Key’s speech 3rd reading GCSB Bill


Prime Minister John Key said he’d be speaking during the third reading of the GCSB Bill and he did.

Mr Speaker, this is an essential Bill which has attracted a lot of debate, much of it alarmist.

It’s one of the strengths of our country that people who oppose legislation have an opportunity to say so.

That’s their right, whether or not they understand what that legislation will actually do.

Some people are fundamentally opposed to the work of our intelligence agencies.

Those critics oppose the agencies almost on principle.

As Prime Minister, I am not one of those people.

That’s because I have access to evidence which shows that without the GCSB and NZSIS, our national security would be vulnerable.

There are threats our Government needs to protect New Zealanders from. Those threats are real and ever-present and we under-estimate them at our peril.

New Zealanders are entitled to expect that their security is something that the Government takes seriously. And we do. We take it very seriously.

But we can’t say we take it seriously, and then not make the tools available to allow our security services to do their job.

That is the opposite of taking security seriously.

And that is something I will never do.

Over the past four and a half years that I have been Prime Minister, I have been briefed by intelligence agencies on many issues, some that have deeply concerned me.

If I could disclose some of the risks and threats from which our security services protect us, I think it would cut dead some of the more fanciful claims that I’ve heard lately from those who oppose this Bill.

But to disclose that work publicly would, in some cases, jeopardise it, so I can’t.
I can only assure New Zealanders that the GCSB is a necessary and valuable contributor to our national security – just ask my predecessor Helen Clark, who said as much just a couple of weeks ago.

Today as the House debates this Bill, I think it’s important we all know why it is needed.

It isn’t a revolution in the way New Zealand conducts its intelligence operations. It is not about expanding the powers of a mysterious intelligence empire.

It simply makes clear what the GCSB may and may not do, and it fixes an Act passed under the Labour Government a decade ago which is not, and probably never has been, fit for purpose.

It’s a great shame to see Labour now running away from sorting out the problems it created.

But here in the National Party, Mr Speaker, I’m proud we recognise the importance of national security.

And I’m pleased that John Banks and Peter Dunne do too.

I’d like to acknowledge Mr Dunne and Mr Banks for their efforts to strengthen this legislation.

It is a better Bill for their input.

Mr Speaker, this Bill makes the GCSB’s three functions clear.

They are:

Information assurance and cyber security;
Foreign intelligence, and;
Assisting other agencies.
The first of these functions allows the GCSB to help protect government organisations and important private sector entities from cyber-attack.

This is a growing threat which targets our information and the intellectual property of our best and brightest.

Already this year the number of logged cyber-attack incidents is larger than it was for all of last year.

GCSB’s specialist skills can help protect departments and companies and this Bill gives it the clear mandate to do that.

A lot has been said about this so I want to be clear about a few things.

Cyber security is about protecting our secrets. It’s not about spying.

The Bill requires GCSB to get a warrant from the independent Commissioner of Security Warrants and me before it can intercept a New Zealander’s communications.

That warrant must be issued for a particular function, in this case cyber security. The clear intention of that function is to protect, not to spy.

The Bill also allows for conditions to be put on warrants and I intend to do that.
I will not allow cyber security warrants in the first instance to give GCSB access to the content of New Zealanders’ communications.

There will be times where a serious cyber intrusion is detected against a New Zealander and the GCSB will then need to look at content – that’s why the law allows that.

But that should be the end point, not the starting point.

So I intend to use a two-step process for warrants, requiring the GCSB to come back and make the case for a new warrant to access content, only where the content is relevant to a significant threat.

I also expect the GCSB to have the consent of the New Zealander involved unless there was a very good reason not to.

The second function of the GCSB is, as I said, – collecting foreign intelligence. That has been the largest portion of the agency’s work.

The third function allows the GCSB to assist the Police, NZSIS and NZ Defence Force.

This is something it has been doing for more than a decade, including under the previous Government.

At all times the GCSB believed it was acting lawfully, as did the Inspector General of Intelligence and Security and successive Prime Ministers.

This is because GCSB’s Act said it could assist others. But its Act also stated it couldn’t undertake surveillance on New Zealanders.

No agency should operate with such an ambiguous legal framework.

The Kitteridge review identified just 88 cases of assistance over 10 years – an average of under nine people a year.

So this isn’t and will never be ‘wholesale spying on New Zealanders’.

The truth is that GCSB has unique capabilities.

It makes no sense to duplicate those when they are so rarely used.

Instead, we will make it clear GCSB can assist only those three agencies, and only when they are able to show they have the lawful authority to undertake the surveillance themselves.

Mr Speaker, nothing in this Bill allows for wholesale spying on New Zealanders.
This Bill actually tightens, not widens, the existing regime.

I also want to be clear about another issue in this Bill, that is metadata.

There have been claims this Bill offers no protection of metadata and allows for wholesale collection of metadata without a warrant.

None of that is true.

Metadata is treated the same in this Bill as the content of a communication.

So when the GCSB wants to access metadata, it is treated with the same level of seriousness and protection as if the GCSB was accessing the actual content of a communication.

And there are protections around that.

Mr Speaker, this Bill is good legislation, and it is necessary legislation.
It fixes the problems with the current Act, and clears up the ambiguities that Labour passed into law a decade ago.

It puts in place a robust review of the intelligence agencies in 2015 and every five to seven years thereafter.

It requires more transparency, through open public hearings for the financial reviews of the intelligence agencies.

It requires the GCSB to tell New Zealanders how many times it has assisted other agencies and how many warrants and authorisations it has been issued.

It gives the GCSB a set of guiding principles that acknowledge the importance of human rights, independence, integrity, and professionalism.

And it puts in place a stronger oversight regime that will go some way to rebuilding public confidence in the GCSB.

Mr Speaker, I have rarely seen so much misinformation and conspiracy about a subject as has been perpetrated about this Bill. That has some citizens agitated and alarmed, which I regret.

But my regret about that would be nothing compared with my regret if this measure was not passed, and New Zealanders were harmed because of the gap that currently exists in our security arrangements.

This Bill is being passed today because its provisions are needed today.

They are needed right now because there are threats against us right now.

Others may play politics with the security and lives of New Zealanders but I cannot and I do not, and I will not.

That is why I commend this Bill to the House.

Call me naive but I don’t see any ability for mass surveillance nor any threat to privacy.

I do see protection from threats and the ability for the GCSB to assist other agencies in doing what other laws already allow them to do.

Word of the day


Fugleman – a leader and organiser and spokesman;  one at the head or forefront of a group,  movement, organisation or party; a trained soldier formerly posted in front of a line of soldiers at drill to serve as a model in their exercises.

Rural round-up


NZ reputation will bounce back –  Pattrick Smellie:

Honest disclosure of the Fonterra infant milk botulism scare will stand New Zealand’s reputation as a food producer in good stead in the long run, although the country’s reputation for safe food has taken a short term hit, says ANZ Bank’s chief economist for Greater China.

Speaking to BusinessDesk in Hong Kong, Li-Gang Liu described the impact of the incident, and the subsequent discovery of raised nitrate levels in lactoferrin produced by Westland Milk, as “a temporary scare.”

“Most Chinese consumers still trust the goods provided by New Zealand producers,” he said. “I don’t think that has changed fundamentally, especially how this case was handled. . .

NZ scientist wants ploughing outlawed:

A New Zealand soil scientist is campaigning to outlaw the plough and to have a warning on it.

Dr John Baker said ploughing or conventional tillage contributed to global warming, crop failure, soil erosion and eventually famine.

He said the single greatest challenge facing the world was feeding the extra 50 per cent population by the year 2050.

“We can get away with conventional methods in New Zealand because we have rich soil and rotating pasture, but other countries don’t have that luxury. Instead they’re turning their backs on ploughing and adopting no tillage as the only way to feed the population.” . .

Reduced volatility critical for long-term sheepmeat sector viability:

Representatives of the sheepmeat sectors from the United Kingdom, France and New Zealand met last week and have agreed that the volatility of returns is negatively impacting the long term viability of their respective sheepmeat sectors.

They agreed that the roller coaster ride of good years followed by poor years saps the confidence of sheepmeat producers, resulting in a decline in production in most sheep producing countries and a sector that has difficulty attracting and retaining good young people.

A cross-sector group from the UK and France came to New Zealand on a fact-finding mission to better understand the current outlook for New Zealand sheep farmers and to identify and discuss common challenges. They met with representatives from key industry organisations, farming groups and the meat processing and exporting companies. . .

Views differ on effluent threat to marine farms – Peter Watson:

Farmers and the Tasman District Council are confident increased monitoring and a lot of on-farm work have reduced the risk of dairy pollution again threatening marine farms off the Collingwood coast, but marine farmers say more still needs to be done.

In November, 2011 and May last year high E coli readings in marine farms near the mouth of the Aorere River caused alarm within the export industry, sparking fears the spikes may halt harvesting and prompting complaints to the council about outdated dairy practices, weak rules and a lack of oversight.

It sparked tension in Golden Bay as one heavyweight export industry was seen to take on another. . .

Wineries suffer further damage from latest quake:

Marlborough wineries have suffered more losses and damage from Friday’s magnitude 6.6 earthquake than they did from the 21 July event.

Wine Marlborough general manager Marcus Pickens says a number of wineries in the region closed after the big quake struck on Friday afternoon and structural engineers will be assessing the damage during the week.

He says there has probably been some wine loss, although how much is not really known at this stage.

“I think a number of the tanks, the way they behave would have spilt wine out the top … and those wine losses are financial losses as well.”

Mr Pickens says wineries are reporting minimal damage to bottled wine stocks. . .

Dairy Awards Plan 25th Anniversary Celebrations:

The 2014 New Zealand Dairy Industry Awards will celebrate the 25th anniversary of the sharemilker competition with a special launch event and celebration ball at its annual awards dinner.

National convenor Chris Keeping says the milestone anniversary creates an opportunity to delve into the sharemilker competition history and to celebrate its success.

“It’s pretty amazing to think that over those years thousands of sharemilkers have participated in the competition, relishing the opportunity to have their business analysed and enhance their progress in the industry while having some fun and meeting lots of people.” . . .

Compare and contrast


What’s the difference between National’s GCSB Bill and the one passed into law by Helen Clark’s government in 2003?

Given the emotion generated by the current Bill you’d think that someone in the mainstream media would have compared and contrasted the two pieces of legislation.

No-one has so Kiwiblog has done it:

Helen Clark GCSB law 2003 John Key GCSB law 2013
Inspector-General sole independent oversight two person advisory panel to assist the Inspector-General of Intelligence and Security
Inspector-General has no staff resources Inspector-General has a Deputy
Inspector-General role is essentially reactive Inspector-General to proactively annually review GCSB procedures, policies and compliance and do unscheduled audits
Inspector General not informed when a warrant is put on the register relating to a New Zealander Inspector General is informed when a warrant is put on the register relating to a New Zealander
GCSB can’t intercept the communications of a NZ citizen or permanent resident but can assist “any public authority” on any matter relevant to their functions, and unclear if the former prevents the latter GCSB can’t intercept the communications of a NZ citizen or permanent resident but can assist (only the) Police, Defence Force or SIS even if it involves a NZer.
No reporting of assistance given to other agencies GCSB will be required to report annually on the number of instances when it has provided assistance to the Police, SIS or NZ Defence Force
No reporting on number of warrants and authorisations GCSB will also be required to report annually on the number of warrants and authorisations issued
Intelligence and Security Committee has secret hearings to discuss the financial reviews of the performance of the GCSB and the SIS Intelligence and Security Committee will hold public hearings annually to discuss the financial reviews of the performance of the GCSB and the SIS
ISC does not have to publicly report to Parliament ISC to report annually to Parliament on its activities
No regular reviews of GCSB An independent review of the operations and performance the GCSB and the NZSIS and their governing legislation in 2015, and thereafter every 5-7 years
GCSB has a function to protect any information that any public authority or other entity produces, sends, receives, or holds in any medium GCSB function to protect any communications that any public entity processed, stored, or communicated in or through information infrastructures
No specification of limits of GCSB assistance Specifies that GCSB can assist Police, Defence Force and SIS, but only for lawful activities such as where warrants have been granted
IPCA has no jurisdiction Gives the IPCA and the IGIS jurisdiction to review any assistance given to Police and SIS respectively
No references to according to human rights standards Specifies all functions of GCSB must accord with NZ law, and all human rights standards recognised by NZ law.
No references to not undertaking partisan activity Specifies GCSB can’t be involved in any action that helps or harms a political party
No requirement to brief the Leader of the Opposition GCSB Director required to brief Leader of Opposition regularly on major activities of GCSB
Requires GCSB to destroy any records not relating to GCSB objectives or functions Required GCSB to not retain any information on NZers collected incidentally as part of foreign intelligence operations unless relates to serious crime, loss of life or national security threats
No special protection for legally privileged communications Legally privileged communications explicitly exempted from scope of an interception warrant
No requirement to have a policy on personal information retention and use GCSB required to work with Privacy Commission to have a policy on personal information retention and use 
No restrictions in GCSB Act on retaining personal information GCSB can only retain personal information for a lawful purpose, and can’t keep longer than required for any lawful purpose

The law currently being debated and roundly condemned has a lot more protections than the one it will replace.

Where were all the protesters in 2003?

More to the point why are opposition MPs who voted for the 2003 law opposing the new law with greater protections?

And another question – if the opposition knows this law is so bad why haven’t they laid out exactly what they’ll replace it with when they are eventually in government?

Govt. control costs consumers


The Opposition is touring the country peddling its power policy.

Dr Muriel Newman points out is has already cost us millions of dollars in sabotaging the Mighty river Power Float:

Just days before the listing, Labour and the Greens announced their intention to regulate the wholesale pricing of the electricity industry should they become the government in 2014. This announcement created such a shockwave that the sale of Mighty River Power had to be suspended to allow investors time to back out of the deal. As a result many tens of thousands of investors who had expressed an interest in investing did not do so and many tens of millions of dollars were wiped off the value of the government’s shareholding. Within two days of the Labour-Green announcement, the share market value of Contact Energy, Trust Power and Infratil had fallen by almost $600 million.  

It is fair to say that as a result of the greed of the Maori Council and the political uncertainty created by Labour and the Greens, New Zealanders lost out. The proceeds of the Mighty River sale were less than expected, so less investment money is available for spending on hospitals and schools than would have been the case if Labour, in particular, had not played politics.

The point is that people have come to expect the Greens to demonstrate their deep socialist roots and extremism when it comes to policy-making. In spite of their clever portrayal of financial credibility, even a cursory examination of their policy proposals reveal how ideologically driven and deeply flawed they actually are.

However, the markets expect Labour to produce a rational policy platform – one designed to take the country forward, not backwards into the dark ages. Yet, if their plan to re-nationalise pricing in the electricity industry ever became the law, industry experts warn that the power cuts of bygone years, would again become part of our future. . .

The architect of National’s electricity reforms, Max Bradford, compares power policies of different political parties:

The Labour and Green parties have announced a policy to effectively nationalize privately and publicly owned companies by controlling their prices and their profits. NZ First proposes to reacquire the generation companies and create one large state-owned generator like the NZ Electricity Department (NZED) once was. They believe they can force down electricity prices, while at the same time guaranteeing security of electricity supply and encourage investment in electricity generation and distribution.

National, on the other hand, believes that the electricity sector works best within a competitive market, with a mix of private and public ownership, and regulation where there is no competition in those parts of the sector where there can be no competition i.e. the local lines companies and Transpower. This is the best way to get the lowest electricity prices consistent with guaranteeing security of supply and sector investment to meet increasing demand.

These are dramatically different approaches.

Furthermore, it seems that the National Government will proceed to partially privatize Meridian Energy now that the uncertainty over the Tiwai smelter’s future has been delayed for a few years. This follows the successful partial float of Mighty River Power.

National’s approach is followed by the rest of the world and gets security of electricity supply and the lowest power prices possible consistent with a long-term viable sector.

It is my view too, not from any ideological perspective, but simply from what achieves the best practical result for consumers: New Zealand’s energy history and experience in world energy markets shows that government owned or controlled energy companies cost consumers – or taxpayers where subsidies are paid – far more than an efficient competitive energy sector, with well designed regulation where it is necessary to make the markets work. . . .

The opposition’s policies are a prescription for price rises, insecure supply, and power cuts.

. . . Some people in New Zealand believe that the electricity sector cannot be competitive, and prices will always be higher than in a state owned, politically determined industry. This belief is in spite of the fact that every other sector of the economy once owned by the government (e.g. telecommunications and airlines) is now operating in competitive markets, giving consumers choice and lower prices.

How many people would want the government to monopolize air travel or telecommunications again? Competition has produced palpable benefits for consumers, and has generated tax revenue for the government, whereas in the past taxpayers had been subsidizing these sectors. . .

The Bradford reforms were criticised from all sides but  when competition was introduced in 1998-99, real electricity prices fell on average for four years. That hadn’t happened in the preceding 20-30 years of state ownership and control.

. . . Prices fell more for some consumers than others: the commercial sector, and farming had been subsidizing households for years as prices were politically determined, with the result that very high non-household power prices helped make business and farming internationally uncompetitive.

Inflation adjusted prices for local lines distribution companies fell substantially for some years after 1999, as the regulator – the Commerce Commission – forced these monopoly companies to seek cost efficiencies and only allowed a reduced rate of return on capital because of the lower commercial risks they faced compared to competitive companies.

In 2002, the then Labour government began to re-regulate the market in a series of policy moves, although they didn’t move to change the structure of the market finally established in 1998 after a decade of reform.

The overall effect of these moves was to reduce the competitive pressures on the generators. Government policies reduced the ability of companies to build low cost thermal generation (such as low emission coal fired stations). There were other pressures as well that no government could avoid e.g. the ending of low cost gas supplies from the Maui gas-field, and the addition of increasingly expensive new generation capacity as lower cost alternatives were not available (such as wind power).

The result was a 72 percent increase in inflation adjusted power prices between 2002 and 2008. This had nothing to do with the structure of the market, but was principally the result of Labour’s policy mix where the market could not find the lowest cost generation capacity and the downward pressure on electricity prices of the 1998-99 reforms was eliminated by government policy.

During this time, the government also sought higher dividends from the state owned power companies, which in turn put upward pressure on prices.

After its election in 2008, National reinstated the policy pressures on competitive producers and retailers. Consumers were encouraged to shop around for alternative electricity suppliers, just as they do for air travel, mobile phones, or petrol, with initiatives like Powershop, the What’s My Number campaign and greater transparency of pricing.

As a result, power prices have risen at a far slower rate than in the 7 years prior to 2008. Whether they can or will fall further on a sustainable basis, depends on the policies being followed by the government of the day, and perhaps more importantly on the cost of each new increment of electricity generation capacity as New Zealand has run out of “cheap” renewable energy such as hydro. . .

He has suggestions for further improvements which would make the market work better, and put pressure on the industry to deliver the lowest possible prices to consumers.

I would include the following:

  • Mandating smart meters into all electricity consumers’ premises
  • Consider removing metering from the generators and putting them in the hands of independent meter operators or lines companies
  • Improve the ability of independent retailers of electricity to provide electricity to household consumers, by removing any barriers to their ability to buy power from generators, independent retailers or the wholesale market
  • Providing a power tariff for household consumers to buy power through the wholesale market (to get the benefit of low prices when the wholesale market is over-supplied)
  • Make it easier for individuals to generate their own power and supply into the grid, with a certain, if necessary mandated, tariff payable by lines or generation companies

He identifies serious shortcomings used by the Labour and Green parties to justify their policy and concludes:

As a country we have clearly reached a fork in the road: do we continue to promote competitive measures to force competitive generators to look for lower cost solutions, together with sensible regulation on monopoly parts of the electricity sector; or do we return to the post-war model of monopoly state ownership and control, where political parties determine prices and profits?

We’ve got a choice.

There’s the LabourGreen policy which puts power in the hands of politicians and bureaucrats or National’s policy which puts the power in the hands of consumers.

Look on the bright side


Does New Zealand suffer from Woody Allan syndrome?

Sebastian Edwards of the University of California and National Bureau of Economic Research thinks so.

In a paper prepared for the “New Zealand Macroeconomic Imbalances– causes and remedies” Forum, organized by the New Zealand Treasury, he said:
The way New Zealanders’ think about the economy reminds me of Woody Allen. . .
As Woody, many New Zealanders worry a lot. They worry about the economy and  about the country’s position in the world. They are convinced that things are going  downhill, and believe that the future looks rather bleak. And yet, by almost every possible metric New Zealand is a success: it is at the very top of the World Bank’s Doing Business ranking, according to the PISA test it has one of the strongest educational systems in the world, and Transparency International assures us that it is one of the least corrupt countries in the globe. And then, of course , there is the All Blacks! What else can you ask for?
In fact, in almost every country I give speeches – and I do it very often –, I hear people say, “If we only were more like the Kiwis.” . . .

Finance Minister Bill English told the National Party conference there isn’t a silver bullet but the changes the government has made are having results.

There is still more to be done but New Zealand has weathered financial storms and natural disasters and the outlook is brighter.

The BNZ PSI – Performance of Service Index – was the highest for July that it has been for that month since records began in 2002.

Fasten your seatbelts. Not because of another bout of turbulence. But because of the acceleration the economy looks to be firmly embarking upon. Such is the strength of today’s Performance of Services Index (PSI). At a seasonally adjusted 58.1 for July it kept good pace with last week’s Performance of Manufacturing Index (PMI), of 59.5. Combined they point to GDP growth quickening to quite a strong pace. . .
This was discussed in parliament yesterday:

Hon BILL ENGLISH (Minister of Finance): It is reasonably clear now that consumer confidence and business confidence is becoming stronger. The BNZ-Business New Zealand Performance of Manufacturing Index increased 4.3 points to a seasonally adjusted 59.5. This is the highest July reading since 2002. This is clearly an indication of the kind of thing the Opposition calls a crisis in manufacturing, where it is expanding faster than it has in the last 10 years. Consumer confidence also rose over the last couple of months.

Maggie Barry: How is the improvement in consumer and business confidence being reflected in other economic indicators such as job advertising and retail spending?

Hon BILL ENGLISH: I think it is important to remember that businesses and households remain cautious overall about their spending and investment decisions, and any one of these indicators can fluctuate from month to month, reflecting that caution. However, there are signs of improvement on the back of a gradually improving economic outlook. Job advertising across newspaper and internet increased by 3.5 percent, seasonally adjusted, in July, and the ANZ Job Ads index is now 4.5 percent higher than a year ago. Of course this is not yet happening fast enough, because there are still too many people without jobs. That is why the Government intends to persevere with its Business Growth Agenda to assist businesses to make the decisions that will allow them to invest and employ.

Maggie Barry: What were some of the contributors to the overall improvement in the BNZBusiness New Zealand Performance of Manufacturing Index in July, and how was this interpreted by analysts?

Hon BILL ENGLISH: The improvement was reasonably broad-based across the whole manufacturing sector. Food and beverages had a reading in the manufacturing index of 69.6, which is very high. Petroleum, coal, chemical, and associated product manufacturing was 65.8. Machinery and equipment was also strong. BNZ economists confirmed that they had maintained a positive outlook for the domestic manufacturing sector for some time, linked to an upswing in construction and broader domestic demand improvement. So this is simply further evidence that a recovery is under way. It is still gradual, and still not yet leading to a sufficient decrease in unemployment, but the signs are promising.

Maggie Barry: How does the state of New Zealand manufacturing compare with the manufacturing sectors of other countries?

Hon BILL ENGLISH: It depends on who you listen to. If you listen to Labour and the Greens, they say New Zealand manufacturing is in a crisis. However, if you look at the facts, according to the manufacturing indexes New Zealand has one of the highest readings in the world. The New Zealand performance of manufacturing index is 59.2. A reading above 50 means expansion. In Australia, the performance of manufacturing index is only 42, which corresponds to a slower growth outlook in Australia and a higher exchange rate. China’s performance of manufacturing index is just above 50, as is Japan and the eurozone. In the UK and the US it is 54 and 55, which is positive, but not growing as fast as New Zealand manufacturing. If this is a definition of a crisis, then we would be pleased to have more of them.

 The ANZ regional trends  also gives grounds for optimism:
Canterbury dominates the year-on-year economic landscape, increasing 6.6 percent in the twelve months to June. Auckland and
Waikato jointly recorded the next fastest growth rate of 3.5 percent. The West Coast and Southland trail the regional rankings with a 1.3 percent rise in economic activity. While weak relative to the rest of the pack, they do however represent the strongest rates of growth at the bottom of the regional rankings for six years.
Over the past 12 months the rebuild in Canterbury has seen the region post very strong growth in employment, dwelling approvals, commercial building consents, new car registrations and retail trade. Nationwide economic activity increased 3.4 percent –  representing the strongest annual average rate of increase since March 2005. The North Island economy expanded 3.1 percent,

while the South Island economy grew 4. percent.

It’s time to look on the bright side and count our blessings but it’s not time to relax.
We’re not yet at the destination of sustained growth, low unemployment and reduced debt – private and public –  but we’re heading in the right direction and the economy is growing.

GDT milk price up


An increase in the GlobalDairyTrade  Price Index in this morning’s auction indicates buyers are reassured our milk is safe.

GDT Trade Weighted Index Changes

GDT 21.8

The price of anhydrous milk fat rose 7.1%, butter was up 3.3%; butter milk dropped 3.1%, cheddar increased 0.9%, milk protein was up 1.5%, rennet casein increased 1.9%, skim milk was down .7% and whole milk increased 2.7%.

This is the second auction since the precautionary recall of products containing a small batch of Fonterra’s whey protein concentrate. The small drop in the first one and small increase today are well within the normal ups and downs.

Wrong question, right answer


In politics it’s never a good idea to ask a question if you’re not prepared for the answer.

Labour leader David Shearer made the mistake of doing that in question time yesterday:

David Shearer: Did he or anyone in his office ever contact the Labour Party to obtain broader support for the bill?

Rt Hon JOHN KEY: I cannot believe the member is asking that question. If he wants me to answer it, I will get on my feet and do so.

David Shearer: I raise a point of order, Mr Speaker. I think that was a question. Did he or anyone in his office ever contact the Labour Party to obtain broader support for the bill—did you contact me?

Rt Hon JOHN KEY: OK—[Interruption]

Mr SPEAKER: Order! I want to hear the answer.

Rt Hon JOHN KEY: OK. Yes, Mr Speaker. After one of the Intelligence and Security Committee meetings, I asked Mr Shearer whether he would like to come to my office to have a discussion. We sat down and had about a 30-minute discussion where Mr Shearer said: “Keep this confidential. If you come out and say we’ve done it, that won’t look good and I don’t want you shouting it out about the House.” My deputy chief of staff went to see Mr Goff and also went to see Mr Robertson. On numerous occasions we reached out and at one point—

Grant Robertson: No, no, no. Don’t make stuff up.

Rt Hon JOHN KEY: If the member really wants to get down and dirty, members of the Labour Party said they did not understand the law.

Mr SPEAKER: Order! The Bledisloe Cup was on Saturday.

David Shearer: So he is saying that he initiated contact with me after the—[Interruption]

Mr SPEAKER: Order! The member has every right to have his supplementary question heard.

David Shearer: Is he saying that he made contact with me after the Intelligence and Security Committee meeting and that it was my request that he should remember that?

Rt Hon JOHN KEY: I am afraid the member is wrong. I went up to the member after the Intelligence and Security Committee meeting and said “Do you want to come to my office?”, to which the member said yes, and I said that we would probably take the stairs to avoid the other guys. We actually waited for the other members, in particular, Dr Norman, to leave so that he did not see the member coming up to my office.

Mr SPEAKER: Order! If members on the right-hand side wish to see the balance of question time, they should respect the position I take when I stand and call for order.

David Shearer: In the course of that discussion, did he say to me that he did not really care whether we supported it or not because he already had Peter Dunne over the line?

Rt Hon JOHN KEY: I did not say exactly that I did not care. What I—[Interruption] No. I will paraphrase the words roughly. What I said was that we had the numbers to pass the legislation and I knew that if for political reasons he was just going to carry on the way he was going because Grant Robertson was calling the shots, fair enough—we would just get on and do it. The member also said he wanted a sunset clause, and I said you have got to have rocks in your head if you want to have that, because if you ever want to be the Prime Minister, you will never get the Greens over the line.

Shearer asked the wrong question and gave the Prime Minister the opportunity to give the right answer.

Labour had an opportunity to look like a government in waiting over the GCSB Bill but chose to play politics instead.

August 21 in history


1192  Minamoto Yoritomo became Seii Tai Shōgun and the de facto ruler of Japan.

1680  Pueblo Indians captured Santa Fe from Spanish during the Pueblo Revolt.

1689  The Battle of Dunkeld in Scotland.

1770  James Cook formally claimed eastern Australia for Great Britain, naming it New South Wales.

1772 King Gustav III completed his coup d’état by adopting a new Constitution, ending half a century of parliamentary rule in Sweden and installing himself as an enlightened despot.

1808 Battle of Vimeiro: British and Portuguese forces led by General Arthur Wellesley defeated French force under Major-General Jean-Andoche Junot.

1810  Jean-Baptiste Bernadotte, Marshal of France, was elected Crown Prince of Sweden by the Swedish Riksdag of the Estates.

1821  Jarvis Island was discovered by the crew of the ship, Eliza Frances.

1831  Nat Turner led black slaves and free blacks in a rebellion.

1863  Lawrence, Kansas was destroyed by Confederate guerrillas Quantrill’s Raiders in the Lawrence Massacre.

1878  The American Bar Association was founded.

1888  The first successful adding machine in the United States was patented by William Seward Burroughs.

1904  William “Count” Basie, American bandleader, was born  (d. 1984).

1911 Mona Lisa was stolen by a Louvre employee.

1918   The Second Battle of the Somme began.

1920 Christopher Robin Milne, inspiration for the Winnie-the-Pooh stories, was born (d. 1996).

1930 Princess Margaret, Countess of Snowdon, was born  (d. 2002).

1942  Allied forces defeated an attack by Japanese Army soldiers in the Battle of the Tenaru.

1944  Dumbarton Oaks Conference, prelude to the United Nations, began.

1945  Physicist Harry K. Daghlian, Jr. was fatally irradiated during an experiment with the Demon core at Los Alamos National Laboratory.

1952 Glenn Hughes, British bassist and vocalist (Finders Keepers/Trapeze/Deep Purple), was born.

1952  Joe Strummer, British musician and singer (The Clash), was born  (d. 2002).

1958  Auckland became the first city in New Zealand to introduce the ‘Barnes Dance’ street-crossing system, which stopped all traffic and allowed pedestrians to cross intersections in every direction at the same time.

Auckland pedestrians begin 'Barnes Dance'

1959  President Dwight D. Eisenhower signed an executive order proclaiming Hawaii the 50th state of the union – now commemorated by Hawaii Admission Day.

1963  Xa Loi Pagoda raids: the Army of the Republic of Vietnam Special Forces vandalised Buddhist pagodas across the country, arresting thousands and leaving an estimated hundreds dead.

1968  Warsaw Pact troops invade Czechoslovakia, crushing the Prague Spring and Nicolae Ceauşescu, leader of Communist Romania, publicly condemned the Soviet maneuver, encouraging the Romanian population to arm itself against possible Soviet reprisals.

1968  James Anderson, Jr. posthumously received the first Medal of Honor to be awarded to an African American U.S. Marine.

1969 Michael Dennis Rohan, an Australian, set the Al-Aqsa Mosque on fire.

1971  A bomb exploded in the Liberal Party campaign rally in Plaza Miranda, Manila, with several anti-Marcos political candidates injured.

1976  Operation Paul Bunyan at Panmunjeom, Korea.

1983  Philippine opposition leader Benigno Aquino, Jr. was assassinated at the Manila International Airport.

1986 Carbon dioxide gas erupted from volcanic Lake Nyos in Cameroon, killing up to 1,800 people within a 20-kilometer range.

1991  Latvia declared renewal of its full independence after the occupation of Soviet Union.

1991  Coup attempt against Mikhail Gorbachev collapsed.

1993  NASA lost contact with the Mars Observer spacecraft.

2007   Hurricane Dean made its first landfall in Costa Maya, Mexico with winds at 165 mph (266 km/h).

Sourced from NZ History Online & Wikipedia

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