The $600 million mistake
March 18th, 2008 at 2:52 pm by David FarrarMy God. The January Crown Accounts had a $600 million error in them. IRD failed to update the provisional tax take, which is why tax revenue was around $700 million below forecast.
Vernon Small blogs that Cullen is furious. I would be also. This is not a minor error. And the fact that the tax figures were below forecast for the first time ever, is all the more reason why it should have been triple-checked.
Related posts:
- Where has the surplus gone?
- The Westpac $10 million
- $880 million loss for the Cullen Fund
- A $20 million blunder
March 18th, 2008 at 3:00 pm
Most cow cockies have a 31 May balance date.
Vote:Accordingly they had provisional tax to pay on Tuesday 15th January. Other provisional taxpayers pay tax, usually on 7th July and 7th November. So I was astounded to see the tax take for January down, when the dairy farmers had been paying plenty to avoid Cullen’s usurious use of money interest.
March 18th, 2008 at 3:16 pm
IRD are far too busy ensuring that NZers are forced into poverty by, as Tauhei says, imposing usurious penalties and interest for the slightest miscalculation (the kind it’s perfectly okay for them to make, it seems), punitive audits and other such activities designed to bring people to their knees.
They simply don’t have time for something as mundane as adding a column of figures correctly. That sort of thing ought to be handed to Treasury to take care of, thus freeing up IRD staff to concentrate on grabbing ridiculously large amounts of our hard-earned money, and then to use the entire power of the state to attack those of us they feel haven’t bled enough.
Vote:March 18th, 2008 at 3:18 pm
While it is indeed a big mistake the thing that should worry all Kiwi’s is this quote from Cullen “The first stage of tax cuts would be unlikely to be affected”
There is a word for what Cullen is doing here, it is called “pre-conditioning”.
As many have suspected all along Cullen is totally opposed to tax cuts of any type, the inside gossip is that he and Clark are at odds over the promised budget tax cuts and if Cullen is successful in his leadership bid or he can convince Clark that the country cannot afford tax cuts he will have his way.
It is becoming abundantly clear that the tax cuts WILL NOT happen, Cullen has lied to us once over tax cuts and he will do it again.
Vote:March 18th, 2008 at 3:22 pm
Haha loopy history teacher wouldn’t know what day it is . What a sad country run by soft cock brainless wimps.
Vote:March 18th, 2008 at 3:25 pm
bruv – ive known you a long time (sorry ya probably dont want that fact out in public) and that is the most valid statement youve ever posted.
no way cullen is going through with tax cuts. if by some miracle he did, there would be nothing “for the rich”
Vote:March 18th, 2008 at 3:38 pm
One would have thought, given the number of eyes and calculators that check and double check such things, that someone would have said “we need to find out what has caused this”. Doing it after the fact makes all involved look incompetent and will no doubt further drive calls for change in the public service.
Vote:March 18th, 2008 at 3:46 pm
Furious! He’s only furious because the mistake was indicated now, and not a month before the election when he would have pulled out another lolly scramble out of his ass, and blind-sided National with it.
Vote:Like he did with Student Loans. And the time before, when he discovered an extra couple of nbillion behind the sofa. looks like the IRD have had it up to hre with CUllen:
March 18th, 2008 at 3:53 pm
And why does Labour defend the increase in the number of seat-warmers?
If more public servants mean a cock-up of $600 million dollars in just 1 government department I think we can do with less of them. They are only getting in the way it seems.
Vote:March 18th, 2008 at 3:53 pm
“no way cullen is going through with tax cuts. if by some miracle he did, there would be nothing “for the rich””
Dime – you missed out “pricks” at the end.
Vote:March 18th, 2008 at 4:12 pm
One would think that a bloated IRD who are building a 35,000 sq m palace in Featherston Street would have people who would check out such things. There simply is nno excuse – but I think it goes to the heart of an inefficient and likspittle Government Department – who at the end of the day could not organise a piss up in a brewery.
If the Deaprtment was leaner and smarter then these mistakes would not happen. It is instead fat andd lazy. John Key needs to send this and many other Government Department off to the fat farm to lose some blubber.
Vote:March 18th, 2008 at 5:06 pm
Who said it was a mistake ? Likely the only mistake was the IRD did not keep their mouth shut when a little “backup” fund kept under wraps, was exposed a bit too early to be realllllllly useful. Am I suspicious or what?
Vote:March 18th, 2008 at 5:44 pm
IRD should invoice itself for shortfall penalties,taking a unreasonable tax position and increase staff dramatically in the policy division
Vote:March 18th, 2008 at 5:44 pm
Monty – It is a private developer who is building this, albeit the developer signed up IRD as the major tenant before starting work. He will probably flick it off to AMP Office Trust when completed as he did after extending the former new Wool House (main tenant Deloittes).
IRD has vacated lots of space in recent years with changes to business methods.
Goverment Departments and other organisations are prepared to pay a premium for offices with large floor plates and provision for technology – they consider it economic when increased efficiency is taken into account (although perhaps one could take a cynical view of the costings).
Vote:March 18th, 2008 at 5:46 pm
7 months of bullshit and spin to go………….Labour are like a horse with a broken leg hobbling down the track to the knackers yard.
Any chance we can bring the election forward to say next week? Save everyone the boredom of having to listen to any more bilge from the socialists
Vote:March 18th, 2008 at 5:55 pm
Peterwm – different owners – The developer of the IRD palace will probably hold onto that asset as he did whn he built the HSBC tower. The point is that IRD have grown enormous under this corrupt Labour Government – to the point where they are going to occupy 35,000m2 building. How much space did they occupy ten years ago. Govt de0partments have grown but the outputs have not. They have become politicised under Labour (another good reason for a clean out) and big and lazy – yet all powerfull as they extend their tentacles into our lives.
Vote:March 18th, 2008 at 7:20 pm
Monty:
The IRD will be my friends for life if they make a similar FUBAR in my favour.
But snark aside, I thought Bill English had it right on Checkpoint this evening: It’s beyond credibility that this was anything more than a fuck up, but what a fuck up! (Naturally, I’m paraphrasing) If we are going to end up in a recession, a couple of hundred million dollars either way could make all the difference between a spending commitment that’s merely fiscally irresponsible and one that’s going to be broken before the ink is dry on the press release.
I don’t know about anyone else, but I’ve got a reasonably accurate idea of what state the financials are in at any given time. If I got a bank statement that said I was a couple of grand overdrawn, when I expected to have a reasonably healthy credit then I’d be going through the bills and receipts with a fine tooth comb.
I have a funny feeling the IRD is going to be having a few ‘please explain how this happened – and how you’re making sure it will not happen again’ meetings, and someone better not even dream of getting their performance pay this year.
Vote:March 18th, 2008 at 8:14 pm
Ah.. but will the punters overseas believe it (the mistake). Come to think of it.. do we?
JC
Vote:March 18th, 2008 at 8:27 pm
like I implied before the IRD is at war with Cullen because he is a f**k-up:
http://monkeyswithtypewriter.blogspot.com/2008/03/property-crash-cullens-fault.html
Vote:March 18th, 2008 at 11:17 pm
I have heard that like a lot of work places, there was a succession of new staff who were feeling their way. Why would good, well qualified staff want to work for IRD – when they can get paid more elsewhere in Wellington or, better still, somewhere overseas?
Vote:March 18th, 2008 at 11:41 pm
Lee et al.
Yeah Cullen’s a f**k-up. this country has been run to the ground over the last 8 years, the economic good times that we have all enjoyed have been an aberration, in true spirit of the mystical lords of the empire, “this is not the economic good times you see before you”, but you’ve got to say that with an Alec Guinness accent.
I love it, a department stuff up and Cullen’s the one still for the chop. You people are Ruthless (get it). Still nice to be one of the bean counters who actually made the cock up, to know that you lot aren’t coming for them.
Money boys and girls, you know the ones, of your ilk, your brethren (exclusive or not) are the ones that made this mistake not Cullen.
glad to see Dad has once again directed the spittle at the wrong person.
Vote:March 19th, 2008 at 4:04 am
Not exactly run into the ground, Paul.
It’s more like we’ve been floating down a lovely meandering river for the last 8 years in our little yacht mostly constructed in the late 80s and early 90s. Since then, it’s had little in the way of upgrades, but who needs it with this gentle current? We’ve just gone along with the international economic flow, enjoying the sun, admiring the scenery, doing a spot of fishing, fooling ourselves Captain Cullen and crew were navigating the river with purpose, skill and experience.
But do you see the water starting to flow a little faster, a little rougher? Can you hear the logs and rocks starting to bump and scrape against the hull? Feel our vessel heave and rock more and more beneath our feet from the strengthening undercurrent? Those whirlpools seem to be getting bigger and stronger! Why can’t Captain Cullen steer around them? What’s that? He’s not actually a captain, he’s never learned how to helm a boat? WHAT?
Shh, listen! An ominous roaring sound in the distance….. it’s getting louder! A waterfall? Captain Cullen never told us there was a waterfa- What? He’s never actuallly studied any navigational charts? B-b-but Captain Cullen said the leisurely cruise was thanks to his superb handling! He MUST know what to do! Oh no, he’s slipped into the churning foaming water and just flailing his arms about….. What? He can’t swim, either? WHAT? WE’RE MEANT TO KNOW HOW, TOO?
Cullen and crew – asleep at the helm, or asleep at the rudder? Same diff.
Vote:March 19th, 2008 at 5:26 am
Monty – The IRD has always taken up a lot of space. It has always been huge and hasn’t really grown that much recently, apart from Kiwisaver additions. It is precisely to avoid the public realizing how huge it is that it has spread its ‘national office’ out over roughly 10 Wellington CBD locations. The Featherson building won’t replace all, or even many, of those 10 locations as far as I know.
Vote:March 19th, 2008 at 6:42 am
“glad to see Dad has once again directed the spittle at the wrong person.”
Excuse me Brokeback Paul, caustic Kullen is a disgrace because a chimpanzee could have managed our economy better than the dribbling sullen prick has . You lefty communist creeps are so deranged that you have no ability to criticize this insidious and totally incompetent government . Go on you twits give me some more thumbs down, because that’s all you can do. What pathetic wimps. Gutless spineless jellyfish . Scared frightened twits. IRD is your typical dysfunctional government department and all our ministers are never accountable . The twisted sods and the bent mongrels that can’t lie straight in bed make me want to puke over Mount Bullshit. If it’s not corruption it’s incompetence.
Vote:March 19th, 2008 at 8:52 am
Paul, you mean the same Cullen who has overseen and encouraged 700+ Kiwis to leave each week? I think he is a total fuck up. He has been smirking for years about “overseeing” a good economy and yet when it comes down to it, his legacy will be a deficit that no history teacher would be proud of.
Vote:March 19th, 2008 at 9:22 am
So if I “forgot” to pay $600,000 worth of tax then said oops sorry it would all be ok right?
Right?
Vote:March 19th, 2008 at 9:48 am
As someone who’s been on the very sharp end of the IRD’s attention (they really went out of their way to screw me) I find it interesting that in the eyes of the department and the politicians who empower it — *they* are “only human” and can be forgiven their mistakes, yet taxpayers are expected to be superhuman in their attention to detail and diligence in every aspect of their obligations.
These people are paid *very* well ($350K base for the Commissioner) and have armies of accountants and lawyers to help them yet their stuff-ups are passed off as “human error” when the average hard-working self-employed Kiwi who might be in a hand-to-mouth situation and has to do all the paperwork on his own can not use “an honest mistake” as any kind of defense against incurring massive penalties and interest if they stuff-up.
Once again we see the duplicity and hypocrisy of those who wield power over us.
And 4 million sheep….
Vote:March 19th, 2008 at 9:52 am
It will be interesting to see the about-face the government will show in the face of the looming spectre of recession.
To date, Cullen has patted himself on the back over his “prudent fiscal management” of the nation and the way it has brought record low levels of unemployment, sustained growth, etc, etc.
No, it’s got nothing to do with riding a wave of global prosperity — it’s all down to his exceptional skills as a manager.
But now things are starting to turn rather ugly. Of course that’ll all be due to things beyond his control. “When America sneezes the world catches cold” etc, etc.
Funny how quickly the buck gets passed when things go wrong isn’t it?
Vote:March 19th, 2008 at 10:37 am
A radio report referred to the error as an “estimate” which I find puzzling as I thought the deficit was a record of the past sum of receipts. However if as suggested in an earlier post the IRD simply failed to update the treasury computer with up to date figures then heads must roll – this is so basic an error that resonsibility must be attributed and some deterrence applied.
Vote: