The government's idea of a four day working week for struggling business appeals for its short-term economic gain. But more vitally it has the potential to re-invent what it means to be a New Zealander

It's an idea I've tossed at friends for years, a notion that has seemed to me to play into the best of who we are as a country and protect a fading part of our culture that we all hold dear. So imagine my surprise when I turned on the news last night and saw the government was actually considering what would amount to a radical policy initiative.

At last, I thought. Perhaps the government is finally responding strategically to this mammoth global recession and daring to think beyond its ideology of tax cuts for the rich and cuts to government departments. I'm talking about the One News report last night that the government is considering an optional four day working week to help businesses which want to avoid laying off staff. While only the briefest outline was sketched by Guyon Espiner, it seems the concept is that businesses would pay full-time workers for four days work, with the government paying at least part of the fifth day's pay. In return, the worker would take on some training or further education or do volunteer work.

It's genius, I've always thought, because it works on so many levels. First and foremost it ingrains in our work culture values that are at the heart of what it means to be a New Zealander. When we gain some success or good fortune in life, we pride ourselves on "giving something back". Sportspeople frequently talk about giving back to the game that gave them fame and fortune. Neighbours helped neighbours to concrete driveways and then those who were helped would pop some home baking round to the back door. We paid our taxes to foster a welfare state, confident that those less fortunate than us would also get the same quality healthcare and education that we could afford.

Heck, Sir Edmund Hillary became our most beloved citizen because he spent his life "giving something back" to the Sherpa people who were so instrumental in helping him reach the summit of Mt Everest. As the ad says, it's in our DNA.

At least, it was. The reality is that our walk no longer matches our talk. A volunteer ethos was common in the middle of the 20th century and earlier, but that has changing. The fading of the war spirit, families' need for a second income, the desire for most women to work, weekend shopping, a wider range of entertainment options, the growing number of baches taking people away at the weekends, the longer time spent commuting, greater mobility meaning people don't stay in one place as long and so don't get as close to their neighbours... There are many, many reasons, but the fact is people can't afford the time and money to volunteer in the way our parents and grandparents did.

I don't mean to romanticise the past; it wasn't all great then and there's still plenty of good being done now. But it's indisputable that community spirit is not what it was. You'll have read the stories in the past decade about the impact that's having on rugby clubs, non-profits, Scouts and Girl Guides, churches, unions, political parties and many other social groups.

If you doubt that this is more than just disappointing, and that it's actually harming us as individuals and a society, read Robert Putnam's brilliant and influential Bowling Alone. Drawing on over 500,000 interviews, he shows that our community breakdown is making us less happy, less healthy and less safe. Putnam called it a loss of social capital. How curious if a loss of financial capital prompted us to invest in its social brethren.

If workers were able to spend a day a week in some voluntary work, imagine the potential outcomes – better organised social groups, greater community ties, and rejuvenated neighbourhoods. That could lead to less crime, better democracy, and better health (you may be dubious, but people who belong to groups live longer. Isolation is seldom good for us).

If workers instead chose to take on some further education, we would benefit from an up-skilled workforce and another nudge towards a "learning for life" culture that has been promoted for so many years. With greater skills, workers could make a case for better pay, helping lift the low wages still paid in this country. Managers and owners get a more refreshed and productive workforce; and there is the crux of the issue, for this government at least.

It has repeatedly said that growth and productivity are its raison d'etre. Here's a chance to prove it. Paying for workers to study or volunteer would boost productivity in several ways. For a start, many would try to get done in four days what they now do in five. There are potential problems in that point, including the potential for abuse by employers, but it's partly human nature. Second, a better educated or more refreshed and connected workforce will produce more. Third, this sort of innovative workplace reform has the potential to become part of a the New Zealand brand and a badge of honour, much like our "clean, green" record. It would attract migrants and help reverse the brain drain.

Crime, health, productivity, jobs, community building... this "give something back" policy works on so many levels. [Note to press secs: feel free to use that phrase]. What it was always lacking was a compelling short-term economic and political reason. This recession has now provided one.

These dire economic times require some bold thinking; even the Herald's Fran O'Sullivan has been despairing at this government's timidity and unwavering commitment to tax cuts. In her weekend column she pointed to Singapore's creative and wide-ranging stimulus package.

Singapore is spending S$5.1 billion helping its companies avoid layoffs by cutting corporate tax (down 1 per cent to 17 per cent), subsidising 12 per cent of the first S$2500 of each employee's monthly wages - a S$300 Government boost per worker per month which will go straight to companies. It is boosting training programmes, putting up cash handouts for low-income workers by 50 per cent and increasing public sector hiring.

Very different from our government's response, which we've been debating vigorously here at Pundit. We might not have the Singaporeans cash reserves of borrowing capacity, but as Sir Ernest Rutherford said, "we haven't the money, so we've got to think". This policy is good thinking.

Yes, it would have a fiscal cost. And starting small, "giving something back" would only go a small way towards the social tune-up I've written about. But it lays the foundation for a genuine culture shift, it's a game-changer in difficult times, and for John Key would be at the heart of a legacy that would see him long in the history books.

Comments (3)

by Claire Browning on February 20, 2009
Claire Browning

Tim, your post is a tour de force, and the idea - yours and the government's - inspirational.  You've both made my day.

I've been musing for a while on the need for a culture change as one - perhaps the only -  method of extricating this country from the current mess and increasing the sum of happiness.  I call it "old-fashioned values".  There might be a better way to express it.  Steve Maharey and Eleanor have written on Pundit about a couple of examples - preferring cash over credit, and winding back on consumption of "stuff".  This idea really resonates.

Economically-challenged as I am, I do understand that the consumption one, particularly, is easy to defend as a greenie, blasphemy in recession.  All I can say is: I guess I'm an old-fashioned kind of girl, and I really do think there are other more constructive ways to keep things ticking over than buying crap synthetic stuff.  Like the subject of this post.  (The other thing I would say is: I'm also an inveterate spender, on the important things, like food - another approach that works on so many levels.)

As from 1 May, I will be reducing my currently fulltime hours to 30 per week - with a proportionate salary cut.  The current arrangements, I decided a while ago, are a disservice to everybody. 

I plan to spend it in the garden, and refocusing my career.  This is not wholly as selfish as it sounds.  One might (and I do) dress it up as a service to the planet, and the community too.  I'm living in a small poor rural town, restoring a settler's cottage and converting the garden to "food forest".  Heads are starting to turn.  I have lost count of the number of people who have somehow found out my name, comment on the changes, and say they like to watch.  Then there are the other people, who don't say anything, but just stop by with a load of free firewood, a punnet of wild blackberries, or the offer of a bit of manpower in exchange for eggs and surplus veg.  We should measure wealth these ways.  We should, like Bhutan, have a Ministry of Happiness.

by GregS on February 20, 2009

Three comments:

  1. I think the fiscal cost is far bigger than you hope.  If "real" work is cut 20%, the govt receives proportionally less in (income) tax, however requires 20% more to cover payment for the "voluntary" day. The best hope would be for companies to employ 25% more people (5 doing the work of 4) to maintain the tax intake, however the books are still behind in paying for "giving something back".  More likely is that it will be found that 4 days was all people were ever working :-)
  2. Paid voluntary work is meaningless. The community spirit that you mention arises not chiefly from the work that is done, but from the fact that it is over-and-above what is required or asked for.
  3. You mention potential abuse by employers.  There is equal potential for employees to abuse this system, simply by not doing anything of value with their extra day.

It seems far better to lift income (both by increasing productivity and growth, and by reducing taxes) such that people have enough from 4 (or even 5) days of work (not the 6 or 7 needed at the moment), and can choose for themselves to volunteer.

by Tim Watkin on February 23, 2009
Tim Watkin

Greg, I fear you may be right to worry about the direct cost, but not the tax take. The unions have said that this scheme is only a go-er if pay levels don't change. So even if the govt. is chipping in for part of the 5th day, a worker on $50k is still on $50k and still paying the same tax. And I don't agree with your second point. This is only for companies and workforces who buy in. And even if there is some compulsion or pay, I don't buy that can't turn into community spirit. People struggling to run community groups won't care where the help comes from, and as for the volunteers, paid volunteering could easily lead to unpaid efforts. Once you get a taste for the groups, once you get the feel-good factor and build the relationships, it will grow. Most university students in the US do some voluntary work, either because it's expected or looks good on their CVs. Yet that can grow into a life-long commitment. It can have a pebble at the top of a mountain-type impact.

Point 3, yep, you'd have to be wary of that in designing the scheme. But your 4th unnumbered point I don't buy either. Even if people get enough to live on in four days' work, what's 'enough'. No, you won't create a culture of volunteerism unless you create a mass movement and embed it in the structure of daily life. This is the kind of thing that only governments can do.


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