Cabinet ignored pay advice

The Government went against the advice of key departments when it decided to lower the minimum income levels required for Pacific Island immigrants, papers released under the Official Information Act show.

The papers, obtained by Act MP Muriel Newman, show that the Department of Labour, Housing New Zealand Corporation and the Treasury did not support lowering the minimum income level for Pacific Island and Samoan quota applicants with dependent children.

But last July, the Cabinet decided to lower the minimum income level of $31,566.08 a year ($15 an hour) to $25,585 ($12.30 an hour).

Dr Newman said it was an irresponsible decision that would leave Pacific Island immigrants struggling to cope and ending up trapped in a cycle of dependence.

Before the Cabinet made its decision, it had asked for a report from the Department of Labour on how to better fill the Pacific Island and Samoan quotas.

Samoa is offered more places because of its special relationship with New Zealand, but to the Government's embarrassment, fewer than half the 1100 annual places were taken in 2003 and 2004.

The Department of Labour reported that the prime problem was the difficulty in securing job offers that met the income requirements.

It said views among Government departments differed on whether the income level should be reduced and it was acknowledged that the-then current level did not reflect realistic salary prospects for entry-level jobs in some industries.

Roading NZ, for instance, paid $12 to $14 an hour, rising to $15 over time.

But the department also said an income level reduction could have an effect on housing, education and health costs and the level of state support for low-earning families.

It could also increase financial pressure on Samoan families already living in New Zealand, and raise overcrowding issues.

The new figure was based on the unemployment benefit plus maximum accommodation allowance.

It broadly aligned with the average income of Pacific people working in New Zealand.

But Samoans already here on higher incomes are reportedly struggling.

The national president of the Corrections Officers Association, Beven Hanlon, said many Samoans employed as prison officers on the starting rate of about $33,000 were finding it hard to manage in Auckland.

"I know of 16 people living in a four-bedroom house because they can't afford a place. They are waiting for a state house ... and we've had to save a couple from loan sharks already."

Immigration Minister Paul Swain said the Government lowered the income requirement because the previous level was too high.

"This was ruling out many applicants and was one of the main reasons why the quota had not been met."

Mr Swain said that thanks to the new income level and other changes, the quota was now "tracking very well".

The story so far

* Northland fruitgrower Kerifresh is bringing in Samoans to work in its orchards, saying it cannot get enough local workers.

* Some local people say the company is just using the immigrant workers as cheap labour.

* Official papers show the Government was warned last year not to lower the minimum income level for Pacific Island immigrants.

* The papers warned that the lower income level could make it harder for immigrants to settle into society in the long term.