Getting excited over, well, nothing

August 21st, 2014 at 10:09 am by David Farrar

The PM has said he wasn’t told about the OIA release from the SIS but his staff were.

NewstalkZb discovered a three year old letter from the SIS Director to them where he said he did advise the Prime Minister.

This got people all excited, but I never saw this as a contradiction as I have worked in Government and in a PM’s Office.

When officials say they have advised the Prime Minister, they generally mean they have advised someone in the PM’s Office.

In my experience it would be very very rare for a Government Department to talk directly to a Minister, let alone the Prime Minister, on an OIA request.

And my assumption has just been confirmed as the then SIS Director has confirmed to media that his 2011 letter was referring to having briefed the PM’s staff, and that he never had a conversation with the PM on it.

Also on the wider issue, of someone tipping off Cameron Slater to ask for the document, I’d also point out that in terms of motive, it may not be someone in Parliament. Phil Goff had incorrectly claimed the SIS had been derelict in their duty and never briefed him on an issue. I could imagine that there were a number of people in the SIS upset about this, and would have been quite happy for the briefing notes to be made public, if requested under the OIA.

I genuinely don’t know who tipped off Whale, but I do know agencies get pretty unhappy when politicians accuse their boss of incompetence or dereliction of duty, and many people at SIS would have known that Goff had been briefed, despite Goff claiming he hadn’t been.

UPDATE: I should add on that I think it is a good thing that the Inspector-General of Intelligence and Security is investigating. I’d also point out that while it involves the SIS, this is an issue about a document that was suitable for release under the OIA, not secret material. That doesn’t mean there isn’t an issue here, but there is a difference between alerting someone to ask for a document suitable for public release, and alerting someone to something classified.

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Hockey on NZ

August 21st, 2014 at 10:00 am by David Farrar

The Australian reports:

JOE Hockey frequently admits he’s a little bit jealous of our cousins across the ditch, in an economic sense at least.

THE treasurer’s green eye probably went an even deeper shade of emerald after New Zealand’s latest employment figures showed their jobless rate tumbled to a five-year low of 5.6 per cent in the June quarter from a revised 5.9 per cent previously.

The best we can hope for is Australia’s jobless rate not reaching 6.25 per cent this financial year, as predicted in Mr Hockey’s May budget.

And what does Hockey say:

He said New Zealand has stolen the advantage from Australia during the past few years by combining domestic structural reforms with newly negotiated trade opportunities in Asia.

“As a result, they have falling unemployment, rising living standards and a budget that is coming into surplus,” Mr Hockey said.

Faced with a hostile Senate over his first budget, Mr Hockey also said he was “quite jealous” that NZ Prime Minister John Key has to deal with only one parliamentary chamber.

Even so, Mr Key and Finance Minister Bill English are showing the world how economic reform should be done.

And it has not been achieved through “luck or complacency”.

“There is no she’ll-be-right attitude,” Mr Hockey said.

Except those parties who want to spend the surpus before we even achieve it, and send us back into deficit.

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Making shit up on Stuff

August 21st, 2014 at 9:45 am by David Farrar

Stuff reports:

If you’ve heard enough about Nicky Hager’s Dirty Politics book and claims of Judith Collins’ leaking like a sieve to blogger Cameron Slater, you’re not alone.

Rumours doing the rounds on social media yesterday suggested a group of Young Nats in Hamilton might take matters into their own hands and dispose of a large stock of the dreaded book.

It’s not exactly on the same scale as the book burnings of the Nazi regime or the anti-communist McCarthy era but social media was yesterday buzzing with rumours of an imminent book burning at Waikato University.

The head of the Waikato Students’ Union and a former member of the Young Nats is alleged to have bought 202 copies of Hager’s book to burn.

Aaron Letcher has denied the claims, but the leader of NZ First Youth and a Waikato University source, who asked not to be named, said he did.

Letcher said the claims were false.

“There is nothing to it. I saw the allegations on Facebook by a NZ First person”

The Facebook page Letcher was referring to belongs to NZ First Youth leader Curwen Rolinson, who posted: “So apparently, the CNI Young Nats (and, assumedly, the NZ Young Nats) are buying up copies of Nicky Hager’s #DirtyPolitics . . . and burning them.”

Rolinson said he stood by his post.

His claims have been backed by a Waikato University student who saw the books in Letcher’s possession.

Stuff now runs as front page news (and lead story in the Waikato Times I believe) a rumour on Facebook, pushed by the former Head of NZ First Youth?

And people say there is a problem with standards on blogs!

Here’s what I understand to be the story from someone close to Aaron (Aaron has the flu).

  1. Aaron purchased six copies of the book.
  2. He sent five of them to an Embassy in Wellington, where his mother works, as they couldn’t buy any locally. He kept one for himself to read and was probably very disappointed he was not in the book.
  3. Someone saw the six books in his office and decided he must have purchased them for a book burning or some such stupidity and the rumour started

It’s one thing for there to be a rumour on Facebook, but for Stuff to run this as a front page story without a single shred of evidence is just making shit up.

The hilarious thing is Aaron has done lots of stupid crap in his time. But this is not one of them.

I look forward to the prominent retraction by Stuff. Nah, just kidding. I’m not that much of an optimist.

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A cheaper way to increase cycling

August 21st, 2014 at 9:00 am by David Farrar

Jamie Whyte announced:

“The National party yesterday announced a $100 million cycle-way that just happens to go through the marginal seat of Hutt South,” said ACT Leader Dr Jamie Whyte.

“The Greens want to spend many hundreds of millions on cycle-ways. ACT’s contribution to this bidding war for the cyclist vote would double cycle use and cost nothing,” said Dr Whyte.

“We need only abolish the law that makes wearing a cycle helmet compulsory. Since 1994, when Parliament established an instant fine of $150 for failing to wear a helmet, cycling has declined by over 50%. Overseas experience also indicates that laws making it compulsory to wear a helmet dramatically reduce cycling.

In fact a study from The Netherlands found that not having a compulsory helmet law has led to much higher levels of bike use.

“This nanny state law does not even save lives,” said Dr Whyte.

“On the contrary, it costs lives. Before the legislation, few people died from cycling accidents and, of those who did, only 20% died from head injuries alone.”

“Research reported in the New Zealand Medical Journal (seehttp://journal.nzma.org.nz/journal/125-1349/5046/) shows that, over a 10 year period, only 20 Aucklanders were killed in cycle accidents and only 4 might have been saved by wearing cycle helmets. This same New Zealand Medical Journal article concluded that life years gained from the health benefits of cycling outweighed life years lost in accidents by 20 times” said Dr Whyte.

This is what The Netherlands study found also.

“The diminished health resulting from the reduced cycling caused by compulsory helmet-wearing costs 53 premature deaths a year. ACT would simply abolish the $150 fine for not wearing a helmet. That would save $100 million on cycle-ways in marginal seats, double cycle use and save 53 lives a year,”  said Dr Whyte.

I’d do both.

Note there is a huge difference between saying helmets should not be compulsory, and saying that people should not wear them.

One day I suspect someone will try and mae helmets compulsory for skiing!

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General Debate 21 August 2014

August 21st, 2014 at 8:00 am by Kokila Patel
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Greens claim they will run bigger surpluses – yeah right

August 21st, 2014 at 7:00 am by David Farrar

The Herald reports:

Prime Minister John Key has taken a shot at Green Party co-leader Russel Norman, saying he must have been smoking dope to believe the Greens could pay off debt faster than National.

The Green Party has claimed its economic policies would pay down debt faster and get bigger surpluses, than under National. Mr Key said he knew the Greens were also keen on legalising cannabis.

“If they really believe that, maybe they’ve been trying the substance because they can’t do it.” Asked if he thought Dr Norman had been smoking weed when he put out the numbers, Mr Key said “well, if he really believes those press releases, yes. Press releases are cheap and easy. Getting back into surplus is a much more challenging issue.”

Mr Key said between them Labour and the Greens had made $28 billion worth of promises already. Even if Labour stuck to its promise to remain in surplus, it would leave no buffer if there was another disaster that impacted on the economy.

The claims they would also be fiscally restrained are laughable.

First of all Labour and Greens have condemned every measure of fiscal restraint in the last six years. We would not be on the verge of surplus if they had been Government.

Secondly it is important to understand how they are claiming they will stay within surplus. It involves the operating allowance.

The Government has allowed $1.5 billion a year of extra spending. This is cumulative. So this year is is $1.5 billion, and next year it is $3.0 billion (over two years ago) and the year after $4.5 billion. Labour and Greens say they will fund all their policies for the next three to four years from those operating allowances.

This is again not even close to credible. What Labour and Greens are implicitly saying, and you have to believe, is that if elected they will make no more spending decisions for the next three or four years. That they will not fund any new initiatives. They will not even have a Budget where they announce new spending, because what they have done is pre-allocate the allowances for the next four years.

Now if you believe that they will make no new spending commitments in the next four years. That for four years they would announce Budgets that are basically one page long and just say “No more spending” then you can believe they will run a surplus. But if you do believe that, can I also offer you this nice bridge for sale.

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National’s first TV ad

August 20th, 2014 at 4:00 pm by David Farrar

National’s first TV ad. I was pretty critical of some of their advertising last campaign (the opening address was terrible) but I have to say I think this one is well done. A clear crisp message that has resonance, plus a bit of humour.

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Greens want co-Deputy PMs

August 20th, 2014 at 3:00 pm by David Farrar

The Herald reports:

Green co-leaders Russel Norman and Metiria Turei want to be in a full coalition with Labour and have senior Cabinet positions that reflect their party’s priorities, social justice and the economy.

And they say that the possibility of sharing the role of deputy prime minister has to be on the negotiation table.

So what positions will Hone, Laila and Kim have?

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Clive Palmer does it again

August 20th, 2014 at 2:00 pm by David Farrar

The Herald reports:

Outspoken Australian tycoon Clive Palmer has labelled the Chinese Government “mongrels” who “shoot their own people” in a televised tirade that was criticised by Canberra yesterday as “hugely damaging”.

The billionaire politician, who was elected to Parliament last year as leader of the Palmer United Party also called the Chinese “bastards” who “want to take over this country”.

The mining baron is locked in a long-running dispute over royalties and port operations with Hong Kong company Citic Pacific over its Sino Iron magnetite project, a partnership with China’s state-owned Metallurgical Group.

Politicians are best not to use their positions to favour their personal business interests.

Treasurer Joe Hockey said Palmer’s comments were hugely damaging and urged him to tone down his rhetoric against Australia’s largest trading partner. Foreign Minister Julie Bishop said she would tell the Chinese Embassy that “these views are not representative of the Australian Parliament and I don’t believe representative of the Australian people.” A spokesperson for the Chinese Embassy called Palmer’s comments “absurd” and “irresponsible”, the ABC reported.

And one of his MPs:

Palmer yesterday tried to play down his comments, tweeting that they were “not intended to refer to Chinese people” but to Citic. But he wasn’t helped by one of his senators, Jacqui Lambie, who said she strongly supported her leader’s comments about “China’s military capacity and threat to Australia”.

“If anybody thinks we should have a national security and defence policy that ignores the threat of a Chinese communist invasion, you’re delusional and got rocks in your head,” she said

The Tasmanian is a ex-Australian Defence Force non-commissioned officer. She said China is controlled by “an aggressive, anti-democratic, totalitarian government. We need to double the size and capacity of our military right now.”

I look forward to Australia declaring war on China :-)

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Flavell on Maori Party wins

August 20th, 2014 at 12:00 pm by David Farrar

The Herald reports:

Maori Party co-leader Te Ururoa Flavell says that Labour ruling out the Internet-Mana Party from ministerial posts shows the importance of the Maori Party sitting with the Government of the day.

Some parties talk about changing things; the Maori Party actually changes things, he says.

“All the philosophies are fine,” says Mr Flavell. “What we have attempted to do is make it happen.”

Mr Flavell speaks in today’s Herald Hot Seat video, the latest in a series of interviews with party leaders.

He said Mana-Internet leader Hone Harawira, a former colleague, “hasn’t got a mortgage on looking after the poor people”.

“He talked about feeding the children … well we’ve done it. Our kaupapa we put in front of the National Party was the Kickstart programme, which is in fact dealing with over 25,000 children in more than 700 schools.”

The ministerial poverty committee led by Finance Minister Bill English had been a Maori Party initiative and had resulted in extending free access to doctors from under-6s to under-13-year-olds. It extended paid parental leave and parental tax credits and led to further moves to insulate homes and address rheumatic fever.

I don’t agree with their world-view and many of their policies, but the Maori Party is a good example of a party that actually achieves things in a constructive manner.

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Mercury Energy

August 20th, 2014 at 11:00 am by David Farrar

Had a phone call from Mercury Energy last night. The rep started the sales pitch and I explained to them that I don’t decide who to buy my power off as the Apartment body corporate has a bulk deal. She brushed this off and continued with her pitch.

I repeated *four* times that I don’t get to decide my power supplier, yet the rep still insists on finishing her marketing spiel and telling me how they are opening their promotion up to Wellington, and can do an 18% discount etc. It was almost surreal.

This is not a very good way to improve brand reputation Mercury Energy. Can I suggest you tell your telemarketers than when someone says they have no ability to decide their power supplier, they don’t insist on carrying on.

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Police Association wishlist

August 20th, 2014 at 10:00 am by David Farrar

Stuff reports:

A blanket gang patch ban, raising the drinking age to 20, harsher penalties for fleeing drivers, and Tasers for all cops are some of the election year suggestions from the Police Association.

My views:

  • Blanket gang patch ban – no. the state should not dictate what you can wear in public.
  • Drinking age to 20 – no. Give it up. Parliament has now voted three times in 12 years for an age of 18.
  • Harsher penalties for fleeing drivers – yes. There needs to be a greater incentive for people not to flee from the Police, and end up killing themselves and/or others.
  • Tasers for all cops – possibly. I’d like to see data to back that up. How often does a cop have a situation where a taser would have been useful and justified?

 

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NZ Herald on Green policy to pay in work tax credit to those not in work

August 20th, 2014 at 9:00 am by David Farrar

The NZ Herald editorial:

The Green Party is offering a simple answer to child poverty: give beneficiary parents the same wage subsidies paid to low and middle income earners with children. That, the party calculates, would give beneficiaries an extra $60 a week. “This money will transform life for these kids,” said co-leader Metiria Turei. “It’ll mean having warm clothes, school books, lunch and turning on the heater when they are cold.” If only it was that simple.

It will mean more families will be penalised if they go from welfare into work.

Quite apart from the cost this would present to taxpayers ($500 million a year, the party estimates) it is an admission that the extra $60 a week the Greens would put in the hands of parents might not be spent on warm clothes, school books, lunch and home heating. Child poverty is not simply a matter of income.

If it were, then all children being raised on current benefits would be poorly housed, clothed and under-nourished. People’s circumstances vary greatly and the welfare system has become much better at providing allowances for particular needs.

Living off welfare is hard, but most families manage to do it without disadvantaging their kids significantly. And there is a lot of flexibility with hardship grants for those who need it.

The much maligned benefit reforms of 1991 reduced base rates and introduced or boosted grants for accommodation and the like. Ms Turei, as it happens, became a single parent in 1993. She referred to this in her speech, noting that her daughter has grown up in an era of “shocking levels of deprivation and poverty among our children”. Yet in that era she managed not only to raise a child but obtain a law degree with the help of a training incentive allowance.

Six years after becoming a sole parent, Ms Turei graduated from Auckland University and began work with Simpson Grierson. Her experience suggests that the welfare system as it exists is not necessarily a poverty trap.

Absolutely.

National argues the cure for poverty is employment, not just because work can pay more than welfare but because it provides the social mobility that a benefit does not. A job is liable to bring opportunities to broaden skills and responsibilities, increase earnings and productivity.

Work is about more than higher incomes. It brings masses of other benefits.

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General Debate 20 August 2014

August 20th, 2014 at 8:00 am by Kokila Patel
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Prosser 3rd, Williams dumped

August 20th, 2014 at 6:59 am by David Farrar

Stuff reports:

NZ First MP Andrew Williams is set to be dumped to a seemingly unelectable position on the party list, and former MP Ron Mark is set to rejoin the party ahead of the general election. 

Stuff understands a draft copy of the NZ First list, determined by the party’s selection committee last weekend, has Williams ranked at 13 and Mark at 9.

The draft list is understood to have MP Richard Prosser ranked at No 3.

Prosser became infamous in 2013 for writing in his regular column in Investigate magazine, that all young Muslim men – or those who “look” Muslim – should be barred from flying on Western airlines. The rights of New Zealanders were being “denigrated by a sorry pack of misogynist troglodytes from Wogistan”, Prosser wrote. He later apologised for the comments.

The guy who said the most racist thing in the last three years is rewarded with the No 3 spot? Only in NZ First.

I also can’t understand why Williams would be ranked so low, at 13.

While Williams did some silly stuff as Mayor of North Shore, my observation of him as an MP is that he has generally been quite sound and hard working. He hasn’t generated anywhere near the negative headlines of MPs such as Prosser and Lole-Taylor yet he is the one dumped. This is very weird.

Williams said his ranking on the list came as “a bolt out of the blue”.

“I think most people would agree around Parliament I’ve been a pretty able MP,” he said.

“I’ve performed for the party, I’ve done a lot of hard work for the party and I’ve represented the party as well as I could.”

The ranking was no reflection of his ability or contribution, but attributable to internal party politics, Williams said.

“I’ve had the most portfolios of any MP. I’ve had 11, plus I’ve been an associate to Winston on foreign affairs, trade, SOEs and finance,” he said.

“So I’ve had a very heavy workload, and the portfolios I’ve had have been pretty solid ones, like local government, veterans’ affairs, conservation, environment, energy; all of which I’ve been solidly batting on.”

Williams said he would like to know what the selection committee’s criteria were for selecting the top 10 candidates for the party.

He had sought an explanation for the drop but had not received a response.

I think he has been hard done by.

The return of Ron Mark at No 9 is interesting. They’ll need to lift their vote slightly to get him in, but if they do, then they may have a potential sucessor to Peters.

UPDATE: Have spoken to someone close to NZ First and they say that the sole criteria for list ranking is total devotion and loyalty to Winston, so in that context the list makes sense!

They also made the point that while Ron Mark has some relationships with people in National, he is also very close to someone in Mana, and his inclusion should not signal they’ll go with National, but equally be used to form a Labour-Greens-NZ First-Mana-Internet Government.

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Bad ad placement

August 19th, 2014 at 4:00 pm by David Farrar

The Herald reports:

TVNZ has apologised for airing a condom advertisement that features a woman talking about her sexual enjoyment during a television movie about one of New Zealand’s most high-profile rape trials.

Consent: The Louise Nicholas Story aired on TV One on Sunday night and told of Ms Nicholas’ fight for justice when she took a police officer and two former police officers to court over allegations of rape.

The small-screen adaptation of her plight, spanning 1981 to 2007, was the most viewed show in its time slot, with an audience of over 305,000, according to Nielsen ratings figures.

During its screening, an advertisement for Skyn condoms aired that featured a woman in her underwear saying how much she enjoyed sex.

The ad attracted immense criticism on TV One’s Facebook page and on Twitter, and complaints were made to the Advertising Standards Authority.

Viewers said they were appalled and horrified by such an ad played during a real-life account of alleged sexual assault, and said it reinforced a “rape culture” in the country.

“Bloody disgusting seeing a near naked woman pitching condoms in the middle of a harrowing tale … ” wrote Stephanie Kane.

“Great drama and horrifyingly real – bad choice of advert,” wrote Suzanne Mary Bull.

It was totally inappropriate, but I doubt it was a choice. People don’t pick ads to appear during specific programmes or episodes generally. They pick timeslots and channels. The problem would be is that this programme was not flagged as having sensitive content where the ads should be vetted for appropriateness.

Inappropriate ad placement is a bigger problem online. If you write a story on someone hacked to death by an axe murderer, then Google is likely to display ads for axes :-)

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Taking offence

August 19th, 2014 at 3:00 pm by David Farrar

Beck Eleven writes in The Press:

In his book, author Richard King argues it is all too easy to give offence. Not only that, but we practically leap at the opportunity to take it.

On Offence: The politics of indignation is King’s first book. Using popular culture examples, he explains how the cycle of giving and taking offence works to shut down debate and democracy.

“The determination to give offence matches the determination to take it,” he writes.

I reviewed his book a year or so ago. It is very good.

“Newspapers have less money these days,” King says. “And let’s face it, it’s cheap, easy copy and it’s copy people want to read. Some sections of the media almost drum up offence. You don’t have to pay a reporter to go to the Ukraine, these types of stories keep generating.”

Among other things, the book examines political correctness, an American pastor bent on burning the Quran, the Tea Party, religious and racist battles.

Finding examples for the book were everywhere.

“If you try to keep abreast of them all, you find yourself sinking beneath them. Offence and indignation are fantastically ubiquitous.”

One only need turn to social media or an online news story to find outrage.

“Comments hang on the end of them like seaweed. It doesn’t matter what an article is on, comments turn very abusive. Road rage is gone and internet rage is here.

So true.

As New Zealanders approach the general election, much of what King says about offence shutting down debate will start to ring a bell.

“The taking and giving of offence is a form of political currency. These days somebody only has to say something is offensive and that is deemed to be their whole argument although no real argument has actually been made.

“The way offence and offendedness is whipped up and weaponised strikes me as being almost corrosive of genuine civility.

“It ends up being more like ‘you have been offensive to me, therefore I am going to grant myself leave to something incredibly offensive back’.

“Offence is bad for democracy because it is treated as an argument in itself.”

His key reasoning in the book is that there is no right not to be offended.

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An example of how it will be better to remain on the benefit under Labour

August 19th, 2014 at 2:00 pm by David Farrar

The Herald looks at parties’ social policies and gives an example:

Solo mother Mia Silverman works 20 hours a week in a professional job – but she is virtually no better off than she would be on a benefit.

A media production assistant at Auckland University, volunteer yoga instructor and established singer-songwriter, Ms Silverman is multi-talented.

Mia Silverman with Monty, 4, and Frankie,2. Photo / Dean Purcell

But when she tried working fulltime when her second son Frankie was still under 2, soon after her marriage broke up, it was too much.

“After working two weeks fulltime, I did a breakdown of my budget,” she says.

“What is better – being really, really stressed and working is great, but the stress of running around was too much.”

She received $680-$690 a week on a benefit. Current rates are $299.45 for a sole-parent benefit, $157.17 in family tax credits for two children, and Ms Silverman got about $205 a week in accommodation supplement for rent.

Now her 20-hour university job pays $430 a week after tax, her tax credits and accommodation supplement are reduced, but she also gets the $60-a-week in-work tax credit, taking her total net income to about $850 a week after tax.

Out of that she pays a net $100 a week for Frankie’s childcare after allowing for a government subsidy, a $16 top-up for her older son Monty’s kindergarten because he needs to be there slightly more than the 20 free hours a week, plus $35 for parking at university and $100 a week for petrol.

“I enjoy being back at work, but I’m not really that much better off.”

Ms Silverman is right. The gap between being on welfare and work is sometimes not great. It would be good to have policies that mean there is a greater gap.

But see that $60 a week in-work tax credit. Labour and Greens want to give that to people not working. What will that mean? It means the already small gap between the income on welfare and work may disappear entirely for people like Ms Silverman.

I think it is vital the in-work tax credit remains for low income people in work, and is not extended to people not in work. It may mean people will earn less if they move into work, and hence they won’t.

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Cycle advocates happy

August 19th, 2014 at 1:00 pm by David Farrar

The Dom Post reports:

Cycling advocates are celebrating the Government’s plan to pump up funding for urban cycleways by $100 million for the next four years.

Prime Minister John Key launched the urban cycling initiative on the Petone foreshore yesterday, chosen because a proposed upgrade of the Petone to Ngauranga Gorge cycleway would be one of the first projects to be considered by a new urban cycleway investment panel.

The panel, to be made up of representatives from central and local government, would advise the Government on where, when and how to speed up development of city cycleways, helping to connect existing routes, as well as expanding the network.

“Everyone knows the health and traffic congestion benefits cycleways can deliver,” Key said.

“Many people cite safety concerns and the lack of infrastructure as the reasons for not cycling. I think we can say that there’s also been some underinvestment in the cycling facilities in urban areas.”

Wellington Mayor Celia Wade-Brown said the move would help to address the “major government underspend on cycling facilities in recent years” and showed that most political parties realised the importance of improving cycling infrastructure.

“This is particularly welcome in Wellington, where we have a number of projects close to being ready and some really significant developments being planned with the potential to transform the cycling network, including the Great Harbour Way, Middleton Rd, and our strategic cycling network.”

I’m now a cyclist and I have to say cycling in Wellington is a bit like Russian Roulette. Will today be the day a car door opens in front of me, or will today be the day a car swipes me as it tries to get past me. This is not the fault of motorists (of which I am one), but reflects we have few dedicated cycleways.

Automobile Association motoring affairs general manager Mike Noon said the extra investment would benefit all road users by making cycling safer in urban centres and reducing congestion.

Yep. Far better if I can cycle somewhere, and not take a car.

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No tax cuts

August 19th, 2014 at 12:00 pm by David Farrar

Have been in the two hour PREFU (Pre-election Economic and Fiscal Update) at Treasury. These are required by law, after that period in the 1980s and 1990 when incoming Governments got a nasty surprise when they found out the Budget forecasts were so far out of date.

Key points made by Treasury are:

  • Surplus for 2014/15 now projected to be $297 million, down from $372 million
  • Core crown expenses forecast to be 30.3% in 2015, down from 35% in 2011. This is the critical figure – making sure spending doesn’t increase faster than the economy.
  • Economic growth last year was 3.3% against 3.0% Budget forecast. For this year now forecast to be 3.8% against 4.0% Budget forecast.
  • Unemployment forecast to be 4.5% by 2018
  • Average annual wage forecast to increase by $6,600 to $62,000 by 2018.
  • Household disposable incomes rose 7.1% last year and forecast to increase 4.0% a year in future
  • Inflation forecast to peak at 2.5% in 2016
  • Annual increases in house prices has declined from 10% to around 6% in the last year
  • Total cost to taxpayers from the Canterbury earthquakes now forecast to be $15.8 billion
  • Economy still growing strongly and above potential
  • Fiscal restraint remains beneficial and important to stop inflation
  • Trading partners still expected to have strong growth
  • Terms of trade will ease up earlier than in Budget, but will remain above historic levels
  • Should utilise upswing to strengthen Crown balance sheet
  • Weakness in global dairy prices is more a short-term issue, not a structural issue, and not inconsistent with Treasury central forecast

It is a good reminder of how fragile our surplus is, and how we also need to start paying off debt. We are still forecast to have the best of all worlds – a growing surplus, higher after tax household incomes, inflation under control, more jobs, and less debt. I contrast that with the tens of billions being promised by certain parties that will mean higher taxes, more debt and probably no surplus.

The downside scenario, if export prices drop down, and stay low, along with weaker household demand, would be no return to surplus until 2018. That is unlikely, but possible. Again, don’t spend the surplus until we have it.

There are a hint of possible tax cuts. Treasury say “The operating allowance has been added to expenditure as a working assumption, but in practice would be available for a mixture of expenditure and revenue initiatives”.  However Bill English stated unequivocally that there will be no tax cuts announced before the election. He says there is not enough fiscal room at this stage, but does make it pretty clear they do plan some in the future, if re-elected.

I do hope there are tax cuts in the next parliamentary term. They will of course be modest. But as the Crown accounts reach surplus, the surplus should go on a mix of extra spending, tax cuts and debt repayment. It is fundamentally unbalanced to only increase expenditure. Tax cuts are the only guaranteed way to increase household incomes. It would be sensible to target the lowest and second lowest tax rates, or the thresholds they apply at.

Due to fiscal drag or bracket creep and the like, tax as a percentage of GDP will rise without tax cuts.  It is forecast to go from 26.6% to 28.4%. I’d like to see it eventually around the 25% mark.  We should fund extra spending from a growing economy, not by increasing the share we all pay in tax.

It is worth stressing that even by 2018, the surplus is only projected to be $3 billion a year. That can easily be wiped out in a downturn. We do not have the fiscal latitude to embark on huge amounts of new spending – now this year, not next year, not the year after. We can afford some modest spending and modest tax cuts within the $1.5 billion annual operating allowance. We can’t afford promises of $2 billion here, $3 billion there.

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Cunliffe and bloggers

August 19th, 2014 at 11:00 am by David Farrar

Stuff reports:

Labour leader David Cunliffe tried to score a point over John Key yesterday by saying he rarely talks to bloggers, but that seems a stretch.

One of his closest advisers (priming him for the televised debates) is Polity blogger Rob Salmond.

Greg Presland, a lawyer friend involved in setting up his leadership fund trust, blogs as MickeySavage at The Standard.

Labour MPs and candidates often write for TheDailyBlog, and Cunliffe gave an early interview to Martin ”Bomber” Bradbury.

Plus at least three staff hand picked by David Cunliffe to write for him are (presumably) former bloggers at The Standard.

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More on electricity prices

August 19th, 2014 at 10:00 am by David Farrar

electprices

An interesting analysis of the Electricity Industry by the Electricity Authority. I blogged yesterday on how price rises are faster than inflation, but lower than in previous years. This graph shows that the competitive market side is working well. The costs increases are on the sides that are price regulated. To be this demonstrates that Labour’s policy of getting rid of the competitive market in generation is absolutely the wrong thing to do.

The analysis shows that the competitive component of electricity prices were rising at an annual rate of 7.1% prior to the What’s My Number campaign, but since the campaign the annual rate has fallen to only 0.5%, which is well below the CPI inflation rate.  So the focus should stay on better competition, rather than less competition.

I’ve just swapped power companies because my body corporate has signed up for an exclusive deal for power from a retailer. By bulk purchasing for the complex, we get around 2c a unit cheaper. It’s a good example of competition at work.

 

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Some changes for Kiwiblog

August 19th, 2014 at 9:00 am by David Farrar

Over the last week or so I have seriously considered walking away from Kiwiblog. While some will take huge pleasure in what has happened, let me say that it is genuinely traumatic to have hacked e-mails to and from yourself (even if you were not the one hacked) floating around, and to also realise that because you are a blogger and pollster, it means you and your office is fair game. One of the worst moments was having a senior staff member of mine, who is also a very good friend, tell me that she had been worried that I might think she was the leak, as our politics are different. I hate the impact this is having on so many people.

Some of the revelations coming out, also do not show aspects of the blogosphere in a good light (to put it mildly) and I’ve thought quite a bit about how this impacts the wider blogosphere.

I don’t believe that the book shows me having acted in any way inappropriately. I have  gone out of my way to be open about my background and leanings and relationships, and I follow my own views when I blog – hence why I campaigned against the Government last year on the copper tax (despite being a Chorus shareholder!). I never have taken any form of money or kind for blog posts, and disclose even the mist minor gifts.

There is part of me that wants to walk away so I am no longer a target. Politics is far less important to me than family and friends. I’ve also considered whether to do what Cameron often calls me, and become a travel and arts blogger, and have less or almost no focus on politics. But the trouble is the blog for me is an outlet on what I think – what I like, what annoys me, what amuses me, what appals me. And I can’t imagine it can function as that, if I try and avoid politics. I do genuinely blog because I like having my say – that is my primary motivation.

Also I do like to think, without being immodest, that I do make good contributions to politics in NZ. I can data crunch, I have a 20+ year history of political knowledge which can put things in context, I have good relationships, and I generally get good feedback on my commentary in the mainstream media. I’m far far from irreplaceable, but there are not that many people who have the time, skills and employment situation that allows them to substantively blog.

So after some reflection, I have decided to carry on, but to make some changes. I want to improve trust in myself, Kiwiblog, and perhaps the wider blogosphere. So I’ve decided on the following.

  1. Kiwiblog is sending in an application today to join the Online Media Standards Authority. I’m not doing this so I can be called media. I don’t intend to label myself as media. I’m a blogger. I’m doing it so I can be held accountable to a public code of ethics and standards, and an independent complaint procedure. The code of ethics and standards will apply to both myself, and all guest bloggers here.
  2. I receive up to a dozen unsolicited e-mails a day, suggesting stories to me. Most are from people who are not politicians or staff – just ordinary readers. Some are just links to stories, some make some points on a topical issue. I sometimes quote these e-mails in posts. I have always been very careful to distinguish between content I write, and content people may send me (which I quote as coming from a reader). But I’m going to go a further step and if any content substantially comes from a parliamentary, or political party staffer, source I will state so when using it. I will not name individuals, but if I quote someone I will include information on their affiliations, when relevant. You will find this is very infrequently.
  3. There has been a culture of sharing stories in advance with others who may be interested in the story. Nothing wrong with sharing information. I don’t do it that often, but have when I think I have a particularly relevant story, that others may want to also blog on. This isn’t a conspiracy, it is simply information sharing. However I’m not going to do this in future. Generally no one will gets a heads up on my stories. The exception will be if it is an explicitly co-ordinated campaign such as happened in early 2009 over the pending changes to the Copyright Act, when I contacted blogs from the left and right to take part in the Black Out campaign.
  4. When I have disagreed in the past with stories Cam has run, I’ve tended to say so directly to try and influence him. The joke is my 1% success rate is higher than most.  On the recent case of Tania Billingsley, I said in a phone conversation that I didn’t think speculating on her motives was a wise thing to do. I made contact after a friend of Tania’s asked me to have a word. But I accept that having a direct conversation doesn’t mean I shouldn’t also publicly say when I think something is wrong. So in future I will more often. One can be friends, and say I think you are wrong with what you are doing. And yes we are friends. When I had some health issues a couple of years ago Cam was there for me in a big way, and on a personal note, I know he will remain there for me, and I will for him. But again, it doesn’t mean I can’t say I think you are wrong and shouldn’t do it, just as he regularly calls me out for being a pinko, or the such!
  5. After the election (ie when I have more time) I am going to consult on a tougher moderation policy for the comments. I want them to be robust and forceful, but focused more on issues than people. I have very limited time to read them myself, so probably will ask for some readers to step forward as moderators. We’ll have that discussion in October.

I hope people will appreciate the changes. I welcome feedback on them, and other suggestions. I believe political blogs can play a very valuable role in political discourse, and want to do what I can to be a constructive part of it.

UPDATE: The hone of mainly anonymous bloggers, The Standard, has a go at my decision to have even more transparency than I currently do. And what is hilarious, is the post is anonymous.

Also they print an extract from the book which is totally factually wrong. The party they cite was not organised by me, and I did not even invite anyone to attend. I went to a party in Palmerston North. Around 30 to 40 people attended the party, and they can all attest I was not the organiser. It’s just a smear.

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General Debate 19 August 2014

August 19th, 2014 at 8:00 am by Kokila Patel
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Voluntary does work

August 19th, 2014 at 7:00 am by David Farrar

Nikki Kaye announced:

Food Safety Minister Nikki Kaye today welcomed the announcement by Foodstuffs that it will adopt the Health Star Ratings on its Pams and Budget product packaging.

“Having the support of one of the biggest food retailers in the country is a good sign of industry confidence in this new food labelling system,” Ms Kaye says.

“Foodstuffs has more than 650 wholesale and retail stores in the country, and its Pams brand is the single largest grocery brand in New Zealand. The company has said that its aim is for 1400 of its Pams product lines and 315 of its Budget-branded lines to eventually be eligible to display the Health Star Rating. It has indicated that it is likely that 100 of these product lines will carry the new labelling next year.

“This new system is a significant step in empowering New Zealanders to make healthier food choices. Having a voluntary commitment by a retailer of this scale is a very good sign for the future of the Health Star Rating system, and it is my hope that this move by Foodstuffs will encourage other food retailers to follow suit.”

Ms Kaye announced in June that the Government will be adopting the new voluntary food labelling system, which uses a star rating scale of ½ to 5 stars and is able to be used on almost all packaged food products for retail sale.

I’m all for better information on what is in our food, but I much prefer a voluntary scheme, than a compulsory one. Compulsion should be the last resort, not the first.

This shows that a voluntary scheme can work. I preduct that in say three years, the vast majority of food sold will have the star labels.

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