Successful mediation hope

New Zealand is facing a winter of industrial action after nurses this week rejected the latest pay offer from district health boards.

Nurses and public servants appear on a collision course with the Government on wage rates, seemingly determined to hinder, not help, the first-term coalition's already rocky administration.

On the face of it, the nurses have been offered generous terms. Under the offer, all members will get a base level pay rise of 9% (three 3% rises) by August next year. DHB-registered nurses and midwives with more than five years' experience to get an additional 6% pay rise by December next year. Senior members to get a 10% pay increase (two 3% and one 4% rise) by August next year. All part-time and casual members to get an additional lump sum payment of $2000 by next month. The on-call allowance will increase from $4.04 to $8 an hour, $6 to $10 on public holidays by June this year and DHBs to receive a $38 million investment, which will allow an extra 500 graduate nurses to be employed, effectively immediately.

According to the DHBs, the total wage package was doubled from the $250 million previously offered to $500 million. And now there is no more money on the table.

Throughout New Zealand, wage levels have remained low as inflation has hovered near zero for several quarters - only recently rising above 1%. Wage inflation has been near zero as employers have kept their hands in their pockets.

The nurses' settlement, if accepted, will set off a chain of events which will be impossible to stop. Nurses are an important part of the country's social wellbeing. But so too are teachers, the police and baristas - only baristas are not paid through taxes.

Nurses say they have had 10 years of underfunding. They also have had three years of seeking settlement, which did not resolve issues of safe staffing and underfunding.

A point to note is thousands of New Zealanders have been left languishing on waiting lists as DHBs ran out of money through either poor management or wrong priorities.

Health is a black hole of expenditure and Health Minister David Clark is only now finding out how expensive his portfolio can be. It is no use looking back and blaming the previous government. For all of its faults, it increased health funding in every one of its nine Budgets, although not as much as everyone wanted.

DHBs say although there is no more money on the table, there is some movement in other areas and mediation is expected to happen immediately. Dr Clark says the offer is the most generous in a decade.

Also, more than 4000 public service workers are preparing to take industrial action. Two stoppages are planned at the Ministry of Business, Innovation and Enterprise, and at Inland Revenue, next month.

The PSA, the union representing public service union workers, says the Government has made it clear it wants the public service to take a new approach, having a focus on collective bargaining. According to the union, MBIE and IRD do not believe the new rules apply to them.

Also this week, the Government agreed to pay the living wage of at least $20.55 an hour by September 1 for all people employed in the core public service.

The key message to remember is the taxpayer will be responsible for any increase agreed to between the public service and its employees. A private employer cannot possibly agree to anything like what nurses have been offered, as they have to rely on increased sales and productivity. As most know, New Zealand is not a country with high productivity.

There is great hope the mediation will find a solution and strike action at hospitals will be averted. Nurses will give priority to patient safety. But for those patients having their operations postponed, possibly after being on a waiting list for months, their disappointment will be palpable.