Review of the Workplace Health and Safety Strategy for New Zealand to 2015 (WHSS)
Rautaki mō te Haumaru me te Hauora o te Wāhi Mahi mō Aotearoa ki te 2015
Review Report - August 2009
2. Strategic context
Competitiveness and safety in the recession
New Zealand is in the midst of a recession, with businesses and workplaces cutting costs to drive efficiency and maintain a competitive edge and with consequent pressure on business leaders to invest less in health and safety.
Health and safety indicators, such as the incidence of workplace injuries, tend to reduce in recessions, as fewer people are in work. If investment in the sector is not maintained, the injury and fatality rates may increase as we move out of the recession. Experience from previous recessions is that health and safety dangers can surface during the recovery period when employment rises in response to improved economic conditions.[2]
New Zealand's workplace health and safety performance is not where it needs to be. Based on 2005 data, the New Zealand Institute of Economic Research estimates the work toll of fatalities, injury and illness costs us $16 billion a year - or around 10 per cent of gross domestic product (GDP). That takes into account a host of factors including lost quality of life and lost future earnings.[3] This cost is too high at any time, let alone in a global economic downturn. Consequently, reducing the New Zealand work toll is doubly important.
The clear link between competitiveness and safety was illustrated by the International Labour Organisation (ILO) when it plotted the International Institute for Management competitive rankings against its own occupational health and safety rankings (see Figure 1). The rankings show a strong link between high safety and high competitiveness.[4]
Figure 1: World rates in competitiveness and safety
This relationship is further validated at the firm level by United States research that demonstrates the positive link between safety leadership, safety performance and business excellence.[5] Whether viewed at the national or firm level, workplace health and safety is a fundamental influence on New Zealand's economic performance.
The government is responding to the current recessionary environment with moves to minimise government expenditure across the public service, with key priorities to keep people in work and to minimise compliance costs to business.
Recommendations from this review process must necessarily reflect these wider government priorities, while also communicating the importance of maintaining a baseline investment in health and safety as an essential component of future productivity.
Footnotes
[2] Research Report 386 Trends and context to rates of workplace injury, Warwick Institute for Employment Research, 2005, available at http://www.hse.gov.uk/research/rrhtm/rr386.htm.
[3] New Zealand Institute of Economic Research, Volume 1 Risk Landscape, Report to the Department of Labour, May 2008.
[4] International Labour Office, Safety in Numbers – Pointers for a global safety culture at work, Geneva, 2003.
[5] Krause, T.R., Leading with Safety, John Wiley & Sons Inc, 2005.
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