For the sake of the children

July 21, 2020

Lindsay Mitchell points out two contrasting approaches to welfare:

Perhaps the single-most underrated and under-reported issue in New Zealand is the practice of adding children to existing benefits. Oodles is spoken and written about child poverty, particularly by the Prime Minister who appointed herself Minister of Child Poverty Reduction in 2017. But the fact that 6,000 children are added to an existing benefit and a further 3-4,000 are reliant on welfare by their first birthday never rates a mention. The numbers have varied only slightly over the past 30 years and persist at very high levels. One in ten babies goes home from hospital to a benefit- dependent family.

Most of those one in ten babies will be behind most babies who go home to a family where at least one adult is in work from the start.

The links between welfare dependence from birth and poor, if not disastrous outcomes, have now been well-explored by institutions like AUT and Treasury. The latter identified 4 indicators:

1)    a finding of abuse or neglect;
2)    spending most of their lifetime supported by benefits;
3)    having a parent who’d received a community or custodial sentence; and
4)    a mother with no formal qualifications. . . 

The outcomes for those children are much poorer than for children in families not dependent on benefits.

They are more likely to have contact with Youth Justice services, leave school without qualifications, follow their parents onto a benefit, and be jailed. They are also more likely to be Maori.

Is it kind to perpetuate this intergenerational failure?

Is it kind to contribute to these bad outcomes?

Is it kind to foster the causes rather than address them?

Act doesn’t think so.

 They point out that it isn’t acceptable for these families to keep having children when other families wait and sacrifice, and sometimes never have their own or additional children. More to the point, it is entirely unacceptable for children to be carelessly thrown into environments that harm them and rob them of their potential.

ACT’s policy says that if someone already on a benefit adds another child their benefit income will thereafter be managed. Rent and utilities will be paid direct, with the large part of the remainder of their benefit loaded onto an electronic card to be used in specified retail outlets. Work and Income already has the technology to do this. They operate income management for Youth and Young Parent beneficiaries in this fashion.

Under this regime children should be guaranteed a secure roof over their heads instead of the insecure transience resulting from unpaid rents, evictions and homelessness. Their schooling would be less interrupted with increased geographical stability. They should have adequate food in their tummies in and out of term time (not assured under school lunch programmes).  Their  mother may be encouraged to take advantage of the fully- subsidised, highly effective,  long-acting contraceptives now available, ameliorating the overcrowding which is a significant factor in New Zealand’s horribly high rate of rheumatic fever. Perhaps most importantly their parent(s) will actually decide working is a better option if they want agency over their income. There is a risk caregivers will try to supplement their incomes in other undesirable, illegal  ways but no policy is risk free, and this almost certainly already happens to some degree.

Increasingly throwing money at dysfunctional families provides no assurance parents will suddenly become better budgeters, or not simply spend more on harmful behaviours. Gambling and substance abuse don’t just hurt the parent. They hurt the child directly (damage in the womb, physical abuse or neglect under the influence) not to mention indirectly through parental role-modelling that normalizes bad behaviours, especially violence, to their children.

The last National government took an actuarial approach to benefit dependence, worked out the long term cost and began putting more money into preventing benefit dependency. It was working but the current government has undone that good work.

There is a need for a welfare safety net and with the Covid-19 induced recession numbers needing benefits are already increasing but welfare should not be a life sentence.

There are sound financial and social benefits to stopping people going on benefits and getting those on benefits off them as soon as possible.

The current government’s approach could be seen as being kind. It stopped sanctions against people who could work but don’t and women who don’t name the fathers of their babies.

That isn’t kind to the adults and it’s even worse for the children.

The two approaches to child benefit dependence are a world apart. One continues the ‘freedom’ of the adult to use taxpayer’s money as they wish; the other prioritizes the best interests of the child -their right to security, stability and safety – or, as ACT puts it, what the taxpayer thinks they are paying for.

The country cannot go on merely paying lip-service to the idea of ‘breaking the cycle’. Now is not the time for more of the same. More than ever New Zealand cannot afford the social cost and lost potential that occurs monotonously in an easily identifiable portion of every generation.

The choice at the election is stark – a vote for any of the parties currently in government that are perpetuating the cycle of benefit dependency and the poor financial and social outcomes that result  or a vote for a National-Act government that will address the causes and break the cycle.

The truly kind way is to vote for change for the sake of the children.


Reds’ policy path to poverty

June 29, 2020

The Reds have announced an $8 billion tax grab:

The Green Party have unveiled a sweeping new welfare policy that would guarantee a weekly income of at least $325, paid for by a wealth tax on millionaires and two new income tax brackets on high-earners. . . 

The $325 after-tax payment would be paid to every adult not in fulltime paid work – including students, part-time workers, and the unemployed. The student allowance and Jobseekers benefit would be replaced. . . 

It would be topped up by $110 for sole parents, and the current best start payment would be expanded from $60 per child to $100 per child, and made universal for children up to three instead of two.

This guaranteed minimum income plan would cost $7.9b a year – roughly half what is spent on NZ Super, but almost twice what is spent on current working age benefits.

Paying for all this would be a wealth tax of one per cent on net wealth of over $1 million and two per cent for assets over $2 million. The party expects this would hit only the wealthiest 6 per cent of Kiwis.

This would take the form of an annual payment and would only apply to those who owned those assets outright – not someone who still had a mortgage on their million-dollar home, for example.

That looks like everyone could avoid the tax by never paying off their mortgage, but the party wouldn’t be that stupid, would it?

Any party that thinks up this sort of economic vandalism could be.

The Taxpayers’ Union is slamming the Green Party’s proposed wealth tax as bureaucratic economic vandalism that would hammer job creators.

Taxpayers’ Union spokesperson Jordan Williams says, “The proposed wealth tax would mean the return of the dreaded compulsory asset valuations that made a capital gains tax so unpopular. A bureaucratic valuation scheme would incentivise people to hide their wealth, or shift it offshore. It would be a dream for tax accountants but hell for small business owners.”

“The policy also appears not to differentiate between asset types.  It would tax entrepreneurs creating jobs the same as someone sitting on an art collection. Ultimately it would cost jobs at the very time New Zealanders need entrepreneurs to create them.”

“Wealthy iwi groups sitting on often unproductive land would also be smashed under this scheme.  It’s bumper sticker type policy which is poorly thought through.”

“Any party that says you should raise taxes in the middle of a recession is divorced from reality. It is scary that all the work James Shaw has done to try and make the Greens more economically credible appears to be for nothing.”

Commenting specifically on the Green Party’s income support policy, Mr Williams says, “Under the Greens’ policy, a family of five with both parents on the dole would receive $1180 a week in taxpayer funds, assuming one of the kids is younger than three. That goes beyond generosity: it is using taxpayer funds to encourage long-term unemployment. Combined with the policies to tax job creators, this package would take a sledgehammer to New Zealand’s productivity.”

There’s no good time to increase taxes and a recession is an even worse time.

Recovery from the economic carnage wrought by the Covid-19 response requires investment, expansion and increased employment opportunities.

This policy will be a handbrake on all of those and an accelerator for benefit dependency which is a pathway to increased poverty.

This policy is typical of a party that’s more red than green and doesn’t understand that a greener country has to be well and truly in the black and you don’t there by taxing more.

New Zealanders gained a glimpse today of what a Labour Greens government would look like, and it involves a lot more taxes, National’s Finance spokesperson, Paul Goldsmith, said today. . . 

At a time when we need our successful small business people to invest and create more jobs, the Greens want to tax them more.

Rather than celebrating Kiwis doing well, the Greens seem to want to punish them.

The Greens never have the influence to get their way entirely, but they would push a Labour Greens coalition in the direction of higher taxes.

Labour have so far refused to rule out taxing people more if they win the election.

The very real fear many New Zealanders have is that this current government, which has $20 billion available for election spending, will spend whatever it takes to try to keep its poll numbers up until the 19 September election.

Then on the 20th, if they win, the smiles will drop and New Zealanders will be presented with the bill – higher taxes.

National has committed to no new taxes for Kiwis in our first term.

While the economy is going down, the Greens want to tax us more, and Labour haven’t ruled out doing the same.

That’s another very good reason to vote for a National/Act government that will focus on policies which foster the economic growth necessary to provide a pathway for progress.


Safe better than essential

April 1, 2020

The government is deciding what is an essential business or service, Act says it would be better to determine what is safe:

 . .. If the objective is to stop the spread of COVID-19, then the test should be whether something can be done safely, not whether it is essential. Moving to a test of safety rather than necessity would be a much better way of fighting the virus while salvaging businesses.

‘Essential’ Compromises ‘Safety’

The Government rightly says it is essential to have food available. Once food is available in an area, no other activity is permissible. But making people travel further to visit a smaller number of bigger and busier stores undermines our goal of reducing the spread of the virus. Supermarkets have remained open because they are essential but they have only undertaken safety mechanisms more recently. Under a safety approach, only food stores with safe processes would be allowed to open, but all stores with such processes would equally be able to open. . .

It would be just as safe for butchers and greengrocers to be open, following best practice of allowing one customer in, one out and keeping everyone two metres apart, as it is for supermarkets, perhaps even safer if it meant fewer people in supermarkets.

Couplands announced yesterday it will close its South Island plant because it mostly supplies its own shops in the south and these aren’t deemed essential.

The bakery supplies about a third of the South’s bread. The plant closure will cause shortages and panic buying. Again, providing the stores have practices which keep their staff and customers safe, they should be able to stay open and lower the pressure on supermarkets.

Instead of the objective test ‘can this be done in a way that is safe’ we are facing a subjective test ‘does the Government think you need this.’ This level of government power is not sustainable.

Breakdown Of The Rule of Law

Subjectivity leads to absurdities and a breakdown of the rule of law. The Government has decided that eating halal meat is a goal important enough to justify opening some butcheries. Driving to the beach for a walk or a picnic is not. Which one is safer? . . .

Halal meat can be bought from supermarkets and a halal butchery isn’t any more or less safe than any other butcheries. It’s the safety practices they follow to protect staff and customers safe that matter, not religious practices.

If the decision to close butcheries isn’t reversed millions of dollars of meat will have to be dumped. That would be an unconscionable waste.

The closure of butchers is also risking animal welfare:

The Government’s decision to exclude independent butchers from the essential business list during the COVID-19 lockdown will cause an animal welfare crisis in the New Zealand pork sector, says an industry group.

All independent butchers across the country have been classified as non-essential businesses and been forced to close as part of the Alert Level 4 lock-down for COVID-19.

However NZ Pork said the decision would likely result in the sector having no place to house up to 5,000 surplus pigs on farms every week.

“By not being able to sell fresh carcass pigs to the independent butchers and other segments, we will be faced with a significant animal welfare issue,” said chief executive of NZ Pork David Baines . . 

Back to Act:

Trust The People

Underpinning the ‘essential’ approach is a belief that people can’t be trusted to judge what is safe. (Can I do this without coming within two metres of others?, without touching things other may have touched?).

Safety Approach: Essential For The Recovery

We are going to have to recover as an economy. Free Press is approached daily by businesspeople in a state of despair. Their working capital may or may not last the first four weeks, it certainly won’t last further. Being able to operate under a safety approach is, to borrow a term, essential. Essential to what? Essential to people protecting their livelihoods in the coming months. . . 

The more businesses that continue operating, the more people who are able to keep working, the less the economic and social damage the lockdown will inflict and the faster the recovery will be.

What Would A Safety Approach Look Like?

A safety approach would involve a basic set of rules that people must follow. A two metre rule (Free Press regrets this would exclude televised dance competitions). Can you do this whilst remaining two metres from others? Yes or no? A ‘touched object’ rule. Can you do this without touching objects others outside your household have touched? Yes or no? A regular testing approach. Can we guarantee regular testing and contact tracing is possible? Yes or no? Obviously there is more to do, but we need to start developing a safety approach rather than an essential approach, pronto.

The only justification for the lockdown is to keep us all safe.

Whether or not a business can operate safely should be the only criteria for allowing it to do so through the lockdown.

That won’t compromise personal health and will help economic and social health.


It’s about trust

February 2, 2020

National leader Simon Bridges has ruled out working with New Zealand First after this year’s election:

Bridges’ messaging is all about bundling New Zealand First, Labour and the Greens together saying: “a vote for NZ First is a vote for Labour and the Greens.”

It was three years ago even though around half the people who voted for NZ First wanted it to support National in government.

“I don’t believe we can work with NZ First and have a constructive trusting relationship,” Bridges says.

“When National was negotiating in good faith with NZ First after the last election, its leader was suing key National MPs and staff. I don’t trust NZ First and I don’t believe New Zealanders can either.”

It’s about trust and Peters can’t be trusted.

This makes NZ First dependent on gaining at least 5% of the vote on September 19 unless it wins a seat.

That’s very unlikely unless Labour throws it a lifeline by campaigning for the party vote in a seat it holds.

That would be rank hypocrisy from both parties which have vehemently criticised for National holding back to help Act in Epsom.

But hypocrisy is not unusual in a politician who can’t be trusted.


Just say no

January 27, 2020

If National had ruled out a deal with New Zealand First three years ago, would the latter have got less than five per cent of the vote and the former still be leading the government?

We’ll never know.

But we do know that around half the people who voted for NZ First hoped the party would go with National and that a lot of them are still very unhappy Winston Peters chose Labour and the Green Party instead.

We also know that while Peters was supposedly negotiating in good faith he was also working on legal action against National’s deputy Paula Bennett and then-minister Ann Tolley.

That tells us, once again, that Peters can’t be trusted.

Simon Bridges has said he will announce well before the election whether or not National will rule out New Zealand First.

I hope he does say no to them which will make it quite clear to voters that a vote for that party is a vote for a Labour-led government.

There are risks.

In spite of their many criticisms of National not trying to win Epsom so that Act will get into parliament, Labour and New Zealand First could come to a similar arrangement in another seat in an attempt to secure an electorate for a New Zealand First candidate. If that worked, NZ First would not need to secure five percent of the vote to stay in parliament.

New Zealand First could get back, with or without an electorate,  and National could have too few seats to form a government without it and so be back in opposition.

But there are bigger risks in not ruling out New Zealand First.

It would send the message to voters that New Zealand First might go with National, even though the chances of that are very, very remote.

It would enable Peters to pretend he’ll listen to voters even though last time more opted for National than Labour.

It would give Peters the power he’s had too many times before to play the bigger parties off against each other and extract too high a price for putting them into government.

The worst day in government is supposed to be better than the best in opposition. But if the choice is government with Peters, I’d opt for opposition.

Tracy Martin says this year feels like the beginning of the end for Peters:

. . .So is it time to write Peters off?  Peters has cleverly played up his part as Labour’s handbrake, just as he once pitched himself as a bulwark against National’s extremes.  It’s how he has survived so long in politics – even after the “baubles of office'” fiasco, or Owen Glenn donations scandal.

But you can only play one side against the other for so long and it feels like Peters has played one too many hands.

So is the extraordinary Peters era coming to an end? He is our most familiar face on television; as recognisable as the theme tune to Coronation Street, as well worn as a pair of old slippers.

 But even soap operas eventually have their day.

National ruling out NZ First would make the end of the Peters soap opera much more likely.

Please, National,  just say no.


It’s only one poll

October 14, 2019

The slide has started:

The age of Jacindamania is over. Brand Ardern has taken its biggest knock yet – and when Labour’s magic weapon loses its power, the party does too.

The latest Newshub-Reid Research Poll shows just how wounded Prime Minister Jacinda Ardern and Labour have been after the string of crises that have beset them.

Labour was the only party to lose support in Newshub’s poll. It’s now on 41.6 percent – smacked down by 9.2 percent.

Most of that went to National, which is on 43.9 percent – up 6.5. This is enough to overtake Labour, and that’s manna from heaven for the Nats and leader Simon Bridges. . .

It’s only one poll,  has a margin of error of 3.1%, and remember the last Newshub-Reid Research Poll, had National much lower and Labour much higher than the TV One poll that came out the same night.

On this result Labour and the Green Party could still form a government and National and Act would be a couple of seats short.

But while Party support ebbs and flows the trend is more significant, and this echoes other polls which show Labour losing support.

And support for the Prime Minister tends to peak and then fall.

Personality matters but it doesn’t pay the bills and while warm words are well received they can’t counter the fact that the year of delivery has been one of disappointments.


Politics changed, facts haven’t

March 28, 2019

Sir Michael Cullen is being paid $1000 to sell the capital gains tax.

It’s a task made more difficult by records of his views on a CGT  which the parliamentary library holds from his time as an MP:

Stuff reported that although the chairman of the Tax Working Group once called a capital gains tax “extreme, socially unacceptable and economically unnecessary”, he has since changed his mind.

New documents compiled by the Parliamentary Library for the ACT party reveal just how far he shifted since leaving Government in 2008.

The 84 pages of research included every reference Cullen ever made in the House in reference to a CGT between 1987 and 2008. . . 

They include:

. . . “I think it is extremely hard to make that connection between a capital gains tax and the affordability of housing, insofar as there has never been a theoretical argument put forward about a capital gains tax on housing. It is more in the direction of a level playing field around investment; it is not around the notion that it will make houses cheaper. Indeed, it is very hard to see how it would necessarily make houses cheaper,” Cullen said at the time.

On June 20, 2007, when Bill English asked Cullen about explicitly ruling out a capital gains tax, he responded saying: “One of the problems with a capital gains tax – apart from the fact that if it were done, it should apply to all asset classes—is that countries overseas that have capital gains taxes have significant inflation in house prices on occasion”.

Then on June 21, 2007, he was asked about the possibility of combining ring-fencing with a capital gains tax on all investments except the family home, and more Government investment in low-cost rental housing.

He responded saying: “I think it is fair to say that, if one was looking at a capital gains tax, which I am certainly not, it would apply to all asset classes. I think the arguments in favour of such a tax, which probably 20 years ago were quite strong, become much, much less strong in the intervening period of time, for a whole host of reasons. So I think that that is actually not a very worthwhile avenue to explore, not least because it comes, in effect, at the end of a process, rather than trying to address the over-investment at the start of the process”. . . 

He says he was Finance Minister at the time and following the government line.

When asked why he changed his mind, he quoted John Maynard Keynes: “When the facts change, I change my mind”.

What facts have changed? It wasn’t a good idea then and it still isn’t, for the same reasons.

As Robin Oliver, former deputy head of Inland Revenue, former Treasury advisor, an expert on the tax system, and one of three dissenters on the Tax Working Group said:

There’s a strong argument for taxing capital gains, as you put it, in theory, the problem is the practicality and of making it work. . .

Kathryn Ryan asked him if, all things being equal and as a tax expert would it be good to do it and her replied:

In the actuality of what you have to do to get such a tax in place, no.

Most of the arguments in favour of a CGT are theoretical ones based on a notion of fairness, whatever that is.

Most of the arguments against it are practical based on facts including that it has done nothing to rein in house prices elsewhere and has led to overinvestment in housing, underinvestment in business, and acts as a handbrake on succession.

The politics have changed but the facts haven’t.

A CGT with exceptions as recommended by the TWG would be expensive to administer, contain loopholes which would only provide work for lawyers and accountants, promote over-investment in housing, stifle investment in productive assets, and result in lower tax revenue in tough times when capital gains fall.


Only one poll

December 2, 2018

It’s only one poll, but the latest one from One News Colmar Brunton is a very good one for National as the political year draws to a close:

National up 3% to 46% support, Labour down 3 to 43%, Green Party down 2 to 5%, NZ First dropping 1 to 4%, the Maori Party on 1% and Act on 1%.

It’s the party vote that counts and this result matters more – at least so far as one poll matters at all – than the preferred PM poll in which National’s leader Simon Bridges is still in single figures.

The changes are in margin of error territory but the trend still has National ahead of Labour.

That isn’t enough to govern under MMP, but it shows National support is solid and that the leader’s stardust isn’t enough to make Labour sparkle too.

Under MMP it’s not enough to have the most support, a party has to get to 61 seats by itself or with at least one support partner.

But at this stage of the political cycle, and given, the rough waters National has had to negotiate in recent months that’s a lesser concern than voter support which is still very strong.


2/4 for Act’s plan

August 13, 2018

Act wants fewer MPs a smaller executive and no Maori seats:

ACT is drawing a line in the sand on the size of government with a new bill aimed at rolling back the state.

Party Leader David Seymour today revealed his Smaller Government Bill which will reduce the size of Parliament to 100 MPs, limit the size of the Executive to 20 Ministers, and remove the Maori seats.

“The growth in government over the past two decades has not delivered better outcomes for New Zealand. We need smaller, smarter government”, says Mr Seymour.

“New Zealand has too many politicians for its size. Our Government costs more and delivers less than it did 20 years ago.

“The Smaller Government Bill will cut the size of Parliament 100 MPs, bringing us into line with other developed countries.

The number of electorates is determined after each census.

The General electoral population is the ordinarily resident population shown in the last census less the Māori electoral population.

All electorates must have about the same population size.   The number of South Island General electorates is fixed at 16 by the Electoral Act 1993.  To calculate the number of electorates the Government Statistician:­

  • divides the South Island General electoral population by 16 (this result provides the average electoral population for South Island electorates and is referred to as the South Island quota)
  • divides the Māori electoral population by the South Island quota to work out the number of Māori electorates, and
  • divides the North Island General electoral population by the South Island quota to work out the number of General electorates for the North Island.  . .

If the number of MPs was reduced the size of electorates would have to increase and rural electorates are already far too big.

Clutha Southland covers an area of 37,378 square kilometres, West Coast Tasman is a little smaller and Waitaki covers an area of around 34,000 kilometres.  It doesn’t matter how hard, smart and effectively  MPs representing these electorates work, it is impossible for them to give the same level of service to constituents spread over these huge area as the MP for Epsom, the smallest electorate, which covers an area just under 20 square kilometres.

“It will also restrict the number of high-paid Ministers to 20. Our Executive is far too big – currently standing at 31 people.

“Almost half of the Government MPs hold a position in the Executive. We have too many pointless ministerial portfolios. They are not improving the lives of New Zealanders and this bill will do away with them.

Quality rather than quantity should be the rule for the executive.

Fewer, more able ministers would serve the country better, and at a lower cost, than the over-populated and under-talented one we have now.

“The bill will also remove the Maori seats. New Zealand is a modern, diverse democracy. There is simply no longer a place for one group of people to be treated differently under the law.

“We now have 27 Maori MPs, 20 of whom were elected through the general roll. Even without the seven Maori seats, Maori would still be proportionately represented in Parliament.

The problem of size in rural general electorates is even worse in Maori seats.

Te Tai Tonga, the largest, covers an area of 153,671 square kilometres and is nearly four times as big as Clutha Southland. It covers the whole of the South Island, Stewart Island, the Chatham Islands, and extends into the lower North Island as far as the Hutt Valley.

It isn’t humanly possible to service an area that big effectively which means constituents are getting inferior representation.

In 2008 then-Maori Party leader Tariana Turia said:*

I think what our people are starting to realise though is that when they voted Maori people into Labour they never got a Maori voice, they got a Labour voice and that was the difference, and they’ve only begun to realise it since the Maori Party came into parliament, because it is the first time that they have heard significant Maori issues raised on a daily basis.

The seats by themselves didn’t give Maori a voice. They have also often given them inferior representation, sometimes because of the MPs and always because of their size.

The Royal Commission on MMP said there would be no need for Maori seats under this system, but that was ignored.

Its prediction that MMP would bring more Maori into parliament anyway has been proved right.

Getting rid of Maori seats is National Party policy. It was set aside in negotiations with the Maori Party after the 2008, 2011 and 2014 elections. It is New Zealand First policy and is now Act policy. That could mean a majority of parliament supports this part of Seymour’s Bill should it be drawn from the ballot.

Maori choose whether they are on the general or Maori roll every six years.

If the greater number of people switching from the Maori roll to the general one in the first month continues it will result in one fewer Maori electorate.  If that trend continued the seats would eventually disappear by attrition any way.

“Our plan would also require all parliamentary candidates to stand in an electorate, and all elected list MPs would be required to open an office in the electorate in which they stood.

“List MPs serve an important function in our democracy, but they should be required to serve New Zealanders and solve real problems, not just collect a salary and spend their time in a Wellington office. . . 

The requirement to serve New Zealanders and solve real problems should apply to all MPs but I wouldn’t go as far as requiring all of them to stand in an electorate.

Some MPs might be more effective if they serviced a nationwide constituency, for example an ethnic community, than a single electorate.

I give Act’s plan a rating of 2/4.

Seymour’s plan to reduce the size of the executive and get rid of Maori seats has merit.

But reducing the number of MPs is simply populism that would make already over-sized electorates even bigger and requiring all MPs to stand in electorates is a blunt instrument that wouldn’t necessarily improve performance.

* Dame Turiana’s quote was made on Agenda. The only record I can find is on a blog post I wrote here  where the link to the quote no longer works.


National in drag difficult sell

May 30, 2018

Two polls this week show the National Party still ahead of Labour with about 45% support.

That is encouraging for National and worrying for Labour.

But the latter has two support parties, although New Zealand First is registering below the 5% and the Green Party is hovering close enough  to the threshold to make it possible it might not make it back into parliament and we’d return to a two-party system in spite of MMP.

Possible isn’t probable and in spite of being the most popular party, National lacks any allies with sufficient support to enable it to form a government with more than 50% of the vote.

Act could gain another MP or two, but it hasn’t managed to do that in recent elections and would have to do so without taking votes from National to make a positive difference.

The Maori Party might win back a seat or two, but that too is more possible than probable.

Finding another party which could either win a seat or cross the 5% threshold would not be easy.

Some are suggesting a National MP leaves the party to form another one. But National in drag would be a very difficult sell for party members and other voters, and would only help if it got votes from the left and not the centre-right.

Tariana Turia managed to win a seat when she left Labour and formed the Maori Party; Winston Peters did it with NZ First; Peter Dunne held his seat under several manifestations of what eventually became United Future and former Labour MP Richard Prebble won a seat for Act but they are the exceptions. Any other MPs that I can recall who left a party and formed another failed to hold their seats.

The other option is standing back and making an accommodation to let a new party, which would take votes from Labour, NZ First and/or the Greens, take a National-held seat.

But that would be very difficult to do and would be entering very dubious territory.

National voters gave electorate votes to Dunne but he was a sitting MP when he formed his own party. Act voters opted for Rodney Hide of their own volition and not because National made an accommodation. They supported him and subsequently David Seymour but didn’t have to vote against a sitting National electorate MP to do so.

Trying to persuade National voters to swap support from an MP they voted in for someone from a new party would be a very different matter.

National is a victim of its own success and any attempt to help another party is likely to backfire and sabotage its own support.

It’s also a victim of the failure of MMP to give us a party in the middle that stands for something and could go centre-right but what can it do about without endangering its own support?


It’s only one poll

April 16, 2018

Labour’s honeymoon is over for now.

National is back in front of Labour but the three parties in the coalition are still comfortably ahead of National and Act.


Satire or serious?

November 29, 2017

Act’s newsletter Free Press says it’s learned from a usually reliable source what’s in the secret coalition document:

First Things First: Why is it Secret?
It is very damaging in a democracy for Jacinda Ardern to keep secret what the Government has pledged to its coalition partner. Why the secrecy? There are significant new extra spending promises. Labour does not want the Treasury to know or the extra spending will be added to the Treasury forecasts due to be published shortly.

Running out of Other People’s Money
Already the treasury forecast will show Labour’s election spending promises were understated and there is a blow out. Add the new secret spending promises and New Zealand’s credit rating is at risk. A credit rating decline means everyone’s mortgage payments go up.

Second
There are or were 38 pages to the Labour-New Zealand First agreement. As the PM has almost admitted it has been edited down to 33 pages and Labour is trying to get it lower. The missing five pages are still part of the coalition agreement but both governing parties have conceded it will be very damaging if they are ever published.

The Two Governments Agreement
What is in the agreement? In effect the document creates two governments, A Labour/Green government and a New Zealand First government. Winston Peters is granted a veto over the Labour/Green government but in the New Zealand First government his powers are untrammelled.

Labour/Green Government
The government budget must be submitted to NZ First (Winston) for approval
Labour has agreed to a 10 percent a year increase in the Foreign Affairs budget.
Labour has agreed that NZ First manifesto promises will have priority. The Northland port and railway, for examples
New Zealand First nominations will be approved. For example to the port inquiry.
No concessions can be made to the Greens without prior approval from New Zealand First, think Kermadecs
No new policy not contained in the coalition agreement can be advanced by Labour Ministers without NZ First approval.
All government appointments must be approved by NZ First
New Zealand First Government
Foreign Affairs budget to be increased and Mr. Peter’s Foreign Affairs budget requests cannot be vetoed. Mr Peters can spend his budget how he chooses.
All budget requests from New Zealand First Ministers that have been approved by Mr Peters must get priority.
As Minister of Foreign Affairs Mr Peters has the sole right to nominate all Ambassadors and other diplomatic posts not just Washington and London but he cannot be stopped from appointing his mates to be consuls as he tried with Owen Glenn.
As Minister of SOEs Mr Peter’s has the sole power to appoint all the chair and directors of every SOE. Dozens of appointments.
New Zealand First can nominate, over three years, six people to be knights (or, theoretically, Dames) and its nominations will be favourably considered for other honours.
New Zealand First will appoint the next Chief of Defense
A provision requires all Ministers to refer any request from or to a New Zealand First Minister to go through Mr Peters office.
The PM has agreed that she will not dismiss any New Zealand First Minister, MP or appointee without Mr Peter’s approval and the PM has also agreed to dismiss any NZ First minister, MP or appointee if asked to by Winston Peters.
Unbridled Power
No previous Prime Minister has had the power and patronage that Winston Peters has been given. He can appoint his cronies to be Ambassadors, SOE chair and directors and he can give them knighthoods. He has an iron grip over his party. Winston in effect controls the government budget and can spend billions of dollars on his pet projects while vetoing the plans of both Labour and the Greens.

Snookered
No wonder the Prime Minister, who foolishly thought none of this would become known, is desperate to keep it secret. We suspect that at some stage some of the document will have to be released but as the PM is now denying even the existence of five pages of the secret deal it may be years before we know.

We Need Some Responsible Adults Here
The Secretary of the Treasury should demand to see the full 38 pages. If the government will not let the Treasury see the full secret coalition agreement then the Secretary of the Treasury must tag the Government accounts saying that the Treasury had asked and been denied access to the full coalition agreement and future spending may be significantly greater than the forecast.

For the country’s sake I hope this is satire, but I think it’s serious.

We’d know which it is if the document was released to the public as Peters said it would be but Jacinda Ardern is refusing to do.


Why are we waiting?

October 8, 2017

The official election results left National with two fewer seats than on election night and Labour and the Green party with one more each:

  • The number of seats in Parliament will be 120.
  • The National Party has 56 seats compared with 58 on election night.  
  • The Labour Party has 46 seats compared with 45 on election night.
  • The Green Party has 8 seats compared with 7 on election night.  
  • There are no changes to the number of seats held by New Zealand First and ACT New Zealand which remain at 9 and 1 respectively.
  • All electorate candidates leading on election night have been confirmed as winning their seats.
  • The total number of votes cast is 2,630,173.  47% of votes were cast in advance.
  • The turnout as a percentage of enrolled electors is 79.8% (2014 – 77.9%).  This is the highest turnout since 2005 (80.9%).
  • The final enrolment rate is 92.4% (2014 – 92.6%).

This still leaves a possibility of National and NZ First governing with 65 seats or Labour, NZ First and the Greens governing with 63 seats, or NZ First giving confidence and supply to one of the bigger parties while sitting on the cross benches.

The difference between the numbers has got a little smaller but nothing else has changed about the options since election night so why couldn’t negotiations have started sooner and why are we still waiting for an outcome?

 


It’s only another poll

September 20, 2017

This is a good boost for Prime Minister Bill English as he heads into the final leaders’ debate:


Labour’s poll lower

July 15, 2017

The 1 News Colmar Brunton poll released this week was bad news for Labour.

Its own poll is even worse.

Newshub has been leaked poll results from the company that does Labour’s internal polling which show it is in big trouble, two-and-a-half months out from the election.

The results show Labour is on 26 percent support – crashing from 34 percent in May. . . 

National is chugging along as usual – currently on 42 percent – then Labour (26 percent), the Greens (13 percent) and New Zealand First (14 percent). . .

The Roy Morgan poll released last night held better news for Labour:

The overall support for the governing National-led coalition was down 3.5% to 45.5% with National support down 3.5% to 43% while support for their Coalition partners was unchanged with Maori Party on 1.5%, Act NZ on 1% and United Future on 0%.

Support for a potential Labour/Greens alliance was up 4.5% to 44% driven by the 5% rise in support for Labour, now on 30.5%, while support for the Greens was down 0.5% to 13.5%. Support for New Zealand First was down 1% to 8%.

But that poll usually has bigger changes than the others and it’s the trend which matters.

The UMR polls shows a downward trend for both National and Labour.

That’s similar to what happened in 2002 when many voters didn’t think National, the bigger Opposition party, had a chance, but Labour, the main governing party,  didn’t benefit.

Act, NZ First and whichever iteration of what is now United Future was then, mopped up support instead.

This time neither Act nor United Future are gaining but NZ First is.

People tend to bank the good things a government does and the longer a party is in power the more people will take issue with what it does, or doesn’t do.

Even though polls continue to show a reasonable majority think the country is on the wrong right track, that might not be enough to return a stable, National-led government.

 


Election Sept 23

February 1, 2017

Prime Minister Bill English has announced that the general election will be held on September 23rd.

He’s following the example of his predecessor John Key who announced the date early.

This gives certainty for everyone about when the regulated period before election day starts, makes it easier for the people who administer the process and takes the politics out of setting the date.

September 23rd is the first day of school holidays but with the freedom for anyone to vote early that shouldn’t be a problem.

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He also spoke of which parties National could work with in the next term should it be in a position to lead a fourth government:

“Under MMP elections are always close so we will be taking nothing for granted as we campaign for the right to lead New Zealand for another term,” says Mr English.

“We will be fighting hard to win every party vote to ensure we are in the best possible position to form a strong and stable Government that continues to deliver for all New Zealanders.

“However, MMP means we will almost certainly have to work with other parties.  This will likely be in the form of confidence and supply agreements, which have worked well for us in the last three terms.”

Mr English said his preference is to continue working with current partners –  ACT, United Future and the Māori Party.

“Together our parties have provided a stable and successful government at a time of great uncertainty in many parts of the world,” says Mr English.

Mr English ruled out working with the Labour-Greens grouping. 

“They are an increasingly far left, inward looking grouping, with no new ideas who don’t back New Zealanders to succeed.

“New Zealand First is an unlikely partner, however I am prepared to have discussions with them post-election depending on the makeup of Parliament,” says Mr English. 

 


Optional hypocrisy

September 29, 2016

The Green Party has announced it won’t be contesting the Mt Roskill by-election, should there be one.

Not wasting time and resources on a contest they can’t win isn’t stupid but it shows up both the Greens and Labour as hypocrites.

Both have been highly critical of National for not trying to win Epsom and Ohariu to help Act’s and United Future’s candidates.

The hypocrisy is particularly bad for Labour’s candidate who stood in Epsom at the last election.

The Opposition’s hypocrisy over ‘dirty deals’ is brazen, says ACT Leader David Seymour as the Green Party confirms that they won’t stand a candidate in Mt Roskill as part of an arrangement with Labour.

“Michael Wood’s campaign in Mt Roskill is set to be a brazen display of hypocrisy,” says Mr Seymour. “Two years ago he was bemoaning John Key’s endorsement of a vote for me in Epsom as a ‘dodgy deal’. Now look at him.

The Greens ought to be just as embarrassed, with Julie-Anne Genter having called John Key’s Epsom endorsement ‘undemocratic’. Clearly, this was nothing more than faux-outrage.

Strategic voting is a reality of MMP, but hypocrisy is optional. Labour and the Greens have shown how cheap their words are by participating in a deal that far eclipses the electoral arrangements they criticise every election.”

Labour and the Greens claimed the principled high ground in their criticism of what they called ‘dirty deals’.

Neither can claim to be so principled and both are guilty of making the wrong choice when faced with otional hypocrisy.


Act out-greening Greens

February 29, 2016

Act leader and sole MP David Seymour’s first shot at the party’s conference this weekend was to pot the Greens for hypocrisy for having the highest expenditure on flights.

The figures come from the fourth quarter parliamentary expense reports.  It excludes ministers who have a much heavier workload, for example the Ministers of Health and Education must visit hospitals and schools, and are reported separately.

In October, November, and December the average Green MP spent $8,562 on air travel.  By comparison the average Labour MP spent $7,790, the average National MP $5,933 and the average New Zealand First MP $6713. . .

“These are the MPs who regularly tell us that climate change is the crisis of our time and we must reduce our emissions.

“It is also extraordinary that they do not even have to serve electorates, as the Greens are all list MPs and have not won an electorate since 1999.  As an Auckland electorate MP I have to see constituents on Monday and be in Parliament on Tuesday, and back in the electorate Friday, practically every week.

“As list MPs the Greens have far more potential to minimise their carbon footprint by flying less, but not only have they not done so, they are the most frequent flyers.

“Co-leader James Shaw loves to tell the story about how, as a consultant, he helped companies reduce their use of air travel.  The Green Party must be his toughest client.”

He then went on to out-green them with proposal to sell  Landcorp and put the proceeds into a Sanctuary Trust for applicants who wish to operate inland sanctuaries for native wildlife.

“Landcorp is a business the Government should never have owned and which is responsible for considerable dairy conversion and deforestation.  

“The new Trust’s grants would be conditional upon the applicant reaching targets for predator exclusion, biodiversity, and community participation.  

“The model is not so very different from what ACT has done with Partnership Schools.  Invite social entrepreneurship, measure performance according to agreed targets, and get out of the way.

“Over 100 years, Sanctuary Trust would radically transform the abundance of New Zealand’s most endangered species.” . . .

Utopia has a graph showing Landcorp’s dividends paid and cash injections received from government since 2007.

As cash cows go, Landcorp has had $2.25 million more in capital injections from taxpayers than it returned to them in dividends since 2007.

image

 Source: data released by the New Zealand Treasury under the Official Information Act.

The $1.5 billion asset is a very poor investment for the taxpayer.

Keeping some of the farms as a land bank for treaty settlements has merit.

But the rest could be sold, gradually so as not to flood the market.

Using some of the proceeds for environmental projects such as Seymour proposes and some for investing in agricultural training and infrastructure, for example irrigation development, would be much better use of the money.

Concern for the environment is not the preserve of the political left.

There is a significant constituency of people who are green but not Green.

They want sound environmental policies without the radical left social and economic agenda. Some of those support National’s Blue Greens but some let their green leanings blind them to the red social and economic policies of the Greens.

Seymour is targeting them and in doing so attempting to grow the centre right share of the vote.

That’s clever politics.

He’s out-greening the Greens with environmental policy that makes economic sense.


Green party poopers

August 12, 2015

The Rugby  World Cup is taking place on the other side of the world and matches will be played when most New Zealanders would normally be in bed and pubs are closed.

When UK fans were faced with that scenario in 2011 the government brought in special legislation to allow pubs to open for fans.

Act MP David Seymour drafted a Bill to allow bars to open at extended hours for 2015 Rugby World Cup games but Green Party MPs torpedoed it.

“An internationally televised world cup featuring our own reigning champions should be an opportunity to bring communities together over coffee or beer and showcase our wonderful hospitality facilities,” said Mr Seymour.

“Shutting New Zealanders at home for this event seems like a mean-spirited affront to community freedoms.

“The Greens do themselves no favours by locking themselves in as the party opposed to fun. . .

 

I’ve no desire to go  to a pub in the wee small hours and if I did go I wouldn’t be drinking anything stronger than water.

I’ve stayed up all night four times in the last 12 years. That was for weddings in Argentina and I drank only one glass of wine at each because I knew any more alcohol would put me to sleep.

But I can see why some people might want to gather in a pub to watch the games, especially if the All Blacks make it to the final.

Green MP Kevin Hague accused Seymour of  using the issue as a publicity stunt.

But it is Hague who is grandstanding.

In being the party pooper  he’s  providing ammunition for those who accuse his party of being the fun police and all for nothing more than negative publicity because the government will probably pick up the Bill.

Too many people drink too much but that’s a problem which won’t be addressed by the party-pooping.

 


Do we have consensus on tax?

July 20, 2015

Labour finally answered the calls to show us some policy last week with an announcement on proposed changes to provisional tax:

The bad news for Labour was that it wasn’t its own fresh policy it was reheated National Party policy:

Acting Minister of Finance Steven Joyce has congratulated Labour Party Leader Andrew Little on finally announcing his first “new” policy after eight months in the job, although unfortunately for Labour it’s a cut and paste of a previous Government announcement.

“Labour announced today it was launching a discussion document on changes to provisional tax for businesses. However it seems to have overlooked that the Government launched its own discussion document containing almost identical proposals back in March,” says Mr Joyce. “These in turn were based on National Party policy at the last election.”

The Government has already consulted on proposed changes to provisional tax including a business PAYE, changes to use-of-money interest and penalties, increased use of tax pooling and the use of tax accounts. A Green Paper was launched on 31 March this year and submissions closed on 29 May.

“Feedback on the Green Paper’s suggestions has generally been supportive, and provisional tax was the part most commented on. As we’ve said previously, the changes will require new technology to be implemented, which will be developed as part of the IRD’s Business Transformation project,” says Mr Joyce.

“Quite why Labour has started its own consultation is beyond me.

“Submissions are now closed but the Government would be happy to accept a late submission from the Labour Party in support of the proposal,” Mr Joyce says. “We also appreciate its implied endorsement of the Business Transformation process that will make these policy changes possible.”

A link to  the March announcement can be found HERE.

A link to the Government’s Green Paper, Making Tax Simpler, can be found HERE.

A link to the National Party’s 2014 election policy on this issue can be found HERE.

Act supports the ideas in the green paper which the government released in March, last week New Zealand First also mooted a similar strategy and the Green Party is also open to the proposed changes.

The good news for all of us is that this could mean there is consensus on provisional tax which is very unpopular with businesses for good reason.

They have to pay on expected income without the benefit of a crystal ball that can give them an accurate forecast of their futures costs and income.

A reasonably accurate estimate is difficult enough for any business, it is particularly taxing in farming where there are so many variables and a lot of income is lumpy.

Dairy farmers get monthly payments for their milk but last year the pay out was far higher than expected, this year it is much lower.

Cropping, sheep and beef farmers and many horticulturists get most of their income in a very few payments a very few times a year. Estimating what they are likely to produce, how much that will cost and what they’ll be paid for it months in advance with any deegree of accuracy is next to impossible.

The changes proposed by the IRD which now seem to have support across the political spectrum would simplify the tax system.

Simpler taxes are less expensive to comply with and administer. That reduces costs for businesses which is good for them and the people they employ, service and supply.


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