End of season bonus for Fonterra suppliers expected


The Dom  reports that Fonterra suppliers might get an end of season bonus of at least an extra 30 cents a kilo when the board announces the final payout after a meeting on Thursday. 

Its current payout forecast for 2007-08 is $7.30. Fonterra has a policy of revising payout estimates, other than its regular updates, only for movements of at least 30 cents, so a payout of at least $7.60 for this season is expected.

That would be higher than the current estimates of Goldman Sachs JBWere – $7.40 – and Westpac’s $7.50.

“It would be a mild surprise if the current season’s payout was $7.60 or more,” Westpac agri-economist Doug Steel said.

 That would be about $60,000 more for a 600 cow herd but farmers may not see all of the extra money because the company is considering retaining some of this season’s payout in light of uncertainty in international  financial markets.

Next year’s payout is expected to reflect the slight easing in world dairy prices in the past six months. Goldman Sachs JBWere is picking $6.25 a kilogram of milk solids for 2008-09, and Westpac $6.50.

Fonterra gave the drought as its main reason for lifting its payout forecast last month. A subsequent lift for 2007-08 and a more optimistic view for 2008-09 may be due to the fact that most dairy commodities, except skim milk powder, have been holding their prices in the past couple of months.

Even if next season’s payout is lower than this season’s it will still make dairying and dairy support attractive to people considering a move from sheep and beef although the latest Rabobank/Nielson Rural Confidence Survey shows some improvement in expectations for lamb prices. Philippa Stevenson reports on the survey on Rural Network.

Bad reporting but good idea


Student bond idea `has merit’

By DAN SILKSTONE – The Press | Tuesday, 27 May 2008


National Party leader John Key supports forcing medical graduates to remain in New Zealand for a set period as part of student loan arrangements.


Good grief – how did this reporting  get past The Press sub?


The headline sums up the story but nowhere in the article is there anything to back up the first paragraph’s statement that Key supports forcing medical graduates to remain here. And the Herald  makes it quite clear the scheme, if implemented, would be voluntary.


National leader John Key says his party is considering wiping medical students’ loans if they agree to work as GPs in rural areas for three or four years.

“I am very concerned about the number of young graduates that are completing their qualification here in New Zealand and leaving,” Mr Key said this morning.

“We need them in New Zealand, we’ve got a GP shortage that is well acknowledged and we’re not afraid to look at creative ways of maybe encouraging them to stay.”

Mr Key said any scheme would be voluntary.

“There are plenty of doctors who have a student loan – they might owe $90-$100,000. The concept of them working in part of regional or rural New Zealand for three or four years to have their loan written off might be very attractive,” he said.

That’s the kind of model we are considering.”


And the idea has merit. There is nothing wrong with graduates going overseas for further training or work experience, but we have a problem when they feel forced to go away for better pay and then don’t come back.


There is a shortage of GPs, especially in rural areas – every doctor at one medical practice in Oamaru is from overseas. Otago Medical School has started a rural training scheme which bases fifth year students in provincial towns in an attempt to redress the chronic shortage of rural doctors. There are a variety of reasons doctors prefer working in cities, but writing off a portion of a recent graduate’s loan for every year worked may help encourage some to the country.


Hat tip: kiwiblog


Why pump sewage uphill?


James Weir writes in the Dominion that if there’s no rain in the next three weeks we’ll be asked to start conserving power. Hydro storage is down to 54% of average, the worst levels since the 1992 power crisis.


It isn’t very difficult to save a bit of power – The Listener (preview available now full story on-line in a month) reckons that turning off at the wall the “vampire” appliances which suck power while on standby will save $75 a year – but an uncharitable corner of my mind is asking why bother?


I understand the problem we’re facing and that every little bit helps. But I also wonder what’s the point of individuals doing our little bits when for example, Queenstown Lakes District Council is building a sewerage scheme which will pump Wanaka’s sewage 10 kilometres uphill all day, every day.


Let’s set aside the question of what happens when power fails, as it does now and then when it snows; and the fact that the oxidation ponds where the sewage ends up will attract birds which could cause problems for the nearby airport.


Let’s just ask why, when we’re supposed to be aiming for sustainability; when gravity is free and less prone to breakdowns than electricity; when ratepayers (of whom I am one) are already struggling with the cost of infrastructure for the rapidly growing town; would you build a new scheme which requires you to pump sewage that distance uphill with the attendant financial and environmental costs?


Hat tip: The Hive

Porkometer shows where to continue cull


Audrey Young  updates the Herald’s Porkometer after the budget.

The cost of promises included in the Porkometer do not include every Budget item. They are items that parties themselves have highlighted and bragged about. Totals have not been annualised. They may be spread over many years. That is because parties tend to announce funding over four, five or more years.

Last week’s Budget allowed for a total of $4.75 billion extra in operational spending in 2008-09 and $23.37 billion extra over four years. It also allowed $1.16 billion in capital spending and $1.91 more over four years.


Additional highlights:
* $10.6 billion over four years on personal tax cuts.
* $553.8 million over five years on faster broadband and digital strategy initiatives.
* $326.3 million extra in education including $182 million for extra teachers.
* $220 million over 15 years for Wellington City Council housing upgrade.
* $180 million for extra police.
* $155.2 million over four years to improve student allowances and eligibility.
* $72 million over four years for free off-peak travel for Supergold card.
* $37.8 million over three years for first phase of Hobsonville development.
* $30 million over three years for transport initiatives in Northland and Tairawhiti.
* $25.1 million over four years for Maori and Treaty initiatives including $5.3 million extra for the Office of Treaty Settlements.
* $24.6 million boost to caregivers of children.
* $23.3 million over four years to establish animal ID and tracing system.
* $18 million over four years to boost subsidy for hearing aids.
* $9 million over four years to monitor financial service providers.
* $7 million over two years to restore 19th century Mataatua Whare in Whakatane.
* $7 million to develop a Maori cultural venue on Wellington waterfront.

The cull which I started  and The Hive continued  could carry on with the $72 million for free off-peak travel, on the silly Supergold Card. The card is not the sort of thing the Government needs to spend time or money on; it’s best left to organisations like Grey Power who’ve negotiated a better range of discounts for members.


Besides being 65 or does not automatically make you in need. One of our staff is 78 and works fulltime; another is 77 and almost fulltime – he just takes Wednesday afternoons off for bridge.


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