$15.8m sitting unspent while Health and Safety suffers

Despite severe staff shortages among health and safety inspectors, including those uncovered in the Pike River inquiry, the government failed to spend $15.8 million collected in levies for health and safety in the workplace, says CTU President Helen Kelly.

The government is now planning to spend $1.5 million annually on its new High Hazards Unit using some of these unspent funds.

"While we welcome additional focus on workplace Health and Safety in highly hazardous industries, the money was available to do this and more, from the day this government took office."

"This is disgraceful and irresponsible and shows the low priority the government has given to workplace Health and Safety until the Pike River tragedy forced it to take some action," says Kelly.

"This money, collected for the purpose of improving workplace Health and Safety, simply went into general government spending while disastrously inadequate health and safety enforcement continued. The Pike River inquiry has brought this situation to public attention, but it is affecting many workplaces where workers endangered by unsafe and unhealthy workplaces find it impossible to get the law enforced," said Helen Kelly.

"Employers should also be upset that this levy was not spent on the purpose it was collected for."

"The Minister of Labour, Kate Wilkinson, cannot say she was not aware of the situation. In the paper to Cabinet proposing the establishment of the new unit, she says 'I review the levy rate annually'. To do this responsibly she must surely look at how it has been spent in the past and how adequate it has been."

"In the same paper she acknowledges that funding had been inadequate to attract and retain the calibre of staff required. At the time the paper was presented, July or August this year, there was one vacancy among the two mines inspectors, and both Senior Advisors on High Hazards in the Petroleum and Geothermal sector were leaving. 'The Department's effectiveness and credibility as a regulator in these high hazard areas is limited and because of this carries a regulatory risk', she wrote."

ENDS

Further information:

The Health and Safety in Employment Levy (sometimes called the "OSH Levy") is collected from employers every year to fund Health and Safety in the workplace. The money is collected by ACC, paid by them to the Department of Labour, who then pay it into the Consolidated Fund.

The workplace Health and Safety activities of the Department of Labour (and smaller sums to the Civil Aviation Authority and Maritime New Zealand) are then funded by an appropriation from government like any other central government activity. That means it is subject to cut backs like all other government activity. Budget estimates show that the Department of Labour currently partly funds it by cuts in other parts of its services.

As a result of a 2007 Cabinet decision, since 2007/08 the Department of Labour has been recording how much was collected and how much was spent each year. The underspends, which have been about $1-2 million a year, ballooned in 2009/2010 due to the addition of several million dollars, apparently added to recognise underspends in years prior to 2007/08.

By the end of June 2011, the underspend had built up to $15,774,000 according to Department of Labour Annual Reports and the Cabinet paper.

The HSE Levy is collected by ACC along with its other Work Account levies, on contract to the Department of Labour. ACC has no role in deciding how the money is spent.

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