Veterans Bolger and Birch . . . an unlikely reform duo

In Bill Birch: Minister of Everything, Brad Tattersfield examines the life and times of the influential politician.

From about 1992 to 1996, Bill Birch was at his peak politically, becoming known as the Minister of Everything. Prime minister Jim Bolger leaned on Birch’s talent for doggedly fixing problems and getting things done.

During its tumultuous first term, the Bolger Government sought to redefine the boundaries of the welfare state in order to save it. National’s radicalism in this period was a huge departure from its history.

Veterans Bolger and Birch, instinctively cautious and pragmatic, were an unlikely reform duo, but they acted because of the parlous state of the country’s finances.

Initially, Birch focused on his own portfolios while the conviction-driven finance minister Ruth Richardson held sway. But Birch gradually assumed a broader role as the public and caucus lost confidence in her approach.

Along with his earlier oversight of the Think Big industrial projects, Birch is perhaps best known for steering National’s labour market deregulation. The 1991

Employment Contracts Act fundamentally changed New Zealand’s industrial relations, removing the entrenched union monopoly on worker representation.

Birch’s involvement in this major reform came about almost by accident. He had no background in industrial relations, being handed the job in Opposition by then-leader Jim McLay when he dumped Birch as finance spokesman. Nor was Birch the reform visionary – the conceptual thinkers were officials and business leaders in Treasury and the Business Roundtable.

Birch wanted less radical labour market change than National’s right wing, led by Richardson, were arguing for. But after losing that battle in Cabinet soon after the 1990 election, Birch drove the reform through over passionate union-led protests. He resisted Richardson-led pressure for more extreme measures like abolishing the Labour Court and the Mediation Service.

Birch’s industrial reform was announced in the Government’s December 1990 economic package, which included harsh welfare cuts.