More evidence of the class divide in NZ

by Daphna Whitmore

A substantial report on class privilege in New Zealand has just been published in the Herald. It’s a compelling piece of journalism by Kirsty Johnston with solid evidence of entrenched class divisions in universities, particularly in enrolment in elite courses. The class divide is not narrowing, as Johnston shows with data from six universities.  In law, medicine and engineering 60 percent of students come from the richest third of homes, and only 6 percent from the poorest third. Just one percent came from the poorest schools.

Johnston quotes Auckland University sociology professor Alan France: “We talk about increasing Māori and Pacific participation at university, but actually the underlying issue is socio-economics. It’s money. It’s class. It’s privilege.” Johnston’s report shows university remains the preserve of the wealthy.  This is despite primary and secondary school education being ostensibly free, and university being highly subsidised with fees covering only a quarter of the actual costs.

Free university education has been a focus of student based protests since the introduction of university fees in the early 1990s. The bulk of university funding comes from  surplus value created by the working class. This is  a value over and above the combined value of the workers’ labour-power and the value of the machinery and raw materials used by the workers in the production process.  So the working class is essentially paying for the tertiary education of the middle and upper layers of society. We discuss the alternatives to middle-class students asking for more for themselves here and also on the commodification of education here.

Twenty-first century NZ capitalism is a low-wage economy  with a very well paid managerial class.This is a theme we have covered frequently in Redline showing that the key factor in the growth of inequality is low pay. 

Not only has the income and wealth gap kept growing, but social mobility has lessened, a University of Otago study by accountancy and finance researcher Helen Roberts in 2017 found chief executives’ pay rose almost five times faster than workers’ income. Half of chief executives earned over $500,000 as the cash component of their annual pay package in 2013 – when the data was collected – compared to just 10 per cent of CEOs in 1997.

Johnston notes New Zealand is now the eighth most unequal society in the OECD – worse than the United Kingdom.Global inequality is growing too. An article by Michael Roberts we published on Redline in 2016 showed research that 3.5 billion individuals – 73% of all adults in the world – have wealth below $10,000. 

The persistence of inequality despite a lot of talk of ‘equity’ suggests that it is a structural feature of capitalism, it is not something that can be fixed without dismantling the system. This is not currently on the agenda and in the absence of big struggles there will be very little reform either. The Labour-NZ First government has already shown it is unwilling to get rid of laws that shackle workers, such as the restrictions on the right to strike. So far it has hesitated to even reverse the anti-worker measures under National.


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