Five more taxes

September 3, 2014

Three years ago John Key asked then-Labour leader Phil Goff to show him the money and he couldn’t.

Last night the Prime Minister asked Labour’s current leader David Cunliffe if people who’s home is in a trust would have to pay a capital gains tax and he wouldn’t answer.

If it would it would hit more than 200,000 families.

There is no tax advantage for having a home in a trust but people use trusts for other reasons.

Even if homes in trusts wouldn’t be hit, farms and businesses would be. That would impose extra costs and reduce profitability.

The PM asked Cunliffe if New Zealand already has a CTG, he said no.

The PM responded that he knows the tax code and we do.

He also pointed out that a Labour/Green government would add five more taxes.

That’s a big point of difference.

National will continue to manage public spending well and let people keep more of their own money; Labour and the Green Party would tax more so they can spend more.

 

We're with John. #teamkey #keyvcunliffe


Press leaders’ debate

September 2, 2014

The Press leaders’ debate will be live streamed here from 7pm tonight.

It's #KeyvCunliffe. Tonight. 7pm. Live streaming at stuff.co.nz

Editorial approval for Budget

May 16, 2014

From south to north:

The Southland Times writes of felines and finances:

As the budget debate was winding down in Parliament yesterday the most popular story on the Stuff website was still “Cat saves boy from dog”.

Bill English will hardly be distraught. He knows this is not an election-losing Budget.

It’s the first since 2008 to project a surplus. Technically, it is perfectly possible for a Government to be rolled in an election year while economic figures are doing OK. Jenny Shipley managed it while running budget surpluses and with economic growth knocking around 3.5 to 4 per cent.

But the public had emphatically soured on the politics of her administration whereas the Key Government, for all that it has had a wretched couple of weeks, would still need to subside spectacularly to find itself in such straits.

English has found himself in the fairly happy situation of not needing a budget that would quicken any pulses . . . merely keep them steady. This one will surely manage that.  . .

Australia has done English the very considerate favour of delivering a gasper of a hard-times Budget just days before his. So if it was a test, we’d be the winners, right? And who doesn’t like beating the Aussies? Big tick for the Nats, then?

Truth to tell those contrasting fortunes are indeed likely to accelerate the net immigration inflow of more than 38,000 this year. That’s assuming people have been paying attention, what with that fabulous cat footage.

 

The ODT calls it a clever document:

This was the Budget that National – right from the time of its re-election in 2011 – would have hoped it could produce leading into this year’s election.

Mr English has not swayed from his path of fiscal restraint. Sure, he has had to borrow heavily during the past six years, but not to the extent the country plunged into recession.

Now, the return to surplus gives options such as paying down debt.

The careful management of the country’s finances by Mr English, and his team of ministers, has helped ensure New Zealand has been mainly immune from the worst of the global decline affecting Europe, parts of Asia, the United States and, latterly, Australia.

Economic growth has been one of the highest in the OECD and, for once, all Treasury indicators are pointing in a positive direction.

This was a Budget of few surprises, but with enough good news to count for something. . .

It will enable Prime Minister John Key to go into the election campaign confident his 2008 promises of fiscal restraint, providing the best care for families, and delivering a better public service have not been compromised.

Opposition parties will have to promise big to counter National, and if they do, the onus will be on them to say exactly how they will fund those promises. . .

If he is looking for a document to define his legacy as Finance Minister, Budget 2014 is a good place to start.

There is some criticism the Budget is too conservative, but that personifies Mr English, who learnt the trade from former finance minister Sir William Birch. And would most New Zealanders rather have a gambler as a finance minister, or a safe pair of hands?

The ”Boy from Dipton” has lived up to his reputation as a ”conservative” politician in every way.

The Timaru Herald opines on the Budget highlight:

The contrast was telling, helped by the fact Australia’s Budget and ours came just two days apart.

Theirs: there will be pain for everyone.

Ours: we’re operating with a surplus and tax cuts may even be on the way.

But hey, we’re heading into an election, so there’s bound to be some gloss. They aren’t.

The National Government has worked long and hard on being able to say it is spending less than it is collecting, and right on cue it has achieved that.

Selling off a few state assets and spending most of the proceeds has helped, of course, and as Labour’s David Cunliffe rightly points out, National has borrowed a massive $56 billion in its tenure, which costs $10 million a day in interest.

He says that’s a lot of money that could be spent on lifting kids out of poverty, which indeed it is.

But because National is the Government it sets the agenda, and the agenda yesterday was for enough lollies to keep sugar levels up without creating a free-for-all. . .

It’s a steady Budget without attempting to buy votes.

The best thing about it?

It’s not Australia’s.

 

 

The Press writes of seeking the recipe for growth:

When he delivered his first Budget six years ago, Finance Minister Bill English faced a grim prospect. Even though the global financial crisis had not yet hit, the economy had gone into recession some time beforehand.

Government debt was at a reasonable level, but spending in Labour’s last years in office had ballooned and, according to Treasury projections, the Government faced deficits for a decade or more ahead.

National had been elected promising responsible Government finances and a stronger economy, but without changes those looked unlikely.

English smiled yesterday as he took delivery of the bound Budget document and well he might. By delivering a surplus, albeit a tiny one, several years ahead of what he had forecast several years ago, today’s Budget will be brighter than even he expected it to be by now.

Since it came to office six years ago, the Government’s core promises have been that it would deliver a stronger economy, responsible public finances and a better public service.

In 2011, after the earthquakes, it added a promise to rebuild Christchurch. Those pledges have become a mantra and can be expected to be repeated today.

Without engaging in a wholesale slash and burn, it has kept public spending under control while maintaining services.

So far as it is possible for a government to claim credit for the performance of the economy generally, National can be pleased with the prospect of growth possibly hitting more than 4 per cent this year. The trick will be to make that growth enduring. . .

In spite of the benign aggregate position it should not be forgotten that, as an Otago University survey reiterated last week, New Zealand still has significant pockets of deprivation.

There are likely to be numberless reasons for them but a growing economy delivering opportunity and jobs offers part of the solution for sustainably dealing with them.

The Marlborough Express writes the jobs challenge continues:

. . . Finance Minister Bill English told Parliament the realisation of job growth forecasts depends on the confidence of businesses to invest more capital and employ more people.

“That is where new jobs come from. They do not come from the Easter bunny.”

The Easter bunny didn’t get a mention when English unveiled his sixth Budget yesterday.

The test will be how much his programme can lift confidence and stimulate growth to create the environment that will put priority on employment growth.

The Dominion Post notes the crowd goes mild:

This is a deliberately bland and even boring Budget. The Government has clearly decided that grey and safe is its best hope in election year. The only surprise was free doctors’ visits for under-13-year-olds. Middle New Zealand will welcome it, as it will many of the other, carefully telegraphed, handouts. More paid parental leave: who could object? A bit more help with childcare costs: why not?

National has made a virtue of small gifts: it shows that the party is “responsible” and not spending money it doesn’t have. And that is why the $372m surplus is intended to have such political heft. The amount is piffling within a $70b budget, and would make no economic difference if it was an equally mouse-sized deficit.

But the surplus is the signal that a caring government has brought us home safely after a nasty trip through recession. And if we carry on being careful and good, the Government says, life will carry on improving. Finance Minister Bill English gave a hint of tax cuts to come, but waffled when pressed. So that means National is keeping its tax promises till closer to the election.

The real question is: is this all the voters want – thrift, mild rewards, steady-as-she-goes? The dissenters have pointed to National’s noticeable lack of flair and imagination. No big new policies, no bold new directions, no surprises.

But that is what the John Key Government is, and so far it has won elections. In tough times, the Government has spent freely to keep the ship afloat, and then it has slowly brought it to the fiscal shore. Now it welcomes us to dry land. . .

Much bolder moves will be needed, including a capital gains tax. But National’s caution here is a drawback, not an advantage. Sometimes problems are serious and need action. National seems to believe it will be enough to cut red tape and remove some of the planning obstacles in the way of housing. It won’t.

At present there is little rage about poverty, inequality and the housing crisis. These problems are raw and real but voters are patient and only a minority of voters now seem to actually hate National. It will probably take another term before a majority is truly fed up with Key and his band. In the meantime, this bland document may be a document for the times.

The Manawatu Standards call it a Budget comfortable fit for many Kiwis

There may be little bling to Finance Minister Bill English’s sixth Budget but, like a pair of sensible shoes, it will make for a comfortable fit for many New Zealanders.

It was a budget light on ambition, heavy on prudence, in its commitment towards a modest $372 million surplus, but with a few policies bearing a distinctive Labour hue to them.

Its “steady as she goes” tenor does shrewdly mine the Kiwi ethos. Yes, a tax cut would have been nice, but they’ve balanced the books and haven’t forgotten the children. So she’ll be right.

It is a budget good enough to serve its purpose, whether that is pragmatic progress towards further surpluses and the lure of an eventual tax cut or simply placating middle New Zealand until after the general election in September is a matter of perspective. . .

The NZ Herald says the Budget steers safe course in rough waters:

The Treasury gave the show away in the Budget’s supporting documents, mentioning that while tax revenue is running at a lower level than expected, some of the Government’s intended spending has been “rephased” to produce the surplus it has promised.

Opponents can call it a trick of “smoke and mirrors” but the verdict that matters comes from credit agencies. They are unlikely to be concerned. Spending rephased is spending we might never see unless surpluses can be maintained. . . .

The Budget’s best feature is the value Bill English seems to be getting for little extra spending on public services. Departments know the results he wants and seem to be delivering them without complaint from providers or the public.

They have stopped demanding endless increases in funds and he shared the credit with them yesterday for his surplus.

Doctored it may be, but it will get better.

The Herald’s last point is a pertinent one and one of the National governments successes – getting better pubic services for less money.

 


Not all schools want free food

May 5, 2013

Hone Harawira’s Bill proposing to provide food for all decile one and two schools will be debated in parliament soon.

It is a blunt instrument which will do nothing for hungry children in higher decile schools and provide food where it’s not needed and not wanted.

A school principal in Whangarei says a proposed law change aimed at providing meals for students in poorer schools could reinforce negative stereotypes. . .

Hora hora Primary principal Pat Newman said that may send a message that all parents with children at poorer schools don’t feed them properly.

He said it does not cost his school a lot to step in when it needs to, discretely offering breakfast and sandwiches to individual students in need. . .

The Press points out other problems with the proposal:

One difficulty is the sheer logistics of the proposal. Most schools are neither set up nor staffed to provide meals to pupils. One figure much bandied about during recent debate has suggested that 80,000 children go to school each morning without having had breakfast.

While that number has a whiff of the Ministry of Made-Up Numbers about it, even confined to decile 1 and 2 schools, Harawira’s proposal would be a large and time- consuming effort to get breakfast and lunch to all those deemed to need them.

But the main difficulty with Harawira’s idea is that it tackles the issue from the wrong end. Hungry children in school are a just symptom of a root cause – inadequate, negligent parenting and decision-making.

For the state to take over providing something as fundamental as proper meals will, if anything, only aggravate that root cause.

The more dud parents become aware that their children will be fed if they fail to do so, the more they will be inclined to abdicate the responsibility.

Providing a decent breakfast and lunch for a child is hardly an onerous or expensive task. Eggs on toast or cereal for breakfast, and sandwiches with a nourishing filling for lunch, are within the capacity of every parent. . .

It’s not the fault of hungry children that their parents don’t feed them and it is a problem which needs to be addressed.

But providing food for all low decile schools isn’t the best way to do it.

Fonterra is providing free milk for all schools that want it – some high decile schools choose to have it, some low ones don’t.

This targeted and voluntary approach, in conjunction with charities like Kids Can which provides food,  doesn’t address the problem of hopeless parents.

But at least it doesn’t waste food on schools which don’t need it, and gives it do children who do.


In praise of capitalism

December 4, 2011

Letter of the week in The Press:

Remember every time you enjoy a latte … you are lucky to have the benefits of capitalism,” writes The Press’s letter writer of the week.

In answer to Gareth Morgan and Susan Guthrie (“Reviving the values of an egalitarian society,” Perspective, Nov 21), I’m for business, technology and the highest wages I can generate . . .

The countries that have experienced the flow-down from the Industrial Revolution are immeasurably better off than those that haven’t. . .

Please don’t tell me that you won’t permit me to have my washing machine, my automobile, my iPhone or the wages I earn.

You can live in any way you choose (I will not interfere) and spend your money the way you choose on the priorities you value.

Remember, every time you enjoy a latte or an organic salad, you are lucky to have the benefits of capitalism at your beck and call, and it not only saves and extends your life, but enhances your life beyond measure.

I’m against your egalitarianism, your environmentalism, and every other anti-man dogma you can invent. You can keep your redistribution of rewards according to your primitive outlook. I’m for laissez-faire! – D. McFarland.

Capitalism isn’t perfect  but no-one has yet come up with a sustainable alternative.


Election editorials

November 28, 2011

The ODT – Three more years:

On any measure, the result of the 2011 general election is a resounding vote of confidence in the leadership and policies of John Key and the National Party. Not since the 1972 Labour victory of Norman Kirk has a single party reached such high levels of support, with National gaining 48% of the vote and 60 MPs in Parliament (pending the outcome of the special votes). The achievement is all the more remarkable given the challenges the country has faced during the past three years . . .

Timaru Herald – No real surpirses:

So now we know. The months of polling are over and we know for sure.

We don’t know everything, because special votes may slightly alter the picture, but we know John Key will be the one to form the Government that will take us through to 2014, when we’ll do it all again. It’s not a surprise, though some elements of the overall picture have been somewhat surprising, particularly the return of Winston Peters to Parliament on the bridge of the good ship NZ First, with a crew of seven supporting him.

For the great survivor of New Zealand politics, it’s a decidedly more comfortable ride than those of John Banks, Peter Dunne and Hone Harawira in their single kayaks. . .

The Press – A mother of a mandate:

As mandates go, they don’t get much bigger. How far will John Key push it?

In a hallmark of the Key style, he will take it as far as he thinks he can while carrying the public with him – but don’t take that as an indication he will go softly on asset sales.

Labour’s brave morning-after talk that it had won the argument on asset sales was nothing more than that – a chin-up exercise aimed squarely at the party faithful after an old-fashioned rout . . .

Dominion Post – Key has the right to sell family silver:

National has won the mandate it sought to pawn the family silver and reshape the welfare system. Prime Minister John Key would be wise to exercise it with discretion.

His party’s 48 per cent share of the vote in Saturday’s election is National’s best result since 1951. It is a personal triumph for the prime minister who has retained the confidence of the public despite having to make provision for the rebuilding of Christchurch in the midst of a global recession . . .

Manawatu Standard – City an atoll of red in an ocean of blue:

The blue tide on Saturday night came from all sides of the compass, but stopped just short of Palmerston North again.

Iain Lees-Galloway, the incumbent Labour member of parliament, somehow managed to not only stop the surge of National support over the country, he increased his majority from 1117 in 2008 to a provisional 3001, with special votes still to be counted.

National won the seat when it came to the party vote, which was probably the prime objective of candidate Leonie Hapeta, who at one stage looked like threatening to turn Palmerston North blue for the first time in decades . . .

Waikato Times – Challenge ahead for Nats:

 In many way it was the most predictable election result in years.

But while his party might have walked off with some 48 per cent of the vote, Prime Minister John Key might well be ruing his actions in the closing weeks, particularly around the now infamous “teapot tapes”. . .

Hawke’s Bay Today – Labour did Nash no favours:

The election delivered just one seismic jolt in Hawke’s Bay but it was one that many had predicted and the casualty, as was the case around New Zealand, was Labour. Actually there were two other casualties in the bailing out of parliament of Labour list MP Stuart Nash and they were the city of Napier and Mr Nash himself . . .  

Gisborne Herlad: Voter’s deliver big tick for John Key’s National Party:

The New Zealand public has given John Key’s National Party a big tick of approval, though not so resounding as to allow it to govern alone — unpopular asset-sale plans made that unlikely.
Mr Key has his mandate for partial privatisation of the state’s power companies and Solid Energy, though, along with radical reform of the welfare system. . .

NZ Herald – Demanding times ahead for National:

So the electorate did not want the National Party to govern alone. Other than that, which signifies its deep resistance to unbridled power, it has handed Prime Minister John Key most of what he wanted – and his opponents on the left nothing much at all.

The election result was encouraging for a party seeking a second term leading the Government. By increasing its share of the vote, and saving enough of Act and United Future to get it over the line, National has its majority. With the Maori Party’s three votes as ballast, it appears more than secure, unless special votes alter the seat allocation to National’s detriment. . .

 

 

 

 

 


A tale of two headlines

July 23, 2011

The Press: Southland lift Ranfurly Shield – last minute drop goal steals shield

Southland Times: Southland’s shield again – late drop-goal gets Stags up


Still shaking

July 22, 2011

A 5.1 magnitude earthquake in Canterbury at 5.39 this morning was felt throughout the South Island.

Reference Number 3550173 [View event in Google Maps][View Felt Reports in Google Maps]
Universal Time July 21 2011 at 17:39
NZ Standard Time Friday, July 22 2011 at 5:39 am
Latitude, Longitude 43.64°S, 172.20°E
Focal Depth 12 km
Richter magnitude 5.1
Region Canterbury
Location
  • 20 km north-west of Leeston
  • 20 km north-east of Rakaia
  • 40 km west of Christchurch

The Press says there’s been no reports of injuries or property damage but that might change when people inspect buildings in daylight.

The Paper also reports on the probabilityof future quakes:

. . . for the 12 months to July 15 next year there is:

a nearly one in two chance of a magnitude-5.5 to 5.9 aftershock

a one in seven or eight chance of a magnitude-6.0 to 6.4 quake

a one in 15 chance of a magnitude-6.5 to 6.9 shake, and

a one in 50 probability of a quake of magnitude 7.0 or higher.

In monthly terms, those figures translate to:

a one in 10 chance of a magnitude 5.5 to 5.9

a one in 25 chance of a magnitude 6.0 to 6.4

a one in 100 chance of a magnitude 6.5 to 6.9, and

a less than 1 per cent probability of a magnitude 7.0 or more.

Based on the same calculations, there could be up to five magnitude-5.0 to 5.4 aftershocks in the next 12 months, with a one in three chance of one in the next month.

I presume this story was written before this morning’s quake so that’s one of the probabl 5.0 – 5.4 quakes down.

 


Losing benefit after 26 years

January 5, 2011

Former gang leader Darryl Harris is to lose the sickness benefit he’s been receiving for 26 years:

Ministry of Social Development chief executive Peter Hughes said Harris had been told that his sickness benefit would stop from January 10 because “he no longer meets standard eligibility requirements”.

Hughes was replying to an Official Information Act request by The Press.

This is more good journalism from The Press which reported last year that Harris and his wife, Marcia Robins, had been claiming unemployment and sickness benefits since 1984.

They had received $30,000 in special-needs grants since 2000, including payments for new tyres for their 2007 Chrysler saloon and to fence a swimming pool at one of their Christchurch properties.

Efforts to cancel Harris’ sickness benefit failed after he obtained a medical opinion that he was addicted to cannabis. The opinion was from one of Work and Income’s designated doctors after the agency appealed against a medical opinion that Harris was suffering “stress and anxiety” over being work-tested.

What about the stress and anxiety those of us who work to pay taxes suffer knowing this is where they go?

Social Development Minister Paula Bennett said yesterday the Government believed those who could work should do so, “and if that is considered hard line, so be it”.

“If someone is receiving the benefit because they are unwell, it is reasonable to expect them to be making every effort to get well so they can return to work. That is their responsibility to the taxpayer,” she said.

“It is unreasonable to expect the New Zealand taxpayer to support someone for extended periods on welfare because of a drug habit, unless every effort is being made to kick that habit and get back to work.”

There is no  doubt a lot more to this case than has been reported. It will be the exception not the rule and shouldn’t be used to put undue pressure on people who need help for circumstances beyond their control.

It could also be used to put a case for more help for the treatment of addiction.

But it is a welcome sign that the right to assistance comes with responsibilities and those who can help themselves will be expected to do so.


On ACC they said:

October 18, 2009

Not all editorials and columns agree with the government view on ACC’s problems and solutions.

But there is concensus that there is a big problem in need of an enduring solution.

Southland Times:

That belt-tightening exercise we’re enduring with ACC – there comes a point where what you’ve got is no longer a tightened belt. It’s a tourniquet. Confuse the two and something’s going to blacken and fall off, writes The Southland Times in an editorial.

Many eyes are bulging at the severity of the huge rises to ACC levies, and the toughening up of the qualifying criteria. These measures, including an extra $320 a year coming out of the average wage (which actually seven out of 10 workers are on or below), do need scrutiny for over-reaching.

ODT:

Of greater concern is the growth of future liabilities, from $9.4 billion to $23.8 billion in four years, and a good deal of the responsibility for widened and costly coverage can be laid at the door of the Clark government.

An example is the physiotherapy benefit . . . According to the Government, the subsidy introduced by Labour in 2004 and budgeted to cost $9 million a year had by this year risen to $139 million and was projected to rise to $225 million by 2011-12, with no equivalent rise in rehabilitation rates.

It has quoted other examples of how the scheme has developed far beyond its original concept to cover diseases like leptospirosis and brucellosis and medical conditions like asthma, when, it argues, these should instead be paid for out of Vote Health.

To these might be added trauma of various kinds suffered by victims and perpetrators resulting not from accidents but from criminal acts, mental injury arising from workplace trauma, and sports injuries.

When it began with the 1972 Accident Compensation Act, only those who were employed were entitled to claim for workplace accidents. That soon changed to cover all accidents, including motor vehicle accidents, regardless how injury occurred.

Timaru Herald:

The unworkable or unprofitable parts will have to be bundled back into a Government scheme. And somewhere in the middle the romantic notion of a Government-funded no-fault system will have to be modified in a politically-acceptable way.

It is a Herculean task and one that will provide a stern test for the National Government. Whatever happens in the long term, what is crystal clear today is that taxpayers will have to dig deep to get ACC out of the mire. Having a unique highly regarded system is great in theory. It is also extremely expensive.

The Press:

What would really undermine ACC and its no-fault comprehensive coverage principle would be a lack of firm action taken now to control its costs, with major levy rises not just a short-term source of financial pain for New Zealanders but something that continues well into future years.

The Nelson Mail:

Though there has been no shortage of spin around ACC’s balance sheet and performance during National’s 11 months in office, it is clear some significant changes were needed in order to bring the scheme back under control.

Some of the proposals will sail in – no more entitlements for injured methamphetamine “cooks” for example – but increased levies have already provoked wide-ranging protest.

Dominion Post:

There is no such thing as a free ACC system.

That must be central to the honest conversation the Government is asking New Zealanders to have about the scheme. Stripped to its essentials, the scheme is an insurance one, and that means any entitlement in the scheme costs money, and must be paid for by levies.

The debate must also recognise that the ACC was established to compensate people who are injured. It was not meant to be an extension of the social welfare system, cushioning people against all misfortune. The distinctions it makes are arbitrary, and can be seen as unfair . . .

. . .  The job facing Dr Smith and his colleagues is to convince the public that what is being done is fair, and within the spirit of the deal that saw New Zealanders trade away their right to sue for a no-fault right to compensation.

That deal remains a good one. It should be made to work and made affordable, not torn up.

Taranaki Daily News:

The massive increases aimed at the two-wheelers just highlights what a sorry mess ACC has become. The corporation was introduced in 1974 on April Fool’s Day which probably says much about what it has become – a $24 billion liability to the taxpayer.National promised to put the boot into bureaucrats and under-performing government departments when it came to power last year.

ACC was clearly in its sights and so it should have been.

Quite apart from the horrific imbalance between money taken in and that dished out, New Zealanders have become sick of the tales that have leaked from the corporation throughout its 35-year existence.

Remember the outrage of the prisoner being paid ACC for injuries suffered during the act of crime?

While those criminal instances might be a fraction of the ACC’s overall costs it nevertheless highlights the stupidity of parts of its system.

Past abusers of ACC are partly responsible for the current tightening in all areas.

Deborah Hill Cone:

A benefit now has a cosier name – an entitlement – which is “a right granted by law or contract”. Big. Difference. . .

There has been a lot of talk of entitlements over the ACC-in-a-pickle problem. . .  And the punters who have “entitlements” are no longer called claimants; they are clients, lest it might sound as though they are putting their paw out. The ACC public relations dude told me the Labour Government had asked for the jargon change – Labour understood the power of Neuro-linguistic Programming. The theory was that people had actually paid their premiums and so shouldn’t feel they were getting summat for nothing. Dinky idea, but as we now know, the premiums do not cover the cost of the ACC scheme – so claimants are getting something for nothing. Actually. . .

. . . I am still waiting for someone to explain to me why it is that large corporates, such as Fonterra and Air New Zealand, can opt out of ACC and self-insure – but I can’t. Oh, I get the practical reason – that I don’t have a lazy mill to cover a claim – but where is the policy rationale? The opt-out clause (cosy name: the “partnership programme”) takes 15 per cent of the country’s workers out of ACC. So if these corporates can manage their health and safety liabilities more efficiently than ACC, what does that say about ACC?

Herald on Sunday:

. . .  in the 35 years since ACC was established, so many bits have been carved off and clipped on that it bears little resemblance to the original design.

Anomalies abound: people who work in dangerous jobs pay more in earner levies than people who work in offices, but rugby league forwards incur no more expense by way of premium payment than those whose leisure preference is macrame. . .

More profoundly, many of its conceptual assumptions have been corrupted by this piecemeal regulatory intervention. ACC has not been reviewed since the 1980s and, once it has dealt with the immediate crisis, the Government would do well to consider another reassessment of the entire system.

In 1974, we entered a social contract by which we surrendered the right to sue. As a society, we were keen to avoid the litigious and ludicrously expensive American model.

But it is not an absolute truth than our system is better. Anyone who spends time in the US will quickly notice the lengths to which people go to avoid posing a risk to others.

That carefulness flows from fear of being sued, of course, but it’s worth wondering whether we here have grown too accustomed to being reckless of others’ – and our own – welfare, in the knowledge that someone else will pay.

If nothing else, the crisis we face now reminds us that we are all that someone else.

Deborah Coddington

The Government can remain insurer of last resort for dangerous employers with bad track records, but why should safe, careful employers who look after their workers continue to pay high levies and cross-subsidise the former?


SCF problems temporary – Updated

September 22, 2009

The central South Island would be a much poorer place were it not for the business acumen and generosity of Allan Hubbard.

Many individuals and businesses owe their success to him as an individual or his company, South Canterbury Finance.

The Opuha Irrigation Scheme is one example where Hubbard’s generosity is public. There have been many more known only to him and the people, charities and businesses he has helped.

Both Hubbard and SCF have a reputation for integrity.

The difficulties the company is facing now which has resulted in a creditwatch negative from Standards and Poor’s, is not a result of shonky dealings or high living. I have no trouble believing Hubbard when he says:

. . . the change in the ratings status “should quickly be resolved as it is a matter of timing arising principally from a delay in finalising the company’s audited accounts.”

Hubbard and the company’s directors will be doing everything they can to solve what should be temporary problems and regain the company’s reputation and credit rating.

UPDATE:

The Press has an interview with the quiet benefactor.


SFF needs a plan B

September 19, 2009

Silver Fern Farms is putting a positive spin on the decision to extend the deadline for farmers to take up its share exchange and cash issue offer.

The chairman of the meat co-operative, Eion Garden, said 37% of shares had been exchanged so far and “a significant number” of shareholders had taken up or exceeded their full cash issue entitlement.

The company had hoped to raise at least $80 million, but with a flood of applications arriving before yesterday’s deadline, more expected over the weekend and the clash with lambing, the deadline had been extended until October 9, Mr Garden said.

I don’t think lambing has anything to do with it. The company obviously didn’t get the support they hoped for. The Press  says the maximum that can be raised is $128m but so far only 12 million new shares at $1 each have been bought by farmer-suppliers.

 The extended deadline might pick up a bit more shahreholder support but it won’t deliver the amount the co-operative needs and the directors will have to look for a plan B.

It hasn’t been a good year for the company.

Alliance Group shareholders turned down the Meat Industry Action Group’s plan for a merger with SFF. PGG Wrightson couldn’t come up with the cash for the 50% buy in it had proposed; and the $10 million PGW shares SFF took as part of their compensation for that are worth little more than half that amount now.

The season ahead won’t be easy either.

Demand for lamb in export markets is firm which is holding prices up. But the strength of the demand is on the back of falling supply caused by drought in Australia and New Zealand and the large number of dairy conversions here.

Fewer sheep to kill exacerbates the over supply of killing space. SFF did some rationalisation last year but the industry as a whole still has excess capacity.

It has been a good season for lambing. The weather has been pretty mild and survival rates have been high. Spring grass growth has been good too but most of the east coast is very dry which will put pressure on feed and bring stock on to the market.

But farmers are spoiled for choice when it comes to meat companies and if they aren’t prepared to invest more in SFF it’s an indication they may well look elsewhere for killing space.


Ecan says ‘e can’t

August 29, 2009

Environment Canterbury  chair Kerry Burke lost a vote of no confidence by eight votes to six  at this week’s council meeting.

The rebellion was led by South Canterbury councillor Mark Oldfield.

The loss has set up a showdown vote on September 24 when councillors will consider removing Sir Kerry as chairman and, if that is resolved, they will have to elect a new chairman.

It’s been a long time coming.

Problems with his leadership have been fomenting for years, aggravated by a rural urban divide which often resulted in seven councillors on each side of a debate.

The result of the 2008 local body elections led to an impasse when an even number of councillors supported the two candidates for chair – Sir Kerry and Alec Neil. That was settled when Mackenzie councillor Bronwen Murray supported Sir Kerry, even though she had said she would not when seeking election.

Problems have not been confined to those round the council table. Ecan is deeply unpopular with people rural people, especially those south of Christchurch where it’s popularly known as ECan’t.

Relationships between Ecan and  district councils in the region are fraught. They have deteriorated so far that the district councils are investigating the possibility of ceding from ECan and forming a unitary authority.

The Waitaki District is divided between the Otago Regional Council and Ecan. The Waitaki District Council and residents regularly complain that it is much more difficult to deal with Ecan than the ORC.

Complaints about  Ecan gained credence when it was found to be the worst performing of all councils in the Ministry for the Environment’s biennial Resource Management Act survey.

Problems run deep among councillors, staff and the people they are supposed to serve. A new chair may help relationships but it will be difficult to solve the underlying problem of a council split by political affiliations and dominated by Christchurch, a large urban area which appears to have no understanding of, or sympathy for, the needs of the rural hinterland.

The Press backgrounded some of the issues here.


Editorials on Field

August 6, 2009

The ODT  says:

However much it might be argued that he was a victim of cultural difference, as an MP he swore an oath to uphold New Zealand law.

He therefore knew the rules and the borders that cannot be crossed.

His peers have judged that he knowingly broke those rules and crossed those borders: if he is a victim, it is of his own arrogance, his own greed and his own lust for status.

The Press says:

For all the shallow cynicism that New Zealanders like to profess towards their politicians, it is undeniable that the country has possibly the least corrupt politics of anywhere in the world.. .

Among the most shameful aspects of this sorrowful affair was the attempt by the Labour government of the time, when the scandal first made the headlines, to trivialise it. . .

. . . Labour’s foot-dragging was dictated by a desire not to offend an important political constituency. But whatever the motive, it was not good enough. The country’s political and administrative integrity will only be preserved by constant vigilance. If there is a lesson to be drawn from Field’s sad case, it is that when such allegations arise they must be dealt with vigorously and promptly.

Sadly, the affair reflects badly not only on Field, but on those politicians who put pragmatism and keeping his vote ahead of principle, and tried to close the issue down rather than do the right thing. Miss Clark was initially dismissive, using her favoured “move along, nothing to see here” strategy. When people didn’t, she launched a narrow inquiry under Noel Ingram QC.

Despite the constraints on Dr Ingram and a distinct lack of co-operation from some of those involved his report made it clear that something was terribly amiss in the way Field had been handling immigration issues to everyone but Labour MPs, that is. They continued to defend him. . .

. . . Under Parliament’s own rules, all members are deemed to be honourable members. Field’s corruption has shown that up as the fiction it always was. His Labour colleagues’ handling of it simply added to the insult of his crime.

The Herald says:

The verdict says we have a culture of public service that allows no favours in return, and that is a culture that rules all.

Summing that up:

MPs must obey New Zealand law regardless of what is acceptable in their own countries and cultures; we are still one of the least corrupt countries in the world and Labour is tarnished by this sorry episode too.


Pregorexia developing problem

June 23, 2009

“You really shouldn’t comment on a woman’s body when they’re pregnant . . . ”

This comment from Maggie Baumann a counsellor who learned from experience the dangers of pregorexia – anorexia during pregnancy.

As models, film stars and other media lovelies get even scrawnier the pressure on women to be unrealistically and unhealthily underweight has grown.

That is bad enough for the mental and physical health of women at the best of times, the dangers are more than doubled during pregnancy when too much exercise and too little food not only endangers the mother, it harms the developing baby.

A post on pregorexia last year is one of the most read on this blog. It was prompted by this story in The Press . It said pregorexia was real and caused by exposure to images of unrealistically underweight celebrities and figure-hugging maternity clothes.

Canterbury District Health Board psychiatrist Sue Luty, who specialises in eating disorders and perinatal mental health, said women limiting their calorie intake during pregnancy or overexercising was becoming “a huge issue”.

Women’s views of pregnancy were being distorted by images of celebrities who “miraculously” got back into shape soon after giving birth, she said.

This was unrealistic as the stars usually had personal trainers and many were too thin before their pregnancy, Luty said.

“It’s not normal for women to be skinny throughout pregnancy but they are seeing pictures in the media that say something completely the opposite.”

Luty said pregnant women were more fashion conscious than before and slinky, form-fitting maternity wear which showed off expectant figures was commonplace.

This put more pressure on pregnant women to stay thin, she said.

“A normal pregnancy shape is chunkier and bumpier but women don’t like that look in tight maternity clothes.”

Maternity clothes available when I was pregnant did their best to disguise the growing baby and I’ve admired the modern fashion for literally being upfront about the bumps but I hadn’t thought about the pressure this put on women to show without growing.

Too much of what passes for women’s fashion in clothes and bodies is misogynistic at the best of times. When unrealistic and unhealthy images become something to aspire to in pregnancy it’s time for a campaign to show that real women have real bodies with curves. A little bit of fat is not only healthier it’s also more attractive than the plastic stick figures the misogynists would have us become.

It could start with people refraining from commenting on other people’s body shapes, whether or not they’re pregnant.


Round up of Budget editorials – updated

May 29, 2009

The Southland Times calls it a pig of a budget:

The constraints on Bill English’s Budget were such that at times he must have felt like calling in Mike King and a documentary crew, writes The Southland Times in an editorial.

It was grimly inappropriate to hear the Finance Minister say his Budget marked a turning point.

Chance would be a fine thing. Instead, Mr English faced manoeuverability issues that could lead a man to commiserate with any crated pig.

He could trample forwards and backwards just a little, even try a few backflips, but there just wasn’t room for sidesteps.

Mr English simply wasn’t in a position to lead us swiftly out of the recessionary mire and into the meadowlands any time soon.

The Timaru Herald says Mr Prudent gets his scissors out:

No-one could accuse Finance Minister Bill English of delivering a charismatic Budget speech yesterday, but what it lacked in flair it more than made up for in guts.

Against the backdrop of the worst economic conditions in decades, the Budget had to be tough. It was.

The gutsy decisions include deferring the next two planned phases of tax cuts in 2010 and 2011, and suspending payments to the Superannuation Fund in the long term.

These are likely to be unpopular measures but, to be fair, there is no surprise in either of them. The Government has been slick at telegraphing the bad news, and the public has a good level of understanding about just how difficult the times we are living in are. In fact, the softening up programme has been so effective that any hint of a tax cut would have seemed reckless.

The ODT headline its editorial walking the tightrope and sounds a warning to individuals:

Most people will be happy benefits have been retained, and they certainly should be happy that state spending is to be curbed.

They should also be budgeting just as carefully as Mr English appears to be: with household debt increasing by 51% since 2004, and with $168 billion of net debt currently owed by the country to overseas lenders, the halcyon days of recent memory are decidedly over.

They will not return until national productivity improves, debt is paid down, our export trade improves and we pay our own bills.

Mr English is walking a tightrope, and so are we all.

The Dominion Post calls it a Budget for a rainy day:

Labour leader Phil Goff says that, by halting contributions to the super fund, the Government is digging a $20b hole for future generations. The truth is that Labour left National with little choice. For all its talk of Keynesian economics and putting money aside in the good times, Labour spent too much of the bounty that flowed into the state’s coffers during its nine years in office.

The $15b the last government set aside for a rainy day by reducing government debt and investing in the super fund will be consumed in less than two years.

Without the changes announced yesterday, debt would have ballooned by 2023 to the crippling levels last seen in the late 1980s. That would have left the state owing the equivalent of $45,000 for every man, woman and child a burden that would have severely limited the ability of future governments to meet health, education and welfare needs. The solution is not to gamble on international markets.

The Taranaki Daily News says move over Fluffy, here comes Bill:

Those of us who share a bed with a rubber hottie and a fluffy cat will welcome at least one bit of good news in yesterday’s dreary Budget.

Finance Minister Bill English has allocated $323 million over the next four years to insulate our appallingly cold homes.

The NZ Herald says it’s a Budget short on tough decisions:

The recession has shown Labour’s spending levels to be unsustainable, and the more since Labour and National have indulged in a round of tax cuts. Hard decisions on welfare entitlements for the well-off, interest-free tertiary loans, free childcare and the like – decisions Mr Key and Mr English were proud to avoid yesterday – will probably have to be made. Maybe next year.

Nine years of deficits is simply too long. The world economy will surely have recovered in half that time. The Government needs to be looking beyond its cushions. The country needs to be awake and well geared for the first signs of recovery.

The Budget has been constrained not just by the recession it’s also been constrained by politics.

National made an election commitment not to alter various Labour initiatives which turned middle and upper  income people into beneficaries. The direct expense and indirect costs – through the bureaucracy which supports it – of  that increased what had to be borrowed and severely limited spending available for more productive initiatives.

UPDATE:

The NBR ditorial is headlined timid steps on a hard road:

Faced with the worst economic conditions in 80 years, Finance Minister Bill English has tried to chart a path to recovery with his first budget.

This was always going to be a difficult task and the government has taken its first rather timid steps on a long road.

The speed of the global recession has highlighted the structural imbalances in the economy, namely excessive household and government spending against insufficient growth and productivity. . .

. . . The government gets another chance next year but politically it gets harder. As Mr English says, there is no long-term free lunch.

The government has been forced to cut contributions to the Superannuation Fund with only partial contributions to be decided on an ad hoc basis until 2023.

To be a wealthy nation, New Zealand has to reward enterprise and penalise waste.


Ag outlook brighter than other sectors

March 28, 2009

The outlook for agriculture is brighter, or at least less gloomy, than for most other sectors according to the EU Prospects for Agricultural Markets  which covers the period from 2008 to 2015.

 The global financial crisis will have an impact in the short term but the medium outlook is more positive with a gradual recovery in commodity prices and:

  • the growth in global food demand,
  • the development of the biofuel sector and the
  • long-term decline in food crop productivity growth.

 The report points to lower production of milk and meat in the EU which means less competition for New Zealand produce. 

While yesterday’s announcement that our gross domestic product declined .9%  in the December quarter is sobering, agriculture outperformed other sectors:

SNZ said primary industry activity increased 1.6 percent in the December quarter, while activity in goods producing industries fell 3.6 percent.

A rise in agriculture production was mainly driven by increased dairy production. For the December year activity in primary industries increased 0.9 percent, compared to an increase of 3.6 percent for the year to December 2007.

 The role meat and milk will play in our economic recovery was noted by AgResearch chief executive Andy West when he stressed the importance of research and development.

He cautions that R&D spend should not be curtailed as credit facilities dry up around the world.

While he doesn’t see any evidence of a decline in pastoral R&D spend in New Zealand, he agrees that it has come under pressure during the economic crisis.

. . . It is the single most important sector that will help us get out of the economic crisis,’ he told Rural News. ‘We have to export our way out and the dairy and meat sectors need all the assistance they can get.’

If the South Island field days are anything to go by, agriculture is not just the most important, it’s also one of the most positive sectors.

The Press reports that opening day numbers were up and while farmers were showing caution, they weren’t mentioning the r word.

And TV3 said that  recession was a dirty word among the farmers they spoke to.

It’s possible they only interviewed the optimists. No-one is saying that farming is booming, but the mood in the paddocks does seem to be more cautious than depressed and the EU forecast suggests a brighter outlook in the medium term.

Hat Tip: Phil Clarke’s Business Blog


Bridge across rural-urban divide lost in translation

January 21, 2009

Dear Don

If an intelligent woman like Cactus Kate, who comes from a farming background, and JC, who left a comment here , struggled to get the message then I’m afraid the bridge you were trying to build across the rural-urban divide has been lost in translation .

You are right about the importance of agriculture to New Zealand, and the world, and Federated Farmers’  Open Farm Day is a good initiative to get people from town in to the country.

But your invitation came at the end of a long piece and if the feedback I’ve had is anything to go by I suspect most of your target audience wouldn’t have got past your opening paragraphs.

That’s a pity because you’ve laid some solid planks across that town-country gap in radio interviews and  Qutoeunquote pointed me at an interview in  The Press where you do it so much better:

But he has to ask why New Zealand, of all places, is shooting itself in the foot this way. He says it is shocking how dependent we are on food production as a country. Surely everyone knows that agriculture and forestry account for 65 per cent of New Zealand’s exports?

You might think Australia is a farming nation, too. Yet, despite those outback farms the size of small European states, agricultural exports are not even 4 per cent of the Aussie economy.

We are quite simply the biggest dairy and sheep meat exporter in the world. Or, to turn it around, the society whose fate is most closely tied to what is going on in its paddocks.

Yes, it is an exceptionally difficult trick we are trying to pull off – to be a nation with a First World standard of living based on an industry that generally, unfortunately, pays a Third World return.

“So many people are coming with negative connotations as to how we farm. And yet the world needs food. Farmers get out of a morning, pull their boots on and produce food, the best way we currently know how,” Nicolson says.

It’s clear, concise, easy to understand and easy to remember.

It worked in this piece and it’s a good blueprint to follow next time you want to build a bridge.

Yours sincerely

Homepaddock


We say . .

November 7, 2008

Today is the last day the media can publish anything which might influence the election and some papers have used their editorials for a final political pontification.

The ODT  says voters aren’t facing an easy choice and has faith the electorate will look for a higher purpose:

The government to emerge from tomorrow’s poll must be capable of managing the nation’s affairs in hard times, principled enough to make unpopular but necessary decisions for the long-term future of the nation and not the short-term ambition of staying in power, and capable of converting our dependency economy into more productive purposes – without destroying the state’s safety-nets or driving overseas our human capital.

The Press says it’s the economy:

What must not be forgotten, however, is that a National-led government, with ACT New Zealand as a key partner, would be a distinctly different beast to another Labour-led administration with the Greens on board.

A government headed by Key would be the more likely to answer business concerns about the Resource Management Act and the Emissions Trading Scheme. It would also make employment legislation more flexible and, although it would retain the KiwiSaver scheme, it would trim the employer and the minimum employee contributions. National also has higher personal tax cuts on offer than Labour, despite Key being forced by the financial crunch to water down his party’s tax relief.

Many of the changes proposed by National are not dramatic. But, put together, they would foster an economic environment which is business-friendly. The question, then, is whether that would address New Zealand’s labour productivity, which remains stubbornly low, and reduce the number of our best and brightest who take their skills overseas.

 The NZ Herald  asks, do we repeat or refresh?

The economic context of this election could not be more challenging. New Zealanders need to deliver a decisive mandate, one way or the other, so that responses to the recession and credit crisis can be emphatic. Second-guessing MMP by flanking major parties with second-tier partners might not be the best answer now.

The “ask” is simple: Is there still benefit for the country in drinking one more time from the cup of Labour, or is another source, National, needed now for economic and political revival?

Update: The Dominion Post  says it’s a weighty decision:

Those thinking of voting for Labour must ask whether its experience in managing the economy outweighs the fumbles and arrogance of nine years in office. Those inclining toward National must judge whether Mr Key’s energy and promise of a new approach are matched by an ability to make tough decisions and say no when he is in government. Those wanting to support the minor parties need to consider whether the country can afford the cost of the boutique policies they insist upon as the price of coalition government.

It is up to voters how they answer those questions. The important thing is to ask them before they cast their ballots tomorrow.


Fizzer fallout

October 31, 2008

The rolling average of polls  still favours National so Labour needed something big to give them the momentum they’ll need to catch up in the last week of the campaign.

But the neutron bomb they dropped proved to be a fizzer and the fallout from it is hitting them in the face.

 

The Press editorialises:

 

The attempt failed ignominiously and the muck the party was trying to throw has wound up all over itself. Yesterday morning, every senior figure in Labour suddenly became uncontactable when journalists were trying to get hold of them, and all of them, from Clark down, were busily distancing themselves from it.

 

To add to their woes The Press  found:

 

. . . that Labour used its taxpayer-funded research unit to trawl through the documents, and also that its chief campaign strategist, senior MP Pete Hodgson, was also working on the story with Williams.

 

The paper also has a he said-she said contradiction between Mike Williams and Helen Clark:

 

Williams told TVNZ last night that the Labour Party had funded his trip to Australia a claim at odds with Clark’s version of events.

Clark told reporters in Christchurch yesterday that Labour had “absolutely not” paid for Williams’ trip, and that the money had come from his own pocket.

 

The Dominion has an explanation for that:

Yesterday Miss Clark said Mr Williams paid for the Melbourne excursion himself, but today said on Newstalk ZB that she had since been updated on the situation.

“He (Mr Williams) told me he paid for it, he now tells me he got reimbursed by the party…” she said.

 

Miss-use of taxpayers’ money is our business but whether Williams or the party paid for his trip is a matter for the them.

 

However, regardless of who stumped up the money it was not only a wasted trip, it could prove to be very costly for Labour.

 

I wouldn’t go so far as Matthew Hooton who reckons Labour’s delivered a fatal blow to their own election chances, but the Stuff poll is encouraging:

 

Do you think Labour’s attempts to dredge up evidence against John Key from a 20-year-old case the Serious Fraud Office says he was not involved with look desperate?

 Yes (1222 votes, 83.0%) 

No (251 votes, 17.0%) 

 

 

Stuff polls are not scientific and reflect the opinions of only those internet users who have chosen to participate.


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