Politics changed, facts haven’t

28/03/2019

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.


What’s fair?

28/02/2019

Definitions of fair include: treating people equally without favouritism or discrimination and: without cheating or trying to achieve unjust advantage.

By either of these definitions attempting to make the tax system fairer is doomed. To take a lot more from some people than from others in very similar circumstances is not fair.

There’s rarely a tax the left doesn’t like and it is particularly enamoured of capital gains tax.

A CGT might be fair in theory but as one of the three dissenters to the Tax working Group’s recommendations, Robin Oliver, said, he’s against it in practice.

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.

Oliver is a former deputy head of Inland Revenue, former Treasury advisor and an expert on the tax system whose views should be taken seriously.

He gave several examples in the interview of how the CGT as recommended would not only not be fair but would lead to perverse consequences including making it more attractive for foreigners to invest in New Zealand and for New Zealanders to invest overseas, and for people to hold on to assets and businesses when without the tax they would be better to sell them; and that it would have made little difference to the housing boom.

He also said that the current law on the bright line test has low compliance and we should make current rules work before starting to think of highly punitive  ones.

That would be fair.

 


Patriotic Call To Yarn

23/02/2015

The National Army Museum at Waiuru made a patriotic Call to Yarn:

They started by calling for a handcrafted poppy for each of the 18,166 New Zealanders killed in service during World War I:

On 16th October the National Army Museum officially launched their ‘Patriotic Call to Yarn’ project commemorating all those who paid the ultimate sacrifice on an important day in history when the first soldiers left New Zealand for Europe and the First World War.

On 16th October 1914 over 8,000 New Zealand troops and their horses left Wellington harbour and New Zealand shores bound for Egypt. They left thinking, “it will all be over by Christmas”, that it was an adventure of a lifetime, the opportunity for overseas travel. Little did they know what awaited them on the other side of the world.

Over the course of the next four to five years on the battlefields of Gallipoli and later Europe, New Zealand lost 18,166 men and women to the ravages of war.

Back home the war effort was strong as the women realised they also could ‘do their bit’.

“For the empire and for freedom, we all must do our bit, the men go forth to battle, the women wait and knit” Lady Liverpool

Patriotic associations were formed all over the country with over 5 million pounds raised. Women got together and knitted and stitched items of clothing for the soldiers including balaclavas, shirts, underclothing, socks and darning kits.

In honour of all those men and women 100 years ago, the National Army Museum is seeking assistance from the general public of New Zealand and have made a ‘patriotic call to yarn’ by aiming to produce one hand crafted poppy for each serviceman and woman lost by our nation in the Great War. That is 18,166 poppies!

These very special tributes will be on show in the form of a cascading waterfall of poppies in the museum’s Tears on Greenstone memorial area.

Poppy project coordinator, Alison Jones said, “We hope to achieve this traget by 2018 and have already had an overwhelming response with well over 1,000 poppies made.

Poppies can be knitted, crocheted, sewn or hand crafted in anyway and there are several different patterns available to assist people in their contributions.

With that total of 18,166 already exceed, they are now making a bigger call:

A Patriotic Call to Yarn – The Last Post

To achieve, one hand crafted poppy for EVERY New Zealand Serviceman or Woman lost during War or conflict.

Based on the Tears on Greenstone database at the Museum – that is 30,475 personnel from all services
(Army, Navy, Airforce and Merchant Navy).

We have already achieved 18,166 – so that is a further 12,309 poppies.

These poppies must be smaller – no more than 7cm in diameter* – so that they can be remembered together in one memorial piece.

*Please note: All poppies will be accepted so do send poppies already constructed larger than 7cm. Smaller poppies are encouraged for the new format to ensure they are able to be displayed all together. . .

poppy reveal 4 200x300 A Patriotic Call to Yarn

The first panel is unveiled in the Tears on Greenstone memorial

Rural women has links to patterns.

Kathryn Ryan interviewed the project coordinator, Alison Jones on Friday.


Yesterday, this morning, this afternoon . . . .

23/06/2014

Labour said it would announce its list yesterday afternoon.

That changed to this morning.

Now former party president Mike Williams has just told Kathryn Ryan that the list will be released at 3pm this afternoon.

The timing isn’t significant the party management is.

One suggestion for the delay was that the party couldn’t handle the list ranking while dealing with the fallout from the Liu donation allegations.

It is just as likely to be a problem with telling MPs and candidates

Whatever the cause for the delay, how can a party that is once again demonstrating problems running one of its most important internal activities smoothly hope to convince voters it can run the country?


Which election is Labour trying to win?

03/03/2014

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

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

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

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

His interview on The Nation adds to that suspicion:

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

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

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

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

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

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

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

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

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

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

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


Appropriate sponsors

30/04/2011

John Drinnan, the Herald’s media commentator muses on the suggestion that sponsorship might be introduced to RadionNZ National:

With its medical disease of the week, Kathryn Ryan’s Nine to Noon could be brought to you by Prozac. Chris Laidlaw would work well with extra strong coffee. Mary Wilson on Checkpoint would suit Mack trucks. . .

It would be hard to beat the Mack Truck for mary Wilson on Checkpoint, but who could sponsor other programmes like Morning and Midday reports, Afternoons, Nights, Country Life or Kim Hill on Saturday morning?


Here to help which cause?

25/03/2011

The principal and all but a couple of teachers at a primary school were happy with the introduction of National Standards.

Then the people turned up to train them and mixed with the training they had a lot of criticism of the introduction of the standards.

How unprofessional is that?

As former States Services Commissioner  Mark Prebble told Kathryn Ryan:

“Public servants have to implement the policies of the government of the day

Many people come to government to try to support a good cause. They don’t realise the one who has to determine which good cause is to be supported is the democratically minister of the day.  . . .

 A key part of the role of senior public servants is to explain to them well it is the minister who has to take the heat in public about that and the public servant really isn’t just employed to follow their own interests and if they want to follow their interests they can go and work in the private sector like anyone else. . .

. . . No public servant should be zealous about the particular cause they’re interested in. They should be zealous about democracy and respecting the law. . .”

The  public service must be apolitical. . .

The people who visited the school were paid from the public purse to help implement government policy but instead were doing their best to sabotage it.

If it happened at one school, how many others also found the people sent to help were advancing their own cause rather than giving the professional development the teachers sought and how often does this happen with other policies?

We’ve spent this week with a group of farmers. Each time tenure review was raised the glacial pace at which it proceeds was criticised.

You could be excused for wondering if this is a deliberate policy on the part of some of the public servants involved in the hope that they can delay the process until the government changes.


How can armchair experts know more than people at the coalface?

27/11/2010

The mother of one of the miners trapped in the Pike River mine said she accepted he was dead as soon as she heard of the explosion.

Other miners knew this too.

West Coast miners knew their 29 mates at Pike River were a lost cause before the official announcement on Wednesday, a union convener in Solid Energy’s nearby Spring Creek pit says.

Pessimism was based on gas readings showing alarming levels of toxicity and the likelihood of further explosions, as the mine remained on fire, said Trevor Balderson, a night-shift development worker who heads a crew of six at Spring Creek, 40km from Pike River.

“The initial explosion wiped out all the infrastructure,” said Mr Balderson, who moved to the West Coast in 2008, after a Yorkshire colliery closed in 2002.

“If you talk to any coal mine workers anywhere in the world, the reality is that you do not survive an explosion if you are in the firing line,” he told the Yorkshire Evening Post newspaper.

This doesn’t stop armchair experts criticising the people in charge of rescue attempts and asking why a resuce wasn’t attempted sooner.

As I said in my first post on this tragedy, the first rule after an accident is to make sure the situation doesn’t get worse.

I posted on Wednesday morning about carrying hope in your heart even when your head knows that’s impossible.

The rescuers didn’t have the luxury of emotion, they couldn’t act from their hearts. They had to act from their heads in the knowledge they couldn’t endnager more lives when it was almost certain there was no-one left to save.

Some of the armchair experts are still calling for speed now it’s a recovery mission rather than a resuce.  But there is no case for risking more lives in the mine when, after three explosions and a fire, there are no longer any there to be saved.

Kathryn Ryan interviewed some real experts on this topic  yesterday morning.

And (hat tip: Keeping Stock)  Guy Body shows the destructive gas starting to disperse.


Someone told someone but we don’t know who

07/10/2010

In nine years with Labour in power did anyone leak anything of significance in order to sabotage government policy?

After less than two years with National in power there have already been two leaks designed to do that.

The first was information from the cabinet paper on a stocktake of minerals on Schedule 4 land. The second was information from a  Cabinet paper on lifting performance and service delivery in the State Sector.

The State Services Commissioner, Iain Rennie,  investigated and discovered someone told someone something they shouldn’t have but was unable to determine who:

In respect of the minerals inquiry it was found that there was a deliberate unauthorised disclosure. There was not sufficient evidence to establish who disclosed the information. The evidence does not indicate that disclosures were more likely to have come from the Public Service than other parties who had access to the information disclosed.

In respect of the machinery of government paper investigation it was found that there was a deliberate unauthorised disclosure of information relating to the options contained in the Cabinet paper. No one person was identified as having deliberately disclosed the information. However, at least one aspect of what was being proposed was probably disclosed by a public servant. The report found that the evidence lead to the conclusion that one of the sources for the journalists was either someone in the National Library, or someone being told something by someone in the National Library, who then passed this information on. This is a disappointing finding as it indicates a lapse from the high standard of professionalism held by the majority of public servants.

In the introduction to his statement Mr Rennie said:

The unauthorised disclosure of government information strikes at the heart of the crucial relationship of trust that needs to exist between Ministers and their officials, for the business of government to work as it should. Ministers have a right to make decisions in a calm and deliberative manner and through processes which are not destabilised by premature and unauthorised disclosure.

This reminded me of  an interview earlier this year in which Mark Prebble told Kathryn Ryan:

“Public servants have to implement the policies of the government of the day

Many people come to government to try to support a good cause. They don’t realise the one who has to determine which good cause is to be supported is the democratically minister of the day. And quite a lot of departments, not slinging off at their professionalism but say DOC, you get a lot of people who join DOC because they know they want to save a kakapo and if not a kakapo it will be the lesser spotted whatever. And if the lesser spotted whatever is not on the minister’s list of priorities they’ll find it hard to do.

A key part of the role of senior public servants is to explain to them well it is the minister who has to take the heat in public about that and the public servant really isn’t just employed to follow their own interests and if they want to follow their interests they can go and work in the private sector like anyone else. . .

. . . No public servant should be zealous about the particular cause they’re interested in. They should be zealous about democracy and respecting the law. . .”

The  public service must be apolitical.

This doesn’t mean public servants can’t hold political views but it does mean they can’t be political in their work and they can’t  use knowledge gained in their work to further their political aims.


Public Service no place for zealots

09/04/2010

“Public servants have to implement the policies of the government of the day

Many people come to government to try to support a good cause. They don’t realise the one who has to determine which good cause is to be supported is the democratically minister of the day. And quite a lot of departments, not slinging off at their professionalism but say DOC, you get a lot of people who join DOC because they know they want to save a kakapo and if not a kakapo it will be the lesser spotted whatever. And if the lesser spotted whatever is not on the minister’s list of priorities they’ll find it hard to do.

A key part of the role of senior public servants is to explain to them well it is the minister who has to take the heat in public about that and the public servant really isn’t just employed to follow their own interests and if they want to follow their interests they can go and work in the private sector like anyone else. . .

. . . No public servant should be zealous about the particular cause they’re interested in. They should be zealous about democracy and respecting the law. . .”

This is an extract from Mark Prebble’s  discussion with Kathryn Ryan on Nine to Noon.

He was referring to central government but Kiwiblog’s posts on why ECan was sacked  and ECan vs its own commissioners show what he says should also apply in local government.

Some of the officers have at times adopted more of an advocacy role than a neutral advisory role. …

The regional councillors have been replaced by commissioners. Very little has been said yet on the need for a change of staff as well but unless there is a change of attitude and/or personal the problems in ECan will continue.


Which part of not optional don’t they understand?

12/03/2010

Criticism of national standards continues but like them or not, most schools are getting on with the work required to implement them.

Southbridge School isn’t.

Kathryn Ryan interviewed the principal and a parent to find out why.

The answer, from the principal, seems to be he wants the system trialled first and the school is too busy implementing the curriculum to handle national standards as well.

That’s a good example to set pupils – you only have to do what you have to do when you have the time and inclination to do it.

It could set an interesting precedent too.

A trucking firm could decide it wants a trial of the road rule change which will give right of way to vehicles turning left at intersections and instruct its drivers to take right of way when they’re turning right.

An employer could decide s/he’s too busy implementing the four-week holiday requirement to deal with changes in tax rates.

Anyone could decide to adopt only those new policies which have been trialled, came from a government of which they approved and to which they weren’t philosophically opposed or too busy to deal with.

But of course they wouldn’t because the law’s the law and some policies are optional, some are not.

If a board and principal don’t understand that, do they understand enough to run their school?


And the winners are:

27/10/2009

Drum roll please, the winner of the Homepaddock poll for best broadcaster is Jim Mora and the best programme title goes to Afternoons.

Jim got 39% of the votes after sitting at more than 50% until yesterday when a surge in votes took Peter Sledmere to 23%.

Mary Wilson attracted 13% support, Brian Crump and Kathryn Ryan got 10% and Clarissa Dunn 6%. There was a lone vote for Sean Plunket in the comments but his nomination came too late for the poll.

Afternoons won 33% support, Media Watch was second with 28%, Country Life attracted 22% of the vote and Check Point got 17%.

If this had been scientific I’d have to tell you how many people voted. Since it’s not, suffice it to say the results reflect high quality opinons rather than a large quantity of voters. 🙂

Jim and the staff at Afternoons will, as promised, receive a box of Whitestone Cheese, which will be delivered some time in the next couple of weeks.


Sue Bradford resigning

25/09/2009

Just heard on Nine to Noon that Green MP Sue Bradford has announced she’s resigning from parliament next month.

UPDATE:

The next person on the Green list is David Clendon. If he enters parliament the Greens will then have five male and four female MPs.

The NZ Herald says Clendon is:

. . . a sustainable business advisor, who is of Ngapuhi, Te Roroa and Pakeha heritage.

Kathryn Ryan interviewed RadioNZ National’s  chief reporter Jane Patterson who said the decision was prompted by Bradford’s loss of the contest for co-leadership to Metiria Turei. The interview will be online here soon  is now online here.

Ryan’s interview with Bradford will be online at the link above soon.


Can’t count can’t cope

09/09/2009

Maths lecturer Peter Hughes is right to be concerned that secondary school pupils are innumerate.

If you can’t count you  can’t cope properly with many functions in every day life.

I’ve often quoted the witticism that there are three kinds of people in the world, those who can count and those who can’t and then said I’m one of the latter.

But I was always joking because although I wouldn’t even attempt complicated maths I’m of the generation where the basics were taught and I can still cope with them.

That means I can add, subtract, multiply and divide, understand rounding,  compound interest, fractions and percentages and the other concepts which we need every day.

It doesn’t mean I always get the sums right, but it means I usually realise when I’ve got them wrong and can work out why.

It’s no use saying we don’t need the basics when we have calculators, unless you have a general idea of what the answer is you can have no idea if you’ve made a mistake.

If you can’t do the basics you’re at sea when you shop because you can’t compare prices properly and have no idea if there’s a gross error in the total you’re charged.

If you can’t do the basics of maths you’ll never cope with finance and as Huges says you’re then at risk of getting “bluechipped” .

If you can’t do the basics of maths you’re worse off than if you can’t spell. If you get the odd letter wrong when writing you can still get your message across. But a minor error with a number can be a major mistake.

If you follow the link above you can try your mental maths skills. I ‘ll confess I got only 4/5 – because I made a silly mistake which goes to show even when you know the basics, it pays to check your calculations.

P.S. Kathryn Ryan  interviewed Hughes on Nine to Noon this morning.


Personal perspective kinder than political

03/06/2009

Had this been last year and I’d just heard the news that a minister had resigned I’d have looked at it from a political perspective.

Because I know and like Richard Worth I am seeing his resignation from a personal perspective and I’m sorry.

Kathryn Ryan said she will be talking to John Key about this on Nine to Noon  at 10.45.


Ecologic to counter greenwash

10/03/2009

Green is the new black and environmentalism has assumed elements of religion so that anyone who questions it risks being accused of heresy.

But every religion attracts false prophets so how do we know if we’re being led astray from the path to a cleaner, greener planet or at least fooled into thinking we’re doing the green thing when we’re not?

Kathryn Ryan sought some answers to these questions and others on the dangers of greenwashing from Brian Clegg, the author of  Ecologic: The Truth and Lies of Green Economics.

Brian’s most recent book is Ecologic to be published by Eden Project Books in January 2009. He has written seven other science titles, including The Global Warming Survival Kit (Doubleday), and Upgrade Me (St Martin’s Press). His earlier book, A Brief History of Infinity reached #1 on Amazon in Popular Science (General) and Popular Maths, staying at #1 for ten further weeks.

Born in Rochdale, Lancashire, UK, Brian read Natural Sciences (specializing in experimental physics) at Cambridge University.  After graduating, he spent a year at Lancaster University where he gained a second MA in Operational Research, a discipline developed during the Second World War to apply mathematics and probability to warfare and since widely applied to business problem solving.

From Lancaster, he joined British Airways, where he formed a new department tasked with developing hi-tech solutions for the airline. His emphasis on innovation led to working with creativity guru Dr. Edward de Bono, and in 1994 he left BA to set up his own creativity consultancy, running courses on the development of ideas and the solution of business problems. His clients include the BBC, the Met Office, Sony, GlaxoSmithKline, the Treasury, Royal Bank of Scotland and many others

He has a blog, Now Appearing.

You can listen to Ryan’s interview here.


Greenmail or compensation?

16/02/2009

When is money paid by the applicant for resouce consent to an individual or body objecting to the consent greenmail and when is it compensation?

The question has come up as the story (three posts back) about Meridian Energy paying DOC has developed.

John Key says the payments would be okay if it was to offset environmental impacts  but not if it’s hush money.

Director-General Al Morrison said a suggestion DOC accepted money in a secret deal to remain quiet over the windfarm proposal is totally inaccurate.

“In this case an agreement was reached which resulted in $175,000 being set aside to improve public access to nearby conservation land and for a series of plant and birdlife issues to be addressed,” Mr Morrison said. . .

. . . “Clauses were specifically entered into the agreements to ensure the details could be publicly released once signed and they have already been fully tabled, including the amount agreed, before the Environment Court,” he said.

Trust Power spokesman Graeme Purches says it  also had an agreement with DOC but:

Mr Purches said some people are calling these deals bribery but that is wrong.

“It’s about working with stake-holders to get a win-win. It’s not about bribery. I think anyone who suggests you can bribe a Government department like DoC has got rocks in their head,” Mr Purches said.

The Resource Management Act allows for payments to be made to mitigate or compensate for adverse effects of any development.

What raised hackles with this example was the suspicion DOC had accepted the payment to remain silent and had done that because of a decision by the previous government to take a whole of government approach in support of the application.

P.S.

Kathryn Ryan had extended interviews and also covered the issue in this morning’s political slot on Nine to Noon;  and Mary Wilson interviewed Al Morrison on Checkpoint.

Alf Grumble  asks, what’s up Doc?


OCR down to 5%

04/12/2008

The Reserve Bank has announced a drop of 1.5% in the official cash rate, taking it to 5%.

That bank’s media release said:

Reserve Bank Governor Alan Bollard commented that “ongoing financial market turmoil and the marked deterioration in the outlook for global growth have played a large role in shaping today’s decision. Activity in most of our trading partners is now expected to contract or grow only very slowly over the next few quarters.

“Economic activity in New Zealand will be further constrained as a result, compared with our view in October.

“Inflation is abating here and overseas as a consequence of these developments. We now have more confidence that annual inflation will return comfortably inside the target band of 1 to 3 percent some time in the first half of 2009 and remain there over the medium term. However, we still have concerns that domestically generated inflation (particularly local body rates and electricity prices) is remaining stubbornly high.

“Today’s decision brings the cumulative reduction in the OCR since July to 3.25 percent, and takes monetary policy to an expansionary position.

Given recent developments in the global economy, the balance of risks to activity and inflation are to the downside. Thus it is appropriate to deliver this reduction quickly to support the economy and keep inflation from falling below the target band.

“Monetary policy is working together with the depreciation of the New Zealand dollar and the fiscal stimulus now in train, to provide substantial support to demand over the period ahead and to create the conditions for some rebound in growth as global conditions improve.

“To ensure the response we are seeking, we expect financial institutions to play their part in the economic adjustment process by passing on lower wholesale interest rates to their customers. . .”

The silver lining to the comparatively high interest rates we’ve faced is that the bank has had more scope for cuts and it has certainly acted on that since July when the OCR was 8.25% as this Herald graphic  shows:

Graphic / Christoph Lukasser
Graphic / Christoph Lukasser

People on fixed mortgages won’t get an immediate benefit from this but businesses which have overdraft facilities and farms which need seasonal finance ought to get a reduction in their interest rates.

There is a flip side of course in that people who depend on savings and investments will face a drop in income.

Kathryn Ryan discussed the issues  on Nine to Noon.


Mums & babes at risk

10/10/2008

A review of maternity services in Wellington has concluded that poor relationships between doctors and midwives, a shortage of both these maternity specialists and poor emergency transfer procedeures are putting women and babies at risk.

However, Health Ministry officials and the independent review team said though there were opportunities for improvement, the region’s maternity care was “as safe as services anywhere else in New Zealand”.

As good as anywhere else is meaningless if anywhere else isn’t good enough.

Kathryn Ryan interviewed  Dr Lynda Exton, a Chirstchurch GP who has just published a book, The Baby Business ,in which she says women are more likely to die during child birth durning childbirth and babies are more likely to contract serious infections than any time in the last 30 years on maternity services.

Kathryn also spoke to NZ College of Midwives chief executive Karen Guilliland who disputed some of the figures and findings in the book.

The Press interviewed these two women and Dr Pat Tuohy, Ministry of Health chief advisor for child and youth health.

There is an international shortage of obstetricians and midwives. That situation has been worsened in New Zealand by changes to maternity services which began in the late 1980s and which have resulted in an exodus for GPs from obstetrics.

Apropos of this issue, it’s baby loss awareness week.


Lessons from China

07/10/2008

The melamine milk poisoning has highlighted China’s defects but of course there is much to admire in that country.

Roderick Deane found lessons we could learn  from China on a recent visit.

And Kathryn Ryan interviewed David Speary  a New Zealand teacher who spent seven years at a provincial Chinese training college.


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