Dim-Post on the left and the Budget

May 22nd, 2015 at 4:45 pm by David Farrar

Danyl McL looks at the Budget and notes:

I’ve been saying for a while that ‘neoliberalism’ – ie a belief in the efficacy of free markets, the distortionary evil of taxes and benefits and the minimalisation of the state – is dead. There are still a few adherents drifting around the fringes of politics that truly believe, but this budget seems like a good time to mark that in National the doctrine is obsolete. National believes in massive intervention in the economy, mostly in favor of their political donors but also in response to signals from their polling and market research, and English has raised or introduced so many taxes I’ve lost count. I don’t know what we’re supposed to call this mode of government, exactly, but it ain’t ‘neoliberal’.

Anyone who calls this Government neo-liberal is profoundly stupid, and thinks it is just a label to apply to anything you don’t like.

Not that I agree with Danyl that National intervenes in the economy to favour political donors. All donors over $15,000 are listed and they’re not the ones who benefit from intervention. The biggest beneficiary of corporate welfare is Kiwirail, followed by all those tech companies that the Callaghan Institute gives money to.

So, on one hand the opposition can put this budget down as a victory. They’ve made a big deal about the housing crisis and child poverty, and the government’s main policy changes have been the introduction of a capital gains tax and an increase in benefits to beneficiaries with families. Forcing your enemies to adopt your rhetoric and policies is a huge win.

Yep, it is a huge win for the left. A National Government has done what not even a Labour Government would do.

On the other hand, the opposition looked like clueless losers yesterday. What kind of left-wing politician opposes the gutting of the KiwiSaver kickstarter – pretty much the definition of middle-class welfare – to tackle child poverty?

Well both Labour and Greens do.

And Little’s speech was just awful. ‘Gene Simmons’? ‘Fiscal gender reassignment’? Why did he think it was a good idea to reference a source of internal division within his own party? What a mess.

It was the worst opposition leader’s budget speech I have seen.

The kids on the social media like to use the phrase ‘hot take’ to describe commentary that is hysterical and uninformed, and that’s what we got from the opposition parties yesterday, gouging their own eyes out with horror at a budget filled with ideas they’ve been demanding for years. Ridiculous.

When I saw the Budget in the lockup and realised how left-wing it was, the one small ray of consolation was that Labour and the Greens would probably be so shocked when they got a copy at 2 pm, they wouldn’t know what to do. Would they look ridiculous, as Danyl says, denouncing they very things they had been demanding, or would they think quickly on their feet.

If I had been the Greens I would have have claimed credit as the only party that had been advocating for an increase in benefit rates, and held the Budget up as an example of why it is important to have the Greens in Parliament – that they can make a difference – even from opposition.

Instead they all routinely denounced it. I guess it was the equivalent of National in 1986 condemning the free market reforms of the then Labour Government.

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Violent protests against giving beneficiaries first increase in 43 years

May 22nd, 2015 at 4:00 pm by David Farrar

This is the so called Auckland Action Against Poverty, in response to the first increase in real benefit rates in 43 years. Lovely people aren’t they.

Sure you may argue it should be more, but the way they are carrying on, you’d think the Government had cut benefits by $25 a week!

They’re part of the demented 1% who won’t be happy until we have the communist nirvana of surgeons being paid the same as McDonalds staff.

Spokeswoman Sue Bradford said if the government was serious about dealing with poverty, it would lift benefits now to the same levels as superannuation

Let’s look at what this would cost.

The standard benefit for a job seeker aged 25 is $210.13 a week.

The standard benefit for a someone on NZ Super living alone is $374.53

So Bradford is demanding a 78.2% increase in non NZ Super benefits. They currently cost around $7.3 billion. So the annual cost of what the AAAP are violently demanding is an extra $5.7 billion a year in welfare payments. In reality it would be far more than that, as many more people would go on welfare.

Now I doubt they want health and education cut by $5.7 billion a year, so I imagine their response would be sock it to the rich and make them pay. Stick up the top tax rate from 33%.

A 1% increase brings in around $210 million a year so they need a 27% increase, meaning the top tax rate would have to be 60 cents in the dollar. Yep anything you earn over $70,000 would go 60/40 to the Government.

And that is just to fund their one sole demand.

Of course in reality a top tax rate of 60% would not bring in even half that amount of money. People would simply leave.



The ruin of US colleges

May 22nd, 2015 at 3:15 pm by David Farrar

Kirsten Powers at The Daily Beast writes:

The root of nearly every free-speech infringement on campuses across the country is that someone—almost always a liberal—has been offended or has sniffed out a potential offense in the making. Then, the silencing campaign begins. The offender must be punished, not just for justice’s sake, but also to send the message to anyone else on campus that should he or she stray off the leftist script, they too might find themselves investigated, harassed, ostracized, or even expelled. If the illiberal left can preemptively silence opposing speakers or opposing groups— such as getting a speech or event canceled, or denying campus recognition for a group—even better.

In a 2014 interview with New York magazine, comedian Chris Rock told journalist Frank Rich that he had stopped playing college campuses because of how easily the audiences were offended.

We live in the age of offence, where people think they have a right not to be offended.

Instead, the politically correct university is a world of land mines, where faculty and students have no idea what innocuous comment might be seen as an offense. In December 2014, the president of Smith College, Kathleen McCartney, sent an email to the student body in the wake of the outcry over two different grand juries failing to indict police officers who killed African-American men. The subject heading read “All Lives Matter” and the email opened with, “As members of the Smith community we are struggling, and we are hurting.” She wrote, “We raise our voices in protest.” She outlined campus actions that would be taken to “heal those in pain” and to “teach, learn and share what we know” and to “work for equity and justice.”

Shortly thereafter, McCartney sent another email. This one was to apologize for the first. What had she done? She explained she had been informed by students “the phrase/hashtag ‘all lives matter’ has been used by some to draw attention away from the focus on institutional violence against black people.”

Insane. She had to apologise for saying “all lives matter”.

On today’s campuses, left-leaning administrators, professors, and students are working overtime in their campaign of silencing dissent, and their unofficialtactics of ostracizing, smearing, and humiliation are highly effective. But what is even more chilling—and more far reaching—is the official power they abuse to ensure the silencing of views they don’t like. They’ve invented a labyrinth of anti-free speech tools that include “speech codes,” “free speech zones,” censorship, investigations by campus “diversity and tolerance offices,” and denial of due process.

And we saw this in Australia where some staff and student groups basically blackmailed the university into revoking the appointment of Bjørn Lomborg, as he doesn’t buy into their view that the world is doomed.

Or how about the Brandeis professor who was found guilty of racial harassment—with no formal hearing—for explaining, indeed criticizing, the word “wetbacks.” Simply saying the word was crime enough. Another professor, this time at the University of Central Florida, was suspended for making a joke in class equating his tough exam questions to a “killing spree.” A student reported the joke to the school’s administration. The professor promptly received a letter suspending him from teaching and banning him from campus. He was reinstated after the case went public.

And all this in the land of the 1st amendment.

The list goes on and on. The University of Wisconsin-Stout at one point had an Information Technology policy prohibiting the distribution of messages that included offensive comments about a list of attributes including hair color.

Get suspended for making a ginga joke!

One student alleged that when the professor changed her capitalization of the word “indigenous” to lowercase he was disrespecting her ideological point of view.

And he was accused of racial microaggression and suspended.

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Well done Andrew

May 22nd, 2015 at 2:30 pm by David Farrar

The Herald reports:

Labour leader Andrew Little says the party will consider means testing superannuation but he did not agree with increasing the age of eligibility despite concern about the rising costs.

It should be means tested. It is silly that we pay NZ Super to someone earning $500,000 a year. It is good to see Andrew Little open to means testing.

Asked about means testing, Mr Little said there were some elements of unfairness in universal superannuation.

An example was where someone over 65 was still working and receiving the pension on top of their wages.

He said Labour would look at that issue, which he considered was unfair. Such a step would break almost four decades of political consensus on universality.

The only real argument against means testing is if the cost of doing so was prohibitively high and costs almost as much as it saves.

Rather he indicated Labour’s focus was on prefunding the cost of it by contributions to the Super Fund which the current Government suspended during the Global Financial Crisis and is yet to re-commence.

Pre-funding has a minor impact at best on sustainability.

UPDATE: I was too quick with my praise. Little has done a u-turn in just six hours.

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Hehir on the conservative evolution

May 22nd, 2015 at 1:45 pm by David Farrar

Liam Hehir writes in the Manawatu Daily Standard:

A spectre is haunting the English-speaking world — the spectre of conservatism. All the powers of progressivism have entered into a holy alliance to exorcise this spectre: Labour and Green parties, television producers, comedians, musicians, actors and the halls of the academy.

So far, they have not succeeded. 

In the United Kingdom, the Conservative government has just won another five-year term. Against the odds, it was returned with an outright majority in the House of Commons. Prior to Election Day, it was thought that the best Prime Minister David Cameron could hope for was another coalition or maybe a fragile minority government. Nobody really believed the Tories would be able to govern alone. But here we are.

In Canada, that country’s Conservative Party has held power since 2006. Prime Minister Stephen Harper is facing another general election this year. It promises to be a tough campaign, but things have been looking up lately and there is as good a chance as not that the Conservatives will win a rare fourth term in office.

In Australia, the revolution has been more tenuous, where Tony Abbott’s Liberal Party came to power in 2013. Forced to make deep cuts to public spending in response to a commodities market downturn, his administration has been sternly tested. And yet despite these difficulties, which have been made worse by an overtly hostile media, Abbott’s polling has been steadily improving.

In the United States, conservative Republicans dominate the US Congress and most state governorships and legislatures. While they face structural difficulties in capturing the presidency, the once unstoppable Hilary Clinton juggernaut is at risk of being crippled by a genuine and concerning corruption scandal.

And, of course, in New Zealand, Prime Minister John Key has won three mandates as the head of a National Party that has improbably improved its share of the vote in each of the last three elections. 

Why has this happened?

A question a smart Labour Party would ask.

When you survey the current state of Anglosphere politics, certain themes emerge. These don’t apply in every instance – we are talking about geographically and economically diverse countries, after all. Nevertheless, there are certain commonalities that go some of the way to explaining the current Centre-Right ascendancy.

First of all, conservative politicians have made the best of the limited means available to them. Harper’s nine years in power have included the two longest lasting minority governments in Canada’s history. Cameron’s government has had to struggle through five years of being shackled to an unpopular coalition partner – and even now its majority is puny compared to those the party enjoyed in the Thatcher years.

Our own electoral system has meant that, despite very high approval ratings, John Key has never had much margin for error. 

This leads on to the second important factor in conservative electoral success: self-control. 

Because none of these governments have the power to impose wide-ranging reforms, conservative politicians have had to restrain their actions and rhetoric. This comes easily for some – Key and Cameron are not temperamentally conservative anyway. For others, like Harper and Abbott, there has been more of a recognition that certain battles can’t be won and therefore aren’t worth fighting.

This moderation is sometimes frustrating for conservative voters, but it also does a good job taking the wind out of the histrionics of Left wing commentators.

Another way to read this is that all these parties have governed as centre-right, instead of right.

Thirdly, and perhaps most importantly, the oppositions in these countries are dysfunctional and discordant.

Long may that last.

A fourth is the GFC has I think made voters prioritise parties that focus on economic management over social issues.


Match speeds to risk

May 22nd, 2015 at 1:00 pm by David Farrar

The NZ Herald editorial:

The speed limit on any road should be appropriate to its design and condition, not the subject of a default 100km/h setting. Therefore, a good case can be made for increasing the limit on many of the country’s motorways to 110km/h. And so, too, and even more strongly, can a case be made for lowering it on many of our two-lane rural roads. The latter are, after all, the scene of a high proportion of the fatal and serious crashes in New Zealand every year.

Such was not the case last weekend when 10 people died on the roads. But that did not diminish the good sense in the call by road policing chief Assistant Commissioner Dave Cliff for some rural roads to have lower speed limits. He was reacting not to one bad weekend but to a problem that has been apparent for years and has not been tackled effectively.

As Mr Cliff suggests, many country roads, especially those with winding stretches, are simply not designed to be travelled at 100km/h. Many drivers do not have the skills or the required concentration to traverse them with a high degree of safety.

Best international practice, said Mr Cliff, would dictate that the limit should be 70 to 80km/h. At that speed, the chances of a crash being survivable would be much increased.

Some roads such as the Rimutaka Hill Road are very dangerous to do at 100 km/hr. Same with the road to Makara. Likewise many roads are safe for modern cars at 110 or 120 km/hr. I’m all for road speed limits being set based on the characteristics of each individual road.

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A new level of political correctness

May 22nd, 2015 at 12:15 pm by David Farrar

I don’t think it is any big thing that we use group descriptions imperfectly. For example we use the term Asian instead of specifying Chinese, Japanese, Korean etc etc. Likewise we use Pasifika rather than Tongan, Samoan, Niuean etc etc. Most people understand why group labels are convenient.

I use the term “guys” as a non gender specific term now. I often e-mail my (all bar one female) supervisors and say “Thanks guys”.

But for some reason it gets  a bit precious when it comes to the gay community. Once upon a time gay was short-hand for what is now the wider rainbow community. Then lesbians said they’re not gay, they’re lesbians. And so it was GL. Then bisexuals said we’re not gay or lesbian and it was GLB. And then transsexuals said they are none of the above. so we went to GLBT. Then inter-sexuals were not covered and it was GLBTI.

But that isn’t politically correct enough for the Greens. In a blog post Jan Logie feels the need to state at the bottom:

*The addition of an asterisk to the word trans is to indicate that the term functions as an umbrella term for an extremely varied range of identities, including culturally specific ones. I use it to include identities such as: whakawahine, tangata ira tane, FtM, MtF, transsexual, fa’afafine, transgender, transmen, transwomen, akava’ine, leiti, genderqueer and gender-neutral people.

Oh good God.

That is just too precious.

Would we do that for every time we use the term Asian*. Imagine that:

The addition of an asterisk to the word Asian is to indicate that the term functions as an umbrella term for an extremely varied range of identities, including Turkic, Mongolic, Persians, Tatars, Sarmatians, Chinese, Indian, Afghan, Japanese, Korean, Tibetan, Uyghur, Kazakh, Manchu, Buryats, Evenks, Yakuts, Sri Lankan etc etc

When referring to an individual, it is polite to use whatever term they identify as. But when referring to a group, there is no need to turn it into a encyclopedia entry.


Ethnic projections

May 22nd, 2015 at 11:30 am by David Farrar

Stats NZ has released projections for the change in our ethnic populations. They project for 2038:

  • European 66% (-9% from 2013)
  • Maori 20% (+4%)
  • Asian 21% (+9%)
  • Pacific 11% (+3%)

Around 2025 the number of Asian New Zealand is expected to exceed the number of Maori New Zealanders.


What a criminal!

May 22nd, 2015 at 10:45 am by David Farrar

The Herald reports:

Panai was fined $330 and disqualified from carrying passengers for one month after he pleaded guilt to driving for three hours more than his allowed time.By law, drivers must take a 30 minute break after every 5.5 hours of work time.

Defence counsel Simon Mount said Panai took a 25-minute break instead.

That criminal. he took a 25 minute break, instead of 30 minutes.

Thank you NZ Police for keeping us safe from these criminals. And very pleased as a taxpayer to see this prosecuted in court.


Labour preparing for victory

May 22nd, 2015 at 10:00 am by David Farrar

Trans-Tasman reported:

Labour leader Andrew Little, who made a good start in the role, has found his poll ratings slipping in recent weeks (with Winston Peters snapping at his heels). He miscued when he contended John Key should stand down a Minister whose brother was reported as facing criminal charges. Bigger problems are to get his team functioning as a policy-making machine, and to stimulate (or discard) those who think they have only to sit it out before they are back in Govt.

Reports of sessions being held for staff to acquaint them how they would operate in Ministerial offices points to a hard-to-shake mindset which underlines the process of rejuvenation has yet to begin. Five of Labour’s MPs have 146 years of service in the House between them.

This must surely be a joke. Labour’s running sessions on preparing for Government just six months after their worst election result in 90 years.


Parliament 22 May 2015

May 22nd, 2015 at 9:27 am by David Farrar

The House is is urgency and is sitting from 9 am to 1 pm, 2 pm to 6 pm and 7 pm to midnight until the following bills are dealt with. It can sit on Saturday also.

The Social Housing Reform (Flexible Purchasing and Remedial Matters) Bill amends the Housing Restructuring and Tenancy Matters Act 1992 to allow the social housing agency (currently the Ministry of Social Development) to enter into more flexible and innovative purchasing arrangements for social housing.

The key purpose of Telecommunications (Development Levy) Amendment Bill is to make additional funding available, through the telecommunications development levy applied to the telecommunications industry, for the Government’s policy of extending the Rural Broadband Initiative and establishing a Mobile Black Spots Fund.

The KiwiSaver Budget Measures Bill proposes to remove the $1,000 KiwiSaver kick-start contribution paid to all new enrollees in the KiwiSaver scheme, effective from 2 pm on 21 May 2015.

The Border Processing (Arrivals and Departures) Levy Bill amends the Biosecurity Act 1993 and the Customs and Excise Act 1996 to introduce levies to fund the direct and indirect costs of activities carried out by the Ministry for Primary Industries and the New Zealand Customs Service relating to the processing of people arriving in and departing from New Zealand.

Support for Children in Hardship Bill is an omnibus Bill introduced under Standing Order 263(a). The Bill strengthens work expectations and increases assistance for parents on a benefit and who have dependent children from 1 April 2016.

To date the Support for Children in Hardship Bill has completed its first reading (109 to 12 – NZ First against) and been referred to the Social Services Committee

The Social Housing Reform (Flexible Purchasing and Remedial Matters) Bill has had its first and second readings (both 63 to 58 with Labour, Greens, NZ First against) and is now at committee stage.


Radio Awards winners

May 22nd, 2015 at 9:15 am by David Farrar

The Herald reports on the winners of the 2015 NZ Radio Awards:

  • Sir Paul Holmes Broadcaster of the Year – Mike Hosking, Newstalk ZB
  • Best Newsreader – Hilary Barry, RadioLIVE
  • Best Talk Presenter – Mike Hosking, The Mike Hosking Breakfast, Newstalk ZB
  • Best Talkback Presenter – Leighton Smith, The Leighton Smith Show, Newstalk ZB
  • Best Sports Presenter/Commentator – Tony Veitch, Newstalk ZB
  • Station of the Year – The Edge, MediaWorks
  • Best New Broadcaster – Luke Howden, Hokonui Southland and South Otago
  • Best Journalist – Jessica Williams, RadioLIVE

Congratulations to the winners.  The full list of winners is at http://radioawards.co.nz/winner/init



Could it be Henry vs Hosking?

May 22nd, 2015 at 8:30 am by David Farrar

John Drinnan writes in the NZ Herald:

Following the announcement that John Campbell is leaving Mediaworks, the company will be tempted to place Paul Henry in to Campbell’s spot at 7pm, continuing with his morning experiment broadcasting on TV3 and RadioLive from 6 am to 9am.

On the face of it that would be a disastrous decision, turning around the target audience and abandoning a newly revived following. Their audience is diametrically opposed and Henry has had a rotten start in his morning show ratings.

But chief executive Mark Weldon and board member Julie Christie love Henry as the face of the company. MediaWorks has already made it clear the new show would not be just a tweaking of the Campbell Live format.

I think some on the left would actually explode in outrage if the 7 pm slot was a choice between Mike Hosking on TV One and Paul Henry on TV3.

That is of course an excellent reason to do it!

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General Debate 22 May 2015

May 22nd, 2015 at 8:00 am by Kokila Patel

1st time since 1991 net migration from Australia has been positive

May 22nd, 2015 at 7:00 am by David Farrar

In April 2015, there was a net inflow of 100 people from Australia to NZ – the first net inflow since 1991.

Here’s what April has looked like for the last decade between Australia and NZ:

  • April 2015 +100
  • April 2014 -240
  • April 2013 -1.930
  • April 2012 -3,410
  • April 2011 -3,080
  • April 2010 -1.430
  • April 2009 -1,520
  • April 2008 -3,040
  • April 2007 -2,380
  • April 2006 -1,660
  • April 2005 -1,990

The annual stats are shown below:



Please, please watch this

May 21st, 2015 at 4:13 pm by David Farrar

Please, please take 20 minutes out of your day and watch this. Ask your family and friends to watch this. Ask as many people as possible to watch this.

Once you have watched it, feel free to share your reactions below.

UPDATE: In case you need cheering up after that, here’s the PM’s reply:


Campbell leaves TV3

May 21st, 2015 at 3:55 pm by David Farrar

Mediaworks announced at 2 pm today that John Campbell is leaving TV3.

The timing is appallingly cynical – to release it at the same time as The Budget.

Media rightfully have a go at press secretaries who try to release bad news at the time of a major event, to hide it. Well how can you expect them not to, when media companies do exactly the same!

Mediaworks have said they offered John Campbell a three year contract last November, which he declined.

They decided to change Campbell Live from five to four nights a week, and Campbell said he doesn’t want to continue with a reduced programme. That is his right.

I think John Campbell is a very talented broadcaster, even though I disagree with his obvious politics. His heart is in the right place, and he campaigned on issues he believes in. The fact his show got such a bounce in the ratings after the possible closure become public is a tribute to him.

I’m glad they are not replacing Campbell Live with some reality TV show, but will still have a current affairs programme on for four nights a week. It won’t be Campbell Live, but what matters is the journalism, not who does it. We’ll have to see if the replacement show will do serious current affairs, or do fluff pieces.

I hope we will see John Campbell come back on television somewhere – maybe even on TVNZ. Again I don’t have to agree with his politics, to appreciate the work both John and his wider team have done to produce a show that makes a difference.



May 21st, 2015 at 2:52 pm by David Farrar

Stuff reports:

Run out of alcohol, and don’t fancy driving to get more? A new Wellington delivery service promises to bring it to your door within 45 minutes.

Quenched,  founded by friends David Loveridge, Tom Brown and Anika Rani, officially launched last week – but already it has come under fire for providing an easy way for drunk people to “refuel”.

It’s a lot better option than people driving to the bottle store!

New Zealand Medical Association chairman Stephen Child said he deplored any move that made it easier to access alcohol in a way that could lead to abuse.

All alcohol can lead to abuse, so I presume Dr Child wants all vineyards closed down?

However, Loveridge said Quenched aimed to provide a convenient and fast service, not to encourage irresponsible drinking.

“Everything is legal, and we definitely don’t want to encourage bad drinking.”

The delivery team checked buyers’ identities on arrival, and would only hand over the order to the person who made it, he said.

If the clients were underage or intoxicated, the order would not be delivered. Instead, the customers would received a full refund, but be charged a $20 callout fee.

Sounds responsible.

“It’s been quite good. We’ve been run off our feet, which is fantastic.”

The idea to start up an alcohol delivery business started with a run and ended with a beer.

“My mate Tom and I went for a long run and we were pretty knackered when we got home, so we got a couple of stubbies but before we had showers we wanted another one, but we didn’t have any left.

“And we couldn’t walk because we were sore from the run. We needed a solution to that problem, and that is what we did.”

I think it could prove very popular. Yes there will be some who will drink to excess (and do so regardless of this service) but for many it will just be an extra convenience, and reduce the temptation for someone to drink drive.

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Budget 2015

May 21st, 2015 at 2:00 pm by David Farrar

This is the most surprising Budget yet from this Government. While I expected the Government to spend a small amount of money on helping low income families, never did I think they would be announcing the first real increase in benefit rates in 43 years as part of an almost $800 million child poverty package.

It will be almost impossible for Labour and Greens to credibly attack this Budget, because it looks a lot like the sort of Budget they would deliver.  I’m impressed with the politics of it, but not impressed with the economics.

The main initiative is the child poverty package. The details are:

  • $25 a week net benefit increase for families with children – 1st increase since 1972. An 8.3% increase in the base benefit rate for most on welfare.
  • To counter against any incentive to remain on welfare due to higher benefit levels, work testing for sole parents to start when youngest child is three, down from five
  • Work testing obligation increases from 15 to 20 hours a week
  • 110,000 beneficiary families with 190,000 children get a net extra $23 a week
  • WFF increases for working families earning under $36,350 a year by $12.50 a week, up to $24.50 a week for very low income
  • Families on WFF who earn over $88,000 a year get a bit less from WFF as abatement rate increases from 21.25c to 22.5c
  • WFF changes benefit 200,000 families and 380,000 children
  • 4,000 very low income working families get a net extra $24.50 a week
  • 50,000 low income working families get a net extra $21.50 a week
  • 150,000 other families get up to $21.50 a week
  • Childcare subsidies for low income families up from $4 to $5 an hour. Families eligible for up to 50 hours a week so worth up to $50 a week.
  • Cost of package $790 million over four years and then $240 million a year

On the overall economic front the main numbers are:

  • Projected GDP growth of 2.8% a year
  • Projected average wage growth from $56,000 to $63,000 by 2019
  • Projected deficit for 2014/15 is $684 million, compared to $2.9 billion in 2013/14
  • 2015/16 projected surplus of just $176 million
  • Operating allowance of $1 billion a year next two years and then $2.5 billion in 2017 (election year) which will include “modest” tax cuts if fiscal and economic conditions permit
  • Core crown expenses down from 34.1% of GDP to 30% next year

The Government is taking a big risk here. They may be forgiven for not making surplus this year, but with a mere $176 surplus projected for 2015/16, there is a real risk they may not even make it next year. This is not good enough.

On the revenue front some good and bad news:

  • ACC levy cuts of $500 million over two years
  • $1,000 kick start for KiwiSaver being removed. Won’t impact existing members who have had $2.5 billion since scheme began. Saves $500 million over four years so funds almost two thirds of the child poverty package
  • New airport tax of $100 million a year being $16 for inbound passengers and $6 for outbound

Quite cunning to mainly fund the child poverty package from the KiwiSaver kick start credit being abolished. It won’t affect the couple of million people already in KiwiSaver, and if you’re a low income family would you rather have $1,000 in 30 years’ time or $25 a week now.

On the expenditure side, the usual mix of announcements:

  • $400 million from the Future Investment Fund for Kiwirail which is the equivalent of throwing four million $100 notes into a paper shredder
  • A further $210 million for fibre roll-out, making a total of $2 billion the UFB and RBI initiatives to have a fast connected country
  • $1.7 billion for health over four years
  • $443 million for education over four years including $63 million for special needs kids
  • $113 million more for tertiary education
  • $164 million for Police
  • $50 million more for Whanau Ora
  • $11 million for to help prevent Kiwi (bird) numbers declining
  • $264 million more for NZ Defence Force
  • $97 million for regional highways and $40 million for urban cycleways
  • SIS and GCSB each get $20 million more
  • Chch rebuild costs now up to $16,5 billion

It is very cunning budget politically.  It is delivering the very thing the left have been demanding – an increase in benefit rates. It will be a fascinating test of which child poverty lobby groups are actually principled, and which are just anti-National shrills. Because the child poverty groups should all be praising the Budget for doing what no Labour Government has done in 43 years – give more money to those on benefits.

But it is not a Budget I support. Where are the tax cuts for hard working Kiwis? Instead of a surplus and likely tax cuts, we get a further deficit and lots of extra spending. The Government had up until now done a good job of fiscal restraint, but not so on this occasion.

This is a Budget that should be praised on The Standard and The Daily Blog. John Key and Bill English have delivered more to families on benefits than Norman Kirk, Bob Tizard, David Lange, Helen Clark and Michael Cullen ever have.


ACT’s Budget Wish List

May 21st, 2015 at 1:00 pm by David Farrar

3 News reports:

ACT would like:

  • A referendum to decide the future structure of NZ Superannuation

  • Indexation of tax brackets to inflation so “stealth tax” increases don’t unfairly cut into household incomes

  • An eight-year programme of annual one percentage point reductions in the corporate tax rate

  • Fundamental RMA reform to remove its anti-development bias, freeing up land for affordable housing and boosting investment

  • Expanding the partnership school (charter school) model by allowing state schools, if their boards choose, to convert to the partnership funding model.


They all look good to me. And unlike some ACT wish lists in the past which were unobtainable without a major shft in government policy, this is all reasonable stuff that can be done.


Parliament 21 May 2015

May 21st, 2015 at 12:15 pm by David Farrar

The Budget will be delivered by the Minister of Finance at 2.00 pm.

After his speech, there will be a 15 hour debate where party leaders (six or more MP parties) get 20 minutes each and all other MPs 10 minutes.

The Government has indicated it will go into urgency at some stage, to debate Budget related legislation.

There is no question time.


Bravo Prince Charles

May 21st, 2015 at 11:30 am by David Farrar

The Guardian reports:

The long, smiling handshake between Gerry Adams and Prince Charles, balancing an informal cup of tea in one hand, was a historic moment not only because it was the first such encounter in the Republic since partition. It happened only because each of them was prepared to look beyond old wounds that as Mr Adams, the Sinn Féin president, acknowledged, have not been entirely healed by peace. For both, it was an encounter of personal significance that also challenged the prejudices of their supporters. It was an unusual moment of collective conciliation between a symbol of republicanism and a symbol of British monarchy – and a moment of almost intimate forgiveness.

It is more than 35 years since Lord Mountbatten, his grandson Nicholas Knatchbull, 14, and a 15-year-old local boy, Paul Maxwell, were blown up by the Provisional IRA at a time when Mr Adams was what is coyly described as a “leading figure” in the republican movement. At the time, he justified the murders by claiming that Mountbatten was too old a soldier not to be aware of the “danger involved in coming to this country”.

Adams’ defence of the Mountbatten murders was vile. Mountbatten was like a grandfather to Prince Charles, and shaking the hands of the apologist for his murder would be no easy thing to do.But it is what the job requires, for the good of the United Kingdom.

For Prince Charles, with apparent warmth, to shake hands with the man who was at the least an apologist for the murder of Mountbatten, who had been the prince’s lifelong mentor and friend, suggests a very personal and indeed admirable act of forgiveness.

An admirable act of duty also.

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Why are the Greens attacking Stats NZ?

May 21st, 2015 at 10:45 am by David Farrar

Stuff reports:

The statistics in the latest Household Labour Force Survey show that while unemployment had dropped to 5.8 per cent, underemployment had risen by 21,200 in two years.

Statistics New Zealand began measuring underemployment in 2013, defining it as the “grey area” where people have a job but have similarities to unemployed people because they face a “partial lack of work”.

It is when a part-time worker is willing and available to work more hours than they usually do. The statistics are limited to part-time workers.

“We know have 103,000 underemployed, but Government treats them as employed for their figures,” said Green Party co-leader Metiria Turei. 

“The Government is massaging their employment figures in order for them to look like they’re doing way better, when in fact these are people looking for more work and many of them are unpaid.”

That is a stupid and false thing to say.

Stats NZ does the classifications. Is Turei accusing the public servants who work at Stats of fraud by massaging the figures?

Or is she claiming that someone working 25 hours a week, but seeking 35 hours, should be classified as unemployed?

The definition of unemployed used by Stats NZ for the HLFS is the same definition used by every country in the OECD. It is someone not in work, who is seeking and available for work.

It is not the only important piece of data in the HLFS. The working age participation rate is important. The FT employment rate is important. The number of hours worked data is important. The underemployment rate is important. But that’s a very different thing to what Turei has done – claiming Stats NZ is committing fraud by massaging the data.


Govt to make up to 430 hectares of crown land available for Auckland housing

May 21st, 2015 at 10:00 am by David Farrar

MBIE sent this brochure out yesterday inviting stakeholders to a programme launch to develop housing on Crown land in Auckland. This may be giving away a Budget announcement. It even details how they have identified 430 hectares of Crown land in residential zoned areas in Auckland.

If you assume 13 houses per hectare (average in Australia) that’s enough land for around 5,600 new houses.

Auckland Crown Land Launch Invite


Labour defending Canadian dairy industry

May 21st, 2015 at 9:15 am by David Farrar

The Herald reports:

Trade Minister Tim Groser says he is not bothered that his name has apparently become a byword for undiplomatic behaviour.

The Labour Party today accused him in Parliament of insulting Canadian diplomats by comparing the country’s dairy industry to the Soviet Union.

Are the Soviets upset?

The description, while harsh, is not inaccurate. The Government limits the amount of domestic dairy production and has huge tariffs on imports. Farms have quotas and a single dairy cow quota is worth around $30,000. Tariffs are around 300% and they also have import quotas so that only say 1% of yoghurt can be imported.

I’d say it is an apt comparison.

Trade spokesman David Parker cited a scathing article by an American policy analyst, which said Mr Groser’s behaviour had led to a new slang term in Washington: “Grossing”.

The article said the Canadian Embassy in Washington was “privately bristling” at the minister’s “counter-productive, undiplomatic sledging”.

Oh no, the Canadian Embassy in Washington is upset. This could form an episode of Southpark!

He said that Canada’s dairy interests had been “diametrically opposed” to New Zealand’s interests for 30 years, and it took “just a little bit of spine to stand up to it”.

Mr Parker said Mr Groser’s comments were “abrasive and arrogant”.

“How does he think slagging off the Canadians using derogatory terms is going to result in a good outcome for those negotiations?” Mr Parker asked.

Mr Groser stood firm: “It’s called a negotiation. And to use one of Tana Umaga’s memorable phrases, ‘We ain’t here to play tiddlywinks’.”

So Labour is attacking the Minister for criticizing the Canadian Government’s dairy policy. Nice to know they’re focusing on the big issues.

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