Heavy weight of big-city living

By ANGELA MCCARTHY

Does our biggest city need a salary weighting or allowance to help retain and recruit in the public sector?

Such a living allowance has existed in London for more than 80 years, introduced to retain and recruit employees in a city with inflated living costs.

Trouble is, despite exorbitant Auckland house prices, promoters of an Auckland allowance find high living costs hard to prove.

The Consumer Price Index, for example, doesn't show any significant difference in costs of living between Auckland and other cities, unlike London where a basket of goods is priced 13 per cent higher than elsewhere in the UK.

A look at the cost of housing shows marked regional differences. In November last year, the median property price in Auckland was $280,000. That figure far outstripped Northland ($157,750), Waikato and Bay of Plenty ($169,000), Taranaki ($115,000), Wellington $222,000. The lowest was Southland ($84,375).

According to Tenancy Services, the average weekly rent for a three-bedroom rented house in New Zealand was $237 in the last six months of last year.

But in the fashionable Auckland suburb of Ponsonby, the average rental for such a home was $578. Even in suburbs perceived as cheaper, such as Avondale, weekly rent was $328.

Traditionally, New Zealand has had more problems staffing remote areas - although some schools in Auckland do get staffing incentives because of their socio-economic status.

But are times changing? Certainly Lara Devereux, associate and team leader of recruitment specialists Sheffield, says many in senior management expect a salary increase when moving to Auckland.

"Cost of living is the driver. We find it is almost impossible for someone with a family to find a good rental in Auckland now."

The reverse is also true, with people taking a drop in salary when moving somewhere like Christchurch, says Devereux.

Of the three public sector groups approached by the Herald, only Auckland nurses were paid more than their regional counterparts.

New Zealand Nursing Organisation organiser Shan Dixon says this is the result of health reform enterprise bargaining in the 90s, not a deliberate NZNO policy. In fact, says NZNO spokeswoman and former Alliance MP Laila Harre, the union is developing a national pay strategy to raise all nurses' incomes. This would eventually be standard across the country but not at the expense of significant pay increases in Auckland. "I guess once we have a national pay rate, if we still have a retention problem in one place, like Auckland, we would then look at how to deal with that," she says.

It is something the Auckland boys in blue want now. In November the Auckland districts were down 141 police officers, according to Police Association figures. They're calling for a special $2500 retention payment for staff in the Counties/Manukau district, Auckland City, North Shore and Waitakere who remain working in Auckland for a full 12 months.

This allowance should be reviewed on an annual basis until staffing levels are under control, says New Zealand Police Association advocate Greg Fleming. He says financial issues, such as cost of housing and travel, figure strongly alongside work pressures in exit interviews for South Auckland police.

National vice-president Richard Middleton, an experienced police officer who lives and works in Auckland, tells of a colleague who left Auckland and reckons he is now $10,000 better off because of a lower mortgage, lower insurances and hardly any travel costs.

Middleton believes it inevitable that public servants will eventually get an allowance for working and living in Auckland, particularly if the public service wants to retain good people.

Some Auckland secondary teachers have flirted with the idea of an Auckland allowance, but they are yet to win over the hearts of colleagues elsewhere.

Just last year a remit was put to the Post Primary Teachers Association national conference by Auckland Eastern board executive member John Hasler, suggesting research be done into whether such a living allowance should exist.

Hasler decided to call the proposed allowance a "high cost of living zone allowance" in acknowledgement that some other areas could be expensive to live in as well. The remit didn't get far, he says, and blames a "here go the Aucklanders again" attitude.

The national office says an Auckland-only allowance can't be justified because recruitment and retention are national issues.

PPTA president Phil Smith says CPI figures supplied by the Council of Trade Unions show no evidence that Auckland is sufficiently similar to London.

There are urban areas outside Auckland with similar cost structures as well as local differences within Auckland itself, making some areas of Auckland cheaper than other parts of the country.

The primary school union, the New Zealand Educational Institute, says its basic philosophy is that everyone should get the same treatment because they're doing the same job, says spokesperson Nick Hurst.

However, there is a perception among some members that the cost of housing is much higher in Auckland which leads to some resistance to move there.

LONDON'S BURNING

The London Weighting (LW) was introduced in London by the Civil Service in the 1920s to prevent recruitment and retention becoming a problem.

Today the city is considered the fifth most expensive in the world - and the weightings completely out of touch with the realities of surviving in London.

A recent review of the weighting system by the Greater London Authority called for the public sector weighting to be calculated by comparison with the private sector.

There were also calls for public sector weighting to become uniform - trade unions want a uniform NZ$12,000 a year. A teacher's weighting is half that of a police officer in London.

A growing shortage of teachers in London saw London teachers striking last year, demanding their allowances go up by a third. They note the biggest shortages are in areas where the pressure for housing is greatest. Other unions are looking at following suit.