Thursday, September 08, 2005

Labour's Pay-Off To Unions

Much discussion has been taking place in the media about pamphlets put out by the obscure Exclusive Brethren Church, advocating that voters vote against the Labour Government. As peculiar as these folk are, there has been little attention paid to the influence of unions in this year’s election.

On Tuesday, I reported that twenty-two of Labour’s twenty-five non-MP candidates are on either the public or union payroll. In addition to the extreme representation of paid Union employees standing for Labour, unions affiliated with the CTU are spending massive amounts of money on this campaign.

David Farrar is currently reporting that the Post Primary Teacher’s Association is spending $353,000 on anti-National advertising, supporting the Left. The PSA, CTU, EPMU, the National Distribution Union, and the Service and Food Workers’ Union, and Finsec are all spending similarly large amounts of money attacking National, and supporting Labour.

Readers of this blog might well ask why they would bother. What is their motivation? What have they got to lose if National takes the Treasury benches? Why are they so hell-bent on keeping Labour in power, and why are they prepared to spend such exhorbitant amounts of money to keep them there?

The answer lies partly in ideology. Ideologically, they detest the concept of lower taxation, and a society where those who work the hardest, and those with the most initiative and creativity, receive the most financial benefit for their actions. A Labour Government is consistent with the Union’s support of the liberal socialist agenda.

But the rest of the answer is purely about money. If Labour loses this election, then the CTU alone stands to lose $3 million in taxpayer support over the next three years.

An analysis of the CTU’s financial report for the 2004 year makes interesting reading. In that year, the CTU received $730,000 from Government subsidies, compared to $1 million in affiliation fees.

In the 2004/2005 year, the Government’s subsidy to the CTU for “employment relations education”, more than doubled. From the Employment Relations Education Fund, administered by the Department of Labour, the CTU received more than half a million dollars in the 2004/2005 year. In addition, the CTU received substantial payments from such sources as the Equal Employment Opportunities Fund, the Ministry of Economic Development, the Ministry of Foreign Affairs and Trade, Industry Training Organisations, and the ACC. In total, taxpayer-funded payments to the CTU totaled more than $1 million this year. That's half of the CTU's annual income.

Most alarming is that the CTU is merely the tip of the iceberg with respect to government subsidies to unions. Over the next three years, Employment Relations Education expenditure, paid by the Department of Labour, will amount to a direct taxpayer subsidy to trade unions, of over $5 million. This is in addition to an estimated $3 million in direct subsidies to Unions from other taxpayer sources over the next three years.

So what does the Employment Relations Education subsidy pay for? Well, again, the courses that the subsidy pays for funds direct union activities: last year, FinSec ran such courses as “organizing people”; “Bargaining Skills Training”; “Be A Union Member”; “Lead People”, and the bafflingly vague “Workplace Dignity”. For those courses, Finsec was paid almost a hundred grand.

The EPMU received $145,000 last year for such courses as “Union Delegate Skills”, “Introduction to Workplace Organising”, various "Maori Workshops", and “Understanding the EPMU Approach to Collective Bargaining”. It doesn't take a genius to understand that educating its own members is a core union activity.

These payments are over and above payments that were made to the CTU for CTU activities.

Why is this relevant? Because, unlike corporate organisations, Unions are non-profit, incorporated societies. As such, they are not liable to pay tax on their activities. They do not have shareholders, or the kind of governance arrangements that apply to limited liability companies under the Companies Act. And this election, they are pouring outlandish sums of money into campaigns to keep National out of Government.

So that explains it. With around $8 million to lose—around half of their operating expenditure—in the next three years, it’s no wonder Unions are kicking up such a fuss.

UPDATE: Labour's Jordan Carter is apparently so keen to hide reference to the payback to unions that he has deleted a link to this post on his blog.


Lucyna said...

Oooh, a money trail!

Jordan said...

The ideological one is actually the useful point, IP. Unions are about collective organising and cooperation to improve the lives of their members. That runs against all the selfish individualism that National stands for. Their political purpose is to advance rights and conditions for working people; National's is to shaft working people in favour of the bosses.

The various funding streams you refer to above are cost neutral to the unions. They add staff etc to provide the courses they're paid to. If the funding went, they'd downsize again. Hardly the primary reason why they want a Labour government.

Like the rest of the left, they want a Labour government because it's better for New Zealanders.

Insolent Prick said...

That's a lie, Jordan.

The services provided by the unions through the various Government-sponsored income streams are core union activities, performed by core union officials.

If the Government did not sponsor unions to provide education and training on how to organise a union, then the Union would provide that service itself.

The funding of core union activities by the Government is a scandal and an outrage.

ZenTiger said...

Cost neutral Jordan? That explains why they can afford such huge funds on electioneering.

Sid X said...

you make the unions sound like mafias to me.

You said: National's is to shaft working people in favour of the bosses.

Aren't bosses working people too? New Zealand needs to encourage its people to be bosses and stop antagonising the title, otherwise we'll all be "working people" under unions.

Look around at how many companies are actually owned by New Zealanders in this country. There are less and less of them. Not surprising though, kids under labour learn that being "bosses" is evil.

darren said...

Such a fine piece of research by IP is worthy of a wider audience, along with his earlier works on the links between labour candidates, unions and the public sector.
Perhaps he should email his work to
The SST and everyone might also be interested in perusing Sir Humphreys where Antarctic Lemur is posting some interesting documents concerning the honesty or otherwise of the PM.

Insolent Prick said...

Feel free to post the links to the SST, Darren.

Cathy Odgers said...

Unions are about collective organising and cooperation to improve the lives of their members

>> News to me. I thought Unions were about providing training for future Labour M.P's and jobs for the "boys" and (recently) "the girls".

span said...

IP i'd be really interested if you could apply yourself to working out how much subsidy businesses have received from the Labour Government, or stand to receive in the next few years. I suspect it far outweighs what the CTU receives.

again you show that you don't have a lot of knowledge of unions. those who do know that union education has been one of the first things on the chopping block when funds are tight. union education is actually a relatively new part of union work in NZ, corresponding with the shift to an organising rather than servicing model of unionism. this shift started in the mid 90s, and the education part has only really started to grow since 1999, and only in some unions.

span said...

CO that's just absurd - there are max 120 MP jobs up for grabs every 3 years (in reality much less), and yet there are many many more unionists then a few hundred - and most of whom undertake their union activities for free.

Berend de Boer said...

On that ideology Rush Limbaugh made a good point today: New Orleans has been run by the Democrats for 60 years. It should have been a socialist paradise by now, wouldn't it?

Nope IP, I would dismiss the ideology part. It's all about power and money.

Insolent Prick said...

Bullshit, Spanner. Here's some more numbers for you.

In 2000, members' funds in the Public Service Association amounted to $14 million. This year, the PSA has a net worth of $18 million. In that time, the PSA has received substantial effective government subsidies for performing core union activities.

The PPTA ran a surplus of over $600k last year, as a result of government subsidies and strong Government incentives for members to join the PPTA. It is ridiculous to claim that the core services that the taxpayer was funding would not have otherwise been performed by the PPTA.

The PPTA is spending a vast amount of money this election, campaigning for Labour. They only generate those surpluses because the taxpayer supports them to fund other core Union activities. You can continue to try and defend that if you like, but it just makes you look silly.

Cathy Odgers said...
This comment has been removed by a blog administrator.
Cathy Odgers said...

Spanner - even lefties have to understand that not everyone can make it.

Unions train political activist. Now get over it because it is true.

You also (as per usual) missed the 2nd part of the equation I mentioned (this is becoming rather habit forming of you) - jobs for the "boys" and "girls". Those who can't be MP's end up somewhere on the public tit or even (shock horror) in non profit organisations.

Lucyna said...

Actually, business subsidies ought to be scrapped too. If a business can't survive without a handout, it ought to die a market death so that meaner and leaner companies get the business instead. None of this handouts to the likes of EDS, etc.

Insolent Prick said...

Spanner, I don't agree with subsidies to business, either. They tend to be made by pinko politicians who have never run successful businesses on their own, and it's the only direct involvement they've ever had in corporate management.

Subsidies to business are a joke, and there's no economic reason why a company that cannot make it on its own should be cushioned from failure by the Government.

Those that do get subsidies provide an ideal photo-opportunity, and means of propaganda, for the responsible minister. But it's bad economics, and worse public policy.

span said...

IP the fact that there is a difference of $4M income from 2000 to 2005 for the PSA is hardly proof that they are somehow receiving govt subsidies. i imagine their membership has gone up, maybe their fees have too, i have no idea. but you can't credibly argue that it's all come from govt just because Labour was in power at the time.

the PPTA is definitely spending a lot this election, compared to what they've probably spent in previous elections (i don't have that information), but you'll notice that it is actually not supporting one particular party. it is promoting its policies, which are democratically decided by it's members, and spending accordingly, as decided by the member leadership. they've spent much less than the Exclusive Bretheren, and I suspect they'll have spent much less than the EMA too.

sure this Govt has been nicer to unions that previous ones, but much more through the employment legislation it has promoted than anything else. if unions have grown it's because employment law is now fairer to workers and unionists who go into bat for their members are able to work on a much more even playing field than in the 1990s.

Cathy Odgers said...


Spanner has a question she would like you to answer.

span said...

CO - not really surprising that you are guilty of what you accuse me of.

my point, which i'll admit may have been a teensy bit subtle for you, was that most unionists don't get paid for their union work because their actual jobs are in supermarkets, factories, shops, schools, community services, hospitals, call centres, etc.

They are actually committed to the paid work that they do, and not seeking jobs for the boys and girls, but to improve the place they are working in now, and hope to work in in the future.

span said...

in terms of business subsidies, i find it interesting that you don't support them. i look forward to your exposure of all those businesses who received subsidies under National who are now donating money to that party to get it back in power.

Insolent Prick said...

Spanner, I know many teachers who are PPTA members, for no other reason than that the Government pays PPTA members more than non-members. This is a direct, government-driven incentive to encourage teachers to join the union and boost union revenues. That is a disgrace. When those union revenues are applied to fund a political party's campaign, then there's only one word for it.

The PPTA have not said that they are supporting Labour, but they have spent their entire time attacking the National Party, and praising the Labour Party. A senior PPTA official is on the Labour Party list. You do the math.

The PPTA has spent hundreds of thousands of dollars on this campaign. Far more than the EB. It is doing so in direct cooperation with the Labour Party. Any claim to the contrary is a lie.

Finally, with respect to corporate donations to the National Party, for the last two years, the only major corporate donations of note, made to the National Party, were made by Westpac Bank, and Contact Energy.

Westpac paid National $20,000. Contact Energy paid National $15,000.

Ooooh, but look at this! Westpac paid Labour $20,000, and Contact paid Labour $39,000!

Cathy Odgers said...
This comment has been removed by a blog administrator.
Insolent Prick said...

Spanner, I didn't answer your question because it was stupid and banal. For the same reason that if a five year old starts asking me ridiculous questions, repetitively, then I tell his parents to take the annoying brat away.

I don't know where you get the idea that I am supportive of subsidies to business. The purpose of business is to create wealth, not suck wealth out from other sources. Corporate welfare is just as pernicious as state welfare. Invariably, it is money wasted.

It is completely wasteful to spend large amounts of taxpayer's money to establish a bureaucracy to establish a grants' scheme to give back to business what they otherwise would have kept in tax. Makes a lot of sense to just cut the tax they pay.

Cathy Odgers said...

1. Arguing Labour does not receive substantial big business and high net worth individuals donations is a very very weak argument. Ask your leftie mates who Owen Glenn is...may be a good start. Then they may tell you to stop it before you put your other foot in it.

2. With regards unionists working for "free", the point is if you have any experience in politics is that in politics this work is never "for free", it is merely considered the first rung on their ladder to Labour party dependency, a bit of "volunteer" work to impress the Labour organisers.

Next stop more of the low level same and once firmly trusted and in the system, tidy little jobs for the boys and girls.

That is the career path of a true unionist.

Everyone else is just in it for the free piss or to make it harder for their employer to sack them.

Have you tried sacking a union rep??

Insolent Prick said...

What are your thoughts, Flash?

Anonymous said...

Workers organise to achieve objectives in common through unions.

This at the workplace, this in services to members, this in politcal action.

Unless you have problems with business group organisations and their political activism in support of business interest - this is a non issue.

It's simply not news.

Insolent Prick said...

Wrong, anonymous.

It is news when the unions are spending hundreds of thousands of dollars to campaign against a political party, spreading propaganda over and above what the Labour Party is currently doing.

The Unions' work during this campaign has got nothing to do with protecting workers' rights. The real motive is maintaining its taxpayer-subsidised activity.

Anonymous said...

Do you really think that if the National Party offered the same "subsidised activity" they would take a different position?

That would be the cheaper than other bribes offered by National. So why not?

Or is it, that National does not accept your arguement either. Because they realise that it is in workers interests to defend themselves against a restoration of the ECA and the hiring workers on easy fire terms - which of course national propose to do. Unions are also aware that Labour's increases in minimum wage and focus on employment growth results in higher wages for union members.

Insolent Prick said...

I suspect, Anonymous, that the unions know that one of the first items of unnecessary and wasteful government expenditure, which should be chopped, is the employment relations education fund.

It was set up as a kick-back to unions, so that they would have the financial means to continue funding Labour Party campaigns.

Dave said...

The fact is that when Labour loses the election the unions will lose a hell of a lot of money. They`ll also lose members as they will not be as good a barganing agent - not that they are much good now - Members will not be able to get extra money in their pay packet for joining a union - why do you think I'm a member of a union? I got an increase, thats why. Also a lot of the work done by unions in my workplace will be gone by lunchtime under National - National has made that public already - and wqhats the bet that unions will put their fees up again if Natinal gets in. And union reps and delegates will not be able to get so much time off work to campaign for Labour at the next election .

Psycho Milt said...

Heh heh - Cathy and IP seem to know as much about unions as I do about running a business. Does ignorance on both sides count as a level playing field?

Here's a tip for you, IP - PPTA members get paid more than non-members because union members generally don't see any need to negotiate pay increases for non-members. Of course, a generous govt could decide out of the goodness of its heart to voluntarily give non-members the same increases - but that would be a pinko liberal socialist kind of thing to do, wouldn't it?

Anonymous said...

Oh, the shock, the surprise, a LABOUR Party with links to unions!
No doubt next you'll discover that the National Party has links to farmers....
Let's face it, all parties have constituencies that they have to keep happy. Always have, always will.
I know what pretty much what constituencies Labour has too keep happy; and can make an educated guess as to National's. I can also pretty much decide whether I can live with the results. I'll cast my vote accordingly.

Flash said...

Hey IP,

My experience of the PTA was in a short-lived job in a certain government department where walk shorts are still commonly worn.

You could tell who the PTA members were: they were the ones who started work at 8 and finished at 3:30, took frequent smoking breaks, and were constantly away at stop-work meetings or some bullshit. Worse, they were able to make recruitment drives at staff meetings.

They're bribing themselves with our money, IP.

Anonymous said...

As an employer who had to make 8 staff redundant this year (very sadly), all of whom were union members, i can only offer my disgust in the union. THEY DID NOTHING. i went to the union 3 times asking them to come, meet with the staff, and offer some help. they never turned up! when my staff rang them, they didnt return their call! the only thing we got was a demand for increased dues! in the end i found my guys jobs, paid them redundancy and even paid this years xmas bonus in April. the union wouldnt even return my call when i asked them to help in finding new jobs for my staff. EVERY ONE of my staff swear they will NEVER be part of a union again and my remaining staff have all resigned and they refuse to have any contact with the union. the union is a collection of bloodsucking leaches who couldnt give a shit about people just interested in their idealogy.

Bentley Strange said...

PsychoM, incorrect. It is illegal to offer non-union members more than union members thanks to changes this government introduced. A good non-PPTA teacher could bargain all they like, but can't get paid more. Level playing field it is not.

Oliver said...

And in other news, Don Brash made a deal with the the Devil (The exclusive bretheren, that is, heh heh they can't see this as they aren't supposed to be on the net)

Anonymous said...

Any Government who pays money to any organisation that supports it and or promotes its ideas is indulging in corruption.This is contrary to a basic principle of good governance.Governments should collect taxes to benefit all the people.Giving to ones favoured few is and I repeat again slooowly for the benefit of those who dont understand good governace CORRUPTION And thos who support corruption are themslves corrupt
Here endith the lesson

Anonymous said...

The purpose of a trade union is to secure above-market wages and conditions for union members through a monopoly (or near-monopoly) on the supply of labour in a particular industry or sector.

While trade union membership is no longer mandatory, employees who want to be part of a collective contract are obliged to join the union. This is de-facto compulsory unionism.

The left has argued that massive trade union support for the Labour Party is ok because the unions have been four square behind Labour since the party was formed in 1916. Bollocks.

The difference betwen the trade union movement and the Exclusive Brethren is that the Brethren are private citizens spending their own money on a political cause in which they believe. In a free society, citizens are at liberty to engage in this kind of political campaigning.

Union leaders, on the other hand, are a group of Labour-voting commies spending money effectively raised under compulsion from members, many of whom do not support the Labour Party, but other parties. The immorality of what amounts to pro-forma political invoicing is something that even a hardcore unionist should be able to get his head around.

Of course, the political and lifestyle left has no morals as we would understand them. That which is moral is that which serves "the cause" and that which is "immoral" is that which retards it.

US political commentator, Joe Sobran calls the informal body of opinion comprising liberals, socialists, outright Communists, and various other strains of 'progressive' opinion "the Hive."

Consider his comments in the light of Labour in general and specifically how this election campaign is proceeding.

"In a beehive, the worker bees have many specialties. The hive is organized around the queen bee, but she doesn’t have to give the workers their instructions. The bee that finds pollen returns to the hive and flies in figure eights; this tells the others the direction and distance of the pollen, and they go get it. And of course the bees need no orders to attack an enemy.

"Members of the progressive Hive likewise act on their own instincts and have their own code of communication. They feel free, but they are also predictable. Liberals laugh at conspiracy theories that assume that because there is a pattern there must be some central control; but the fact that there is no central control doesn’t mean that there is no pattern.

"My Hive metaphor was enriched by an essay by Igor Shafarevich, 'Socialism in Our Past and Future,' in Solzhenitsyn’s collection of dissident writings, Shafarevich argues that socialism is not just a modern phenomenon, but a perennial problem of decadent societies. In the name of equality, it tries to destroy the family, private property, and religion - institutions that prevent the state from monopolising loyalty, wealth, and authority. Since ancient times, socialists (under whatever labels) have favored sexual license - 'the community of wives,' 'free love,' 'sexual freedom,' et cetera. By breaking down bonds of kinship, sexual anarchy reduces the individual to a mere unit of the state.

"I saw immediately what Shafarevich meant. His words applied not only to doctrinaire socialists and overt Communists, but to all those liberals whose efforts constantly (though implicitly) tend toward a socialist order. Liberalism, I saw, was the retail version of the society of which Communism was the wholesale version. Liberals don’t speak (or think, as a rule) of outright revolution; they move one step at a time, always edging toward the socialist model of an egalitarian centralised state, always nibbling at the family (in the name of sexual freedom), property rights (in the name of social justice), and religion (in the name of the separation of church and state). Like bees, they swarm against enemies of (or perceived threats to) their Hive.

"The Hive no longer believes in socialism, though it keeps moving spasmodically toward it out of old habits. The victory of market capitalism is too clear, and planned economies have proved embarrassing. The Bees have to settle for keeping the welfare state - also semi-disreputable - and making hay on abortion, sodomy, environmentalism, smoking, whatever promises to allow some incremental government growth."

According to Sobran: "the Hive was not, and is not, a conspiracy; it’s more a pattern. Naive anti-Communists, seeing the pattern, have mistaken it for a conspiracy. The Bees, on the other hand, have made their own mistake. Knowing that they aren’t parties to a conspiracy, they fail to see the evident pattern of their collective behavior. By sheer, insectlike instinct, they obey not the dictates of a foreign power, but the internal logic of their own nature, their yearning for a secular and socialist political order."

Continuing, he says, "The Hive bears traces of its [Communist] ancestry. It still believes reflexively in the state, vilifies its opponents, and, above all, keeps its gains. It practices not only a 'politics of personal destruction,' but a politics of general destruction, in which all social relations are determined by force. It believes in power and nothing else.

"[T]he strongest resemblance between the old Left and the Hive lies in their shared hatred of human individuality. To become a Bee in this Hive is to surrender, voluntarily and eagerly, your own personality; to submerge the self in a collectivity; to prefer the buzzing cliché of the group to individualised thought and expression; to take satisfaction in belonging, and conforming, to a powerful mass, while punishing others for failure to conform.

"The similarity to an insect colony - where the individual exists only functionally, being both indistinguishable from and interchangeable with its fellows - is not superficial. It’s of the essence. To be an insect is to be relieved of the burden of having a soul of your own."


darren said...

Not sure whether attacking the messenger is the way to win over the media, but Murray mccully has this to say--

"So how come, we hear you ask, the nation’s media have been so fixated by two brochures which are legal (they don’t tell people who to vote for) from the Exclusive Brethren, yet so uninterested in the torrent of illegal material emanating from the trade unions?

Well, the answer is simple. Amongst the most aggressively anti-National of the nation’s unions is the Engineering, Printing and Manufacturing Union (who, incidentally, have received a cool half million dollars of taxpayers’ cash under the Sisterhood). The EPMU is, of course, formally affiliated to the Labour Party (and gave $80 000 in 1999 and $70 000 in campaign donations). The boss of the EPMU declared "war" on the National Party at last year’s union conference. And he clearly meant it, having lavishly employed union funds in that pursuit ever since.

How very very inappropriate it is therefore that the Labour Party affiliated, vehemently anti-National EPMU is the union to which the nation’s journalists belong. And in state radio, they have even elevated the EPMU delegate (the hopelessly left wing and biased Brent Edwards) to the position of head of the Election Unit. What clearer message could they possibly send?"

unaha-closp said...

Unions are such a good idea that I do not understand why there are not heaps more of them. Competing conservative unions would seem a simple remedy for Labours dominance of the forum.

Anonymous said...

unaha-closp, sure company unions operating for the National party, would make the party less dependent on business owners. But National has farmer run branches and business run branches who would have to learn some new rhetoric first, before they could co-exist with workers in any political solidarity.

Public campaigns by unions, or business groups, have never been illegal darren.

It has also never been the purpose of unions to get above market wages, but to maxmise wages to the maximum the market can stand. This means a share of the profits to workers, as well as capital. Whereas capital likes to offer management a share in return for maximising profit at workers expense.

As to the Hive nonsense and other post 1917 replays of the Protocols - Jews/political enemies, as enemies of humanity/righteousness - yeah right. It's just the ideology of judgmental condemnation moved from religion to politics.

The alliance against the nation state and its citizenship naturally includes those for the empire of global market and those who would run it's poor laws system (see Marx on the opiate of the masses) - the church that anoints empires and blesses susbsidarity (break up of the state down to religious group identity and faith based service providers). See Vatican One where the church declares it's hostility to nationalism and modernism and rationalism.

The Tsar and his lackies ran a similar system for control of the people of Russia. The 1917 division against the Church, the Church's division against the masses. Reprise the Church and it's alliance with capitalism against the secular society citizen worker.

The USA where the Church and capital allied and one got power over the poor and the other got real wealth. Regrets, there are now Christians who regret this, but what will change now?

Why would anyone want anything but a secular society with freedom and equal citizenship for all? Why would would anyone want anything but opportunity for the individual with economic security for all?

Insolent Prick said...

Andrew Little: Why are you posting to my blog? Surely you haven't run out of money at the EPMU?

Anonymous said...

The National Party calls PPTA a union. PPTA is actually a professional body.

National Party publicly ridicules them. PPTA does not like them. Seems like a perfect 2-sided relationship to me.

National does not understand teachers, schools, kids - they simply don't understand Education. With reshuffle, Nats taking opportunity to get Bill English out of Education. They need to jettison Pansy Wong and Allan Peachey as well from the shadow team, and bring in some top thinkers.

Rumours about Katherine Rich hold promise.