Dialogue: Wonderful news: gaps are closing themselves

RICHARD PREBBLE* says that fostering the myth that there are growing gaps between Maori and Pakeha is just propaganda that poisons race relations.

It is one of the unwritten rules of international investment: never invest in a nation with bad race relations. We have the examples of the Balkans and Northern Ireland or, closer to home, East Timor and Fiji, to tell us that this is an issue of first importance.

My message is not to claim that New Zealand is another Fiji in the making, but to say that New Zealand is not. We need people in leadership positions to say that race relations in New Zealand are good. They could be better, but they are not bad.

In the 1950s we were guilty of being too optimistic; now we are being too pessimistic. This pessimism comes from our nation's leaders.

Take the speech of Finance Minister Michael Cullen in the Budget: "Unfortunately New Zealand has had faster growth in inequality than any other country in the developed world. That is shameful. In our country that inequality has had a unique and unfortunate dimension. There has been a growing disparity between the life chances of Maori and other New Zealanders."

All New Zealanders of goodwill would be horrified by such statistics and deeply concerned for the future of our country. The pessimism over race relations has contributed to a mood of depression deeper than any I have experienced in my adult life.

Now the good news. It is just not true. The gaps are not widening. The gaps are closing. The Government's own research reveals a very optimistic picture.

A Government research paper by the Labour Department's senior research analyst, Simon Chapple, published this month, says: "The post-1970s Maori population is in absolute terms larger, per capita materially wealthier and has a higher life expectancy than at any time in New Zealand's history.

"A frequent articulated belief is that over the past decade the relative social and economic position of Maori has worsened. As shall be shown, this belief is a misconception. Take three indicators of socio-economic outcomes that most of us would consider to be key: employment rates, median incomes and education levels. By all these indicators, gaps closed over the 1990s.

"Using household labour force data on differences in employment rates as the best single measure of Maori labour market disparity shows that today employment rate disparity peaked in the early 1990s at over 14 per cent and thereafter has fallen. It rests at 6 per cent.

"Given ongoing declines in the employment rate disparity between 1996 and 1999, further reductions in median income disparity when data becomes available from the 2001 census seem likely.

"Finally, consider the educational qualifications of the Maori population relative to non-Maori. Data from the household labour force survey show that there has been a slow, progressive decline in the differences between the population shares of Maori and non-Maori without qualifications between 1985 and 1998.

"More sophisticated measures of the education gap between the two populations show a very similar pattern of slow convergence."

This is wonderful news. Mr Chapple's research shows that while there are poor Maori, there are also poor whites. He also points out there are Maori who "already have jobs, skills, high incomes and good prospects."

The 6 per cent gap is not an absolute gap, it's an average gap. There are, in fact, more than 40 per cent of Maori who are on incomes above the New Zealand average income. The National Business Review rich list shows that there are Maori multi-millionaires.

The Chapple research shows that where you live, your age, gender, education and skills explain how well you are doing - not race. So people living in Northland, both Maori and non-Maori, are poorer than people living in Wellington, both Maori and non-Maori.

Students, regardless of race, are poor. The well-educated have higher incomes. Indeed, well-educated Maori have slightly, but not statistically higher, incomes than non-Maori.

Mr Chapple points out that in New Zealand you are Maori if you identify yourself as such. Between the 1991 and 1996 census, more than 100,000 people who in 1991 identified themselves as non-Maori decided in 1996 that they were Maori.

People respond to incentives. It also shows that there is no socio-economic stigma in being Maori, which must show that race relations in New Zealand must be better than our leaders believe.

The whole factual, intellectual and moral basis of the Government's cornerstone policy, Closing the Gaps, has turned out to be false.

A courageous Government will face the facts and do a u-turn. It will not be easy. Over the past few years a wealthy and powerful grievance industry has developed. It will oppose being declared redundant.

By fostering the myth that there is a growing gap, we are creating a stereotype that Maori are doomed to failure. The propaganda is poisoning race relations. It is affecting our self-belief as a nation that believes strongly in being fair.

Let's celebrate the fact that the gaps are closing. That's a reason to be proud, to be proud to live in a nation where how well you can achieve does not depend on the colour of your skin, but your effort.

I would not have it any other way.

* Richard Prebble is the leader of Act New Zealand.