If Peters is preferable . . .

April 12, 2014

John Armstrong forecasts storms ahead for the left:

Having turned its caucus room in Parliament Buildings into a war room staffed almost around the clock by policy wonks, political strategists, experts in social media, plus assorted press secretaries – all in readiness for the coming general election – the Labour Party may find itself with another war on its hands before then. Or something close to it.

The “enemy” on this occasion will not be National. Neither will it be Act. Nor United Future. Nor Colin Craig’s Conservatives. Nor even Kim Dotcom and his Internet Party.

No, this war will be of the internecine variety where the combatants all come from the same neck of the (political) woods.

It will have been sparked by the seemingly endless positioning and posturing ahead of September’s election which will count for little in the aftermath. But this week it all turned ugly for the Greens. And things may yet get uglier still.

It may be that fate has decreed that the power struggle between Labour and the Greens takes centre stage at the worst possible time for the centre-left.

It may not come to open warfare. But the dismissive, almost contemptuous attitude displayed by David Cunliffe with regard to a supposed ally is bound to rankle deeply wherever Green Party members gather.

You can be assured there will be a response; that there will no longer be any scruples about upstaging Labour on the hustings. . .

For all MMP is supposed to be about consensus it is first about competition and then compromise.

Labour has set up a war room and it is aiming not just at National but potential allies with whom it is in competition for votes and the biggest of those is the Green Party.

In-fighting and lack of traction by Labour has enabled the Greens to stake out territory as the de facto leading opposition party.

Labour has more MPs and is a bigger party, but it isn’t getting enough support to be a strong leader in a coalition.

The weaker it is, the stronger the Greens will be and that poses a dilemma for Labour. A stronger Green Party isn’t at all attractive to  voters in the centre. The more power the Greens are likely to have the less attractive a Labour-led government becomes to many in the centre who will be much more likely to move a bit right to National than leap left to Labour.

Labour knows it has to grow the left block, but it also knows this will be harder with a strong Green Party which is why it is doing its best to keep its distance.

Labour’s failure to take the initiative must have made the Greens suspicious. So they approached Labour with a proposal for both parties to co-operate to a much greater extent in the run-up to the election and “brand” themselves as the Government-in-waiting.

What the Greens were really doing was testing the extent of Labour’s commitment to working with them in government following signs that Cunliffe was wavering on that question.

The Greens got their answer soon enough. It was not what they wanted to hear. They got a lecture in semantics – that the next Government would be a “Labour-led” one, not a “Labour-Greens coalition” – and a lesson in history – that Labour had been the dominant party on the centre-left for the past 100 years and thus called the shots as of right.

Cunliffe made it patently clear in word – and more so in tone – that Labour was decoupling itself from the Greens and would be seeking to “maximise its share of the vote” – code for saying it was now open season on territory occupied by the Greens.

Neither could Cunliffe muster much enthusiasm when asked to digress on how Labour would treat the Greens in any post-election negotiations.

Of course, Cunliffe’s remarks were for targeted at an audience of one – Winston Peters. Cunliffe knows he will likely need both New Zealand First and the Greens to make it to the swearing-in of a new Government. But it is Peters’ chalk to the Greens’ cheese. It is Cunliffe’s conundrum.

Peters has choices. The quickest way to have him running helter-skelter towards National’s camp would be for Labour to get tied down in some pre-election arrangement with the Greens.

The Greens are consequently expendable. But for how long? Cunliffe is clearly taking things step-by-step, conscious that the voters might solve his problem. Or compound it.

But Labour’s antipathy cuts deep. Labour does not trust the Greens and believes that party is seeking to supplant it. . .

If Labour doesn’t trust a potential coalition partner it can’t expect voters to either.

The net result of this week’s wrangling is to reduce the centre-left’s share even more. The message most voters would have picked up is that Labour no longer wanted to work with the Greens. Voters hate disunity and punish accordingly.

The Greens deserved better. They are not responsible for Peters’ existence. Cunliffe could have been less dismissive and more accommodating in his language.

He could have accepted a much more limited pre-election understanding. Something symbolic, like Jim Anderton’s invitation to Helen Clark to speak at the Alliance’s conference a year before the 1999 election.

Key likes to wind Peters up; Cunliffe risks looking like he is being cowered by the veteran politician.

Labour’s pursuit of power dictates, however, that Labour be hostage to Peters for the next five months despite knowing such obedience will not make even the tiniest bit of difference as to whether he ultimately favours the centre-right or centre-left. . .

Labour is competing with the Greens to keep its vote strong and is signalling if it has to make comprises it would prefer to do so with Winston Peters.

Peters will be enjoying that. However, if he’s the more preferred partner for Labour it speaks volumes about how little the party thinks of the Greens.


Don’t want wiffle waffle

April 7, 2014

Winston Peters says that the issue of foreign ownership of farms and residential property has always been a bottom line for New Zealand First.

“The reality is that’s always been a bottom line for New Zealand First.”

Read his lips – always has been is not quite the same as is now or will always be.

“We are making it very clear where we stand in this election. People out there don’t want wiffle waffle they want certainty. . .

He’s right we don’t want wiffle waffle.

But wiffle waffle is what we often get from him and it’s what we’re still getting on the question of which party New Zealand First would be prepared to support should he be in a position to do so after the election.

He continues to say it’s up to the voters, as it is. But voters who know if Winston and his sycophants would be prepared to enter a coalition with or give confidence and supply to, one party or another would be able to vote with their eyes open.

As it stands anyone silly enough to favour New Zealand First with a vote will be taking a stab in the dark.

If you can cope with the wiffle waffle, you can listen to the interview on Q & A.

 


Would it be churlish to ask for interest?

April 1, 2014

Winston Peters has finally deigned to repay the $158,000 of public money he and New Zealand First misappropriated for their 2005 election campaign.

Would it be churlish to ask for interest and penalties for late payment?


Another poll confirms the trend

March 18, 2014

Support for he Labour Party is below 30% in the latest Herald DigiPoll survey:

Labour’s support has sunk nearly six points and it is polling only 29.5 per cent in the Herald-DigiPoll survey.

The popularity of leader David Cunliffe has fallen by almost the same amount, to 11.1 per cent. That is worse than the 12.4 per cent worst rating of former leader David Shearer.

National could govern alone with 50.8 per cent if the poll were translated to an election result.

The popularity of John Key as Prime Minister has climbed by 4.6 points to 66.5 per cent. That is his best rating since the election but not as high as he reached in his first term when he often rated more than 70 against Phil Goff.

The increases in support for National and the Greens since December put them at their highest ratings since the 2011 election.

The Greens are up 2.3 points to 13.1 per cent and with Labour would muster a combined 42.6 per cent.

New Zealand First is down slightly to 3.6 per cent but leader Winston Peters’ ratings as preferred Prime Minister at 6.5 per cent suggest the party could still top the 5 per cent threshold required to get MPs under MMP without requiring an electorate seat.

Other polls have shown a decline in Labour’s fortunes this year but today’s is the first to have Labour in the 20s since Mr Cunliffe took over the leadership from Mr Shearer in September last year. . .

Polling began on March 6, in the midst of the fallout over his use of trusts for donations.

But it continued through last week when Mr Key condemned minister Judith Collins for her failure to declare a dinner in Beijing with her husband’s business associates. . . .

The last fortnight was dire for Labour and last week wasn’t good for National, but maybe it’s only political tragics who are really interested in these issues.

Mr Key said the poll was a confirmation that a majority of New Zealanders believe the country is heading in the right direction “but clearly there is a lot more work to be done if we are to create the jobs and increase the living standards that New Zealanders want to see”. . . 

Asked if the issue of Mr Cunliffe’s of Ms Collins non-declarations would have affected the poll, he said: “Voters weigh up a great many factors when considering who to support but I continue to believe the strongest motivation is when a political party is focused on the issues that really matter to voters.” . . .

Individual polls bounce around but this one confirms the trend which shows National and its leader are popular, Labour and its leader aren’t.

There’s just six months until the election.

That’s time enough for National to slip a few points and make it difficult to form a coalition.

But it’s not a lot of time for Labour to climb out of the doldrums and convince voters it could offer good governance and stability with the collection of support parties it would need.


Knowledge is power

March 11, 2014

Prime Minister John Key has called on the wee parties to be upfront about which party they might support after the election.

. . . Announcing the election date on Monday, Mr Key said he is the only New Zealand prime minister to have been so upfront about an election date – and he challenged the minor parties to be, in his words, equally forthright about who they would work with post-election.

He said New Zealand First leader Winston Peters could announce right now that he would go with the largest party, but he won’t.

Mr Key said all the anecdotal evidence he has heard is that Mr Peters would partner with Labour and the Greens: “That’s what I hear,” he said, “so that’s what I’ve got to work on.”

For his part, Mr Peters says the Prime Minister is scaremongering. “He’s never talked to me on the matter,” says Mr Peters, “and whatever his planning skills are, mind-reading is not one of them.” . . .

Peters always insists that who he’ll support will be up to voters.

It will of course, but without telling us which party or parties his would support he’s leaving voters in the dark and expecting them to vote blind.

Knowledge is power – giving voters a clear indication of their intentions helps them make an informed decision.

Peters’s refusal to be clear is simply playing politics.


Which election is Labour trying to win?

March 3, 2014

Last Monday when interviewed by Kathryn Ryan, Labour leader David Cunliffe said:

“We all know the Government is going to change. It’s either going to change this time or next time. I think it’s more likely to change this time, and if it does, the question in front of New Zealanders is what is the composition of that new government going to be?”

For a leader to suggest he’s focussed on anything other than a win in the next election is unusual.

Could it be that he has a two-election strategy, to increase Labour’s vote at the expense of the Green Party this year in the hope that will give him a really strong foundation to win the election in 2017?

His interview on The Nation adds to that suspicion:

• Cunliffe refuses to guarantee the Greens’ place in Labour-led government – “that depends on how the voters decide.”
• Withdraws promise by previous Labour leader David Shearer that Greens will get a proportionate share of Cabinet seats – “we’re different roosters, I’m not doing it that way” – and won’t discuss coalition deals before election.

How the voters decide is the sort of game-playing Winston Peters indulges in.

Giving voters a good indication of what sort of government their votes might result in gives them the power. This shilly-shallying leaves the power with the parties.

But Cunliffe is firing a warning shot across the Green’s bow on purpose.

Voters in the centre aren’t keen on the radical left policies of the Green Party and many would prefer a strong National-led government than a weak Labour-led one beholden to the Greens.

All polls put National well ahead of Labour which would need Green support to govern, and probably some of the other minor players as well.

If Cunliffe could suck votes from the Greens on its left flank it wouldn’t increase the left-bloc but would make Labour stronger.

The swapping of votes within the left wouldn’t be enough to win this election.

But a stronger Labour Party would have a much better chance in the next one if it relegated the Green Party to a very distant third and therefore a much more minor player in government that it would be on current polling.

The trick for Cunliffe would be to lose but not so badly that he’d be deposed as leader.

That would be a delicate balancing act at the best of times and will be even more difficult if the ABC -  Anyone But Cunliffe – decide they’d prefer a big loss and the chance of a new leader.


Lies, damn lies and Winston

February 22, 2014

Winston Peters delivered his state of the nation speech yesterday.

It was full of the usual dog whistles against immigrants and Asians in particular.

One of the claims he made was that Huka Lodge had been sold to Chinese investors.

This has been denied by the lodge and Minister for Land Information Maurice Williams.

. . . “The Overseas Investment Office has spoken to Huka Lodge director and shareholder David McGregor, and he has confirmed no sale has been made or is being considered.

Huka Lodge was last sold in 2003, following Overseas Investment Commission approval, when a Labour Government was in power.

Peters has back-tracked ever so slightly:

Later, Peters modified his claim to say the lodge was for sale.

But only very slightly:

But Peters was unrepentant last night, accusing the OIO of having become a “political pawn”.

Such was the paperwork involved, the OIO may not know the status of the sale, Peters said.

“It’s for sale.”

This is in spite of Huka Lodge director and shareholder David McGregor confirming no sale has been made or is being considered.

But Peters has never let the facts get in the way of his stories in his quest for votes.

It’s just another case of lies, damn lies and Winston.


Time to take focus off mavericks

January 25, 2014

The media has a propensity for getting side tracked by mavericks.

Kim Dotcom is losing some of his gloss but the fascination with Winston Peters continues.

Prime Minister John Key carefully explained his preferences for coalition partners after this year’s election making it very clear New Zealand First would only be considered if the alternative was a Labour?Green government.

That, only-as-a-last-resort statement has prompted lots of interviews with Peters who continues his bizarre insistence that it’s better to keep the voters in the dark until after the election.

Equally bizarre is John Armstrong’s column this morning headlined Peters for Prime Minister? Don’t bet against it.

It is based on the assumption that the PM would resign from politics sometime in the third term, if he got it for which there is no evidence at all.

Political tragics from the left and the media (which is sometimes but not always the same people) have raised this as a possibility but he has always made it quite clear he is in politics to get a job done and isn’t planning to give up part way through.

But even if there was a vacancy for PM in a National-led government Peters wouldn’t ever be considered when there’s a list of able and trustworthy successors within National.

The media needs to take the focus off the mavericks and help voters focus on what matters and what might happen.


National will consider working with . . .

January 21, 2014

Prime Minister John Key has announced which parties  National will consider working with following this year’s General Election.

His preferences are ACT, the Māori Party and United Future and is not discounting the Conservative Party.

He’s also left the door slightly ajar for New Zealand First.

 “MMP makes it likely that every election will be a tight contest,” Mr Key says.

“That means it’s also likely that following the election we will need to work collaboratively with other parties to form a stable Government.

“First and foremost, National will be campaigning hard for every party vote it can win, because that puts us in the best position to continue the positive policy direction New Zealand is on.

“Put simply, the higher National’s party vote, the more options we have.

“I know that post the 2014 election, National will almost certainly need to work constructively with other political parties to form a stable Government.

“Since November 2008, we have shown that we can lead a stable Government with other political parties involved, even when those parties have different outlooks and policies.

“Looking ahead, it is most likely that the nature of these working relationships will be via Confidence and Supply Agreements, as these have worked well in the past two Parliamentary terms.

“In the end it is the public who largely determine the make-up of the Government by voting in parties to Parliament,” says Mr Key.

Mr Key says that given the right electoral circumstances, his preference would be to continue working with the current three partners to the Government, which are ACT, the Māori Party and United Future.

“I believe there is also a scenario where it would be possible to add the Conservative Party to this group.

“While National has of course had differences with ACT, the Māori Party and United Future, together our four parties have formed a stable and successful Government since late 2008,” Mr Key says.

“We also have policy differences with the Conservative Party, however it is likely that there would be enough common ground to work with them in Government.”

In terms of other parliamentary parties, Mr Key ruled out working with Labour, the Greens and Mana on the basis that there is insufficient common ground to achieve a stable and successful working relationship.

“These parties represent a far left wing agenda that we do not believe is good for New Zealand,” says Mr Key.

With regard to New Zealand First, Mr Key said that he believed a post-election working relationship was very unlikely; however he would not rule the possibility out ahead of the election.

“In 2008 we ruled them out because we were unable to reconcile some of their statements on the Glenn donation matter. Six years has passed and, should New Zealand First be returned to Parliament, we would not rule out a discussion after the election.”

 I sincerely hope that New Zealand’s First’s support won’t be needed, although David Farrar posts on the possibility of asking for it to support a minority government.

It’s more of a vanity vehicle than a party and its leader has shown he’s unreliable.

He’s also not prepared to show his hand before the election:

. . .  Winston Peters says the party is making its position clear from the outset that it will not be part of any pre-election discussions or arrangements aimed at subverting the democratic process.

“We thought MMP would stop the gerrymandering and ‘old boys’ arrangements of the past but some political parties keep manipulating the political process for their own ends instead of trusting the voters.”

Mr Peters says the time for talking about forming governments should be immediately after the election and not before. . .

What he means is he’s not prepared to put commit himself one way or the other for fear of losing votes.

Instead he’ll keep everyone in the dark until he can make a deal which best advantages him.


More self-confidence than self-knowledge

January 12, 2014

Self-confidence is one of the necessary attributes for politicians.

Unfortunately many don’t also have self-knowledge.

That’s the quality that helps them know if it’s right to stage a come-back and when it’s time to go.

Rodney Hide has got it.

. . . I loved being MP for Epsom. The people were very good to me. It was a tremendous privilege to get to know the diverse communities and neighbourhoods in such a great part of our greatest city.

In my time, thousands of people came to see me from across the political spectrum, very often at the end of their tether. I was usually able to help. It was satisfying work.

I didn’t want to go when I got the sack. As a minister in Government I was able to help Epsom people better than ever before and I finally had legislation under way to ensure better and more-principled government.

But that’s politics. It wasn’t to be.

And now the position of Act candidate for Epsom is open again. I am very pleased Act has excellent candidates in prospect. I have concluded it can’t be me. . . .

Hide was a good local MP, and he also became a minister. He then paid a high price for taking a perk after gaining a justified reputation as a perk-buster.

But he’s been there and done that and there are far more examples of people who make the mistake of going back than those who make a come-back work.

If Act is to survive it needs fresh faces.

In his own party, Roger Douglas and John Banks are good examples of returns which fell flat.

Hide brings up another:

There was a time when Winston Peters could rattle an entire government, bringing ministers to their knees. Now, even junior ministers get the better of him.

I think it’s sad. Peters appears like some aged rock star who has partied way too hard and is now up on stage trying to relive the glory days. Or perhaps a champion boxer who has stayed too long in the ring. I wouldn’t want that.

I thought the worst thing for Peters was getting dumped in 2008. No. The worst thing for Peters was getting back in 2011.

New MPs snigger at him. There was a time he would have swatted them down like flies.

I prefer to remember Peters as he was. He’s a salutary lesson. . .

He too has been there and done that but he doesn’t know when to let go.

He’s holding on, collecting the pay, warming a seat and occasionally venturing out to dog whistle to the disaffected.

But if he had a fraction of the self-knowledge to match his self-confidence he’d know it’s time to go.


More than a long blink

December 4, 2013

Anyone’s who’s sat through a meeting where your attention isn’t fully engaged on proceedings knows the urge to have a long blink.

This looks more than a very long blink.

Are we paying him to sleep?

 


NZ First needs a headline

November 29, 2013

Colin Craig is a younger, fresher option for people who might have been attracted to Winston Peters.

Craig’s Conservative Party has been getting headlines and that’s bestirred a New Zealand First MP to go in search of one too.

He found it in NZ First will stop farm sales to foreigners:

. . . New Zealand First is calling for a complete halt to sales of farmland to non resident foreign buyers, its primary industries spokesman Richard Prosser says.

“Under a New Zealand First-influenced government there will be no more sales of farmland to non resident foreigners, full stop.

“This road leads to peasantry and New Zealanders being tenants in our own country,” Prosser said.

Not surprisingly the rhetoric isn’t supported by the facts:

Though there is no formal record of how much land is owned by offshore investors Overseas Investment Office land information manager Annelies McClure said “Current best estimates are that between 1% and 2% of New Zealand farmland is held by overseas interests.”

That figure excludes forestry and land, such as areas of native bush, not in productive use. . .

Prosser’s rant has been prompted by plans for Synlait Milk to sell to the Pengxin Group.

He doesn’t factor in the foreign exchange this will bring into the country and what those who sell their shares might do with the money they’ll get for them.

But then that wouldn’t get the attention-grabbing negative headline he wanted.

It might not do him and his party any good though because the Conservatives are not keen on foreign ownership either.


Cavalier attitude to taxpayers’ money

November 6, 2013

The Press, which is very familiar with insurance issues in Christchurch was less than impressed with Labour’s plan to establish a state-owned insurance company.

. . . The proposal for a new state-owned insurance company – KiwiAssure – would, Cunliffe says, be an effort to address problems over the responsiveness of private companies in settling claims and of the price of insurance. But in a market as competitive as the New Zealand one is, the price of insurance is determined by risk and the cost of covering it on the overseas reinsurance market. That applies whether the entity is private or state-owned. A state-owned enterprise required to lower its prices or be more generous towards customers than competitors could only do so at the expense of taxpayers.

As for the implication that a state-owned enterprise might provide a better customer experience in general than a private company, that only shows how far Auckland is from Christchurch. There are many in Christchurch who have dealt with EQC who could put Cunliffe right on that point. . .

The Herald is equally unenthusiastic about the idea:

. . . Ironically, the frustrations experienced by home-owners in Christchurch have much to do with government insurance in the form of the Earthquake Commission. . .

Nothing in the policy announced by Mr Cunliffe at the weekend dealt with any of the real insurance policy issues arising from Christchurch. The announcement was little more than a replay of a commercial for KiwiBank which, like it or not, could be saddled with the insurance company. “KiwiAssure will work for all New Zealanders,” Mr Cunliffe declared. It would be “a service-focused, state-owned company that has their best interests at heart”. It would “keep profits from this crucial industry in New Zealand”.

Wisely, he did not quite claim it would offer cheaper premiums than existing companies. Christchurch had an insurance company that did that. AMI had come to dominate the local market by undercutting competitors and the earthquake exposed its inability to meet all of its liabilities.

The AMI experience is salutary for national taxpayers, too, when they hear Labour’s assurance that its company would not carry a government guarantee. The present Government quickly came to the relief of AMI’s policy holders, taking over the worst liabilities and selling AMI as a going concern to the multinational IAG. It is hard to imagine a Labour Government acting any differently if a state-owned insurer fell into the same trouble.

Insurance is almost the last business that should be nationalised. Its purpose is to share risk internationally. Labour’s company, like KiwiBank, might appeal to those who dislike profit-seeking private enterprise and prefer to deal with a state agency, but they will be under-written by a global insurance network of private enterprise. The profits of insurance provide security for all its subscribers.

The illusion of a “home-grown alternative”, as Mr Cunliffe calls it, has a powerful commercial appeal.

Members of the Insurance Council do not relish competing with a new state company for that reason. Taxpayers should be wary too. When a political party goes into business for no reason better than ideological satisfaction, it is likely to create a commercial lemon requiring ever more capital to survive. Let us hope this is one we will never see.

The ODT raises concerns:

. . . The suggestion KiwiAssure will be run by Kiwibank is not sensible.

The success of Kiwibank will be put at risk by tacking on an insurance company with a domestic focus.

Voters only have to look at the downfall of AMI, a Christchurch-based insurance company which substantially undervalued its reinsurance obligations and ended up with the Government – and taxpayers – having to step in to bail it out.

Of course, a government bail-out is exactly what will happen to KiwiAssure if it does not spread its reassurance risks widely.

Reinsurance for a totally-owned government-controlled insurance company will be expensive.

There can be no discounted policies on offer; it does not make sense.

Residents of Christchurch, and other cities and towns, should be asked how they feel about the state-run EQC, or the many people waiting for some help from ACC, to get some indication of whether they feel comfortable with a state-owned insurance company looking after their interests.

Overseas-owned insurance companies, although receiving much criticism for the slowness of their reviews and delays in payments, at least have a global reach of funds on which to draw. . .

Labour’s insurer will be completely exposed to events in New Zealand, a country at major risk of incurring heavy losses from natural disasters. . .

The Auditor General’s report on EQC said its response in Christchurch had been mixed.

There is nothing in the report to give any confidence in a new sate owned insurance company.

Labour leader David Cunliffe  tried to get some traction for the idea in Question time yesterday but gave Prime Minister John Key an opportunity to remind everyone of the risks instead:

. . . According to the public register, believe it or not, a total of 96 insurance firms have a full licence from the Reserve Bank’s carry-on insurance business in New Zealand. I have heard of a group proposing to set up a 97th insurer. The only point of difference is that that insurance business would put hundreds of millions of dollars of taxpayers’ money at risk by entering a market in which that group has no expertise and for which it cannot offer any competitive advantage. That cavalier attitude to taxpayers’ money comes from who else but the Labour Party. . . 

Hon David Cunliffe: Is it not true that the Prime Minister called Kiwibank a “failing institution” after almost a million Kiwis signed up as customers; therefore, why could not KiwiAssure also provide a locally owned, competitive, and high-quality option in the insurance market?

Rt Hon JOHN KEY: It is great that it has taken to supplementary question No. 4, but we will get to the heart of it. These are the reasons. For a start off, let us just take Kiwibank. Yes, it is a good little business. I might point out, though, that it has taken $860 million of taxpayers’ money and it has never paid a dividend in over 10 years. Secondly, the insurance market is hardly a free ride, because insurance companies happen to be in the process of paying $20 billion out in Christchurch. So if we had KiwiAssure, which the member wants to talk about, then New Zealand taxpayers would be paying a fortune into Christchurch. Thirdly, it is a competitive market at the moment. So if one assumes that they are just going to lay off their risk, they will be laying it off with the same reinsurers. Fourthly—     

. . .  Rt Hon JOHN KEY: To my fourth point as to why an insurance company would be a bad idea—name another major bank that operates in New Zealand that has an insurance company. It would not make sense to lend money [Interruption]—no, lend money—and actually have the insurance on the same property they are renting. They do not do that. . .

Finance Minister Bill English got a further opportunity to reinforce the risks in the proposal:

David Parker—Labour) to the Minister of Finance: Does he agree with IAG’s submission to the Commerce Commission that “there is real potential for major banks to begin underwriting their own general insurance products, and to compete directly with the incumbent insurance companies at the underwriting level as they already do at a retail level of the insurance market”?

Hon BILL ENGLISH (Minister of Finance): I have no responsibility for the opinion of IAG New Zealand but I can give the member the benefit of the experience of watching and working closely with the Reserve Bank to reduce the risks of our banking system to the New Zealand taxpayer. There have been 3 or 4 years where capital requirements have been increased, the core funding ratio has been increased, and we have put in place an open bank resolution system. The idea of a bank taking on more insurance risk is about the dumbest proposal that could possibly be made in the light on the events following the global financial crisis. The member should think very carefully before putting forward a policy that heads in exactly the opposite direction to where every other country in the world is heading.

Hon David Parker: Am I correct, then, to infer that he does not support the creation of a Kiwibank-style insurer to serve New Zealand consumers, which would reduce the dominance of overseas-owned insurers, keep profits in New Zealand, and bring added competition, added flexibility, and choice to New Zealanders?

Hon BILL ENGLISH: That is exactly the misleading pitch around this proposition. If there is one thing every taxpayer in the developed world now understands but the Labour Party does not, it is that the risk would be on taxpayers—taxpayers in Ireland, Spain, the US, and the UK. A billiondollar impost on New Zealand taxpayers arises exactly from financial institutions taking too much risk and loading it on to the Government. That is why his proposition is stupid. . .

Hon BILL ENGLISH:  . . . Secondly, what is surprising here is that when we have had the biggest manifestation of risk, it going wrong, and its impact on taxpayers in 100 years, the Labour Party still does not get it.

Hon David Parker: Why should anyone accept what the Minister of Finance says about KiwiAssure when 10 years ago he was pouring scorn on Kiwibank, saying it was “a small bank that has got no long-term viability.”?

Hon BILL ENGLISH: It is a small bank and it has never paid a dividend. It is great that it meets the needs of New Zealanders but it is certainly not an argument for creating a parallel insurance company. It is absolutely clear from our experience with the Earthquake Commission, AMI Insurance, and South Canterbury Finance that when the taxpayer has to underwrite this kind of risk, it can go wrong and taxpayers can be up for billions of dollars. Having low-income people working in the rain, paying their PAYE, and underwriting financial risk is as dumb an idea as you can have in the 2020s.

Rt Hon Winston Peters: Why would any sane New Zealander believe that last diatribe given that just 10 years ago, when the Cullen fund was announced, he said the very same thing about that, then went down just last week to its 10-year celebration and humbly had to admit what a fool he was?

Hon BILL ENGLISH: Well, as the member will know, because he was there, I did not say that. I did praise Dr Cullen for finding a way of stopping the Labour caucus spending billions of dollars in surpluses. If Dr Cullen had been there, he would have said that that was why he set up the Superannuation Fund—to protect New Zealand from the Labour caucus.

The one thing that is saving us from Labour’s cavalier attitude to taxpayers’ money is the proviso on the policy that a business case stacks up.

It is very unlikely a business case will so this isn’t so much policy or a promise as an attempt to get votes in the Christchurch by-election the outcome of which will be settled well before the business case is found to be faulty.

The business case for #gigatownoamaru stacks up well.


Margin of error changes

October 29, 2013

People on the left hoping Labour’s rise in recent polls was pointing to certain success in next year’s election will have been disappointed by the results of two polls released yesterday:

The Fairfax Media poll, showed Labour and National were both up a couple of points.

. . . Labour is up two percentage points to 33.6 per cent since the last Fairfax poll, completed in August before the leadership spill that saw Cunliffe replace David Shearer.

But National is also up two points and holds a huge 17 point lead over Labour, winning the backing of more than 50 per cent of committed voters. . . .

Most of Labour’s support appears to have come at the expense of the Green Party which does nothing for the left block.

The One News Colmar Brunton poll showed a gap of only 11 between National and Labour:

Support for Labour and its new leader has stalled in the latest ONE News Colmar Brunton poll, with neither the party or David Cunliffe making any gains over the last few weeks. . .

But when it comes to preferred Prime Minister John Key still appears to have the golden touch, up one to 43%, while Mr Cunliffe hasn’t built on his strong start and is unchanged at 12. Winston Peters is steady on 4%.

In the Fairfax poll National had enough support to govern alone but that is very unlikely to be reflected by actual support in next year’s election.

Under MMP support for minor parties will determine which party governs.

In the second poll the right and left can both get to 60 but that’s not enough:

National has 58 seats and with one each from Act and United Future the centre right can muster 60.

But Labour’s 43 seats plus the Greens 16 and Mana’s 1 also gives the centre left 60.

The Maori Party with its three seats and New Zealand First could be the kingmakers.

This assumes NZ First doesn’t get over the 5% threshold and that Act and United Future both win a seat.

Before anyone gets too excited about the results, it’s only a couple of polls and the changes are in margin of error territory.

At best it shows that changing leaders hasn’t made much difference to Labour and if Cunliffe had a new leader’s honeymoon it’s over.

But we’ve more than a year until the next election.

Winning a third term was always going to be hard but not impossible for National and that hasn’t changed.


Mad Hatters’ tea party

October 21, 2013

Quote of the day:

 . . . “You guys have spent your careers trying to analyse what he says and you’ve got more sense out of the Mad Hatter’s Tea Party. He talks in riddles, he doesn’t stick to what he says, it’s a waste of time having discussions that are about a bottom line.

“There are no bottom lines with Winston Peters. He will do a deal with who he feels like doing a deal with. . . ” John Key.

The USA has the Tea party. In Peters we’ve got the Mad Hatter.


Waiting leaves voters in dark

October 21, 2013

Winston Peters will again leave voters in the dark over his post-election intentions.

We have this old fashioned perception of democracy and that is we wait until the votes are counted.

This isn’t more democratic, it’s less.

Letting voters know a party’s position about potential coalition partners gives them information on which they can make an informed decision.

Some voters might support a party that will support one party but not another.

But what Peters says is irrelevant anyway.

This is the man who said he wouldn’t accept the baubles of power then not only did but clung onto them after he’d been stripped of his ministerial power.

Like Humpty Dumpty, what Winston says means just what he chooses it to mean so an indication of what he’d do after the election would be worthless anyway.


NZ First’s Kiwifund threat to super

October 21, 2013

Winston Peters has let his distrust of business and ignorance design a flawed superannuation investment policy:

A new superannuation fund to save billions of dollars for KiwiSaver contributors over the next thirty years will be a central plank for New Zealand First at the 2014 General Election. . . .

 Mr Peters told delegates that private funds managers were sucking the lifeblood out of KiwiSaver, and in five short years had already taken $325 million in management and investment fees.
 
“Independent forecasts show that over the next thirty years these funds managers will take more than $22 billion from KiwiSavers and there is no government guarantee that the remaining funds will be safe.
 
“There is huge pressure from the finance industry to get their hands on more retirement funds. The figures show these companies will make spectacular profits at the expense of people saving for their retirement. 
 
“Our plan is to change KiwiSaver so that it is a truly government-backed and managed retirement fund. Because of the economies of scale, and the elimination of hordes of ticket clipping fund managers, costs will be greatly reduced. People who pay into KiwiSaver will get their full return.”

Has he any idea of the cost of this? Can he guarantee the bureaucrats who will be managing the funds will be any less expensive and any better at investing than private fund managers?

Under the New Zealand First plan, KiwiFund will be government-guaranteed and it would invest substantially in New Zealand.
 
“People saving through KiwiFund will be buying back New Zealand.  KiwiFund will invest in buying back farmland, state assets and critical infrastructure. Funding will also be provided to support smart local companies to develop new products and create jobs.

A government guarantee passes the risk to taxpayers.

Super funds invest overseas for very good reasons. Funds based only, or substantially, in New Zealand would be vulnerable to natural or financial disasters here, some overseas investments insulates funds from that.

Having financial eggs is several baskets is a sound and sensible investment strategy.

Landcorp, the state owned farm company, makes less than 1% return on assets. How will KiwiFund’s farms do better than that?

Who will pick these smart, local companies and what guarantees will there be that they will provide sustained returns necessary to make superannuation sustainable?

“We have to invest in our own future. Overseas pension funds and corporate investors can hardly believe their luck – and are buying up everything they can in New Zealand.

“New Zealand First says its time to stop this sell out. We are already well down the road to serfdom in our own country.” . . .

Other people risking their money in our businesses isn’t a sell-out. It’s welcome inward investment which boosts share prices.

How much does he think these assets would be worth without overseas investment?

Mr Peters warned there would be “howls of outrage” from the private funds managers who would “fight to the death” to retain their $22 billion gravy train.
 
“In the United States, private funds managers lost billions of dollars of pension funds during the 2008 financial crisis. We simply cannot afford to let that happen to the retirement savings of New Zealanders.

And how would he guarantee that public funds wouldn’t do the same in the next financial crisis?

“KiwiFund will enable us to build a high performance economy from which all New Zealanders will get the benefit,” said Mr Peters.

KiwiFund would nationalise private savings.

It would jeopardise superannuation and threaten its sustainability by increasing the risk and reducing returns.

Investment policy must be based on sound financial sense not xenophobia and populist bias against business.

Peters says KiwFund will be a bottom line in coalition negotiations.

Labour and the Green Party might be stupid enough to agree to it, National wouldn’t.

But history tells us what Winston says is a bottom line now and what actually is if he’s in a position to negotiate after next year’s election won’t be the same thing.


Quantity rather than quality

October 19, 2013

Winston Peters hopes to have at least 16 MPs in his caucus after next year’s election.

If New Zealand First’s form is anything to go on that would be quantity rather than quality.


Left will cut superannuation

September 2, 2013

Labour and the Green Party it will almost certainly need as a coalition or support partner both want to increase taxes.

Superannuation is based on the average after tax wage.

When taxes drop and the average after tax wage increases, as it has under National, superannuation increases too.

When taxes increase, the average after tax wage falls and superannuation will too.

This is the law of unexpected consequences that hits policies based on ideology rather than reason.

How will they explain an income drop to the 65+ age group who are already wary about Labour’s suggestion that the age of superannuation should increase?

What baubles and election bribes will they have to throw Winston Peters’ way to get him to agree to a super cut when the New Zealand First constituency is in the age group most likely to be detrimentally affected?


Information beats confrontation

August 20, 2013

John Campbell’s confrontation with John Key on Campbell Live last Wednesday was a wonderful example of how not to do an interview.

Campbell was crusading, confrontational and angry. He made his views on the GCSB Bill blatantly obvious.

This morning Rachel Smalley’s interview (not yet online) with the Prime Minister was a complete contrast.

She was calm, measured, and gave no indication of her views on the issue.

She was after information, not confrontation, and she got it.

That included a repeat of the explanation of what access to metadata will mean under the new law:

Mr Key says the cyber-security function is to “protect” information, rather than accessing content.

He says the GCSB will be able to look at some email metadata, but that will not include addresses, the times emails were sent or received, or their content.

“Essentially it flows through a filter, and as it flows through that filter, it doesn’t record for anything other than a hundredth of a second,” he told media.

“It’s looking for the viruses which are coming into the system – it’s not looking at content, it’s not looking at who sent the email, it’s simply looking for the viruses and we don’t record … where the emails came from, who got them, any of that sort of stuff.” . . .
Mr Key is categorically ruling out “wholesale surveillance” of emails.
In cases where the GCSB wants to access the content of New Zealanders’ emails, Mr Key expects the agency to apply for very specific warrants, and seek the New Zealander’s consent, unless there are very good reasons not to.
Parliament’s intelligence and security committee will be able to see what type of warrants are being signed off and ask questions about those.The bill’s most controversial provision makes it legal for the GCSB to spy on New Zealanders on behalf of the SIS, Defence Force and police, if they have a warrant.

Whether or not viewers were reassured by what the PM said will almost certainly depend on their bias.

A lot, though not all, of the opposition to the Bill is politically motivated and Labour has made the mistake of opting for short-term point scoring rather than taking the opportunity to look like a government in waiting.

The wee parties can do what they like knowing they’ll never lead a government but sooner or later Labour will.

It could have looked like it was fit to do so by working with the government to address legitimate concerns about the legislation.

Instead of which it’s just playing me-too to the Green and Mana Parties and New Zealand First with David Shearer just another opposition party leader like Russel Norman, Winston Peters and Hone Harawira.


Follow

Get every new post delivered to your Inbox.

Join 1,163 other followers

%d bloggers like this: