Annie Newman: Government contractors fill our ranks of the working poor

Workers are at the frontline of essential services such as guarding hospitals while earning little more than minimum wage. Photo / Bradley Ambrose

COMMENT

A security guard lies in Waikato Hospital with multiple severe injuries to the head, face and body after an assault on the job. The guard works for a DHB contractor, Allied Security, paid through the public purse to deliver a public service. This is the visible face of an invisible workforce.

Contracted security, cleaning and catering workers are part of the $51 billion annual public procurement spend by central and local government. All around the country, government agencies are signing off on contracts that see thousands of workers and their families living in poverty and suffering appalling working conditions that are neither healthy nor safe. Government workers fill the ranks of the working poor of New Zealand.

The Government committed to a Living Wage for directly employed public servants at the last election and agreed to begin moving contracted workers as well. The first is delivered, the second is not. Yet, contracted workers are mopping up offices, cleaning toilets and guarding staff on little more than the minimum wage. They are, in effect, public servants, doing a public service, just as they did when governments directly employed them before contracting out became the cost-cutting norm in the 1980s.

This procurement behemoth is covered by rules and consultation on new rules has just been completed. Public value is to guide the delivery of goods and services in the public sector and not just lowest cost. However, the standards otherwise set are low and policies mean little if there is no public scrutiny of the implementation.

The Procurement Rules (4th edition) require designated contracts are "compliant with minimum employment standards". This abysmally low standard includes the minimum wage, which is a poverty income that sits some 25 per cent below the Living Wage. It is not an acceptable standard for a government seeking to add public value through procurement.

Further, the rules don't provide for monitoring, where informed stakeholders, such as unions, can offer feedback about performance and impact of a contract. The commitment to be "fair to all suppliers" is a clear signal as to who matters in this story – and it is not the contracted workers.

Currently, government contracts are being tendered without consideration of decent wages and conditions for the workers. The MSD cleaning contract, which is being renewed, is a case in point because, regardless of the coalition commitment, there is no reference in the tender to the requirement to pay a Living Wage at all.

It is hard to take the Government's commitment to social transformation seriously when its own agencies are signing off deals to distribute billions of taxpayers' money for contracts that entrench poverty for workers and their families.

Annie Newman

Fifty-one billion dollars of procurement spend is in the hands of public servants behind closed doors and away from public scrutiny and accountability. Not only are the contracted workers invisible, the dealmakers are as well.

In public procurement, there is no political accountability, save some minimal requirements for "designated" contracts signed off by Cabinet. The public can't see how our money is being spent, which means we can't influence how it's spent. There is no engagement with the very civil society organisations that could shine a light on problems in the employment practices of many contracting companies, such as Allied Security at Waikato DHB.

Two hundred and thirty thousand children are living in poverty according to the most recent statistics, a figure little changed over recent decades. As the "Wellbeing Budget" looms, it is hard to take seriously the Government's commitment to social transformation when its own agencies are signing off deals to distribute billions of taxpayers' money for contracts that entrench poverty for workers and their families.

How many more assaults on security guards have to take place before the "real employer", the Government, accepts its responsibility for its own workers?

* Annie Newman is national director of campaigning for E tū