Anger isn’t kind

10/06/2020

Does Jacinda Ardern not take her own advice on being kind?

Retail NZ is calling for the Prime Minister to be kind, after reports that she is ‘angry’ that the Warehouse Group is undertaking a change process that could result in a substantial number of job losses.

“Retail NZ has been advising Government for months that larger retail chains are not immune from the impacts of the COVID-19 and we have been forecasting substantial numbers of job losses across the sector, and the Prime Minister should not be angry that businesses are acting to reduce costs and create sustainable futures,” Greg Harford, Retail NZ Chief Executive, said today.

“Retailers greatly appreciate the support that the Government has provided to the retail sector in recent months – but the margins in retail are wafer-thin. New Zealand businesses, both large and small are doing their best to manage the consequences of the lockdowns, and they are needing to make very tough decisions. Recently, a number of small and high-profile retailers have found themselves in a position where they need to close stores and reduce headcount in order to remain viable into the future. Retail NZ research suggests that more change and more job losses are expected in the coming period, across both small and large businesses.

“There is a misconception that larger businesses are able to incur big losses – but the fundamentals of operating a business are the same whether your business is large or small. Nobody in retail wants to make people redundant or close stores, but no matter the size of a business, it needs to make operational decisions to drive efficiency and productivity in order to survive. Failing to do so will ultimately lead to the demise of those businesses, and much greater numbers of job losses. . .

There is rarely a single factor behind business difficulty.

Those shedding staff, closing branches and folding altogether may well have been facing problems before the Covid-19 lockdown.

But not being able to operate for weeks while still incurring fixed costs, even with the wage subsidy, pushed them over and it didn’t have to be that tough for most of them.

When the lockdown was first announced, the Warehouse declared it was an essential business and would be operating at alert level 4. Ardern declared it wasn’t and wouldn’t be.

I had joined the chorus of people saying that the Warehouse wasn’t an essential business and agreed its stores shouldn’t be open at level 4. But why couldn’t it and any other retailer that could have done mail order not been able to do so?

Had the government allowed what was safe rather than dictating what was essential, the Warehouse and many other retailers would not have faced the total loss of business for all those weeks at level 4.

If it was safe to order Easter eggs online from a confectionary factory and a children’s or text book from a book shop, it would have been safe for the Warehouse to offer an online mail order service.

Perhaps the Prime Minister has forgotten her part in the forced closures, and has she also forgotten all the Warehouse founder did to help?

Warehouse founder Sir Stephen Tindall, Trade Me creator Sam Morgan and former Air New Zealand chief executive Rob Fyfe joined forces to help ready the country to fight Covid-19.

Together they ordered 50 intensive care ventilators, seven planeloads of PPE protective clothing and equipment, and met with the Prime Minister Jacinda Ardern the Sunday before lockdown was announced to urge the Government not to delay shutting the country down to try to limit deaths and eradicate Covid-19. . .

“Some of us, Sam Morgan and I in particular, realised there was a lot of stuff not getting done. We basically took the bull by the horns along with the guys from Zuru, and used our own money and ordered up a whole heap of PPE gear. There’s actually seven planeloads coming. Two have arrived already.”

They also worried New Zealand didn’t have enough ventilators, and moved to source some to give as many severely ill people the chance of beating infection.

“Of course every ventilator manufacturer in the world was chocka,” he said.

A little Kiwi ingenuity followed, and the group has backed niche New Zealand manufacturers around the country to begin manufacture once key parts can be sourced, though efforts to buy ventilators from overseas continued.

Tindall underwrote the purchase of 50 New Zealand-made ventilators at $60,000 each.

“I said to the agent, place the order, and you have got my word I will pay for them, if the Government doesn’t,” Tindall said. . . 

Tindall and Morgan became convinced lockdown was inevitable about two weeks before the meeting with the politicians. . . 

The government keeps telling us they went early and hard, but these business people saw the danger earlier and didn’t just talk, they acted.

The government didn’t go early enough, didn’t go hard enough at the border soon enough, then went too hard at level 4 and now Ardern has the audacity to vent her anger at the business founded by one of the men who saw the danger and acted earlier to help.

Heather du Plessis-Allan says the anger attack is a bad call politically:

. . . Already, the PM has a long list of calling out business: The Warehouse, Burger Fuel and Air New Zealand. And that’s all just within this Covid crisis.

Yes, this might play favourably with voters at the moment because of the rally-around-the-flag sentimentalism and because plenty of voters don’t understand business and seem to think the wage subsidy was intended for The Warehouse itself rather than the workers

But the PM should know better than that.

What she’s done here is betray her own fundamental let’s-all-work-four-days-a-week lack of understanding of what drives business. She’s complained that The Warehouse should prioritise staff higher and focus less on the shareholder.

Well that’s not how business works. Businesses are not charities.

The business sense behind that is deeply flawed. Sometimes it’s better to cut 100 jobs and save 900 for example, than to keep all 1000 on, risk the business itself – and then lose them all eventually anyway.

Through this public rebuke Ardern’s also essentially warned other big businesses to be careful about redundancies lest they also earn one too.

I tell you what, what I’m hearing from those involved in big business in this country is a deep frustration with this Government, their lack of understanding and their tin ear to pleas.

And what just happened will not make that better.

We’re going into an economic downturn and we are going to look to and lean on big business to help us out of this.

It’d be in the Government’s interests to keep them as friends, not make enemies out of them. . . 

Paul Goldsmith said the PM has the wrong focus:

National’s finance spokesman Paul Goldsmith says Prime Minister should “stick to her knitting” after expressing her fury at The Warehouse Group’s mass job cuts.

“I don’t think it’s helpful for the Prime Minister to be criticising struggling businesses, she should stick to her knitting,” Goldsmith said.

Rather than getting angry, Ardern should be “better focused” on the Government’s plan to grow the economy, he said. . . 

Meanwhile, Independent economist Cameron Bagrie said Ardern “overstepped the mark” when she said she was angry with the Warehouse over the job losses.

“Businesses are dealing with tough economic times,” he said.

“If that means they [businesses] need to cut costs to recalibrate for a different economic environment then so be it.”

He said there is a big structural shift going on in the economy at the moment – “I don’t think consumers are going to be out there spending like they were pre-Covid-19”. . .

No employers make these decisions lightly but sometimes cutting parts is necessary to save the whole.

A politician who preaches kindness shouldn’t be criticising those who are forced to act to ensure their business, and the remaining jobs, are sustainable.


Rural round-up

18/12/2014

Alarm over off-road toll -Timothy Brown:

Federated Farmers Otago president says children on four-wheeled bikes are a reality of rural life despite damning statistics and some calling for a ban.

A report released yesterday said off-road vehicle accidents accounted for the second-highest number of recreational deaths of children, behind only swimming and other water activities.

The findings focused on four-wheeled bikes, which accounted for more than a third of the deaths, and highlighted children’s vulnerability when using vehicles designed for adults.

Federated Farmers Otago president Stephen Korteweg said the statistics were ”pretty alarming”, but the practicalities of farm life meant children would continue to drive off-road vehicles, and particularly four-wheeled bikes. . .

Quads Bikes Not for Under 16s

Safekids Aotearoa strongly supports recommendations made in a report released today highlighting the dangers posed by quad bikes when ridden or controlled by children who are under 16 years of age.

The Child & Youth Mortality Review Committee (CYMRC) report ‘Child and youth mortality from motorcycle, quad bike and motorised agricultural vehicle use’ looked into 33 child deaths caused by off road motor vehicles from 2001-2012. This includes 12 deaths caused by quad bikes.

According to Safekids Aotearoa, 30 children die or are hospitalised every year as a result of quad bike injuries. . .

Minister welcomes predator control venture:

Conservation Minister Maggie Barry has welcomed an innovative partnership to dramatically transform the way invasive predators are managed on mainland New Zealand.

The NEXT Foundation has partnered with philanthropists Gareth Morgan and Sam Morgan, and the Department of Conservation, to set up the Zero Invasive Predators (ZIP) project. All parties are contributing funding to the venture, with DOC providing $500,000 per year for an initial three years.

The ZIP project will focus on developing the tools and systems needed to permanently remove introduced predators from large areas of mainland New Zealand. . . .

Zespri forecasts record grower returns for 2014/15 season:

Record per-hectare returns for Green and Organic Green are forecast this season as a combination of supply constraint, favourable market conditions and strong end-of-season sales leads to increased Zespri grower returns across all categories. Per-hectare returns for Green growers are forecast at $52,987 and Organic Green at $42,207.

Zespri Chief Executive Lain Jager says these returns are the result of great work from growers, the post-harvest sector, the Zespri team onshore and in the markets, and our retail and trade partners.

Mr Jager explains the overall result reflects some unique, one-off factors. “A shortage of supply of Green kiwifruit from Chile and constrained supply of Gold kiwifruit from New Zealand have supported pricing, while Zespri’s foreign exchange hedging policy has mitigated against the strong value of the New Zealand dollar.” . . .

 

Time for Jobs that Count in the Meat Industry:

The NZ Meat Workers Union will launch a new national campaign to highlight job insecurity in the Meat Industry this afternoon in Palmerston North.

“Meat Workers face it all”, says Graham Cooke, National Secretary.

“Seasonal work, dangerous jobs, casual and zero hours contracts, and increasing pressure on workers to join non-union individual agreements.

“As if that’s not enough, the government’s recent Employment Law changes mean meat workers will face a tougher time settling collective agreements and earning a decent living. . .

Celebrating 30 years in business:

New Zealand’s largest animal feed exporter and world-leading fibre nutrition company, Fiber Fresh Feeds, is celebrating 30 years in business by giving away nearly ten tonne of feed to horse riders at one of the country’s biggest equine events.

As the naming right sponsor of the Fiber Fresh Taupo Christmas Classic from December 18-21, New Zealand’s second largest equestrian event behind Horse of the Year and the largest event by horse number in the Southern Hemisphere, Fiber Fresh is giving a free bag of feed to each of the 450 riders at the event. . .

Farmer AKA Mechanic, Agronomist, Engineer, Economist, Businessman, Accountant, Architect, Doctor,  Manager, Electrician, Plumber, Veterinarian, Market Analyst, Meteorologist, Communicator, Teacher, Conservationist, Nutritionist, Carpenter, Biologist, Technician, Trucker, Maintenance worker, etc. (PETERSON FARM BROS ORIGINAL)

Farmer AKA Mechanic, Agronomist, Engineer, Economist, Businessman, Accountant, Architect, Doctor, Manager, Electrician, Plumber, Veterinarian, Market Analyst, Meteorologist, Communicator, Teacher, Conservationist, Nutritionist, Carpenter, Biologist, Technician, Trucker, Maintenance worker, etc.

(PETERSON FARM BROS ORIGINAL)


Labour’s fair not fair

23/07/2011

Labour is trying to sell its proposal to impose a selective capital gains tax on us as an issue of fairness.

But as Trans Tasman argues it’s proposal isn’t so equitable:

It is difficult to understand why, if the fairness arguments are taken down the track Labour argues for, all gains are not taxed at the same rate. For example, why should the occupant of a substantial coastal lifestyle block escape this new tax when the person running a productive farm falls directly within it?

And why should art, gambling proceeds and  stamp collections be spared, when businesses aren’t?

Multimillionaires Sam Morgan and Selwyn Pellet have become Labour’s poster-boys to justify the CGT and new top rate. Both are said by Goff to have thought it unfair they did not pay tax on their huge gains. But Goff needs to be careful, Shewan says, not to overplay this hand. The public will quickly tire of extreme examples being rolled out to justify changes which will have a deeply pervasive effect on ordinary transactions much closer to home like the family farm or window cleaning business.

It is difficult to design a tax system which catches everyone but while Morgan and Pellet weren’t taxed on the proceeds of their sales they would have paid plenty of tax while running their businesses.

If a CTG is imposed, sales like this would be designed to avoid at least some of the tax by, for example, giving shares in lieu of cash.

But there are just extreme examples which Labour is using to stoke up envy and distract people from the impact their flawed proposal would have on many more people of very modest means.

Among them would be siblings who sell the family home after their parents die and couples who divest themselves of matrimonial property during a divorce settlement.

Retirement savings could also be eroded. The Shareholders Association warns that shareholdings in Kiwisaver would be hit by a CGT and that younger people would be most severely disadvantaged by this.


Morgan buys high country station

23/10/2008

Wanaka’s Hillend Station  has a new owner.

Trade Me founder Sam Morgan has bought it from Infinity Investments for $25 million.

“It’s an exciting new challenge for me and I look forward to investing further in the region, while continuing all of Infinity’s good work in preserving the unique beauty and character of the area,” Mr Morgan said.

Infinity owned the property for nine years and had it valued at $33m. It has two consented development options. One is 41 lot farmpark and the other a subdivision into 31 titles of 20ha.

Mr Morgan could pick up either option or continue to run the station as a high country property.

“It is a very exciting opportunity for him. What we have got here is an iconic South Island property,” said Infinity’s general manager Marc Bretherton.

He said $25m was a fair price in the current climate.

The 2,665 hectare station is on the flanks of Mt Alpha and over looks Wanaka.


%d bloggers like this: