How are going to get out of this mess?

August 3, 2020

Sir Bill English is warning businesses to prepare for a W-shaped downturn:

Former prime minister Sir Bill English has issued a bleak warning to businesses to prepare for the worst case scenario as “cracks” created by the economic earthquake of Covid-19 become more apparent.

Just like the damage caused to Wellington’s buildings by the Kaikoura earthquake, the true damage to the economy might not emerge immediately, he said.

Wage subsidies had “bought time for thousands of businesses” and there was a sense just from the amount of traffic on the streets of there being a “bounce”, he said.

But the return in consumer confidence would not last and businesses are “reluctant to deal with the fact” that the economy might drop back again, he told a webinar hosted by accounting firm BDO. . . 

Businesses might find by the middle of next year that they had 20 per cent less revenue as a “W”-shaped downturn took shape, and needed to ask if they could survive on that, English said.

“This is going to be marathon not a sprint. It could be really tough.” . . 

Job losses are already piling up:

Today’s troubling revelation that another 1500 Kiwis lost their jobs this week highlights the need for a sound economic plan to get us through the current jobs crisis, National’s Finance spokesperson Paul Goldsmith says.

The number of people receiving unemployment benefits is now up to 212,000 – an increase of 67,000 since New Zealand went into lockdown.

This week alone, 1500 more people went on the dole. Another 450,000 Kiwis are also in the precarious position of relying on the wage subsidy scheme that will run out on September 1.

“New Zealand is facing its worst economic downturn in 160 years,” Mr Goldsmith says.

“This incompetent Government’s big idea is simply to increase government spending, which will just lump the country with more debt for future generations to repay through higher taxes. . . 

The government’s response so far is not going to help the economy:

Massive debt-fuelled spending and keeping the border tight are necessary but insufficient to restore our economy and create jobs, National’s Finance spokesperson Paul Goldsmith says.

Mr Goldsmith was reacting to Grant Robertson’s “Q & A” interview this morning, where the Minister played down projected job-losses when the wage subsidy ends and emphasised more government spending and tight border as the government’s primary economic response.

“The reality is that the spending has not always been well targeted or effective and the so-called tight border of Labour has been shown to have holes.

“The missing piece in the job creation story – the third trick – is bold moves to enable private sector investment,” Mr Goldsmith says.

“The government can buy temporary jobs, such as it is with its $1.1 billion programme to hunt possums and plant flax bushes, but it is the free enterprise economy that creates the most sustainable jobs.

“We need to be making it easier for firms to hire workers and expand their business.

“As well as its JobStart and BusinessStart programmes, which help businesses hire additional workers and redundant workers start a business, National has announced substantial tax changes to encourage businesses to invest. Firms will be able to write off $150,000 per new asset immediately.

“National would also extend 90 day trials to all firms – making it easier for companies to take a chance on new employees, and reverse recent further restrictions on inward investment.

“The government, meantime, is still in the mind-set of adding costs and regulations to business, such as last week’s higher waste levy charges,” Mr Goldsmith says.

Debt will increase whichever parties are in government after next month’s election.

A responsible one needs a plan to minimise  the borrowing and to pay it back.

Without that, Damien Grant says, the Government’s Covid-19 spending will be an economic albatross for decades:

 The true extent of the intergenerational crime that is being committed is becoming clear.

Today’s young are being robbed of opportunities and may be the first generation in our nation’s history to be significantly poorer than their parents.

Let’s start with the easy part: government debt. We spent $12 billion on the wage subsidy, the vast majority going to boomer-owned businesses to ensure they did not have to pay the full cost of their firms being shuttered.

Think about this for a moment. Almost every firm that got the money would have survived. This was a freebie to the capital-owning class; paid for with borrowed money that will not be re-paid by them, as their tax-paying days are coming to a close in the next decade. . . 

Whether or not most firms would have survived is debatable, as is the question of whether they were in trouble before the lockdown.

Wellington has decided, with overwhelming community support, to smash our economy in order to temporarily eliminate what has proved to be a virus with a far lower level of mortality than first advertised.

Fine. This isn’t something that I support, but OK. Let’s do this. However, if you are going to destroy tourism, damage hospitality and cripple construction, we need to be honest with ourselves; we are going to have to get by with less.

But we don’t want to do that. There is a collective refusal to accept that we are considerably poorer today than we were in January. There is an illusion of economic normality being created by enough ink to re-hydrate the Red Sea. . . 

National Party finance spokesman and putative post-election leader Paul Goldsmith estimates the projected $140b of future borrowings is equal to $80,000 per household.

Yet, no one seems to care. We’re in a panic over the fairness of charging people $3000 to cover the costs of an enforced stay in a quarantine hotel and the antics of school kids playing at being Nazis, but were heading off the edge of a fiscal cliff and … nothing.

The cost of borrowing will be paid for in two ways. Not only will this money need to be paid back; either through higher taxes, reduced government services or by the pernicious and economically destructive hidden tax of inflation, there is the opportunity cost of lost growth.

When you borrow to maintain consumption you are stripping resources from the economy that could have been deployed elsewhere for more productive activity; investment, primarily.

People wanting to borrow find they cannot get access to capital because the state is sucking up all available cash.

It isn’t just the cash available for lending either. It is the physical and human resources that entrepreneurs require to trade that are being diverted by the states’ uncontrolled spending. . . 

This government thinks it’s better at spending our money than we are and it’s spending is making it more difficult for private enterprise to flourish.

The lockdown produced a very good health response but the government response to the economic crisis will make it worse.

The problem isn’t just that sooner or later the debt will have to be repaid. It’s that every cent needed to repay it is a cent not available for essential services and infrastructure unless the economy starts growing, and growing well, again and there is no sign of anything from the government that will help us get out of this mess.


Media release ready not shovel ready

July 23, 2020

The delay in releasing the list of shovel-ready projects is putting jobs at risk while playing politics:

National Leader Judith Collins is demanding Labour Leader Jacinda Ardern release the list of the shovel-ready projects her Government has agreed to fund but is keeping secret for political reasons.

Ms Ardern told Parliament today that the list of projects was signed off by her Government nearly a month ago, on 29 June.

Her Deputy, Winston Peters, told the Wellington Chamber of Commerce yesterday that “I have the list; the whole lot”.

“This is not a game, Ms Ardern and Mr Peters,” Ms Collins said.

“The livelihoods of more than 200,000 construction workers and their families depend on getting the shovels out of the shed, the diggers on the roads and hundreds of new projects underway.

“The construction industry needs to see the list to keep those people employed.

“Stop playing games with Kiwis’ jobs, Ms Ardern and Mr Peters, and release the list today.”

Why won’t the government release the list?

Could it be they want to drip feed it milking opportunities for photo opportunities?

Or is the problem that the list is not of shovel-ready projects but media release ready ones, perpetuating grounds to accuse the government of being much better at making announcements than delivering on them?

Even if there is a far better reason than either of these, it would be difficult for it to be good enough to justify the delays that are putting jobs and even businesses at risk.


Rural round-up

July 10, 2020

No place for gender bias in farming – Milne – Sudesh Kissun:

Former Federated Farmers president Katie Milne says having women in the farmer lobby leadership team is a reminder that NZ ag is about couples working together.

Milne, the first woman president of Feds, stepped down last month after serving her three-year term.

In her final speech at the Feds’ annual meeting, Milne said men and women bring their own perspectives and strengths to farming, neither being more important than the other.

“It’s useful to remind the rest of the country by having men and women – all working farmers – speaking for the organisation that those old newsreels of men out on the land on machinery and women confined to baking scones for the shearers is pre-war history, and even then it was a stereotype rather than the truth,” she said. . .

Election forestry Policy unnecessary:

Right now, we are in a Covid-19 recovery phase and an election year. Farmers feel good about keeping the economy going, but are challenged by climate change, freshwater regulations and afforestation. Some press releases strongly defend pastoral farming against encroaching forests, as if we are fighting over land use. We’re not. What both the farming and forestry sectors are doing is searching for the best way forward, post-covid, in terms of investing and adapting. What neither sector needs are knee-jerk regulations that distract from finding real solutions of mutual benefit. A diverse range of viewpoints is good for innovation, so let’s encourage it. The NZ Farm Forestry Association suggests we should avoid the myths, maintain perspective and share some new ideas.

The long-term perspective is that land use change has and should occur in response to developing markets and scientific guidance. . . 

Dairy prices lift the gloom for farmers but their future meanwhile is being plotted by Beehive planners with a vision:

Fonterra’s  boss  might have been  ultra-cautious   but  out on  the country’s dairy farms there  was a  subdued  cheer  at the  news  that the wholemilk powder price had leapt  14%  at  the  latest  GDT  auction..

The  GDT  index  rose  8.3%,  the biggest  rise   since  November  2016,  and the fourth   successive gain.   Fonterra’s  CEO   Miles  Hurrell  says  it’s  “really  surprising—no-one  saw a number of  this  magnitude”.

It dispels  some of the   gloom generated  by the  Covid-19 pandemic.  And it generates  the  hope  that  Fonterra pitched  its  forecast  for  the season too  low,  in  the  broad range  from $5.40kg/MS  to $US6.90.

Hurrell  suggested   suppliers    should not  get “too excited” by the WMP  result. Fonterra had put out excess product for immediate shipment, which resulted in “a bit of a flurry in that first event” .. . .

Farmers, foresters and fishing folk rejoice – the govt is fixing your wellbeing to a 10-year plan (and film-makers have not been forsaken) – Point of Order:

Latest from the Beehive

The government’s economic engineers were hard at work yesterday.  One minister was set on establishing a base for film production in Christchurch while – much more critically for the wellbeing of the nation – a cluster of others led by the PM were unveiling their grand design for reshaping the primary sector.  If they get it wrong (and we should never be sure politicians will get this sort of thing right), our economy will be dealt a greater mischief than ever was done by a pandemic.

Environment Minister David Parker was busy in the planning business, too, announcing appointments to the newly established Freshwater Planning Process and the Expert Consenting Panels for fast-track consenting.

Wearning his Attorney-General hat he also announced a new Judge of the High Court.

Immigration Minister Iain Lees-Galloway, meanwhile, was announcing immediate short-term changes to visa settings to support temporary migrants already onshore in New Zealand and their employers, while ensuring New Zealanders needing work are prioritised. . . 

Accelerating our economic potential: – Primary Land Users’ Group:

The Government plans to increase primary sector export earnings by $44 billion over the next decade with a goal of getting 10,000 more New Zealanders working in the sector over the next four years.

Prime Minister Ardern said the sector, which has proven essential for New Zealand during the Covid-19 pandemic, will be vital to New Zealand’s economic recovery.

HOW?

The plan sets a target of lifting primary sector export earnings to $10b a year by 2030 which would bring in a cumulative $44b more in earnings in a decade. If successful, the plan would almost double the current value of the primary sector. . .

Sustainability stars pick up awards :

Ten kiwi dairy farmers who have shown exceptional care for the environment have been recognised with a DairyNZ sustainability and stewardship award.

The award was part of the Ballance Farm Environment Awards. 

“The dairy sector has made a commitment under the Dairy Tomorrow strategy to protect and nurture the environment for future generations,” says Dr David Burger, DairyNZ strategy and investment leader – responsible dairy.  . . 

How will we recover from social isolation? – Stephen Burns:

Our species has been put on notice: the natural world will no longer tolerate the abuse it has taken for centuries and only exaggerated by recent avarice.

A minute organism, unable to be seen except through a microscope has brought the world as we have enjoyed to a grinding halt.

Invisible to a naked eye yet more powerful than any despotic politician, more devastating than the Global Financial Crisis and more destructive than a nuclear war head, COVID-19 has the power to threaten our continued existence. . .


Rural round-up

July 6, 2020

The perils of growing food in the era of Covid-19 – Eric Frykberg:

More evidence has emerged of the perils of growing food in the era of Covid-19.

The main problem is that many essential workers from overseas cannot come in because of travel restrictions, either as backpacking working holiday makers, or Recognised Seasonal Employment (RSE) scheme workers from the Pacific Islands.

This point was made repeatedly by agricultural sectors at a Parliament’s Primary Production Select Committee yesterday.

Representatives of the strawberry industry told the committee that had done all they could to attract New Zealand workers – even growing strawberries on tables so that pickers don’t have to toil all day bent double. . . 

Rural water hijacked – Gerald Piddock:

Farmers are worried Environment Minister David Parker’s decision to fast track Watercare’s consent to take Waikato River water for Aucklanders will come at the expense of their allocations.

There is concern farmers who were ahead of the Auckland Council’s water company in the queue for consent applications could now miss out because of the decision, Waikato Federated Farmers president Jacqui Hahn said.

“It’s not really right. A region should look after its own.” . . 

Farmers donate meat to charity :

A North Otago farmer who is among the first in the country to contribute to a new meat donation service is hoping others will follow.

Meat the Need is a national charity designed to supply meat to City Missions and food banks.

The meat is donated by farmers, processed, packed and delivered to those most in need.

Altavady Farm’s Kate Faulks was one of the first Silver Fern Farms farmers to support the cause, donating a cow and a beef steer.

She is part of a North Otago family business made up of four farms: two dairy farms (Providence farm, Fortitude farm), one dairy support farm (Living Springs Farm) and one dairy support/beef farm (Altavady Farm). . . 

Report shows swell in demand for irrigation – Daniel Birchfield:

A dry autumn helped the North Otago Irrigation Company pump out its third highest recorded volume of water to properties on its scheme since it was opened close to 14 years ago.

About 38million cum of water was delivered to 163 farmer shareholders, irrigating 26,000 hectares of land in the 11 months to May 31, the company’s report to the Waitaki District Council, presented on Tuesday, showed.

There was strong demand for irrigation over the peak summer period, after a typically slow start in October and November, which the report said was more than offset by demand in December and January.

The dry autumn which followed boosted demand further.  . . 

Hemp success at Darfield farm:

As one of the world’s most controversial (and misunderstood) plants, hemp is good for a whole lot of things: shoes, clothing, paper, you name it. And now it’s proven to be a perfect crop for the Co-op.

It was grown at Fonterra’s Darfield farm as a first-of-its-kind trial to see how hemp grows under dairy wastewater irrigation. They’ve found it’s a profitable, resilient and nutrient-gobbling alternative to the usual pasture grown at the 850ha Darfield farm, located just out of Christchurch.

While Hemp looks like cannabis, it does not contain high levels of THC, the psychoactive substance found in marijuana.

Fonterra’s Regional Farm Operations Manager, Steve Veix says the dry, hot Canterbury summers make it challenging to find the ideal crop to grow on-farm, which traditionally grows pasture. . . 

2020 Tonnellerie De Mercurey NZ Young Winemaker of the Year competition to go ahead:

Entries are now open for the 2020 Tonnellerie de Mercurey NZ Young Winemaker of the Year Competition. Plans are well underway for the regional competitions to take place throughout September and the national final in November.

The competition is open to all those under the age of thirty involved in wine production. This includes cellarhands, cellar managers, laboratory technicians, assistant winemakers and winemakers.

The competition helps stretch the ambitious contestants as well as help them widen their network and start making a name for themselves. . .


Planning to fail

July 3, 2020

Ensuring Covid-19 doesn’t get past the border has widespread support, but it’s time for a plan that keeps it there and lets more people in:

The Prime Minister needs to stop misrepresenting the border issue and tell New Zealanders what her strategy is to protect the economy long-term, Leader of the Opposition Todd Muller says.

“The Government’s clumsy and incompetent management of our quarantine procedures means it is impossible for New Zealand’s border to open tomorrow, next week or even next month.

“That simply would not be safe.

“However, New Zealanders also need to know how and when the border will progressively be reopened, because not doing that is untenable.

“New Zealanders deserve the highest standards to protect them from getting Covid-19, both at the border and when it comes to tracking and tracing in the event of cases in the community.

“We need to know when those standards will be in place so that New Zealanders have confidence to progressively and safely open the border and grow the economy.

“Locking down what’s left of the economy and waiting for a vaccine isn’t an option.”

Prime Minister Jacinda Ardern’s response ignores the issue:

 . . .”It is untenable to consider the idea of opening up New Zealand’s borders to Covid-19.

“In some parts of the world where we have had frequent movement of people they are not estimating that they will reach a peak for at least a month,” Ardern said.

“Any suggestion of borders opening at this point, frankly, is dangerous.” . . .

No-one is asking for the borders to open at this point.

A lot of people, businesses and organisations are asking for information on the plan for when and how the borders will open at some point in the future.

Farmers and contractors need experienced workers, principals facing teacher shortages are looking for staff, secondary schools and tertiary institutions want to be able to host foreign students again . . .

None of these is asking for anything that would risk Covid-19 getting past the border, but all want to know the government’s plan for safe entry of more than returning New Zealanders and the heavily restricted number and categories of people deemed essential workers so they can plan.

Any half competent government would have had people planning ahead months ago.

The omnishambles at the border that required the military and another minister to take over running it, shows that wasn’t done.

The current situation needs a strong focus but the inability for someone in government to look further ahead while others deal with immediate priorities reinforces Todd Muller’s observation there are three or four competent ministers and a whole lot of empty chairs in Cabinet.

Had there been anyone with more ability in any of those chairs, perhaps one of the three deputy Health Ministers for example, Chris Hipkins who already had a very heavy workload wouldn’t have been the only one capable of taking over as Health Minister yesterday after David Clark resigned.

That appointment highlights the shallowness of the Cabinet pond and explains why Muller’s request for details of the strategy for opening the border is being ignored.

There doesn’t appear to be anyone in the government with the time and ability to plan that far ahead which is a very serious problem because as the adage says, if you fail to plan then you’ll plan to fail.


Rural round-up

June 30, 2020

Migrant numbers reduce ‘in silence’ as Kiwis move into farm jobs – Lawrence Gullery:

An agency which helps farms source overseas staff believes the Covid-19 fallout is being used to manage migrant workers out of New Zealand.

Christiaan Arns, the managing director of Auckland-based Frenz, a recruitment and immigration agency for dairy farms, described the state of New Zealand’s immigration rules as a “complete shambles”.

The short term picture is clear, the pandemic has forced borders to close.

But the medium to long-term outlook is confusing, Arns said. . . 

Red meat opportunities ‘if we’re quick enough’ – Sally Rae:

The Covid-19 situation has provided opportunities for New Zealand’s red meat sector to capitalise on — “if we’re quick enough”.

That is the message from Michael Wan, global manager of the New Zealand Red Meat Story for Beef + Lamb New Zealand.

Likening it to the equivalent of the panic buying of toilet paper here and in Australia, Mr Wan said there had been a “massive run” on red meat in the United States.

As people hunkered down over lockdown, they were stocking up their freezers, concerned they might not be able to access fresh protein. They had reverted to cooking traditional types of food and wanted to keep well and boost their immunity, he said. . . 

Dunedin geneticist looking to Africa – John Gibb:

When the world starts to recover from the Covid-19 pandemic, big agribusiness opportunities will open up for New Zealand, Dunedin geneticist Dr Bruno Santos believes.

Brazilian-born Dr Santos has welcomed his recent promotion to partner at AbacusBio and said that would increase his ability to provide input into the international company’s future.

The agribusiness consulting company was ‘‘hugely passionate about making a difference to agriculture and has great scientific credentials as well as on-farm pragmatism’’.

‘‘Bruno leads projects for AbacusBio in the genetics of many species from sheep to rice,’’ the company said. . . 

Great to meet ewe: Introducing sheep via Zoom to fans worldwide :

A sheep farmer who is making money from virtual tours of her farm does not believe people will give up on the idea of visiting New Zealand to experience things for themselves.

With the world in lockdown, people are having to get creative in their pursuit of overseas adventures.

Sheep farmer Angie Hossack who used to host visitors from all over the world via the Farmstay programme, has discovered another way to make money.

Her popular online farm tour ‘Meet the Woolly Sheep on My Farm‘ takes place on her 10-acre block south of Rotorua. . . 

Fermenting for good :

Three and four-year-olds in the rural village of Clevedon have developed a taste for sauerkraut.

The kindergarten children have been making sauerkraut under the guidance of Kelli Walker who has set up a fermentary just out of the town.

Clevedon is about 35 minutes south-east of central Auckland.

Under Kelli’s supervision, kids there squeeze out cabbage and watch the sauerkraut ferment and burble away before taking it home in jars to devour – much to the surprise of their parents. . . 

North Queensland photographers acknowledged among world’s best – Sally Gall:

Townsville-based freelance photojournalist Fiona Lake has been acknowledged as one of the best in the world in the field of agricultural photography.

In the early hours of Saturday morning Australia-time she was announced as the winner of the International Federation of Agricultural Journalism 2020 Star Prize for Photography for her exquisitely-composed aerial image of a bullock team published by the Queensland Country Life last September.

Ms Lake’s entry had earlier in the evening been announced as the winner of the nature/landscape category.

Commenting on the news, she said the win highlighted the affinity that rural Australians have with their animals. . . 


$50m wasted on politicising grief

June 11, 2020

Andrew Little, says it is “just impractical” to expect the remains of all of the fallen miners to be recovered from the Pike River mine:

Instead, the re-entry efforts are now essentially solely focused on gathering evidence in the “homicide of 29 men”, Little told a select committee hearing this morning. . .

Re-entry originally had a $23 million budget but the Government has already spent roughly $35m and that that could reach as high as $50m.

But that, according to Little, is the absolute funding limit.

“There is always a limit to these things – I have no plan or intention of returning to Cabinet for any further additional resources.” . . 

The limit was reached a decade ago when the then-National government made the only sensible and ethical decision that lives would not be risked to rescue the dead.

That decision was criticised by Labour, NZ First and the Green Party all of whom are guilty of politicising the grief of the families who believed them.

Mike Hosking says the fiasco has been exposed:

. . .The retrieval of bodies is no longer practical. The simple truth, a decade on, is that the retrieval of remains was never practical.

Little perpetrates the con a little further by suggesting that the main reason they are still there, apart from perceived political gain, is to gather evidence for the crime committed.

If it needs to be stated, let me state it again, there is no evidence, there will be no evidence, and there will be no charges. . . 

Families who are angry, and rightly so, who want vengeance, justice, or a bit of both, all have good arguments and much emotion behind the cause. But that does not a case or charges make, or indeed anywhere close.

The Labour Party should be ashamed of themselves. They took a tragedy, saw a political gap, and leapt on it.

Not just Labour, New Zealand First and the Green Party leapt on it too.

The previous National government did what any logical, sensible, and adult government would have done, all they could. Short of making up stories and promising false hope like the current lot have.

They consulted experts, the experts said it was too dangerous and too big a risk. The Labour Party promised the world. Winston Peters chimed in equally as opportunistically and promised to be one of the first down the shaft.

Millions has been spent, budgets have been blown – and now the cold hard truth. There will be no bodies. The families asked for and were granted by the Labour Party their loved ones back, but it won’t be happening.

But the con is, it never was. The families were used for political gain, and cheap violin string headlines.

Most of them won’t admit it, I don’t think because they all seem enamoured with the Labour Party. This was as much about being against the last government as it was about a rescue. . . 

If they really wanted to know what went wrong they could have saved their time and our money and spent just $40.00 for Rebecca MacFie’s book Tragedy at Pike River.

As is often the case in major failures, there were multiple faults that led to the tragedy and at least some of those should have been known by the union which Little headed at the time.

The chances of investigations uncovering anything that isn’t already known about the compounding failings in design and operation are tiny.

The three governing parties have already done far too much harm, stringing along the grieving families with promises that should never have been made.

They have wasted $35m and finally admitted that they’re not, as they foolishly promised, going to be able to bring the men back.

There is nothing to be gained by wasting another $15m in hopeless pursuit of answers that almost certainly won’t be there.

There is something to be gained if they learned from their mistakes and in future followed National’s good example with the Christchurch massacre and White Island tragedy, in not politicising tragedy.


Govt hasn’t learned

June 4, 2020

The government hasn’t learned from mistakes it made in deciding which businesses could operate at alert level 4:

Dozens of marine engineering jobs in Nelson are at risk over a Government policy to refuse entry to ships during the Covid-19 pandemic, delivering a hammer blow to the international repair and refit industry.

Aimex Service Group managing director Steve Sullivan said about 40 jobs were under threat at the Port Nelson-based company he founded in 2009.

“Forty per cent of our revenue comes from the international refit business,” Sullivan said. “It’s all under threat.”

Two major contracts were cancelled just before the alert level 4 lockdown, leading to a loss of about $4 million to the wider Nelson economy, Sullivan said.

“We … will have to put more people out of work if the policy does not change,” Sullivan said, referring to the 40 jobs at risk.

Both he and Nelson MP Dr Nick Smith urged the Government to lift the blanket ban and consider the entry of each ship on a case-by-case basis.

The catalyst for prompting Sullivan to speak out publicly was the Government refusal to allow entry to the Captain Vincent Gann, a tuna boat now at sea in the eastern Pacific and in need of urgent repair.

A fault with the Captain Vincent Gann’s reduction gear that provides propulsion meant it was able to travel at half its usual speed only. It was also at risk of further damage. The repair work was expected to take about six weeks and would deliver about $600,000 to the wider Nelson economy – $400,000 to Aimex and $200,000 to associated businesses.

The Captain Vincent Gann’s last port of call was American Samoa, which had no reported cases of Covid-19 and had closed its borders in late March.

TNL International shipping agent John Lowden said the American-owned Captain Vincent Gann had been fishing out of Pago Pago for the past 18 months.

“The crew has been at sea since … 15th May and by the time it gets down here, they would have been at sea for a month,” Lowden said. “They don’t pose any threat at all.”

Sullivan said the crew members could easily be tested for Covid-19 and were prepared to be quarantined on arrival, if necessary. . . 

This exchange in parliament yesterday gives no hope that common sense will prevail:

 Hon Dr NICK SMITH (National—Nelson) to the Minister of Customs: Does she agree with the statement by Steve Sullivan from Nelson’s marine engineering company AIMEX that “The Government’s policy to refuse entry of vessels for engineering and maintenance work is costing jobs and millions of dollars in work”, and does she stand by her department’s decision to refuse entry to the fishing vessel the Captain Vincent Gann?

Hon JENNY SALESA (Minister of Customs): I do stand by Customs’ decision to give effect to immigration rules. This Government’s position has continued to be that the best economic response is a strong public health response. While I appreciate this is an incredibly difficult time for many businesses in New Zealand, our Government has made unprecedented support available for businesses like AIMEX. I encourage them to take up any and all support that they are eligible for from the Government during this unprecedented time.

Hon Dr Nick Smith: Is the Minister saying it’s better for New Zealand for companies like AIMEX to take a wage subsidy rather than actually letting them do the work that earns the company and the country income.

Hon JENNY SALESA: The question is mainly about whether or not we allow a fishing vessel like this to come through. The decision made by the Government has not been to open up our border. We are 12 days into having zero COVID-19 cases, with only one active case. In terms of foreign ships, on 26 May a foreign fishing boat emerged as one of the points of transmission where a foreign-flagged, foreign-crewed vessel with 29 members of its crew being COVID-19 positive was heading towards the Pacific. A vaccine is not yet available for COVID-19, so the fact is that we are focused on saving lives and focused on public health. We are now looking at the recovery of our economy, but I stand by our Government and our response.

Hon Dr NICK SMITH: Why did she state yesterday in this House that the Customs refusal to allow entry of the Capt. Vincent Gann from American Samoa to New Zealand was based on advice of the ministry and Director-General of Health, when her department has admitted it never sought any advice from the Ministry of Health or the director-general on that vessel from American Samoa. . . 

Hon JENNY SALESA: The question that the honourable member asked me yesterday was whether I stand by Customs’ policies and actions—a very general question. Then he followed up with the question about this particular vessel. Had he put down a specific question like that, I would have been able to answer in specific ways.

Hon Dr Nick Smith: Does she accept that the COVID-19 risks for the fishing crew from American Samoa are far less than from the film crew that’s been allowed in by the Government from California, when American Samoa has had zero cases and zero deaths, and California has had 115,000 cases and 4,200 deaths?

Hon JENNY SALESA: I reiterate that this particular ship was a foreign-flagged, foreign-crewed ship. They were not all Americans or American Samoans on that particular ship. Customs enforces the rules and laws that Parliament and Cabinet set. The exemptions for visas are by the Minister of Immigration and the exemptions for jobs are by the Minister for Economic Development. The honourable member who has been a member for many, many decades—more than me—should know if he was to put down this kind of question who the right Minister is to ask about these sorts of issues. . . 

The government’s insistence on its own arbitrary and inconsistent definition of essential during the alert level 4 cost more jobs and did much more damage to the economy than had any business that could operate safely been permitted to do so.

Its refusal to let this boat when the crew has been isolated at sea for more than two weeks, are prepared to be tested and if necessary quarantined, shows it hasn’t learned from that.

There are plenty of other examples of the immigration lottery:

The Avatar film crew has been allowed in but there’s still no certainty over whether America’s Cup crews will be.

Dairy farmers are desperate for migrant staff to return:

. . . Ryan Baricuatro has worked on McFarlane’s 550-cow family farm near Carew, west of Ashburton, for seven years.

In early March, with no cows on the farm following the cull and Baricuatro’s wife due to have a baby in the Philippines, McFarlane encouraged him take some leave and return to his home country.

“We didn’t expect him to be gone for two months and not knowing when he’ll be back is tough,” McFarlane said.

“With his knowledge of the farm and the way we operate, he’ll be integral to getting us back and running after Mycoplasma bovis and at calving. He’s virtually irreplaceable for us, we’re desperate to get him back.” . . 

Geraldine farmer Tom Hargreaves shares McFarlane’s concerns.

Last May, his sheep and beef farming family bought the property next door and hired two staff, including Uruguayan Patricia Grilli, to run a 420-cow dairy operation.

After a successful first season on the farm, Grilli took time off to return to Uruguay for her father’s surprise birthday celebrations. . . 

Despite their best efforts, including providing Grilli with a letter from her employer and a lawyer, she was turned away by customs officials at the airport in Uruguay.

That’s left Hargreaves worried and his team stretched thin to cover Grilli’s role through winter.

“We don’t really know what’s happening. Nothing has been shown to us, so we’re really in the dark and getting more and more nervous,” he said.

“The dairy farm should start up from August 1, but we really needed her over winter as well. Our dairy farm manager didn’t have a day off and the sheep and beef guys would help out but only he and Patricia know the milking shed.” . . 

As of Wednesday, DairyNZ was aware of at least 40 skilled workers who had taken ill-timed holidays and are now unable to get back into New Zealand. 

DairyNZ chief executive Tim Mackle agreed it could become a human and animal welfare issue if dairy farms were understaffed or had staff with the wrong skill-sets come calving.

As well as the workers stuck offshore, the industry was facing a much bigger problem if lower skilled workers already in the country couldn’t get their visa extended, he said. . . 

It’s not just workers who can’t get in.

Schools and universities could be attracting foreign fee-paying pupils and students from the northern hemisphere to start study in July but they too have yet to gain permission for entry.

Eric Crampton discussed why getting safe entry at the border matters:

The government seems to have everything backwards currently. It results in horrible inequities and the usual amounts of muppetry because they’re starting at the thing from the wrong end.

Right now, if you want to enter New Zealand and you’re not a returning resident or citizen, you have to convince the Minister that you’re important enough to be let in. That kind of regime was hard to avoid during the worst part of lockdown because you also needed exemptions from piles of other mobility restrictions if you were coming in as an essential worker to fix Wellington’s sewer pipes. But it’s got things the wrong way around now that lockdown is over. Instead, the principle should be that if you can enter safely, you’re allowed in – with no sign off from the Minister unless that were somehow already required for whatever visa you’d be coming in on.

Starting from the economic necessity of getting particular people in has the government picking winners – it’s the aristocracy of pull all over again. James Cameron has pull; some poor guy whose pregnant wife is here in New Zealand while he’s in Australia doesn’t. Because being allowed in is a function of their having the Seal Of Approval, safety gets less consideration than it should. Tom Hunt’s story from yesterday of quarantine-bound Avatar film crews mingling in hotel reception with regular guests – that kind of muppetry absolutely cannot be allowed to happen. And maybe it didn’t – the story relied on a non-quarantined guest’s reckon that the crowd she went through at reception was that film crew. But it is the kind of thing that’s more likely to happen if the guiding principle is “Movies are important and Avatar Sequels about that main Avatar and the other Avatar – that’s what matters and it matters so much that we’ll pay them tons of money to make those movies here”

You need to flip it.

If people can come in safely, they should be allowed in. . . 

The government was too slow to close the borders before the lockdown and too slow to insist on quarantine for anyone who came in.

Now it’s gone to the opposite extreme with arbitrary and inconsistent exemptions instead of working on the safety principle.

There would be a slight risk of someone bringing Covid-19 with them but providing everyone who comes in was required to quarantine at their own expense, the risk and cost would be minimal when compared with the benefits of businesses and jobs saved.

It would also give us some hope that it was able, and willing, to learn from its mistakes.


Contradictions and confusion

June 3, 2020

Police Minister Stuart Nash says the social distancing breaches at the weekend’s protest marches was irresponsible.

Prime Minister Jacinda Ardern said the marches breached the rules.

That was yesterday, after the event. Both were silent before the event when they might have been able to persuade people to protest in ways that didn’t breach the rules.

The PM gave us repeated warnings and guidelines for Anzac Day, why didn’t she speak up before the protests?

That she only voiced an opinion after the event is contradictory and confusing for those of us who thought we knew the rules and were keeping to the requirement to have no more than 100 people at an event and to maintain social distance.

But there’s more contradiction and confusion from DIrector General of Health, Ashley Bloomfield:

“There’s currently no evidence of community transmission in New Zealand so at this time, quarantine for 14 days after attending one of these outdoor events is not required.”

If that’s the case why are we still at Level 2 which is handicapping businesses which in turn is costing jobs and livelihoods?

But he says it’s still important that Kiwis remain “alert to symptoms and seek advice if they’re at all concerned”.

“Whatever the alert level in New Zealand, it’s clear COVID-19 will continue to be a global threat for some time and it’s important we remain vigilant – both as individuals and as a country,” Dr Bloomfield said.

“This means continuing to observe physical distancing to keep yourself and others safe, seeking appropriate heath advice, and most importantly staying at home if you’re unwell.”

Continuing to observe physical distancing – unless you’re at a protest or the PM or DG:

Photographs have emerged of the Prime Minister and director general of health posed for pictures close to wellwishers, prompting accusations of hypocrisy from a National Party MP warned by police for doing the same.

It has led to an admission from the Prime Minister it was a struggle to maintain “appropriate distancing” with people approaching wanting “handshakes and hugs”.

It’s been a struggle for the rest of us to maintain “appropriate distancing” at funerals and with family and friends but most of us have managed it.

Bloomfield also confirmed he was in a photograph with strangers but said it was only for a moment.

Northland MP Matt King produced the photographs after facing public criticism when he posted to Facebook photographs of himself with staff from a restaurant in Paihia where he had dined.

King told the Herald today coverage of the photograph led to a phone call from a senior Northland police officer who reminded him of social distancing rules.

“I felt sorry for the cop. He was a senior cop. He said: ‘This is not a formal warning – you’re standing too close‘.” . . .

It doesn’t help that there’s contradictory statements coming from the PM and her deputy:

With businesses hemorrhaging money by the day, the Government should be discussing the move to Level 1 now, not in a week, Leader of the Opposition Todd Muller says.

“The Prime Minister and her Cabinet could have discussed the move to Level 1 today. It’s not good enough that all they did was agree to meet again next week to make a call.”

National is demanding the Government immediately release the secret Cabinet papers on which it decided last week to stay in Level 2.

“Divisions between Prime Minister Jacinda Ardern and Deputy Prime Minister Winston Peters are causing confusion about what the secret papers say about how safe it would be to move to Level 1,” Mr Muller says.

“The Prime Minister and the Deputy Prime Minister have both read the same Cabinet papers but one is telling us it is too dangerous to move to Level 1 while the other says it would be perfectly safe.

“Moving to Level 1 as soon as it is safe is of the greatest importance to small businesses and the thousands of Kiwis losing their jobs each week.

“The public deserves to see the same advice Ms Ardern and Mr Peters are publicly disagreeing about.”

We also need to know the criteria for moving to Level 1 because it obviously isn’t what is on the Ministry of Health’s website or we’d already be there.

Alert Level 1 — Prepare

The disease is contained in New Zealand.

Risk assessment

    • COVID-19 is uncontrolled overseas.
    • Isolated household transmission could be occurring in New Zealand. . . 

Instead we’ve got confusion and contradiction over which gatherings can have more than 100 people and which can’t; between what the DG of Health says and what we’ve been told about Alert Level 2; and between the PM and her deputy and what’s on the website and what’s happening in practice.

The social and economic cost of this is far too high for anything but the clarity and certainty businesses need to make decisions and all of us deserve if the social licence the government lost at the weekend is to be regained.

Without it, more and more people are going to flout the rules in the certain knowledge that they, like the protesters, will be left to do as they will.

 


Quotes of the month

June 1, 2020

Our primary industries are the ones that have propped it [the economy] up. We can’t keep borrowing money. Money doesn’t come from out of thin air and if there are jobs there, let us work.

“Don’t give us job centres for queues of people lining up for jobs that aren’t there. We have these jobs sitting under our noses. – Tania Gibson

We need you to accept that there is a problem, see what the problem is, and fix the problem and make sure that the problem never happens again. – Dr Jan White

Vaccine shortages have dogged previous flu and measles campaigns, and doctors have called this year’s flu campaign a “complete debacle”.

It has become abundantly clear that despite the Government’s rejection of such an assertion, a debacle is exactly what it is.  Michael Morrah

The stakes are higher than any election since 1984 because a second-term Ardern Government will have a mandate and an appetite for the largest expansion of the state since Robert Muldoon’s Think Big schemes and endless tinkering beggared the country.  – Damien Grant

The public is putting an immense amount of trust in the Government as it circumvents the usual checks and balances to get us through this crisis. But trust is earned. It’s also key to maintaining social cohesion. – Jenée Tibshraeny

The calamitous way in which Parliament turned Inland Revenue into a small business lender , without a single MP realising they were doing so, is a sign that the time is well past for greater scrutiny to return.

The Government’s refusal to release the advice it used as the basis of its decision to place New Zealand into a highly restrictive lockdown is coming close to an abuse of the extraordinary trust the public has granted it.Hamish Rutherford

No policy decision is costless. Advocates of a longer extension expound the benefits of the approach they advocate; they often are less forthcoming on the costs. The costs of our lockdown could well be slower coming through than the corona virus itself, they are costs that we as the citizens will sooner or later have to bear. – Wyatt Creech

He turns being artless into an art form; he is a Picasso of pettiness; a Shakespeare of shit. His faults are fractal: even his flaws have flaws, and so on ad infinitum. Nate White

One of the worst effects of a lack of understanding of risk management is the precautionary principle. This is the belief that unless you have complete knowledge about the likelihood and impact of the risk, either you shouldn’t take any action at all (e.g. not allowing the trial of a new drug) or you should go all-out to prevent the risk eventuating (e.g. locking down the population in a pandemic). – Kiwiwit

We’ve elected politicians without enough prior life tests and career leadership experience  to exercise democratic control. Without authoritative experienced oversight, some official cultures will inevitably become immune to their own convenient cruelty. “Be kind” means nothing without the leadership diligence that makes it practical, everyday, and integrated among all the other demands of hard decision-making.  Stephen Franks

People talk a big game about moving away from eating meat, and no doubt tell researchers they are vegetarian when asked – but when they get home they are tucking into a big porterhouse. – Trent Thorne

We are very good at managing weeds and pests. Had the Department of Conservation taken it over I don’t know that the same standard of management would have been there to look after it. They don’t have the budget.

“And it would be devastating to watch it fill up with wildings and be overrun by rabbits again.

“They’re very complex places to run and if all of the high country farmers stopped farming it would be a huge burden on the taxpayer to actually manage that land.Andrew Simpson

A lot of farmers, particularly our young farmers, have found themselves in a very lonely place in the last five years.

“I like to think the understanding might shift as people get to understand where their food comes from.

“And it’s our interests to tell our story so that people do understand. We still grow food, and we love the land. The two can coexist. – Andrew Simpson

A human life, it will be said, is of incalculable value, and in some metaphysical sense this is so. Usually we do not value people’s lives in dollars and cents, and we would regard anyone who did so with horror or disgust. But at the same time, we know that in practice we do place a value on people’s lives. We would think it right to spend more on saving a child’s life at the age of 3 than to spend it on prolonging the life of a 95-year-old by five minutes. The relative values of human lives may not be calculable in any precise sense, but where choices have to be made and resources are scarce (as they always are), we make them.

Sacrificing life to maintain normal life may not therefore be a monstrous policy, though the question of how much life can be sacrificed for how much normality is very difficult to answer, because neither the quantity of life sacrificed nor the amount of normality preserved can be known, certainly not in advance, and perhaps not even in retrospect, for there are so many variables that might account for differences. Besides, the two—life lost and economic collapse—are incommensurable. – Theodore Dalrymple

The shackles should be discarded and ministers should be open to scrutiny. If they can’t be trusted to answer questions about their portfolios, they shouldn’t be ministers. – Derek Cheng

Fundamentally, this is a story of two governments and their differing response to the crisis. The Australian Government has committed to preserving jobs by keeping the economy going, no doubt aware that creating a job is so much harder than preserving one. On the other hand, the New Zealand Government chose instead to shut down the economy. As a result, I believe thousands of businesses will close or drastically shrink, and unemployment will grow significantly.

The initial focus by Governments in both countries was quite rightly the health and well-being of the citizens. Australia and New Zealand have achieved admirable results compared to many other countries, particularly the comparatively low number and rate of deaths from COVID-19. The number of deaths per 100,000 population in both countries is much the same. However, the big difference is that Australia will emerge with their economy virtually intact, while we have done serious damage to ours. There is significant business failure happening now in New Zealand that could have been avoided, and still can be in my opinion. –  Lee Short

I see a stark difference between the wealth creators and those untouched and shielded from the impact on the business world. They are not having their pay slashed and are not suffering unemployment or the threat of it. Business owners and employees provide the wealth that funds those in the public service. They take risks, many borrowing substantial sums, some making sacrifices for years. The result is companies that pay tax and employ staff who pay tax. These taxes keep those in public service in employment.Lee Short

Those of us whose adult lives have largely played out over the last four decades should be grateful that we have lived through the best of times, but we owe it to our children and grandchildren to give them at least the same opportunities that we have had to enjoy happy, healthy and fulfilling lives. How we handle the recovery from Covid-19 will determine whether we do so.Kiwiwit

There is not one person in the Government that has a plan or can articulate a plan.  A plan has a start, a process and a goal….not one Minister can articulate what that plan is. Instead, it’s panic and continue to employ as many people as possible. That is not a plan’s arsehole. – Paul Henry

No opinion is worth expressing that is not also worth contradicting (except, perhaps, this one); nevertheless, clichés have their attraction. They are the teddy-bears of the mind, or, to change the metaphor slightly, the mental lifebuoys we cling to in times of stormy intellectual or political weather. They are the sovereign remedy for thought, which is always a rather painful activity. –  Theodore Dalrymple

 Is mastery of this kind of meaningless verbalisation, eloquently empty and passionately delivered, the key to political success? And if so what does it say of us, the citizens of democracies? – Theodore Dalrymple

As is quite often the case, hiding in the great mound of high-sounding bilge are quite nasty sentiments that would, if taken seriously (which thankfully they will not be), lead straight to a totalitarian society. . . It has long been my opinion that inside every sentimentalist there is a despot trying to get out. – Theodore Dalrymple

Except that people will remember the sectors that helped them get through – agriculture and horticulture. They might also remember that the air became cleaner during the pandemic, and that the rivers ran clear. The environmental impact of reduction in transport has been noticed globally. The clarity of waterways has featured on RNZ with commentators noting bird song and clear water… because building and roadworks had stopped. No mention was made of the fact that agriculture and horticulture continued, nor that there had been no reduction in animals. – Jacqueline Rowarth

I would go so far as to compare the Prime Minister to Rob Muldoon. She is Rob Muldoon with slogans and kindness. Michael Woodhouse

How have we got to a stage where we think this is fine. Where we accept rules that say only 10 people are allowed at funerals but 100 people can go to a pub? Where families can’t get out of quarantine to say goodbye to dying family members and people in hospitals die without any loved ones holding their hands? – Heather du Plessis-Allan

You can’t spend your way back to surplus. You can’t tax your back to surplus (without decreasing economic growth). You need to grow your way back to surplus. So most important of all we need policies that will not just get us through the recession but lead to a strong growing economy for the decade that follows. – David Farrar

The budget was heavy in numbers. A few hundred million here, a few billion here – there were big spending initiatives for everything.

But it was light on demonstrating how these programmes will help repair the country. As KiwiBuild showed, good intentions plus government money do not automatically equate to success. But that lesson appears to have been forgotten and Budget 2020 is just KiwiBuild on steroids. – Oliver Hartwich

It’s easy to get lost in all of the big numbers today. The four-year projections of spending, the extra of billions in debt, the debt-to-GDP ratio.

We forget that each of those numbers, all of the numbers in fact, represents a bigger challenge. The burden we place on New Zealanders and the responsibility we have to them.

We forget that a decade of deficits and debt means fewer choices for our kids down the road.

The obligation we as Parliamentarians have to make sure the next generation is better off than we were. That they have more choices, more opportunities, and more ability to succeed in the world because we back them, not burden them with debt.Simon Bridges

Next time, with substantial administrative improvement and a whole lot more political honesty (surely an oxymoron if ever there was one!), there may be some justification in claiming the government’s responses and directives as a  “masterclass of communication” – but definitely not this time. – Henry Armstrong

Whether the virus is quelled or not, in four months’ time the wreckage of New Zealand’s economy will be visible from space. Last week, leaked documents showed the Ministry of Social Development is preparing for an extra 300,000 benefit applications in response to mass unemployment generated by the pandemic.

You don’t have to be a seer to guess that material concerns and a desire for economic and logistical competence will likely trump all other considerations — including abstract notions of “wellbeing” and admonitions to “be kind” — in choosing the next government.Graham Adams

You have had the five million locked up in Cindy’s Kindy with a daily political party broadcast with an incredibly compliant media who have been in her bubble. – Michelle Boag

Our Prime Minister is daily lauded for her leadership in times of crisis.  In the immediate glare of publicity, kindness and empathy are endearing qualities.  The cold reality is that those qualities will not pay the bills.  Gestures of 20% pay cuts are welcomed but 20% of a heck of a lot is no real sacrifice.  Real leadership involves more than optics and safeguarding political gains. It requires tough and hurtful decisions.Owen Jennings

If ‘helicopter’ cash and ‘shovel ready’ projects are the best you can come up with, think again.  If dressing up green initiatives and sneaking through climate change penalties are on the menu, forget it.  If asking us to pay new taxes is in the budget, pull it out again.  Our burden is already too heavy.  Focus on what might hold back private sector initiatives, frustrate investors, limit progress and delay the recovery.  Prune such fearlessly.  Waiting seven years for a consent to increase a water take when your city is running dry isn’t helping anything – the environment, the economy, thirsty businesses or my vegetable garden. –  Owen Jennings

I would like to change the way we treated our farmers and our primary industries for the last while. ‘They are the heroes of our economy and I think they are being treated as though they were the villains.  It is really important to show how valuable the agriculture and primary industries are to New Zealand. They are the basis of our economy, and valuing that is really important to me.  – Penny Simmonds 

I’m afraid it’s too late to put Ardern’s debt genie back in the bottle. I apologise on behalf of my generation and older that you and your kids will carry this debt for all of us. My advice to you is to do what this government should have done. Cut costs and minimise your liabilities. Spend only on the essentials and invest in assets that will produce a safe dividend. Perhaps most important of all, stay engaged in our democracy and encourage your friends to do the same. If COVID-19 has taught the world anything it is this: politicians need to be closely scrutinised at all times but especially in crises like these. – Heather Roy

Australia is currently co-optimising the wellbeing of the Covid outbreak and the wellbeing consequences of the economy better than New Zealand.  If we don’t martial the best possible team for both recovery and reform, we will exacerbate the slide against our greatest comparator and lose even more of our most precious asset, our people.That risks a younger generation not only inheriting greater debt, but also makes Aotearoa a less desirable place to live with substantially less wellbeing. Fraser Whineray

I trust the prime minister a lot more than her critics do. But I also believe that a lot of her cabinet ministers are incompetent, and others are highly unscrupulous, and that this government makes operational and policy blunders on a scale we haven’t seen in our last few decades of technocratic centrism (as I was writing this the news broke that the entire lockdown may have been illegal). And they’re currently making huge decisions based on incomplete information because there is no expert consensus or reliable data available. – Danyl Mclauchlan

So I think there’s value to disrespectful questions and politicised critiques, and even some of the contrarianism, even if a lot of it is misguided or in bad faith, or simply wrong. And I think we need a space for those critiques in our mainstream politics and media instead of shouting it down and leaving it to circulate on the shadowy fringes of the internet. Because the experts are not always right and the government is not always trustworthy. If contrarians warn about the danger to our freedom in this moment, and it makes us more vigilant and we remain free, does it mean the contrarians were wrong? – Danyl Mclauchlan

What drives me is community – the people who help their elderly neighbours with the lawns on the weekend; The Dad who does the food stall at the annual school fair; The Mum who coaches a touch rugby team; This election will be about the economy, but not the economy the bureaucracy talks about. It’ll be about the economy that you live in – the economy in your community – your job, your main street, your marae, your tourism business, your local rugby league club, your local butcher, your kura, your netball courts, your farms, your shops and your families.  This is the economy National MPs are grounded in, and the one that matters most to New Zealand. Todd Muller

The problem with this government is they’ve two or three strong performers and 17 empty seats in CabinetTodd Muller

Poker machines are a de facto tax on the brain-dead. As a taxpayer I resent having to support no-hopers when in the case of these addictions, their problems are self-inflicted. – Bob Jones

A modern democracy, we should not forget, is a people of the government, by the government, and for the government.Theodore Dalrymple

What the “employed and unemployed workers” of 1935 would be scandalised by is being forced to support other people’s children whose father’s pay nothing. They would be outraged that someone who has committed a crime can come out of a prison and get immediate recourse to welfare – repeatedly! They would be angry that  entire isolated rural communities could turn their local economies on welfare. – Lindsay Mitchell

The world doesn’t need more examples of the progressive social direction of NZ so we can learn from their utter failure sad as it is. She’s all hat and no cattle, just a charismatic executioner of her country’s future prospects. Alfred

New Zealand’s economy is in strife. Without major change, our constitutional cousin is in decline. Its public finances are in tatters, its biggest export, tourism, has been obliterated — Air New Zealand announced 4000 job losses this week — and New Zealand police now can enter people’s homes without a warrant.Adam Creighton

In one year, New Zealand has blown 30 years of hard-fought ­fiscal rectitude. Its public debt will explode from the equivalent of 19 per cent of gross domestic product last year to 54 per cent by 2022, on the government’s own figures. – Adam Creighton

The Prime Minister and Finance Minister, who have not worked in the private sector, spruik the totems of modern left governments — renewable energy, trees, higher tax, equality — but without much to show for it. Plans for a billion trees and 100,000 houses have come close to almost naught, and a capital-gains tax was dumped. Labour made a song and dance about reducing child poverty too, but on six out of nine measures tracked by Statistics New Zealand it is unchanged or worse since 2017, including the share of children living in “material hardship”, which has risen to 13.4 per cent. – Adam Creighton

The real problem with the Ardern government is they have no idea whatsoever apart from how to throw money at things, – Roger Douglas

In any case, it wasn’t outsized compassion that drove the lockdown sledgehammer but the ­brutal reality of an underfunded health system. With about 140 intensive care unit beds and few ventilators — far fewer than Australia per capita — it was woefully underprepared. Ardern is more popular than ever, and by all accounts is a good person and a great communicator. But if a COVID-19 vaccine remains elusive, New Zealanders may come to question her wisdom as they fall further down the global pecking order. Without economic growth, there won’t be money for more ICU beds. – Adam Creighton

The world doesn’t need more examples of the progressive social direction of NZ so we can learn from their utter failure sad as it is. She’s all hat and no cattle, just a charismatic executioner of her country’s future prospects.  – Alfred

They’ll make excuses for her, that’s what left supporters and the media do to prop up failed politicians. It’s not about results, it’s about virtuous ideas and statements. The voters least affected – the latte sipping urbanites will keep supporting her, while the poorer people, whom she has vowed are the ones she’s trying to help, will suffer.Melanie

If you, as small business owners, give just one of your newly unemployed neighbours a job before Christmas, you will be the heroes of the economic crisis, the way that our nurses and doctors and all five million of us who stayed at home and washed our hands were the heroes of the health crisis, –  Todd Muller

National does not start by saying everything should be closed unless the Government says it can be open. Instead, our guiding principle is that everything should be open unless there is good reason for it to be closed.Todd Muller

Ethnic communities don’t want tokenism or special treatment; we simply want to be treated as equals and live in an inclusive society. We don’t wish to question or demonise anybody’s “whiteness”. We should all be able to celebrate who we are without fear or favour. – Gregory Fortuin

Muller is still an unknown quantity and has taken over National at the worst possible time for a prime ministerial aspirant. His best hope is that by the election on September 19, unemployment has rocketed, the cult of Winston has shattered, the economy has tanked and voters are starting to worry about how the country will ever pay the billions back.

Then voters might start to think empathy is all very well, but we need a leader capable of some hard- headed decisions that look beyond the lens of political correctness.Martin van Beynen

Don’t be fooled, Winston Peters declarations are not about principle. His game is political expediency. . . Will Winston Peters last the distance or are we seeing the tactic that’s been so successful in the past being reeled out for a third time? Peters shows yet again he will call the shots and for a party polling well below the 5 percent threshold he has nothing to lose. – Heather Roy

Months of monotony, with nothing to look forward to and nothing to distinguish one day from another, is an experience which fundamentally conflicts with most of the ways societies throughout history have found to give structure to the passage of time. Most religions recognise the importance of marking time: celebrating rites of passage, appointing seasons for feasting and fasting, getting together at set times to celebrate, pray, or mourn. As religious holidays die away, secular society invents its own alternatives.

Over the past few months, we’ve been stripped of all that. Those keeping Easter, Passover, Ramadan or other commemorations have had to do so at home and online, for many a very imperfect substitute, and non-believers have lost their rituals too: no birthday parties, no graduations, not even the weekly trip to a favourite coffee shop. We’ve been deprived of almost every conceivable form of public, shared experience — perhaps most painfully of all, with restrictions on funerals, the rituals of grieving. These are anchors, and without them we drift.Eleanor Parker

We’re all hypocrites. Outrage is selective. Personally I’m much more concerned with the fact we’re staring down mass unemployment and a generation-defining economic crisis than the fact Todd Muller has a Trump hat. – Jack Tame

In the face of soaring unemployment and plummeting house prices, middle voters may pause for thought. People who care passionately about inequality, over-tourism and climate change in the good times, tend to be less progressive when their personal economic circumstances are shaken.Andrea Vance


Level 2ish

May 12, 2020

New Zealand is being permitted to go to Level 2ish at midnight on Wednesday.

Much of the economy will open including restaurants, malls, cinemas, shops, health services, and hairdressers. People will be able to socialise with others and travel around the country, as well as playing team sports.

The following Monday – May 18 – schools and early childhood centres will open.

Finally on Thursday May 21 bars will be allowed to reopen. . .

While gatherings would be allowed they would be limited to ten people, Ardern said – even for weddings or funerals. This has been changed from a limit of 100 last week.

Bookings for restaurants and the like will not be allowed for groups larger than 10.

A time limit of two hours for gatherings is mentioned on the Covid-19 website, but a spokeswoman for the Prime Minister’s Office said this was not intended to cover private gatherings.

These rules would be reviewed in another two weeks time on May 25. . .

This still won’t be business as usual, or what usual used to be and National leader Simon Bridges says the focus must now be on economic recovery:

“We need to focus on the other wave coming on us: having dealt with the Covid-19 wave, we now have got to be thinking about the real suffering that comes from 1000 people a day going on the dole and growing,” he said.

“We’ve flattened the curve, we’ve got to make sure we don’t flatten the economy in the process and we get it and jobs up and running.”

As the country faced a looming, deep recession, Bridges said he wanted to ensure that the economic hole gouged out by the pandemic wasn’t deeper than necessary.

“We’ve got some banks and economists saying this could be $100bn in debt – that takes it to over 50 per cent of GDP and we want to make sure that whilst there’s investment going into jobs, there’s not a bunch of other low-priority, untargeted things.

“Because ultimately if there is, that’s $50,000 a household that has to be paid back at $100bn dollars, that’s inevitably more taxes and that’s a legacy of debt on our children and grandchildren.”

Despite hospitality businesses getting the green light to reopen – with restrictions – from Thursday, Bridges acknowledged that many won’t make it through the next month.

“Whether it’s retail or hospitality, from restaurants and cafes through to bars, the costs have risen with the rules and requirements and in fact their revenue may be down, so it is tough for them.” . .

Murray Sherwin, Productivity Commission chair, is also worried about the economic outlook:

The die is cast. We won’t see the official numbers for quite a while, but it is already apparent that New Zealand is headed into the sharpest and deepest recession in 100 years.

We know we will experience unemployment at, and perhaps above, levels not seen since the late 1980s, company failures and large income losses across the economy. Amongst the bits we don’t know are just how deep the emerging recession will prove to be and how long it will last. . .

The policy choices we make and how well we execute them can cushion the downturn, accelerate the recovery and shape the nation that we eventually emerge as.

What we learn from previous recessions is that they carry lasting impacts on firms and employees. The Productivity Commission’s recent inquiry into technology and the future of work showed that workers who lose their jobs can be subject to significant “scarring” even when they get back into work – meaning that they may experience a loss of future earnings over an extended period of time – especially if they are young and with lower skills.

In high-performing economies, a major source of productivity growth comes from workers shifting from low productivity firms to high productivity/high growth firms. For that to happen, and to reduce the risk of long-term disadvantage, workers need easy access to training and upskilling.1 Alongside that, firms need a policy environment that encourages them onto a high productivity path that can support high productivity and high-income jobs.

But the impact of recession is not felt just by workers. We should expect some proportion of firms that are closed during the lockdown phase will not re-open in the future – another form of scarring. With firms, as with workers, a dynamic environment that encourages the movement of labour, capital and other resources from low to high productivity entities is an essential element in a successful future. . . 

That environment is one which reduces regulations that add costs and complexity to business; one that makes it easier to employ the right people and let the wrong ones go; one that values the private sector and encourages it to invest and innovate.

It is not an accident that since 1991 Australia has been riding the longest unbroken phase of economic growth recorded amongst OECD economies – a growth cycle only now being broken as Australia slips into recession like the rest of us. When we review that 30 year growth cycle alongside New Zealand’s experience we see that New Zealand is more vulnerable to economic downturns. Where Australia has ridden though shocks such as the 1997 Asian economic crisis, the GFC and others, suffering a growth slowdown, but avoiding recessions, New Zealand has dropped into recessions. On each occasion, NZ slips perhaps 2% or 3%. And while we may quite quickly get back to a growth path matching (and at times exceeding) Australia’s, we never do well enough, for long enough, to close the gap.

The lesson to take from this is that how well we manage our way through shocks has real and lasting effects. And right now we are hitting the biggest shock in a century. The quality of the policy response – over the next decade or more – will determine the living standards of New Zealanders for at least the next couple of generations. It will determine our capacity to make real choices about income distribution, environmental standards, housing quality, income distribution, the capacity and capability of our health and education systems and our progress towards climate change goals.

Nothing will undermine our capacity to achieve high standards on those fronts more than an underperforming, low productivity economy.

Productivity is the key.

Increasing that will reduce the harm and repair the damage faster.

That will take a government that understands its role is to get the policy environment right, keeps its role to the areas best left to government and allows the private sector to get on with the work that is needed to rebuild the economy.

 


More generous, better targeted

May 7, 2020

National has come up with a more generous and better targeted plan for small businesses hit by the Covid-19 lockdown:

Leader of the Opposition Simon Bridges has today announced the first part of National’s plan for getting New Zealand working again.

“New Zealand has flattened the curve. Our first priority now must be to lift the restrictions that are flattening the economy.

“We need to get cash flowing to the thousands of small businesses that were forced to close in the national interest, and left shouldering a disproportionate amount of the economic burden.

Businesses, and the jobs they support, come and go at the best of times.

But these are the worst of times owing to circumstances beyond their control and as a direct result of government directive.

The directive was made with the best of intentions and for the public good but that in no way softens the blow to businesses nor reduces their need for help.

“To reduce the damage and to save jobs, National would offer a GST cash refund of up to $100,000 – based off the GST they paid in the 6 months to 1 January 2020 – to the small businesses most affected. They would need to demonstrate a revenue drop of more than 50 per cent across two successive months due to the lockdown rules.

“We estimate this could benefit up to 160,000 businesses and save countless jobs.

“If the business paid more than $100,000 in GST over that period, then they would be able to claim up to an additional $250,000 as a repayable loan over 5 years.

“National understands the key to growing the economy is to encourage and incentivise business investment.

“That’s why we would temporarily lift the threshold to expense new capital investment for firms. The Government lifted the threshold from $500 to $5000 as part of its Covid response. We’d go much further and lift it to $150,000 for two years.

For example, if a company spends $145,000 on a new machine to improve its productivity, rather than depreciating that asset over many years, it will be able to expense the full $145,000 in this tax year.

“What we do in the next few months is critical to help businesses survive and save jobs.

“The Government took the right steps to contain the virus but already it’s stalling on what to do next.

“National will work alongside New Zealanders to achieve jobs, sustainable growth and boundless opportunities for New Zealanders and their families.

“Kiwis have done a great job self-isolating and social distancing to save lives. But with 1000 people a day joining the dole queue, we now need to turn our attention to saving jobs.

“National will get New Zealand working again.”

Business NZ approves:

BusinessNZ says National’s proposals for business support would help build investment and confidence.

Chief Executive Kirk Hope says National’s proposals for cash grants, low-interest loans and a higher cap on depreciation are sensible options. . . 

Luke Malpass says Bridges has hit the right note:

. . .For a start he has been positive: although all the usual political point-scoring applied, he has announced a new policy that, were it to be enacted, would greatly assist many small businesses which are currently being nursed through the continued lockdown. It is new, it has been roughly costed (at a cool $8 billion it is not chump change) and it is specifically designed to support small businesses which will struggle to make payroll once they can start operating again.

The second policy announced — a temporary instant asset write-off for investments of up to $150,000 (supercharging the Government’s $5000, which was increased only in March) is also good policy given the circumstances. It is designed to provide an extra incentive for firms to invest as the lockdown continues to wind down. 

Importantly, the policies are both forward-looking and recognise that as the economy loosens, the next wave of Government support is going to be needed. This will clearly be the focus of Grant Robertson’s Budget next Thursday.

The entire basis of the lockdown was that the Government was prepared to induce a sharp recession in order to avoid a surge of Covid cases  resulting in deaths, which would in turn lead to an elongated downturn, driven by fear and uncertainty.

Yet as the will-they-won’t-they nature of the Covid alert levels rolls along the Government risks having both the sharp and deep recession, followed by a drawn-out period of uncertainty which it sold the New Zealand public on hopefully being able to avoid.

It is this risk that Bridges is seizing on, pushing the Government to move to level 2 quickly, and it is not unreasonable. . .

The Prime Minister was praised for her announcement explaining the alert system levels but they no longer mean what she said, and what the Ministry of Health’s website, say they mean.

A couple of weeks with new cases in single figures, two days with no new cases and then just one confirmed and one probable case yesterday should mean the risk of community transmission is low.

People are losing patience with the constraints under which we’re working and the lack of information on what will happen next, and when it will happen.

We’ll learn today what will and what will be permitted at Level 2 but won’t know until Monday when we’ll get there.

Clutha Southland MP Hamish Walker writes of the need for certainty:

. . .The Government needs to be giving details of the conditions that will enable an easing of the alert levels, and when Southland will be able to function normally again. If normal functioning is not possible, the Government needs to tell us what restrictions will be put in place and what support there will be for businesses?

The Government needs to be providing details to us now so businesses can plan.

Sir Bill English once said to me “Hamish, it’s uncertainty which kills business and the economy. People can live with negative decisions that affect them, but you need to tell them so they can plan.” . . 

The government isn’t following this advice and National has stepped into the vacuum with a policy that would provide certainty and enable businesses to plan.  Unfortunately it’s in opposition and therefore not in a position to implement it.

That leaves us with uncertainty until the government deigns to provide us with the information we need and the assistance businesses require.

The full speech is here.


Straining social licence

May 5, 2020

Yesterday we got the welcome news that no new cases of Covid-19 had been detected.

That follows several days of new cases in single digits.

To most of us that looks like it would be safe to drop to Level 2 or may even Level 1:

At Level 2:

The disease is contained, but the risk of community transmission remains.

Risk assessment

    • Household transmission could be occurring.
    • Single or isolated cluster outbreaks. . . 

At Level 1:

The disease is contained in New Zealand.

Risk assessment

    • COVID-19 is uncontrolled overseas.
    • Isolated household transmission could be occurring in New Zealand. . .

So why aren’t we moving down at least one level, or at least knowing when we will?

The government has explained that elimination doesn’t mean no cases. That means that at whatever level we’re at there will almost certainly be some new ones.

But the health risk now appears to be less serious than the risk to the economy:

National Party leader Simon Bridges admits moving to pandemic alert level 2 could result in more COVID-19 cases, but says this could happen under any level and the lockdown has to end for the sake of the economy. . .

While the unprecedented restrictions have been successful in dramatically reducing the number of new infections of the virus – which has killed hundreds of thousands of people overseas – they’ve also taken a toll on the economy.

Bridges says there are 1000 jobs being lost every day under level 3, based on new applications for the Jobseeker benefit. This is similar to the rate of new applications under level 4, when far fewer businesses were able to operate – there were 30,000 applications in the month to April 17, despite the Government’s wage subsidy being paid out to organisations employing 1.6 million people.

“This has gone on too long,” he told Newshub. “We need to get New Zealand working again. Quite simply we’ve got to end lockdown because it’s so much easier to keep someone in a job.”

He said officials “from Ashley Bloomfield down” have said COVID-19 is “eliminated”.

“Having flattened the curve, let’s not flatten the economy as well. We have to come out at some point. We can’t just wait until there’s a vaccine.”   . . 

A thousand jobs lost a day is 1,000 people a day at risk financially and at risk of poorer physical and mental health as a consequence of that.

It’s not just jobs but whole businesses that have been lost and the longer we’re stuck at Level 3 the greater the risk and the greater the economic and social costs which also have health costs.

Compounding the frustration is the continuing dearth of information on what will happen and when it will happen.

We were initially told we’d be at Level 4 for four weeks. That turned into nearly five.

We were then told we’d be at Level 3 for at least two weeks. Given we’re not going to know until next Monday if there’s going to be a drop in levels, it’s likely that we’ll be stuck at Level 3 for at least a few more days longer.

Uncertainty about the legality of police action isn’t helping:

New Zealand Police’s decision to arrest Kiwis during alert level 4 despite being advised they had little legal basis to do so “undermines the rule of law” in New Zealand, the former Attorney-General believes.

The comment from Chris Finlayson comes just hours after leaked emails to NZ Herald revealed that police were told by Crown Law that they had little to no power to enforce lockdown rules.

Finlayson, a former National MP who served as Attorney-General for nine years between 2008 and 2017, says it’s clear the police have acted beyond their powers during the coronavirus crisis.  . . 

The refusal to release Crown Law advice makes it even worse.

Incumbent Attorney-General David Parker has thus far refused to make public the advice, despite mounting pressure from the Epidemic Response Committee and MPs to do so.

Finlayson believes Parker’s refusal means there are parts of the advice “he may not like” – but says that shouldn’t change whether it’s released or not.

“There’s an overwhelming public interest, for people whose freedoms have been curtailed over the last few months, to know exactly the legal basis upon which certain decisions were made,” he said. . . 

Last week the government accidently passed legislation that differed from the Bill MPs had seen. That undermines confidence, but Jenée Tibshraeny writes:

. . .The public is putting an immense amount of trust in the Government as it circumvents the usual checks and balances to get us through this crisis. But trust is earned. It’s also key to maintaining social cohesion.

Oddly, I can dismiss Thursday’s passing of the wrong legislation as an extraordinary genuine mistake.

But the lack of transparency around decision-making and incoherent way of announcing a billion-dollar policy change, are inexcusable.

The government has imposed unprecedented restrictions on us at an enormous economic and social cost.

The willingness of most of us to abide by the lockdown requires a social licence which must be based on trust.

The government’s refusal to give us all the information we need, and to which we are entitled, is undermining trust and straining that social licence, and that is putting strict compliance at risk.


What else will go?

April 23, 2020

Covid-19 has claimed another victim:

Pharmac has frozen plans to fund a lung cancer drug that would have helped at least 1400 patients a year, saying it can no longer afford to make the investment.

The move has dashed hopes that Keytruda would soon be publicly funded for lung cancer – New Zealand’s biggest cancer killer. . .

What will follow?

Other drugs, other treatments, more research.

Health received $19.871 billion in the 2019/20 Budget. More than $9 billion has already been spent on wage subsidies as part of the response to the Covid-19 lockdown.

That’s a big hole to fill and it won’t just be health that gets less.

What was expected to be a vote-buying spend-up Budget next month will be much, much more restrained.

We’re told that most people support the lockdown, but how many understand the full costs, and not just in money but in businesses, livelihoods and lives?

How many would have been at least as supportive of a response that safe-guarded people from the rampant spread of Covid-19 while letting more businesses operate?

The insistence on using the arbitrary view of what’s essential rather than what’s safe has increased the economic and social costs of the lockdown while doing nothing at all to make it more effective.

I got an email last week telling me I could buy text books and any children’s reading material from Dunedin’s University Book Shop but I couldn’t get adult novels until after the lockdown was eased.

How could delivering an adult novel be any more risky than the other books deemed essential?

A friend needed a merino t-shirt as the one she uses for her daily walks is falling to bits. She went on line and found she could buy long-sleeved merino garments but not t-shirts.

Why is a t-shirt not essential when something with longer sleeves is, and how much more risk is there in packing, dispatching and delivering a t-shirt than in doing it for something with long sleeves?

Another friend’s elderly mother has her lawns mown by a man who brings his own mower.

Providing he stayed outside and kept at least two metres from her, how is that any more risky than her grandson coming with his mower, and keeping a safe distance, to cut her lawn?

There are very small examples, there are plenty more much bigger ones of constraints on commerce that should not have been imposed.

Health and safety in employment law is rigorous at the best of times, its requirements should be fit for the purpose of safeguarding employees and customers in these worst of times.

Had businesses which could have operated safely been able to do so the government would be spending less on welfare, staff subsidies and business support.

These businesses, and their employees, would be then be contributing to public coffers through tax, rather than taking from them.

That would have gone someway to reducing the cost of the lockdown and contributing to a swifter recovery.

It might not have been enough to save Pharmac from reversing its decision to fund Keytruda for lung cancer, but it would have made the difference between life and death for some businesses and the livelihoods of their staff.


Still not enough PPE

April 15, 2020

The message from the top is that New Zealand has enough personal protective equipment (PPE) for people who need it.

The message further down the chain contradicts that:

Newshub has obtained more evidence of the gulf between the Ministry of Health and nurses about what’s happening on the frontline with masks and personal protective equipment (PPE).

An audio recording between a charge nurse and staff member reveals the reality of the frustration heath workers face in their efforts to wear masks to protect themselves from coronavirus.

“If you are telling me that you are insisting on wearing a mask at work, I don’t know what to say – we are stopping other people doing that,” the nurse can be heard telling the staff member.

“We are directed that staff can’t wear masks.” . . 

These concerns are not isolated to just one hospital; a nurse at Burwood Hospital, for instance – where six of New Zealand’s nine COVID-19 deaths have occured – says staff even on the COVID-19 ward do not have adequate protection.

They’re on the frontline of the COVID-19 crisis and want to do all they can to protect themselves and their patients, but requests for masks are being blocked by their managers.  . .

A major healthcare provider says it’s struggling to get even a week’s worth of PPE:

Green Cross Health is a provider of primary health care services through pharmacies, GP clinics and home health care and community nursing.

Group chief executive Rachael Newfield said they were struggling to get PPE for their community health division.

“We undertake 60,000 personal cares, which are close contact carers looking after an individual in their home every week.

“To date, from the 20 DHBs, we have received just 30,000 masks, so that isn’t enough to last a week, if we allow our staff to feel safe and follow the latest guidance,” she said.

Newfield said the amount of PPE they could receive also differed between individual DHBs, and stocks from local suppliers were also tight.

When the message to the public is to protect ourselves why doesn’t the health service have enough PPE for all the staff who need it?

Yesterday a third of people with Covid-19 were health workers.

The number of health workers in New Zealand with Covid-19 has jumped by nearly 60 percent in just four days.

On Wednesday, 64 healthcare workers had contracted the virus but that figure had leapt to 101 by Sunday.

Of the 110 new confirmed and probable Covid-19 cases in the intervening period, 37 of them – more than a third – were health staff. . . 

Not all The health workers contracted the disease through work but that some did makes it even more important that all of them have PPE when and where they need it.

Director-General of Health Ashley Bloomfield said the situation was worrying.

“I’m concerned about any case in a healthcare worker, particularly where it happens in the workplace,” he said.

“We’ve got some information about the cases that are healthcare workers and what I’ve asked the team for particular analysis of is, of the cases that have happened in the workplace, how was it that they were infected? So was that through being part of caring for someone with Covid-19 or was it because they are part of a cluster where they may be a close contact of another staff member?” . . .

And was it because staff don’t have the PPE they need?

The incidence of disease in health workers takes the edge off the hope that comes from the decline in the number of new cases.

That downward trend will have to continue before the government decides to let us out of the level 4 lockdown and giving health workers the PPE they need will help that.

Yesterday Treasury outlined various scenarios showing  the economic impact of the lockdown:

Treasury scenarios released by the Government show unemployment could reach up to 26 percent if the coronavirus lockdown is extended beyond four weeks.

The data shows the range of scenarios Treasury has predicted for the New Zealand economy, based on assumptions of different amounts of time under the four COVID-19 alert levels.

The scenarios show that unemployment can be kept below 10 percent, and return to 5 percent next year, if the Government is willing to provide additional financial support. . .

The economic and social costs of the lockdown are already too high.

We can not afford to have it extended, especially if the extension was due to an increase in infections because health workers don’t have the PPE they need to keep themselves safe.


This is agriculture

April 6, 2020

There’s a lot more to farming than farming:


The other curve

April 6, 2020

In ordering a lockdown and putting New Zealand into a state of emergency, the government is firmly fixed on reducing the spread of Covid-19 to save lives and, ultimately, eliminate the disease.

That’s the health side of the equation. Roger Partridge argues a coherent Covid-19 strategy would also taken into account the economic one:

Professor Sir David Skegg raised the 64-thousand-dollar (or perhaps 64 billion-dollar) question in his testimony before Parliament’s Epidemic Response Committee this week. He asked whether the government had a clear the strategic objective for its unprecedented level-four lockdown.

Since the subtitle of Alert Level 4 is “Eliminate”, Sir David’s question might seem unfair. And Director General of Health, Dr Ashly Bloomfield, quickly clarified to media that elimination is indeed the goal.

But if elimination is the objective, it is troubling that Minister of Health David Clark referred to a goal of reducing the epidemic’s effect to successive “waves” of infection in his testimony before the Committee. There will be no waves of infection if elimination is successful.

Lack of consistency in messaging about the Government’s strategic objective is worrying. But there is a more fundamental concern with the elimination objective: the absence of a clear timeframe. Of course, we can eliminate the disease. If the four-week lockdown does not work, the government simply forces us into lockdown for longer. But at what cost?

A cost-benefit assessment sounds heartless when the goal of the lockdown policy is to save lives. But the country-wide pause has already triggered a domino-effect of business failures and job losses. Just as the coronavirus spreads exponentially, so does harm from the lockdown. For firms and workers, each day of lockdown causes more business failures and job losses.

It is easy to count the deaths of, or at least with, Covid-19. It will be harder to count the social costs, including lives lost, from both later treatment of other health conditions and the economic devastation, but they will be real.

These economic effects have health and wellbeing implications too. And at some point, the harm to the wellbeing of Kiwis from the lockdown may become greater than the benefit to the wellbeing of New Zealanders from continuing with it.

This will include more suicides, more domestic violence, more alcohol and drug abuse and delayed treatment for health conditions including cancer which could make a life or death difference.

Most estimates show unemployment soon running into double figures. Overseas estimates suggest if Governments are not careful unemployment could exceed 20% or even 30% – levels not seen since the Great Depression.

The hardship caused to hundreds of thousands of Kiwi families from widespread unemployment, the evaporation of job opportunities for the new generation of school leavers and the losses to the productive side of the economy which funds our social services and most of the population’s livelihoods, must all be factored into the Government’s strategic choices.

The business failures and job losses have both and economic and social cost that will feed off each other.

They will also result in less tax paid while demands on the public purse will increase.

Until it addresses this complicated equation, the Government’s Covid-19 strategy is at best only half complete. A well-informed strategy must consider both curves – the epidemiological curve and the economic curve.

In the meantime, Professor Skegg had some clear advice for the Government on the areas it must lift its game to give us the best chance of achieving the goal of elimination. The Government must fix the shortcomings with Covid-19 testing. It must enforce strict quarantining at the border. And it must improve contact tracing.

If the Government gets these tactics right, perhaps it can sidestep the bigger strategic decision. But it is fast bearing down on us.

In the meantime, the Government must be more transparent with New Zealanders on the difficult strategic choices the country is facing. If it isn’t, we risk drifting in a direction that may do more harm than good.

This response form the Prime Minister suggests she doesn’t understand that:

“A strategy that sacrifices people in favour of, supposedly, a better economic outcome is a false dichotomy and has been shown to produce the worst of both worlds: loss of life and prolonged economic pain,” Ardern said. . .

She is saying there would be fewer lives lost and less economic pain if the lockdown continues as it is which is not necessarily so. A better economic one would be a better social and health one too with fewer deaths from other causes.

The economic and social costs wouldn’t be so high if the government was to opt for safety rather than essential as the guide for which businesses can operate.

National on Sunday called for more businesses to be allowed to open up if they could prove they could operate safely.

“Our economy has already faced unprecedented devastation since the Government closed it down, we should be doing all we can help revive it and protect businesses and jobs,” economic development spokesman Todd McClay said.

“To date the decision making has been too arbitrary and there are too many inconsistencies. For instance, allowing dairies to open but not local butchers or greengrocers, agriculture to continue but not forestry, cigarettes to be manufactured but community newspapers cannot be printed.”

“If a business proves it can operate safely, provide contactless selling and ensure physical distancing then they should be able to operate.”

What’s the difference between butcheries, greengrocers and fishmongers following practices that keep their staff and customers safe, and supermarkets operating as they are now?

What’s the risk in greens keepers working by themselves on a golf course?

Why can’t  more businesses that sell online be able to do so? If it’s safe to sell a heater or a winter jumper why not a scanner or a shirt?

Why couldn’t some road works be done safely while there’s so little traffic? Why can’t some building continue as long as the tradies work alone or at safe distances from each other and without sharing tools? If an urgent repair to a vehicle can be done safely, why not a warrant of fitness?

All the arbitrary emphasis on essential rather than safe is doing is allow overseas online businesses to compete with domestic ones which might not survive the shutdown.

While Baur might have pulled out of New Zealand anyway, the government’s declaration that only daily media was essential has killed some of our best magazines.

The latest update on Covid-19 cases does show that the lockdown appears to have stopped the steep spike in cases seen elsewhere.

That doesn’t mean we can relax, but it ought to allow the government to take a broader look at its strategy and its social and economic costs.

The lockdown does appear to be achieving its aim of flattening the epidemiological curve, but the government is not doing nearly enough to consider the economic curve and the social costs that will result from that.

Flattening the Covid-19 curve is good but not at the cost of flattening the economy more than is necessary.


Minimum wage increase on hold

April 1, 2020

The government has come to its senses and put a hold on the minimum wage rise that was supposed to come into effect today.

Employers, business groups and economists have argued that imposing a pay increase on businesses in the current environment would endanger businesses and risk jobs for the people the policy was aiming to help.

“We realised that a steep increase would have been imprudent at the best of times and foolish in the extreme when so many businesses are unable to function and so many people are facing redundancy,” spokesperson for the Ministry of Policy Reversals Ms Fairly Frugal said.

“When the government is asking everyone to unite for health’s sake we realised we had to stand together with employers and wait until the economy picks up before forcing a wage increase on them.

”It was a difficult decision but difficult times require governments to accept that political philosophy has to take a backseat to prudence and common sense.”

Business groups greeted the announcement with muted enthusiasm.

”It’s good to have our concerns acknowledged, but we’re not very happy that the hold on the increase will only be until noon,” BusynessNZ spokesperson Ms Penny Wise said.


Processing essential link in economic chain

March 27, 2020

Some New Zealanders don’t understand primary production and the importance of trade:

A number of New Zealanders are outraged that staff at largely export-driven food manufacturers are required to work during lockdown, leading to questions over the fairness of putting employees’ health at risk for the sake of feeding foreign markets.

It is valid to question if all possible measures to keep workers safe from Covid-19 are being observed, but not to discount the importance of processing food for export.

An employee of an unnamed onion processing factory claims staff are required to work throughout New Zealand’s four-week lockdown, despite all the produce being exported overseas. 

“I work in a food factory that processes onions – hardly essential by themselves. They export them all overseas, none go to the local market, but these guys have decided to stay open,” the worker, who Newshub has decided to keep anonymous, told MagicTalk host Ryan Bridge on Tuesday.

Onions might not be essential by themselves, but does the worker want them left in paddocks to rot, does he not want a job when the pandemic is over and does he not want the country to keep up the trade that will be essential for economic recovery?

“I don’t see what good that’s doing for New Zealand in this situation. The directors have decided because they can, because they’re a food manufacturer, they’re going to stay open… it’s not cool, I’m really aggravated by it.”

The employee says the factory has given staff an ultimatum: if they don’t want to work, they don’t get paid. 

“I have to work… if we don’t, we don’t get any money. I don’t really have a choice, everyone needs a wage coming in,” he said. 

If the factory isn’t operating, the business doesn’t get income and if there’s no income how will it pay its staff?

“Everyone’s health is at risk for absolutely no gain. An onion is not essential, especially when it’s getting sent overseas.” . . 

All workers have the right to be safe from disease just as they have the right to be safe in every other way at work.

The worker can ask for safety measures such as protective clothing and masks and for the two-metre rule of social distancing to be observed at all times. But he’s wrong to question the need for the factory to keep operating.

He obviously doesn’t understand his work in processing is an essential link in the chain that starts in the paddock and finishes with export income that will be needed even more now that the country is headed into recession and spending billions on measures to reduce the damage that Covid-19, and the response to it, is  inflicting on businesses, their owners and staff.

ExportNZ Executive Director Catherine Beard says supplying food is an essential activity, and all governments around the world – including New Zealand – are prioritising food production, importing and exporting.

“New Zealand is part of a global food supply chain which would be disrupted if we started putting restrictions on food exports,” Catherine Beard said.

“Food exports are going to help New Zealand weather this economic storm. 70-80% of goods exports are food-related and they are essential to our economy.

“Nor is there cause for concern about working conditions, as food manufacturing businesses are already highly regulated and sanitised environments.

“Employers will be taking extra care about working conditions to keep employees safe, in line with Government recommendations for safe working conditions in a Covid19 situation.

“Any employee with safety concerns should talk to their employer. Employers don’t want sick workers coming to work with even a cold. Employers will be highly vigilant around the safety of their workers as they don’t want to risk a shut down.”

People everywhere still need to eat.

New Zealand produces far more food than we can consume domestically.

Keeping the production chain going will reduce waste, enable growers to prepare for next season, keep people in work, keep businesses afloat and keep on earning the export income that will be needed to fund the economic and social recovery from Covid-19.


Rural round-up

March 24, 2020

Farmers want essential services clarity :

Federated Farmers president Katie Milne is urgently seeking clarity from the Government about what primary sector activities will qualify as essential after the Government effectively put the country into lockdown for four weeks to stop the spread of covid-19.

Milne said she has made it clear in conversations with the Government the definition of essential business has to be as wide-ranging as possible so farmers can keep functioning.

“They are part of the food chain and we need them. 

“The people who do service farming, they have an as equally critical role as us who are growing the food.  . . 

Otago farmers nervous about labour from border restrictions :

Uncertainty over travel for the international workforce is compounding what has been a difficult season for orchardists in Central Otago.

Border restrictions and reduced airline capacity in response to Covid-19 are creating anxiety in the industry.

Summerfruit New Zealand chairman and chief executive of 45 South – New Zealand’s largest cherry exporter – Tim Jones said traditionally two-thirds of his workforce came from overseas, half on Recognised Seasonal Employer (RSE) visas and half backpackers.

“As a grower, I sit here nervous about labour and we know we use as many Kiwis as we can but to supplement that we employ RSE labour and we employ a lot of backpackers and our obvious concerns are they may not be around in the sort of numbers we’ve had recently. . . 

A DIRA decision – Elbow Deep:

As the world is faced with torrents of horrific news as the pandemic sweeps the globe, it feels like there is little to be positive about. But over recent weeks there have been two small gems for New Zealand dairy farmers.

The first piece of good news was Fonterra’s half year financial results, which are a remarkable turnaround from the Co-op’s first ever loss posted last year. The loss wasn’t insignificant or so small it could be dismissed as a rounding error, the Co-op lost over half a billion dollars which only makes the recent turnaround even more impressive.

At a time of mass uncertainty when many people don’t know if they’ll still have a job in a few months, it is somewhat relieving that these results will see Fonterra inject more than $11 billion into the New Zealand economy through milk payments to their farmers. Those farmers will in turn spend over half of that in their local communities, communities which need money now more than ever before. It’s not just Fonterra farmers who will benefit from the Co-op’s strong performance; independent processors around the country will be benchmarking themselves off the Co-op’s strong performance. . .

Rural sector crying out to recruit more staff – Jacob McSweeny:

While thousands of people around the country are facing joblessness a recruiting company is calling out for workers in the primary sector, saying there were 40 jobs in South Canterbury available now.

Agstaff, Canstaff and New Zealand Dairy Careers managing director Matt Jones said the need for workers had increased as a result of implications from the Covid-19 outbreak.

“The work does not stop — it’s ramped up as some of our clients in the primary production sector increase production to meet New Zealand’s needs.

“The cows still need milked and the crops must be picked,” Mr Jones said.

He said he had a client in South Canterbury who needed 40 people to start immediately. . . 

Post-quake study reveals hort potential – Nigel Malthus:

Large areas of North Canterbury and South Marlborough – affected by the 2016 Kaikoura Earthquakes – offer wide potential for horticulture.

A Plant and Food Research investigation has found that several crops – in particular, apples, grapes, hazelnuts and walnuts – could be grown in pockets throughout the region.

It identified 41,515 ha of land – or about 9% of the total 466,000ha – that would potentially be suitable. . . 

Vets offer Covid-19 advice:

The New Zealand Veterinary Association has some advice for animal owners amid the COVID-19 pandemic.

The association representing New Zealand veterinarians says COVID-19 should not reduce the care owners give to their animals’ health and welfare.

“We appreciate there are many issues that people are dealing with in relation to COVID-19, particularly those self-isolating or with family members taking this precautionary measure,” says New Zealand Veterinary Association chief veterinary officer, Dr Helen Beattie.  . . 

Why cradle-to-cradle needs to be included in fashion’s sustainability rating tools :

A review of a leading environmental impact tool for apparel finds that unless improvements are made, weaknesses in the underlying science could lead to misleading results, with potentially far-reaching consequences for the environment.

What do textile lifecycle assessment tools do?

Textile lifecycle assessment (LCA) tools aim to understand, quantify and communicate the environmental credentials of textiles with the intent of minimising environmental impact.

The Sustainable Apparel Coalition’s Material Sustainability Index (MSI) is increasingly being adopted by industry but this LCA method currently fails to account for the complexity of the textile industry.

“Several significant environmental impacts and processes are excluded from the MSI and PM, including recyclability, biodegradability, renewability of resource used, microfibres, abiotic resource depletion (minerals) and abiotic bioaccumulation,” said Dr Steve Wiedemann of Integrity AG & Environment.  . . 


%d bloggers like this: