Economic and environmental history of
Aotearoa - New Zealand|
From: firstname.lastname@example.org (John Gile)
Subject: Fed reveals current position !!
Subject: N.Z. MAI -Ready & Willing
From: Janice Moira Graham <JanisGraham@xtra.co.nz>
Date: Sun, 11 Jan 1998 19:40:53 -0800
MAI - ready and willing
By Janice Moira Graham,
11 January 1998
The transnationals- multinationals are not particularly interested
in manufacturing or production sectors (risky investments for
shareholders) but are rather more interested in essential national and
subnational services and infrastructure - publicly owned health,
education, energy resources, public transport systems along with other
universally available public services.
The privatisation regime has been underway in NZ since the mid
nineteen-eighties, carefully monitored by the World Bank and
International Monetary Fund, facilitated by the a succession of trade
agreements via APEC, GATT and now the MAI; and implemented by a
succession of right wing governments- advised & guided by the
ideologically driven neo-liberal New Zealand Business Roundtable.
The economic benefits of private companies taking over public services
are supposed to be that they are more efficient managers and that they
are technically more advanced and that they bring capital investment.
However the main efficiencies are not technical, but are in financial
administration- through intensified invoicing. The other efficiencies
are in labour cuts borne by workers.- i.e. 7000 job losses in our
privatised telecommunications company, alone Most investment finance
is borrowed privately at higher rates of interest than that which can be
borrowed by the public sector so local people end up paying more anyway
through increased prices or taxes. Share giveaways are a common feature
of privatisation in the U.K but not in NZ. The London Financial Times
(1995) called these share floats ""a systematic defrauding of the
rate/tax payer" as only the wealthy can afford to buy up the shares.
Within 6 months the number of share holders in water and electricity
companies had decreased by over 50%.
A winding down of funding and/or privatisation, within our public
health services, public education services, energy utilities-electricity,
gas, coal, both wholesale and retail sectors, national roads, national
transport systems (railways, shipping, airways, -ports, and airports),
postal services, national works & maintenance services, traffic
control, police force, prison systems, welfare system,
telecommunications systems, state owned T.V, radio and newspapers has
been underway for some time.
As more services are sold the government has had less revenue to
continue funding other services so more services go on the auction block
and so on. (We have not experienced any real corresponding reductions
in taxation, in fact taxes and rates are higher than ever - this does
not include corporations whose taxes have steadily reduced.)
Privatisations of sub-national government services such as:
-water-wastewater systems, public transport, public maintenance services,
crematoriums & cemeteries, parks, local roading, recreational centres
and grounds, libraries, waste management services and sports grounds are
being slowly implemented, primarily from a directive to local governments
by central government via an amendment to the Local Government Act to
assess and implement "user pays" on services. The local bodies must put
forward their user pays propositions to government by July 1998.
Many local bodies have already started implementing 'user pays' regimes
by the establishment of L.A.T.E.s The initial establishment of these
fully commercialised ' local authority trading enterprises' on services
such as roading , waste management and water-wastewater is being
implemented progressively as, pre-privatisation programmes (we call it
back-door privatisation) before being finally onsold to multinational-transnational
According to overseas research - we will experience a plethora of new
pipe, concrete and steel technology within services such as roading and
water. i.e. new reservoirs built on farming land and valleys - rather
than any implementation of conservation measures, pipe repairs, smaller
cisterns installed, or compulsory water metering - followed by large
increases on water and waste water charges. Pollution, induced droughts,
water disconnections and a rise in certain gastro-enteric diseases
following water privatisation was experienced in the U.K. along with
massive increases of directors salaries. As the same transnationals are
lining up to purchase our water, I expect we will experience similar
A proliferation of new roading is anticipated with corresponding user
charges.. 'User pays' on roading has been widely discussed here. Our
erstwhile Minister of Transport now our Prime Minister told the nation
recently that it is intended that our road usage be calculated by
inserting microchips in our cars which will be monitored by satellite, -road
user charges will be automatically debited from our bank accounts.
All aspects of our education system have been subjected to change by
the privatisation gurus; kindergartens have had funding reduced by the
government and Universities now have very high fees. High schools are
being subjected to pressure to take on bulk funding - a pre
privatisation gambit. Skills based training is become institutionalised
and I believe we are en-route to farewelling subjects such as history &
Welfare is being gradually turned over to organisations such as Salvation
Army, the Catholic Church and Barnados, in accordance to directives from
the neo-liberals, before funding is finally withdrawn. Our welfare system
once the best in the world is a national disgrace. The first victims of
new right philosophy -the withdrawal of funding- were single mothers and
their children. They had their incomes slashed by 20% in 1991 and have
experienced a continued assault on their living standards with creeping
'user pays' on essential services. Other victims of changes to the
welfare system have been the aged, the sick, the disabled, the
unemployed and state house tenants. The latter are now paying market
driven rents which are higher than the private sector - there has been
a mass exodus from tax payer funded housing. The government simply sells
off the 'choice' empty properties to local property developers whilst
building ghettos for sardines. We now have a homeless population
described as the 'caravan, shack and garage dwellers.'
Unemployment is reaching epidemic proportions whilst people are having
benefit cuts in order to encourage them to find work. It's true.
Policing has become increasingly private, with security firms now
providing surveillance and night watch to many wealthy urban areas and
to companies. Traffic management is now the domain of the increasingly
burdened police force with speed and security cameras replacing men on
the job. Our overcrowded prisons are being guarded by fewer wardens whose
surveillance is becoming superseded by electronic technology. The injoke
now, is, if you want to find work, go to prison. It's true!
Various inroads have already been made on our labour laws such as the
Employment Contracts Act (1989) which effectively eliminated unions in
one swipe. Workers must now sign 'individual contracts' - you don't sign
the contract you don't get the job. Strikes have been outlawed. New
Zealand workers have been rapidly losing most of the rights they had
gained over 60 years of 'social democracy'.
The latest attacks are on the 'Holidays Act. We will soon be able to
'choose' whether you want to work or have statutory holidays off.
Critics wonder how long it will be before the employees individualised
contract will stipulate whether you work or take statutory holidays -
don't sign, don't work.
Reservations to the MAI were supposed to have included the remainder of
our State Owned Services such as TV1, National Radio, gas and
electricity, ports, airports but we have since found our Coalition
Government has just "reserved their position" on these assets but not
reserved the assets themselves. They claim they are not going to sell
these assets but have reserved the right not to constrain any future
government from selling them. How ironic that no future government will
be able to extricate us from the MAI regime for 20 years without
incurring huge renationalisation costs and litigation, but we must
protect any future governments right to sell our few remaining services
to foreign investors. .
The government also stated in the Coalition Accord that not more than
24.9 % of certain local body assets could be sold without ratepayer
permission. We are experiencing local bodies now selling 50%+ of the
asset without public consultation because the service/asset (LATE) has
been entered on the Companies Register and as such the information is now
considered commercially sensitive so the ratepaying 'owners' do not have
to be consulted.
The impact of the MAI widens the scope of transnationals investment ambit
considerably on our public services. There simply won't be any
competition, for the remainder of services and assets, for who can
afford to compete? The power of the mega-corporations is enormous, their
investment interests widely diverse; they establish mergers and cartels
to eliminate competition and they can defend their monopolies with a
variety of measures.
Even if local investors could afford to compete they are at a distinct
disadvantage under MAI for the avenues for compensation under the MAI
are open only to the transnationals and multinationals. Domestic
companies may not be compensated., but foreign companies can be, and at
a higher amount. Smart domestic companies will do joint ventures with
foreign investors to take advantage of the benefits. This contributes to
the problem of monopolies.
Investment is exceptionally broadly defined under the MAI. with the MAI
everything falls within its ambit unless it is specifically excluded.
(see Barry Appleton.) Our government has hardly excluded a thing. The
same corporations who are queuing for our water also have interests in
private health provision, education, public transport, waste management,
telecommunications, roading, agribusiness and agricultural land, media,
energy, catering- you name it & they have investments.
The expropriation rules mean that any investor whom the government may
attempt to regulate re -environmental infringement can sue for 'loss of
enjoyment' for there doesn't have to be 'a taking' under expropriation,
just a 'deprivation.'
Our environmental laws will be subjected to repeated charges of
expropriation should central or local government try to enforce the
Resource Management Act - our domestic environmental law. (The Tener
case is prime example where the British Columbia Government 'argued'
that "expropriation" (where the Crown had to pay) was different from
"injurious affectation", where it did not. The Crown lost the case.)
Foreign investors can gain access to our assets (already set up for
privatisation ) without facing any duties which do not apply to local
firms- requirements to create jobs, employ local people, or locate to
regions which require development i.e. water not supplied by water
systems, bus services to areas devoid of public transport, postal
services not covered by direct mail, electricity, gas and TV where
there is no supply, policing to rural areas, or roading to homes where
there are no roads.
There was a recent signing of another O.E.C.D. agreement recently in
which government officials were prohibited from taking bribes, because
corruption of both local and central government officials, (I have
been given to understand) is part and parcel of the transnational
There have been repeated corruption charges brought against the same
transnational-multinational corporations for irregularities in tender
processes/asset purchases, globally.
One of the most recent investigations (to my knowledge) were brought
against a mega TNC-MN in Adelaide, Australia over a 1.3 billion water
franchise. I believe this same corporation is now facing an environmental
pollution charge in Adelaide for causing a toxic stink which lay over the
city for some three months in 1997 and for which it consistently denied
I have tried to cover my main concerns - "New Zealand - a country set up
for sale to transnationals" and a bit on the charter of rights & freedoms
of the MAI, and a few thoughts on how that may impact on the systems,
p.s. Keep a eye out for any new developments to your
Local Government Acts. (New Zealand)
Bob Olsen Toronto email@example.com (:-)
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