary long-term objectives and priorities to be.

The new long-term goals ensure better alignment with the Department’s new understanding of its purpose, and the revised, whole-of-department priorities will ensure that its activities will be effective in meeting these goals (see the outcomes framework diagram inside the front cover).

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GOAL 1:

Our place in the world: New Zealand will prosper through its connections with the rest of the world

Why this is important

This long-term goal recognises that New Zealand’s connection with the world is crucial. The Department’s contribution to the goal is delivered in two intersecting ways – through the movement of people into and out of New Zealand (immigration and border security), and through international connections (multilateral, bilateral and Pacific region engagement).

Our prosperity will depend on the strength of our economy in comparison to other nations. If New Zealand is to achieve the Government’s goals of economic transformation, and opportunity and security for all families, within a knowledge-based economy, we must be positioned to take advantage of high rates of international migration, by supporting skilled migrants with the skills and expertise needed by our industries to settle well in New Zealand. Facilitation of short-term visits – by tourists, students and temporary workers – is also important to our economy and, by strengthening the connections between New Zealand and other countries, improves our ability over time to attract and retain the people we need.

New Zealand’s security as a nation depends on the way we manage our borders and stability in our region. Issues such as people smuggling, immigration fraud and identity fraud are international issues and will only be addressed through international cooperation and coordination.

The importance of New Zealand’s national identity – who we are, what we do, where we live and how we are seen by the world – is reflected in this long-term goal. New Zealand must influence, and be influenced by, the international labour market environment. On the one hand, this helps to ensure domestic labour laws, policy and practice are consistent with international standards and practices, and on the other, enables us to help ensure the international environment is conducive to New Zealand’s best interests. Our enterprises must be able to adopt international best practice or risk falling behind the world on labour market innovation and improvement.

Medium-term priority

Under this goal, our medium-term priority is supporting New Zealand’s prosperity, through:

Why this is important in the medium term

People and skills are becoming increasingly mobile, with a tendency towards temporary or circular migration instead of permanent migration. In 2005, there were nearly 200 million migrants globally, compared with 82 million in 1970.

Large numbers of people move into and out of New Zealand every year. Some 14% of all people born in New Zealand are living overseas, while 20% of our population were born offshore. There is strong international competition for skilled workers, and this will increase as ageing populations in developed countries retire.

At the same time as we wish to attract skilled workers and visitors to New Zealand, we must manage the risks inherent in the increasing international mobility of people. With heightened awareness of international terrorism, there is a stronger focus on border security nationally and internationally. The Department’s management of New Zealand’s borders must continue to ensure that we keep out those who may adversely impact on our international, domestic and business communities, while facilitating the movement of people who bring value. New Zealand’s domestic security is also influenced by the security of the Pacific region. It is important that we support Pacific nations to become more economically stable through the development of strong labour markets and enhanced workforce skills.

It is also essential, for both national identity and economic transformation, that successful migrants are made to feel welcome and are assisted to settle well when they come to New Zealand. Factors like having a job, housing, connections with the community and support systems are all critical to helping people settle, feel welcome and make the best contribution they can to the economy and to New Zealand society.

The increasing pattern of mobility and globalisation has also highlighted the need for New Zealand to maintain key relationships with domestic and international stakeholders in order to influence the development of an international labour market that reflects New Zealand’s domestic interests. To this end, the Department seeks to build New Zealand’s reputation as an international “thought leader” on labour market law, policy and practice, by sharing knowledge about labour relations issues and profiling New Zealand’s domestic labour market successes and best practice. Knowledge sharing also means that international best practice is identified and informs our workplaces, our workforce and our people. Free trade negotiations also contribute in this way.

What this means for us

We need to work harder and smarter to attract skilled migrants and encourage short-term workers and visitors. To do this we need improved, faster facilitation of visas and permits for people we want, and smarter border processes to avoid potential risk. Good support, enabling people who come here to settle well, will ensure they contribute to social cohesion, productivity and economic development. Therefore, the Department is developing a new immigration service delivery model based on the following:

The Department is increasingly looking to ensure that the knowledge and value gained through its international connections is maximised by domestic stakeholders. We also take account of international best practice already in existence in other countries, to contribute to New Zealand’s domestic labour law, policy and practice.

Action to achieve the priority

The following activities are, or will be, directed towards achieving the medium-term priority:

Details about the Department’s outputs and activities for 2006/07 are set out in the Statement of Forecast Service Performance
in Part B.

Who we will be working with

The Department will continue to work with a wide range of domestic and international stakeholders, ranging from Business New Zealand; the New Zealand Council of Trade Unions (CTU); New Zealand government agencies such as the Ministry of Foreign Affairs and Trade, Ministry of Social Development, Ministry for the Environment, New Zealand Customs Service and Ministry of Economic Development; multilateral organisations such as the International Labour Organisation, Asia-Pacific Economic Cooperation (APEC) and the OECD; and overseas governments such as Australia.

Measuring progress towards the goal

We will know how we are progressing towards our goal by monitoring indicators in the following three areas:

Associated research and evaluative activity

The following research and evaluation projects will be undertaken over the next two to three years to inform our monitoring of progress and to assist us in continuously improving our policies and practices:

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Goal 2:

Our workplaces: New Zealand workplaces will lead the world in maximising the value of work while providing a high quality working life

Why this is important

Lifting workplace productivity is a critical part of creating long-term sustainable economic growth for all New Zealanders. We have to increase the value produced for every hour worked if we are to move to a high-value high-wage economy. Workplaces need to be attractive places to work, and embrace new ways of working and new technology, while also providing high-quality working lives and helping New Zealand attract and retain a globally-skilled workforce.

Attractive and productive workplaces promote safe and healthy workplace cultures, positive employment relationships, Work-Life balance, innovative practices and employee involvement in decision-making. These workplaces are likely to be more productive because they provide an environment where employees are willing to ‘go the extra mile’, where days are not lost to injuries, and where workers are properly recruited, developed and retained. By encouraging workplaces to adopt better workplace practices and cultures, we will improve the productivity of individual businesses and New Zealand overall.

Medium-term priority

Our medium-term priority is supporting and promoting the transformation of New Zealand workplaces to become high-performing and to achieve high-quality working lives by focusing on the drivers of workplace productivity – skills, safe and healthy workplace cultures, decent work and excellent employment relationships.

Why this is important in the medium term

Over the last five years, economic growth has largely come from more people in the working population, more people in the labour force and more hours worked. Although further gains can be made from getting more New Zealanders into work, economic growth based predominantly on increasing numbers of people cannot be sustained in an environment of low population growth, low unemployment and skill shortages. We need to lift productivity if we are going to achieve sustainable economic growth in the future.

Future economic growth and social wellbeing rest on how well the economy and labour market adjust to new challenges posed by globalisation, technology and demographic changes. We need to make economic gains by working smarter, creating more high-value work and doing less low-value work. For New Zealand to become a world leader in workforce and workplace performance, workplaces need to shift beyond minimum standards and adopt practices that will make them more productive and increase the value of their work, creating economic and social wealth.

What this means for us

In the past, the Department has mostly focused on regulating for minimum labour market standards and ensuring compliance with these standards.

Ensuring that all New Zealanders have access to decent work, in places where minimum workplace standards are met, will always be important to the Department. However, we believe we can add more value by:

We are committed to creating value for workplaces, people who work in them, and all New Zealanders. We will work with industry and sector groups, unions, employer groups, other government agencies and non-government organisations to achieve this. The Department’s and targeted services to assist workplaces in the most efficient way.

We want an environment that supports workplace productivity by promoting an inclusive view of workplace issues, encouraging and rewarding best practice, and providing sanctions for breaches of minimum standards. We will continue to use targeted enforcement to support behaviour change and discourage anti-competitive and unlawful behaviour.

The holistic approach we take to the whole policy cycle provides the discussion and thinking that informs what we do and how we provide our services. We will continue to evaluate the impact of the policies we develop and services we provide to inform and improve what we do.

To enable us to achieve this, we are:

Action to achieve the priority

The following activities are, or will be, directed towards achieving the medium-term priority:

Details about the Department’s outputs and activities for 2006/07 are set out in the Statement of Forecast Service Performance
in Part B.

Who we will be working with

The Department has established relationships with, and will continue working to understand the evolving needs of employers and employees at the industry, sector and regional level. This includes our on-going working relationships with our social partners: Business New Zealand and the New Zealand Council of Trade Unions (CTU). This places the Department in a strong position to facilitate solutions or to partner/lead national initiatives.

The Department also has strong ties internationally through the International Labour Organisation, and through country-by-country relationships. These relationships enable the Department to share internationally New Zealand best practice and to facilitate the spread of international best practice to firms and sectors within New Zealand.

The Department leads or contributes to the work of a range of agencies dealing with workplace issues (e.g. the Accident Compensation Corporation, the Civil Aviation Authority, the Environmental Risk Management Authority, local authorities) and works across government on a range of issues affecting the performance of workplaces and their contribution to the economic transformation of New Zealand.

Measuring progress towards the goal

We will know how we are progressing towards our goal by monitoring indicators in the following three areas:

Associated research and evaluative activity

The following research and evaluation projects will be undertaken over the next two to three years to inform our monitoring of progress and to assist us in continuously improving our policies and practices:

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GOAL 3:

Our workforce: The skills of our workers will ensure New Zealand enterprises are leaders internationally

Why this is important

Developing a skilled and productive workforce and improving the number of globally-competitive New Zealand firms is a cornerstone of the economic transformation agenda. Skill shortages need to be addressed to ensure our workforce is able to support growth and provide the key skills businesses require now. We need to ensure the country has the talent necessary to drive future business performance in a global environment of ageing workforces, labour mobility and competition for skills. This means developing skills at all levels, from functional literacy to managerial and leadership capability. We need to attract and retain key skilled individuals from around the world. It is closely linked to improving workplace practices so that industries and firms continue to develop and make best use of the skills of their existing workforce.

Medium-term priority

Under this goal, our medium-term priority is influencing the supply of skilled labour by:

Why this is important in the medium term

Since 2000, there have been significant changes in the labour market which have been accompanied by skill shortages across the economy. Although these have eased slightly in recent quarters, they remain at historically high levels.

Particular trades’ and professional occupations’ training levels are insufficient to meet new demand for skilled labour through job creation and replacing demand from out migration and retirement. In other instances, such as some of the professions, training rates are adequate to meet demand but workplace conditions are insufficiently attractive to attract and retain workers.

The global economy is able to provide many of the skilled and talented migrants needed to support the existing workforce. Properly matched, talented and skilled migrants enhance the local workforce by sharing skills, experiences and knowledge, leading to innovation. These workers bring access to networks and knowledge not always available to New Zealanders.

The international market for skills and talent is highly competitive, as many countries are seeking to increase economic competitiveness based on improving productivity and skills. New Zealand faces particular challenges around maintaining and attracting talent because there has always been net outflow of New Zealand-born workers.

What this means for us

The Department will seek to help industries, sectors, regions and other agencies balance the range of possible responses to skill and labour issues. This will include initiatives such as improving skill development and utilisation, short- and longer-term immigration responses, and changes to industry and workplace practices that, for example, make skill development or attracting and retaining skilled workers possible.

Action to achieve the priority

The following activities are, or will be, directed towards achieving the medium-term priority:

Details about the Department’s outputs and activities for 2006/07 are set out in the Statement of Forecast Service Performance in Part B.

Who we will be working with

Increasingly, the Department will need to work with employer groups and industry sectors to help identify skills gaps in New Zealand that cannot be met through short-term training, and target sources for those skills in overseas markets, including:

Measuring progress towards the goal

We will know how we are progressing by monitoring indicators in the following three areas:

Associated research and evaluative activity

The following research and evaluation projects will be undertaken over the next two to three years to monitor progress and to assist us in continuously improving our policies and practices:

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GOAL 4:

Our people: All New Zealanders will be able to grow and develop through access to well-paid and meaningful employment.

Why this is important

Continued growth in employment is leading to a very tight labour market. This will be exacerbated over the coming decades as the population ages. It is critical that all people who are able to work are supported to do so.

High-quality meaningful employment means work is rewarding and attractive, giving a sense of pride and purpose. New Zealanders need opportunities to fully realise their potential. Enabling more people to participate in paid work, particularly meaningful higher-value work, means more New Zealanders achieve an enhanced quality of life. This ultimately supports greater social cohesion and economic growth.

In the short term, this work should result in increases in the availability of skills and labour for firms and reduce stress, improve incomes and enhance care arrangements for individuals and families. Medium-term benefits are expected to come from better use of skills, increased productivity and consistently high-quality care. Longer-term outcomes include sustained productivity growth, population growth/maintenance and improved early childhood outcomes.

Medium-term priority

Under this goal, our medium-term priority is supporting increased labour market participation by leading the Government’s work programme on:

Why this is important in the medium term

The labour market is still tight, despite already high levels of workforce participation. This trend is likely to continue over the coming decades. People who are able to work must be supported to enter into employment. Barriers to participation that have prevented or discouraged New Zealanders from seeking employment must be removed – particularly parents and carers, young people, people with disabilities, older people, Maori, Pacific people, migrants and refugees.

There is evidence that the labour market skills and experiences of carers are often underutilised, with many families experiencing difficulties accessing quality childcare and achieving work-life balance. The short-term benefits of achieving a better balance between work and caring responsibilities for businesses include increased availability and better use of skills and labour. For individuals and families, benefits include reduced stress, better care arrangements and higher incomes. The longer-term benefits include sustained productivity through on-going labour market involvement by experienced people and the best start in life for children.

What this means for us

The Department will be positioned on a growing depth of understanding of the labour market to act in a proactive and coordinated manner, identifying and prioritising key participation issues. A coordinated approach, across the whole of the Department and government, will mean better targeting of resources and activity in ways more likely to result in improving participation outcomes for key groups. Overseas experience suggests that integrating complementary measures across areas of government intervention is most likely to be effective in achieving durable outcomes.

Action to achieve the priority

The following activities are, or will be, directed towards achieving the medium-term priority:

Details about the Department’s outputs and activities for 2006/07 are set out in the Statement of Forecast Service Performance in Part B.

Who we will be working with

The Department of Labour will collaborate with a range of government and business agencies to support workplaces to adapt to the changing labour market environment, and to encourage under-represented groups in the workforce to participate, including:

Measuring progress towards the goal

We will know how we are progressing towards our goal by monitoring indicators in the following three areas:

Associated research and evaluative activity

The following research and evaluation project will be undertaken over the next two to three years to inform our monitoring of progress and to assist us in continuously improving our policies and practices:

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