Immigration minister Michael Wood says system has been running on an ‘exploitist charter’

Immigration minister Michael Wood says rebalancing immigration away from relying on a low-cost labour model remains the government’s top priority for the portfolio.

Wood told Parliament’s education and workforce committee on Tuesday he hoped the new accredited employer work visa would turn the page on what had been “a bit of an exploitist charter”.

The new visa went fully operational on Monday, allowing accredited employers to hire as many migrant workers as they wanted if they pay the median wage and first advertise the job for New Zealanders.

The median wage is $27.76 per hour ($57,740.80 a year before tax for a 40-hour work week) and sits almost 31% higher than the minimum wage of $21.20 ($44,096 a year).

Wood said the government was looking for a reasonable and sustainable way to raise the bar on working conditions and was working with some sectors on a transition towards the median wage threshold.

However, he said the threshold was an important part of stepping away from a system that had been overly reliant on a very significant supply of relatively low-wage labour that he didn’t think was good for either the economy or workers.

Wood downplayed his recent criticism of the hospitality sector, saying he wasn’t intending to be critical of any one sector but was making a general comment that he thought should be relatively uncontroversial.

That is, if pay was low and working conditions insecure then employers needed to consider those factors if they wanted to attract more people.

He acknowledged there was a lot of good practice and improvements being made in hospitality, but he also received “consistent advocacy” from workers and unions that poor pay and conditions can be a barrier to attracting people.

He wanted to work with the sector to lift those conditions and the government was doing its part by allowing hospitality a lower wage threshold until April 2023 and by making working holidaymakers a priority.

Also on Tuesday, ANZ Bank chief executive Antonia Watson called on the government to loosen immigration settings, saying it would take years to train locals to meet the current demand for workers.