Matariki public holiday could cost firms $448m

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The rising of Matariki, the star cluster known as Pleiades, usually happens near the end of June...
The rising of Matariki, the star cluster known as Pleiades, usually happens near the end of June or beginning of July, marking the start of the Maori New Year. Photo: ODT files
Making Matariki a public holiday could cost New Zealand businesses up to $448 million - double previous forecasts, officials say.


It is the first time the Government has revealed the possible cost of adding a 12th public holiday to the calendar despite receiving the advice last term.

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Michael Wood. Photo: supplied
Michael Wood. Photo: supplied
Earlier this month, Prime Minister Jacinda Ardern announced the date would be Friday June 24 in 2022.

The rising of Matariki, the star cluster known as Pleiades, usually happens near the end of June or beginning of July, marking the start of the Maori New Year.

Last year, the Ministry of Business, Innovation and Employment calculated the effect on 534,930 businesses giving their staff an extra day off to be between $377 million and $448 million - or between 0.35% and 0.42% of 2019’s wage bill of $107 billion.

That figure is double the $200 million the Employers and Manufacturers Association (EMA) forecast when Labour made its Matariki election promise in September.

The estimates were included in a response from Workplace Relations and Safety Minister Michael Wood to a parliamentary written question from Act NZ.

Mr Wood said the MBIE advice had not been published before now because the Government was preparing a full cost-to-benefit analysis for when legislation was tabled in the next few months.

That analysis would reflect the present climate and also factor in possible benefits such as increased retail and tourism spending, productivity gains arising from an extra rest day and the cultural impact of recognising the indigenous culture of te ao Maori.

The legislation will go through a full select committee process before being implemented ahead of the first day off on June 24 next year.

Mr Wood ruled out swapping another public holiday and said he would not be seeking advice on doing so.

‘‘In reality, if we followed through on Act’s world view, we probably wouldn’t have any public holidays. Work is important but there’s more to life than just work and we actually need a decent number of public holidays to enable people to have a good sense of wellbeing.’’

Act leader David Seymour said the $440 million estimate showed Labour was being reckless with ‘‘the country’s ability to pay its way’’.

Instead, he wanted the Government to swap Matariki for a different public holiday.

‘‘We might have slightly fewer holidays than the average, but we rank behind most OECD countries for productivity. Another holiday won’t improve that.

‘‘Anyway, at the rate this Government is piling fresh costs on to business, New Zealand won’t deserve to be in the OECD.’’

Economist Brad Olsen said the Government should have requested advice on substituting Matariki for another public holiday given the other added costs of increased sick leave and minimum wage hikes.

‘‘There should have at least been an option on the table.’’

He expected most businesses would be able to shoulder the extra public holiday but as the cumulative effect of the regulatory changes ate into profit margins, New Zealanders could start to see the costs passed on to them.

There was international evidence giving workers an extra day of rest bolstered productivity, especially during the middle the year which was starved of holidays, Mr Olsen said. 

Comments

Doom and gloom David prattling on again.
If history has taught us one thing it is that business leaders will moan and whinge about increased compliance costs, predict the arrival of the four horsemen of the apocalypse and the end of civilization as we know it.
And what happens? Nothing! Businesses adapt, they survive, they continue to thrive. And the world is a slightly better place for most of us with another holiday to enjoy doing the things we enjoy, who knows, we might even go shopping in one of the doom and gloomer's shop and spend some our I'll gotten wages.

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