Economic prosperity must also provide social justice

By Steve Maharey, MP for Palmerston North

Some of the change of the past 15 years was necessary. Some of it was good. But it has not allowed us to adapt and prosper.

New Zealanders do not feel secure in the new world that is taking shape. In fact, as we pick our way through the past few months of the 20th century the dominant feeling is one of apprehension.

New Zealanders know their country had to change and they have endured pain hoping for real gains. Unfortunately, too often the policy options chosen did not deliver.

It is time to look at a new option in the form of an "investors" strategy for a New Zealand which combines the ethics of community with the dynamics of a market economy.

At the heart of this strategy is a belief that the extension of economic opportunity is not only the basis of prosperity, but also of social justice. The competitive requirements for constant innovation and high quality demand opportunities for every individual, not just the elite few, to contribute to New Zealand's economic renewal.

This, in turn, requires strong social institutions, strong families and strong communities that enable people and businesses to grow, adapt and succeed.

Investors offer a genuine "third way," a high road into the next century. How might we build this road? Here is my economic and social framework. We need:

* Intelligent regulation which shapes the market to meet the social and economic needs.

* Constant innovation to drive a niche-oriented, skills-based, high-technology knowledge economy.

* Full employment.

* Local and regional economies based on industry clusters.

* A cycle of sustainable growth driven by investment in skills, research, technology, childcare and community development.

* An end to poverty through the provision of adequate incomes and a welfare system designed to create opportunities;

* Quality public services in lifelong education, health care, childcare and eldercare.

* To build strong families by supporting parents and good parenting.

* Government services tailored to the needs of individuals, families, communities and businesses.

* A confident national identity which reflects all cultures.

The investors strategy requires new skills from government to ensure it can work in partnership with the private and voluntary sectors, share responsibility and be accountable to a more demanding public.

Emphasis needs to fall on policies that enhance the ability of communities to act for themselves. By community I mean the networks, norms and trust that facilitate coordination and cooperation; networks of neighbours and extended families, community groups and religious organisations, local businesses and local public services, youth clubs and parent-teacher associations, playgroups and police on the street. Community is where and how we live.

The sociologist Robert Putnam put it well when he said: "Communities do not become strong because they are rich; they become rich because they are strong."

Successful schools depend on involved parents as well as good teachers. Job training is most effective if it is coupled with the broadening of social networks though community organisations. Entrepreneurs are more likely to succeed if they know local people who can help them to find funds, advice, supplies and customers.

One of the main reasons for the repeated failure of social and economic policy initiatives is that they have not understood the importance of community. A programme such as Strengthening Families is doomed to limited success. The Government should have focused on building among local people the capacity and institutions that enable them to take more responsibility for the families in their midst.

Relying on tarriff reductions to bring about economic prosperity is equally limited. What is a town such as Thames or a city such as Porirua supposed to do when the demands of the market close down the automotive industry? A sensible government might be expected to help local people to rebuild regions hit by unemployment.

Seeing communities as the focal point of policy demands changes from the state and the market. Governments need to follow the policies of an enabling state strategies that allow communities to develop the capacity upon which effective service delivery can then be based.

Businesses need to understand that they do best in an environment in which there are flourishing banks and financial institutions, community organisations, training organisations, technology transfer centres, schools, adult education centres, universities and cultural and sports facilities. Social responsibility makes good business sense.

Both government and business need to see themselves as in partnership with the community. Community-based organisations, so often seen as the dumping ground for social and economic problems, need to be understood as the "third sector" which is vital to a successful society.

Extending the role of local government and of local democracy must be seen as the way of giving New Zealanders a chance to be directly involved in the decisions that have an impact on their lives.

These, then, are policies of a "third way" for New Zealand. They represent a new compact between economic progress and social justice that will lead to a future in which all New Zealanders have a stake.

* Steve Maharey, MP for Palmerston North, is Labour's spokesman on social welfare and employment.