Gordon Campbell on the ch-ch-changes at IRD

New Zealand may pride itself on being relatively free of political corruption, but the corruption of our political language has built up a fine head of steam. On any number of issues we’re now supposedly engaged in a ‘conversation’ about policy options, even if that ‘conversation’ mostly involves the government saying what’s going to be what, while the rest of us get to shut up and listen.

In similar vein, job cuts aren’t happening at the IRD, exactly. Instead, there’s apparently a ‘transformation’ in store, and jobs won’t be axed ; no, they will be ‘transformed’ before our eyes into… non-jobs, if you happen to be among the unlucky legion of 1,900 who are being lined up for transformation, which seems to work rather like a secular version of the Rapture. Except that at IRD, not even your shoes will be left behind.

This week, the IRD situation has overshadowed Labour’s release of its alternative Budget. Basically, Labour is promising to scrap the government’s tax cuts and invest those billions in health and education, while still delivering (smaller) surpluses and further debt reduction, although at a slower rate.

Predictably, Finance Minister Steven Joyce has reached into his kitbag of political cliches and decried this effort as an irresponsible reversion to the ‘tax and spend’ policies of yore – while contrasting this with National’s allegedly ‘careful’ use of taxpayer money. Huh. In reality, this ‘careful’ stewardship will involve blowing the surplus couple of billions on tax cuts and related retail spending – mainly to the benefit of the wealthy – while continuing to starve this country’s desperately stretched systems of public health and education. Maybe Joyce could start a ‘conversation’ about this. Because in the past, the public has said it would prefer to see its taxes go into public services, rather than tax cuts.

Equating Labour with tax and spend, while equating National with wise and thrifty restraint is a refrain that we’re going to hear a lot over the next two months. Repetition is known to work pretty well. ‘Slogans should be persistently repeated until the very last individual has come to grasp the idea,’ according to the guy who wrote Mein Kampf.

Small government, smaller IRD

Cutting jobs on the scale being flagged at IRD doesn’t make much sense, given that tax law and IRD investigations are set to become increasingly complex over the timeframe envisaged. The impact of digital technology is the main reason being cited by IRD for its plans to shed a whopping one third of its staff – those 1,900 jobs – over the next four years, even though by that time the New Zealand population will be banging on the door of six million people. Sure, IRD can always do more with less, but this looks less like a well-planned campaign, and more like Custer’s Last Stand.

Despite the assurances from IRD that its ‘customer facing’ staff numbers will not be reduced, concerns have already been expressed that the IRD’s key analysts involved in (a) interpreting current tax policy (b) formulating new policy and (c) conducting investigations into tax fraud all appear to be in the firing line. Job losses, the need to re-apply for a shrinking list of positions, retraining and pay cuts all seem to be part of the IRD’s magical mystery ‘transformation’ programme. To state the bleedingly obvious: these deadly rounds of musical chairs are very bad for morale, and bad morale is very bad for productivity. Just sayin’.

Digital technology can indeed work wonders. Yet just as obviously, computers can’t replace the people who devise the tax policy, who evaluate and explain it to ordinary citizens and firms, and who ensure that these clients then behave in line with the law. That’s what seems so scary about this endeavour. The integrity of the tax system – which the main gateway through which those ordinary citizens and firms contribute to the funding of essential public services – is now on the line, given the scale and rate of change being contemplated. Crucial staff will be getting out their CVs and heading for exits. ‘Some very very experienced people are having to re-apply for jobs,’ Terry Baucher of Baucher Consulting has told RNZ.

“We’re looking at highly experienced people on the legal side of matters, where tax legislation is not a matter of processing, but of interpretation. And also [that’s happening] on the policy side, in determining how we write legislation, and how we should respond to changing events and investigations. That,” Baucher concluded, “doesn’t make a lot of sense.”

Right you are. Still, according to the Public Service Association, the briefings provided to the union so far indicate that cost cutting has not been the main motivation for the changes. Even so, as PSA national secretary Erin Polaczuk also told RNZ, there are signs that the wage rates for entry positions are likely to be reduced, along with the pay rates for some of the department’s experienced analysts. Obviously, this will undermine the ability of IRD to recruit and retain the expertise it needs to function effectively – especially on the crucial, precedent-setting occasions when IRD squares off in court against teams of lawyers who are working under nothing like the same cost constraints.

Social spending or tax cuts? Unless IRD can still manage to do its job properly, there may not be enough money in future for either.

Music for mules
Given how IRD staff are going to be driven over the next four years, it seems appropriate to link to some of the excellent music that celebrates humanity’s hard working friend, the mule. Mule train, hyaaaww!… as Frankie Laine once put it. From the country blues of circa 1930, here’s the great Robert Hicks aka Barbecue Bob, talking about how bad it can be when some other mule gets to kick in your stall, even harder than you can:

As mule-driven hits go though, the Fendermen remain right at the top of the heap. The Minneapolis duo of Phil Humphrey and Jim Sundquist had a one-off Top 5 smash hit with “Mule Skinner Blues” back in 1960. Amos Hielicher, the one time polka producer who recorded the track with them went on to work with the Trashmen of ‘Surfin’ Bird” infamy – so you could, if so inclined, trace the lineage of this tune from the Jimmie Rodgers original at one end, right on through rockabilly to the Trashmen and the Cramps (and beyond) at the other…That’s Humphrey BTW, on vocals. And yep, both guys played Fender guitars, a Telecaster and a Stratocaster.

Finally here’s They Might Be Giants – with all 47 seconds of their (Frankie Laine spoofing) mule train opus.