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Choosing the right track

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“We interviewed luminaries like Bruce
Beetham and the late Trevor DeCleene
for audiences of roughly 50 people each
night, roughly 48 of whom would have
preferred to hear the latest
Joy Division track.”

 

If you are an aspiring politician, a good biography is useful to have. For a member of a centre right party, Steven Joyce’s biography could hardly be better. He is a self made man. His parents, both of whom left school at 15, were seven-day-week grocery store owners. Joyce is a multimillionaire. Now he is a Minister of the Crown – whose most recently acquired portfolio is Tertiary Education – and a set of trusted hands in a relatively new government.
And it all began at a student radio station. He talks to Paul Mulrooney.

What is it about not-quite-veterinarians? Why do so many do so well? Think cartoonist and all-round renaissance man Tom Scott, former Commissioner of Police Rob Robinson, or actor Peter Hayden. Had their grades been slightly better, or their resolution slightly stronger (Scott chose to switch degrees) they might all have led blamelessly virtuous lives ministering to creatures great and small well away from the public gaze.
Or think Steven Joyce, the horse-owning Taranaki boy, who wanted to be a vet, failed to make the cut, and went on to become a self-made multimillionaire and the Minister of Tertiary Education.

Joyce came to Massey in 1980, did the pre-veterinary year, and missed selection by a whisker. This was no dishonour – veterinary studies was and is famously selective – but Joyce then had to decide on plan B; after dallying briefly with chemistry, he opted for zoology, heeding the advice of the careers counsellor who told him that, so long as he stuck with a major, what it was didn’t much matter. Getting a degree was about learning how to learn. Arguably it worked. Joyce may not have much contact with animal life – except if you count the two cattle he keeps on his lifestyle block and the retrodoodle (a golden retriever -poodle cross) he enlists when rounding them up – but he has turned out to be a remarkably quick study.

In the past 15 months he has had to come to grips with being both a new MP and a Minister of the Crown. He has had to learn the unaccustomed protocols of government and officialdom. Then there are his portfolios and their issues. Road transport: a plane crash in France, the parlous state of the railway system, clogged highways, questions around road rules and driving ages. Telecommunications: the need for national high speed broadband, the failings of Telecom’s XT network, cellphone termination charges. And now Tertiary Education.

All of this he is taken in his stride. So capable is Joyce proving, he is already seen as being something of a successor to Bill Birch, the politician who for a time became known as minister of everything.

But the discipline of university study is in a way the least part of Massey’s contribution to Joyce’s career. It was Masskeradio, the first commercial student radio in New Zealand, that woke Joyce to the passion that would consume him for the next 20 years.

Joyce debuted there as a presenter in 1983, the final year of his degree. As Joyce remembers it, this meant a cursory introduction to the equipment, and then being pointed at the music collection – all of it vinyl in these pre-CD days, and none of it familiar.

“[The departing deejay] said ‘just choose what you like,’ I thought ‘I have no idea, there is nothing here I know.’ I figured that generally most artists put their best songs pretty early on in the album so I thought side one track one and thought I’d work my way front and back, side one track one, and that worked pretty well for a while, till someone helpfully rang up and said that song I was playing probably sounded better on 45 [rpm] given it was an EP not an album.”

Joyce was undeterred. In fact, by dint of hanging around, as he puts it, in 1984 (the year the station went FM) he became the programme manager and, the following year, the station manager.

Joyce took to his new responsibilities with zest. 1984 was the year of the snap election that brought in the first Lange government. As Joyce told Parliament in his maiden speech, “With seriously inferior equipment, a fearless group of us worked 24 hours at a time to bring together the hugely important radio Massey election specials on political issues of the day. We interviewed luminaries like Bruce Beetham and the late Trevor DeCleene, for audiences of roughly 50 people each night, roughly 48 of whom would have preferred to hear the latest Joy Division track.”

As Joyce has said, such experiences could have led him to journalism as a career. But his interests lay elsewhere.

Somewhere amidst those late night sessions he and four other students (one of them comedian Jeremy Corbett) banded together and decided to set up a commercial radio station. Each put in $100, and so, with $500 capital, Energy Enterprises was born.

For the next three summers, Energy Enterprises ran a makeshift radio station, lined with egg cartons as sound insulation, in New Plymouth, putting aside the sum they would need to draw on to apply for a full-time FM licence application. They found shareholders and appointed a board of directors, went through an arduous licence hearing with the broadcasting tribunal, and then waited 15 long months for a decision to be released.
“During that time we lost three of our number – I think they got bored – and gained one more.”

Against all expectation, the bid was successful. “It was this sort of dream we wanted to achieve... It was really cool.”

In mid 1987 Energy FM had a licence to broadcast in Taranaki, and in November of that year it began broadcasting. So it was that Joyce’s ascent in business began.

It helped that in 1989, partly in response to lobbying by the radio industry, the government had, with the passing of the Radiocommunications Act and the Broadcasting Act, deregulated the radio spectrum. In the years 1990 to 1993 the Ministry of Commerce put 234 frequencies up for sale.

As Energy Enterprises prospered, it bought stations in Tauranga and Hamilton, started the Edge and Solid Gold FM and built them and the Rock into national satellite-delivered networks. It bought up lucrative radio spectrum at buyers' prices. “Our best deal was, I think, when we bought three FM frequencies in Rotorua, which at that stage doubled the commercial market [there]. We bought them for $45,000, 15 grand each – it was fantastic!” says Joyce, still exultant.

In 1997 Energy Enterprises and Radio Pacific merged, and at the close of 1998, with further acquisitions, Radio Pacific-Energy Enterprises had 80 stations around New Zealand. In 1999 they merged with Radio Otago and the combined enterprise, now called RadioWorks, continued expanding into provincial markets.
By 2000 RadioWorks had an office in every major town and city and 650 staff across four networks and 18 local radio stations.

It was, says Joyce, an amazing ride – “hard work all of the time and fantastic fun most of the time” – right up until the day it ended.

In May 2000 the CanWest Global group bought out 72 per cent of the NZSX-listed RadioWorks, and, in January 2001, they acquired the remaining 28 per cent. Joyce, who hadn’t wanted to sell up, retired as chief executive on his 38th birthday. His holdings had brought him a windfall of $8 million.

After pouring all he had into RadioWorks and living for the early years as frugally as any university student, he was wealthy, unfit, and without obligation. He joined a gym and, not having run since he was 21, ran two half marathons.

And he joined the National Party – the best philosophical fit with his own values – put his name forward as a candidate, and almost stood in the 2002 general election. Not that his chances would have been good: Helen Clark’s Labour Government was re-elected; and National, with 21 per cent of the vote, had its worst-ever performance.

How had this calamity occurred and what should be done about it? The Party turned to Joyce, who in his RadioWorks ride, with all its mergers, acquisitions and restructurings, learned “about growing and running companies, about organisational cultures and getting the best out of people”.

Taking up an appointment as the National Party’s general manager in April 2003, Joyce chaired the campaign review and then conducted a full strategic review of the organisation. Pre-review, National’s regional offices had largely held sway over both the central office and electorates, one result being worrying national inconsistencies in branding and message. Post-review, power emanated from the centre.

In the 2005 election, for which Joyce was the campaign manager, the party under Don Brash’s leadership increased its share of votes by 18 per cent.

But the vagaries of coalition-building under MMP meant that National ended up once more in the Opposition, and its campaign is remembered more for the issues surrounding the Brethren Church’s funding of an advertising campaign in support of the National Party and the anonymity of party donations than it is for the turnaround in National’s electoral fortunes. In the wake of Nicky Hager’s leaked or hacked e-mail-driven exposé of National’s campaign, The Hollow Men – in which Joyce features – Brash soon resigned.

After the election, Joyce was quick to rebound. He became the director and then chief executive of Jason’s Travel Media and the chairman of hospital bed manufacturer Howard Wright, and there were sea changes in his personal life: he married, moved with his wife Suzanne to a lifestyle block north of Auckland, and the Joyce family soon added baby Amelia and Gemma the retrodoodle to their number.

When the next election came around in 2008, both he and National were ready. This time the stars were in alignment: National won the largest number of seats of any party, formed a successful coalition, and Joyce became, as he has put it, “one of the lesser beasts” a list MP, and something more significant, a cabinet minister, first picking up the Transport and the Communication and Information Technology portfolios, and, in January 2010, Tertiary Education, succeeding Anne Tolley. (He is also the Associate Minister of Finance and of Infrastructure.)

Why such responsibility so early? Perhaps because Joyce is someone Prime Minister John Key likes and trusts. After the election, Key was quick to credit Joyce as the “man who ran the campaign, who rang me every morning at 6 o’clock, who was up at 4.30 in the morning to read every newspaper cover to cover”, and when Key took up residence in Premier House, Joyce was offered the rare privilege of the use of the cottage in the house’s grounds.

In fact Key and Joyce share a lot in common. They are near contemporaries (Key is slightly older). They came to positions of influence in the party at nearly the same time. (Key was first elected to Parliament in 2002; Joyce became general manager in 2003). Neither comes from a particularly advantaged background. (Key was raised by his widowed mother in a state house; Joyce is the son of self employed grocers, both of whom left school at 15.) And, of course, both are wealthy, self-made men.

Joyce also seems a good fit with his portfolios. Who better to be Minister of Telecommunications than a man who has dealt with the intricacies of the allocation of radio spectrum for the past 20 years?

And if he has no explicit background in transport, he has certainly proven willing to grasp some nettles: new highways have been approved and funded; road rules are to be changed; the driving age will be raised. He gets things done. Even in his breaks he is deal-making by mobile phone. As Jeremy Corbett has said, “Steven expects everyone to work as hard as him and nobody does.” And thus far he has proven a safe pair of hands.
So, what of tertiary education? Study after study has shown that economic development hinges around the advantages that university education and research bring. A 2009 report by KPMG in Australia has estimated the real economic return on investment in higher education to be between 14 and 15 per cent. And, as Joyce and Key know, access to tertiary education is one of the key determinants of social mobility: higher level study, particularly at a degree level, brings a significant and life-long wage premium.

If New Zealand is to achieve anything like Australia’s growth in GDP per head – let alone exceed it, as would need to happen for us to catch up – then the tertiary education sector will be pivotal.

But these are straitened times; every week the Government borrows $250 million to support public services. And, perversely, as happens in unsettled economic times, the demand for university education has risen.

But is New Zealand’s tertiary education system so poorly off? Joyce does not think so. New Zealand’s annual spending of $4 billion represents 2.3 per cent of GDP, notably higher than the OECD average. We are, Joyce asserts, “pretty good”. (Though New Zealand’s generous student loan scheme – which, at 0.45 per cent of GDP, stands four times higher than the OECD average – accounts for a large part of the difference. )
“Even if it wasn’t a case of tight financial times for the Government, we [tertiary education] would be struggling to put up an argument we should have more money.”

In the absence of there being more money for tertiary education, Joyce wants better value for what money there is.

Take qualifications. Currently, Joyce points out, there are more than 6000 qualifications on the New Zealand Register of Quality Assured Qualifications; Finland, with a slightly larger population, has 500. This profusion of qualifications – though most are outside the university sector – generates uncertainty, inefficiency and expense.

Or consider students who enrol for qualifications they never complete, either choosing to switch to other perhaps less-taxing qualifications or to remove themselves from study entirely. In 2006, across the university sector, the first-year attrition rate for degrees, graduate diplomas and post-graduate diplomas was approximately one student in four.

Joyce intends to have some portion of tertiary education funding – and, for individual students, of the continuing provision of student loans – linked to student success. Students in tertiary education, he says, may well be “encouraged to more uniformly make academic progress” and institutions told “actually, we’re not going to pay you on enrolments, we’re going to include an element of performance during the year”, encouraging them to take more interest in their students.

Then there is open entry. Currently, once they pass age 20, New Zealanders are – with the exception of some particular courses of study – entitled to entry regardless of whether they have formal school qualifications. Is this an enlightened policy that allows talent to flower? After all, many late entrants do well at university study, bringing with them a depth of commitment and maturity that would be the envy of many a new-from-school entrant.

Or, in a constrained environment, is it better to pick the winners – those who have already succeeded at school – rather than chance matters with people whose abilities are unproven?

Finally, the tertiary sector needs to be cultivating non-governmental funding.

“You’re seeing things like Massey’s Foundation launching a big endowment fundraising effort, you’re seeing I think a greater focus on international students – though we have to get the balance right – and you’re seeing a greater focus on commercialisation on research. These are three potentially big income streams where, in international terms, you would say we are a bit underdone.”

Whatever Joyce does, his approach will need to be carefully judged. A recent Ministry of Education analysis looking at how New Zealand’s universities rank internationally, found them to be well regarded and, measured against GDP, highly efficient.

Which may be the right moment to raise a minor matter to do with Joyce’s own efficiency. Although he accumulated enough papers in his first three years of study to qualify for his BSc (and he would carry on taking papers during his time with Masskeradio), it was not until 2002 that he took the time to have the degree conferred.

In March, attempting to filibuster the passing of legislation, Trevor Mallard moved that Steven Joyce be congratulated for having his degree conferred 21 years after he started it. Joyce took his ribbing good naturedly.

“I’m very proud that I’m possibly one of the few people to have their academic record celebrated by Parliament. It’s a rare privilege.”

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