NZ Herald on boat building contract

January 16th, 2014 at 1:00 pm by David Farrar

The Herald editorial:

The local boat-building industry says it is outraged that it was not awarded a government contract to build a ferry which will link the New Zealand territory of Tokelau to Samoa. On almost every level, its anger is odd.

The 43-metre vessel will be built in Bangladesh for $8 million. According to this country’s Marine Industry Association, the cheapest price for building it here would have been $14 million to $15 million. Awarding the contract to a New Zealand company would, therefore, have involved what amounts to a substantial handout to that boat-builder. In such circumstances, it is puzzling that the local industry feels even the slightest bit annoyed.

Yet Labour is also outraged that taxpayers did not pay three times as much for the boat.

Clearly, the Government was mindful of the pluses that would come from building the ferry locally. It indicated there was some room for manoeuvre by telling a Nelson boat-builder that its quote would need to be in the region of $9.5 million to $10 million. But the lowest bid from a New Zealand company, according to the Government, was about $23 million. That is almost three times the price of building the ferry in Bangladesh. For all the talk of the gains from buying New Zealand-made and of a new Government procurement policy that aims to create more incentives for local manufacturers, this was simply too wide a gap.

You go local when the prices are close to each other, not when one is three times the other.

Other criticisms of the awarding of the contract are similarly misplaced. Chief among these is the perception that any ferry built in Bangladesh will not be up to the task of making the often dangerous voyage across the Pacific. This disregards the fact that Bangladesh has a long tradition of boat-building. While best known more recently for breaking up ships, it has now become a major constructor of small ocean-going vessels as Asia’s traditional builders, such as South Korea and China, focus on larger container ships and tankers.

Western Marine Shipyard, which will construct the Tokelau ferry, is one of its most successful ship-builders.

I think the editorial is right that there was an inherent belief by some people that a Bangladeshi company can’t possibly be any good.

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69 Responses to “NZ Herald on boat building contract”

  1. Joanne (177 comments) says:

    Totally agree – go local when the costs are close to each other but not 3x apart. The government can utilise the amount save to improve NZers life in whatever way.

    The have been building boats slightly longer than NZ.

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  2. RRM (10,099 comments) says:

    TBH I had no idea NZ had any tradition of building big steel commercial ferries…

    I thought racing yachts and mega motor launches for big boys is where it’s at here?

    And as someone else just said on the other thread; if the $23m contract HAD been given to a NZ builder, how long would it have been before we started hearing all about how the builder was supposedly “one of John Key’s rich prick mates”…?

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  3. scrubone (3,097 comments) says:

    If it can be made here for $14m and the lowest quote for here was $23m, who’s fault is that?

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  4. wrightingright (145 comments) says:

    According to this country’s Marine Industry Association, the cheapest price for building it here would have been $14 million to $15 million.

    But the lowest bid from a New Zealand company, according to the Government, was about $23 million.

    Awkward… according to their own industry association they were trying to overcharge the government by at least $8million!!

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  5. Yogibear (375 comments) says:

    Hang on – wasn’t our $35 million “investment” in the Americas Cup supposed to take care of all of this?

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  6. RRM (10,099 comments) says:

    Awkward… according to their own industry association they were trying to overcharge the government by at least $8million!!

    Or perhaps the industry association came up with a very optimistic estimate of the likely price?

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  7. RightNow (7,014 comments) says:

    Regarding the discrepancy between the $14 million local “cost” and the local bids of $22 million:

    Several New Zealand companies have the capabilities to build the specified ferry and most recently, Nelson’s AIMEX Ltd indicated that, based on the design criteria, they believed they could build this vessel in Nelson for NZ$14-15 million. Following further discussions with MFAT, AIMEX was advised that unless they could provide a quote in the region of NZ$9.5-10 million, they were wasting their time.

    http://www.nzmarine.com/news/item/governments-ferry-purchase-bangladesh-disregards-b

    So there was never a bid of $14 million.

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  8. wrightingright (145 comments) says:

    RightNow, yeah that sounds like all talk.

    Guess what, I believe I can build the boat for only $3 million in my front yard together with my mates! I couldn’t prove it though.

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  9. scrubone (3,097 comments) says:

    Pft. I can do it for $1.5 so long as the payment is upfront to my Swiss bank account :)

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  10. burt (7,425 comments) says:

    The real protest from the lefties is probably related to the union status of the company that won the tender.

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  11. Positan (396 comments) says:

    Realistically, what clearer evidence can be adduced that Labour politicians have neither the competence nor the understanding to ever offer themselves as “alternative government.”

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  12. rouppe (983 comments) says:

    Having said that I am reminded of the result when contracts were awarded to Tenix for the construction of the RNZN ships. Over-runs, extra costs, breakdowns, failures, even deaths.

    I guess we’ll see with this one

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  13. Tauhei Notts (1,687 comments) says:

    Remember the good old days when Bangladesh were easy beats at cricket.
    The Bangladeshi’s worked hard to improve their status and removed that easy beat label.
    Similarly, they have worked hard to develop their boat building industry.
    This has put us in a good situation as up and comers like them will loathe, hate and detest bad publicity so our country will be getting the best possible deal.
    Weird logic, but it is logic.

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  14. edhunter (554 comments) says:

    Hey and lets be honest, it’s not going to be used for transporting Kiwi’s.
    Also I know some 2nd boat dealers in Somalia that could’ve given the govt a great deal. Could’ve saved them another 4-5 million easily.

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  15. wikiriwhis business (4,200 comments) says:

    let’s hope we’ll hear any future incident that occurs with this boat

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  16. igm (1,413 comments) says:

    It is quite scary how the left are so fiscally ignorant. This being the reason why collectively, Labour/Green MPs can only leave Parliament when their super is available, or if their trough is empty of swill, slither into a ratepayer-funded leech in councils or like the GWRC, overfill it, now even nepotism being in vogue. What a hopeless bunch of financial misfits these wallies are proving to be.

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  17. srylands (437 comments) says:

    http://www.wms.com.bd/corporate-social-responsibility/

    I know it is partisan, but looking at the website of the successful tender, this is no backyard operation. They are certified for developed country standard health and safety. The workers all get health care. They all have safety kit.

    Good on them for getting the contract. Free trade benefits demonstrated.

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  18. Psycho Milt (2,423 comments) says:

    They are certified for developed country standard health and safety. The workers all get health care. They all have safety kit.

    Ever worked in the Third World? Those guys will have every single, possible piece of official documentation, certifications of compliance, inspection reports and you-fucken-name-it that Bangladeshi officialdom can think of to meet whatever international agreements Bangladesh has signed. They’ll have paperwork confirming they meet every safety regulation they’re ignoring, inspectors will have confirmed a full complement of safety gear that doesn’t actually exist, workers will be documented to have all kinds of gear they don’t have, pay they don’t get, etc, etc.

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  19. srylands (437 comments) says:

    Their injury rate has fallen to effectively zero. They are certified by independent accreditors outside Bangladesh.

    It looks to be a safer, happier, more productive workplace than many New Zealand workplaces. You should be ashamed for denigrating them and publicly deriding them for their fortune in winning this contract.

    I’ll be doing my best to encourage other Bangladesh firms to tender for Government contracts.

    Bangladesh all the way I say. What a bunch of winners. I can guarantee they are not beset by groups of miserable, bitter, full of hatred, and illogical, with thinking mired in 1977 Hamilton, smokers, on sickness benefits, living in State houses, moaning about rich pricks. Now who am I thinking of? Oh yes that’s right. The folk (who are not a collective – they are all independent thinkers) at that forum that begins with “The” and ends with “Standard”.

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  20. ross69 (3,652 comments) says:

    So there was never a bid of $14 million.

    Did you bother to read the article? AIMEX were told they’d be wasting their time putting in a bid at that level. So, presumably they didn’t.

    I’m guessing you also missed the bit about the $9 million in economic benefits which would have accrued had the boat been built here. As it is, there will be no benefits.

    The government has made the wrong choice.

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  21. hj (7,165 comments) says:

    Bangladesh’s advantage is it’s massive (poor) population. Population increase is government policy. Are we trying to emulate them?

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  22. ross69 (3,652 comments) says:

    They are certified for developed country standard health and safety. The workers all get health care. They all have safety kit.

    So did the workers at Pike River. How did that work out? But hey, look on the bright side – we saved $1 million by closing down the mines inspectorate.

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  23. ross69 (3,652 comments) says:

    The folk (who are not a collective – they are all independent thinkers) at that forum that begins with “The” and ends with “Standard”.

    So you are banned there? Thought so.

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  24. Viking2 (11,674 comments) says:

    Joanne (56 comments) says:
    January 16th, 2014 at 1:08 pm

    Totally agree – go local when the costs are close to each other but not 3x apart. The government can utilise the amount save to improve NZers life in whatever way.
    ===========================
    Meanwhile an other 120 bosat builders in New Plymaouth are on the way to unemployment.
    http://www.stuff.co.nz/taranaki-daily-news/news/9617250/Boat-builders-closing

    Luxury yacht builder Fitzroy Yachts has announced it is closing its boat building operation.

    Managing Director Rodney Martin announced the decision, which would result in a substantial number of jobs lost, to the company’s 120 staff this morning.

    He made the call after the company, which has been in business 15 years, was unable to secure a contract to build a yacht following the completion of its current project, FY17, on February 28.

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  25. Jack5 (5,278 comments) says:

    NZ a free market champ? What about the film industry subsidies?

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  26. jcuk (756 comments) says:

    The Standard has as many fruitcakes writing in it as Kiwiblog … in amongst the sensible people.

    On hearing the ferry news my first thought was “Oh Yes! another Hillside!” …. while I think this current National government has done it right most of the time they do unfortunately have a blind sport of the subject of keeping the workers of NZ in work and paying taxes. 30 million to help them make more from the sale of an electricity company is obviously better than around six million to AIMEX. You ignore the gross 22 million tenders and talk to the 15 million version and work with them to keep employing kiwis.

    On another subject did people hear about the UK proposal to house single people in ‘container studio appartments’ …. makes me wonder what happened to the idea of housing prisoners in modified containers …. properly designed a pair of containers linked together could be an excellent home for newly weds while they save for a regular house. I was thinking about it as an idea for a pensioner home for myself which would have meant my current home was available to rent. A big sticking point would be the draconian housing regulations bought in as a result leaky homes and politicians frantic rush to ‘do something’ when the crap hit the fan.

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  27. adze (2,130 comments) says:

    I’m guessing you also missed the bit about the $9 million in economic benefits which would have accrued had the boat been built here. As it is, there will be no benefits. The government has made the wrong choice.

    Is this the same ross69 that criticised the government for subsidising Rio Tinto to keep the jobs at Tiwai Point going for a few more years?

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  28. bhudson (4,741 comments) says:

    I’m guessing you also missed the bit about the $9 million in economic benefits which would have accrued had the boat been built here.

    $9m in economic benefits if we had spent an additional $14m to get them.

    You’ve cracked the Keynesian code

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  29. ross69 (3,652 comments) says:

    Is this the same ross69 that criticised the government for subsidising Rio Tinto to keep the jobs at Tiwai Point going for a few more years?

    Rio Tinto is a multi-national that doesn’t need subsidies. You probably already knew that but you thought you’d try to make some obscure point instead.

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  30. ross69 (3,652 comments) says:

    $9m in economic benefits if we had spent an additional $14m to get them.

    So let’s spend at least $8 million and get no benefits. Genius.

    We have of course been down this road before:

    So the brake pads on every single one of the 500 freight wagons delivered to KiwiRail by its favoured Chinese supplier have had to be replaced. When fully loaded, they evidently couldn’t stop in a safe period of time. Wow. What was in the contracts that the Chinese manufacturers couldn’t read, or couldn’t comply with – or more likely, did they simply not care? Though the costs involved with upgrading all the wagons (with a brake block that has higher friction) will be borne by the Chinese, the incident demonstrates the perils of outsourcing, and the inability of its local enthusiasts to prevent New Zealand from being taken to the cleaners.

    I mean, how easy is it for foreign bidders to win a contract from state agencies in New Zealand – whether they be in Defence, or Transport or Health or in IT? Simple. Bid unrealistically low for the contract, get the suckers on the line and then deliver them the bad news – and the true cost of the contract – a bit later on, once they’ve taken the bait and can’t afford to back out. Nor that they’d really want to, anyway. After all, the Kiwi bureaucrats running our SOEs will have already pocketed their bonuses for apparently getting the work done, cheaply.

    http://gordoncampbell.scoop.co.nz/2012/07/20/gordon-campbell-on-kiwirails-outsourcing-bungle-with-the-chinese/

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  31. adze (2,130 comments) says:

    “Rio Tinto is a multi-national that doesn’t need subsidies. ”

    No, but if the choice was to lose the jobs, or swallow a dead rat and pay them, is it still a good pragmatic investment or not? And if not, why is subsidising an uncompetitive local industry any better if all it does is temporarily maintain a few jobs until the contract’s finished?

    Is the point less obscure now?

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  32. Johnboy (17,051 comments) says:

    The extra 6M for being built here was most likely the cost for the Taniwha figurehead and the koha to appease Tangaroa for floating in his waters. A nice figurehead of Ganesha will probably work better! :)

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  33. jcuk (756 comments) says:

    Otago Harbour board built two of its tugs and a dredge before the out-sourcing became ‘the thing’ .. all working well, see them on the harbour often. It can be done but for the outsourcing mindset of counting dollars and cents ahead of the welfare of kiwis.

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  34. bhudson (4,741 comments) says:

    So let’s spend at least $8 million and get no benefits. Genius.

    No. Actually we get a boat. That is a benefit, surely.

    But far more than that simple logic is this:

    Thinking there is no benefit to NZ in having a boat built offshore, you propose to spend an additional $14m to return a mere $8m in [theoretical Keynesian*] benefits

    The mind boggles…

    [* a review of the US QE stimulus packages has shown that the Keynesian multiplier is less than 1. Not such a good idea after all]

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  35. ross69 (3,652 comments) says:

    Actually we get a boat. That is a benefit, surely

    No, we don’t get a boat, another country gets a boat.

    Thinking there is no benefit to NZ in having a boat built offshore, you propose to spend an additional $14m

    Not an additional $14 million. A net cost of $5 million which makes it cheaper than buying from Bangladesh.

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  36. ross69 (3,652 comments) says:

    No, but if the choice was to lose the jobs, or swallow a dead rat and pay them, is it still a good pragmatic investment or not?

    That depends if the numbers stack up. I doubt they do in that case. But in the case of building a boat here, the numbers do stack up.

    why is subsidising an uncompetitive local industry any better if all it does is temporarily maintain a few jobs until the contract’s finished

    Except the boat building industry clearly is competitive. No need for straw men.

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  37. OneTrack (3,362 comments) says:

    ross69 – “So you are banned there? Thought so..”

    Everybody with an independent thought in their head is banned from the Standard. The totalitarian/communist mindset in full view.

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  38. ross69 (3,652 comments) says:

    Meanwhile the Stena Alegra has broken down in its first week of service here. The Alegra replaced the Aratere which lost its propeller.

    Another great overseas acquisition LOL

    http://www.stuff.co.nz/travel/travel-troubles/9620390/Stena-Alegra-breaks-down-in-Wellington-Harbour

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  39. flipper (4,330 comments) says:

    Well, the usual suspects are at it again, most demonstrating economic/business illiteracy, but some, as always, taking a knee-jerk anti Government stance.

    Can we review a few matters?

    What is the status of the Tokelau Islands? I’m not entirely sure (can’t be bothered checking?), but I think it is part of the Cook Islands, and receives special support (foreign aid) from New Zealand.

    Who funds the aid, and how is it paid? It is funded by NZ taxpayers, and paid via our Foreign Aid budget, administered by MFAT – which is why they were involved in the discussions over price.

    What was the best (only?) NZ price submitted? $22 million. The 14-15 was “think” price based on the specs. The 9.5 – 10 MFAT figure was a “we may be able to make a case for extra funding” price. The whole exercise was theoretical, pie in the sky stuff, with taxpayers being the suckers.

    Is there any valid reason to compare the Bangladesh boat contract with Tiwai and the film/tv production incentives? No, none whatsoever., They are just NOT comparable.

    Are Labour joined by the red melons in their desire to spend another $14 million of our money On this issue alone, not as far as I can see. It would, after all, be contrary to their position ion Bangladesh et al.

    Who is screaming? The usual band of trade union numbskulls, time servers, and idiot commenters here, like silly rossie69.

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  40. bhudson (4,741 comments) says:

    No, we don’t get a boat, another country gets a boat.

    We get to discharge our obligation to that other country – that is the same under both options. But is another good reason to take the cheapest tender for a boat to specification [which includes quality.]

    You are mistaken on the difference – what an industry spokesperson claims the boat could be built for in NZ is not relevant when the lowest NZ tender was $14m greater than the Bangladesh tender. That was what the decision had to be make in comparison to.

    So, it remains that you want to spend an additional $14m for $8m of benefits. That sort of thinking is the pathway to Greece [economically].

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  41. wat dabney (3,840 comments) says:

    ross69 and his fellow economic illiterates are essentially saying that British Leyland – that monstrous money-pit which plundered tax-payers for years – was a good thing; that ‘Britain’ was better off because of it, rather than buying (better) cars more cheaply from Japan.

    Millions of British taxpayers – even non-car-buyers – would beg to disagree, and the economically literate would point out all the productive economic activity which didn’t take place, because money (and therefore resources) was being taxed away.

    The only people who benefited were the lazy communists who worked at BL.

    Yet ross and his chums insist that such subsidies are an economic good.

    Tariffs work the same way, and Americans pay a hugely inflated price for sugar because, thanks to lobbying and generous political donations, the sugar industry is ‘protected.’ Again, “America” as a whole is left vastly worse off. The only beneficiaries are those connected to the sugar industry. Yes ross and his lefty chums insist that the US as a whole is better off.

    It goes back also to the notorious Corn Laws in Britain, which resulted in poor people rioting against high food prices because of import restrictions which effectively subsidised British producers (rich land-owners.) Again, ross and his lefty chums insist that those poor rioters were mistaken and that they were in fact better-off because of these restrictions.

    Isn’t it strange how the left actively harms the poor in this way, instead favouring special interest groups.

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  42. flipper (4,330 comments) says:

    WAT Dabs…..

    Excellent.

    But do not expect it to penetrate…. :-)

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  43. Psycho Milt (2,423 comments) says:

    They are certified by independent accreditors…

    You should be ashamed for denigrating them…

    When I was working in the Middle East, the relevant Minister said pretty much the same thing, regarding English-language media reports that local employers routinely confiscated their Third-World-expat employees passports, despite it being illegal to do so. However, the legislation, the auditing, the accreditation, the inspections and the certification didn’t alter the fact that whenever one of my Indian staff wanted to go home on vacation, I had to write to our local sponsor respectfully requesting that Mr So-and-so be allowed to borrow his passport for a few weeks.

    Not to mention, if anyone should be ashamed for denigrating the efforts of private companies to get business, it’s commenters like wat dabney above, who cheerfully equates NZ boatbuilding firms with British Leyland.

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  44. RRM (10,099 comments) says:

    wat dabney –

    Absolutely – but it’s always hard to read those comments when you are a fan of some of those British Leyland products, and restoring one to a standard hopefully better than its former glory consumes most of your spare time and money!

    It took socialism 20 years to ruin the British motor industry – many of the best cars the English ever made were designed at the end of the 50s /beginning of the 60s by private motor companies, and sold well… 20 years later as Socialist Leyland they were still producing the last of those same cars, and the forward planning and design/development was so inadequate, that the new models that replaced them were so awful that they were the death knell of the industry.

    Incidentally I have heard muttered comments that the Japanese government supports / supported its car industry hugely, I must try to read up about that..

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  45. jcuk (756 comments) says:

    Peoples arithmatic is faulty with talk of 9 million. If the boat is built overseas that is a 9 million boost to the o/sea company and a 9m loss to NZ …. whereas lets say 15 million spent in NZ is a 15m boost for local industray less componant parts sourced from o’seas.

    But sadly people like Wat Dabney will never understand the responsible society concept instead of the dog eat dog approach they love … they in the case of British Leyland would rather have thousands of workers on the unemployed benefit and idle … idle hands create mischief …. than subsidise worthwhile employment … and if we have to come down hard on unions demanding unrealistic demands then so be it. Unions are just one part of the equation and need to be responsbile too.

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  46. ross69 (3,652 comments) says:

    Peoples arithmatic is faulty with talk of 9 million. If the boat is built overseas that is a 9 million boost to the o/sea company and a 9m loss to NZ …. whereas lets say 15 million spent in NZ is a 15m boost for local industry less componant parts sourced from o’seas.

    Yes, it’s quite a simple proposition. Of course it gets worse if local builders become unemployed. Not only won’t they be paying tax and contributing so much re GST, but the State will be paying them to do nothing.

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  47. ross69 (3,652 comments) says:

    ross69 and his fellow economic illiterates are essentially saying that British Leyland

    Wat, you lost me from the first sentence. Why do you need to invent straw men?

    You must be stupid if you think that paying $8 million to a foreign company (with no benefits to NZ) is good business when the benefits of building here are huge.

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  48. jcuk (756 comments) says:

    When the 9m is sent to Bangladesh for a a boat top islands that is a 9m donation to the Pacific with little return except kudos for being a good ‘big neighbour’. By saving lets say 6m on my earlier 15m it reduces ths cost to the taxpayer but with nobenefit to the NZ workers and that is the narrow minded attitude of officials advising the politicians. On the other hand a nominal 15m spent in NZ much would be returned to the country’s coffers with taxation and less spent on social security payments.

    The basic problem is all these decisions is the narrow minded ‘ on my patch’ attitude instead of a truely holistic approach to benefit the country …. you don’t have to quote Keynesian and others at me it is just bloddy obvious common sense which seems lost to advisors and polies … nothing new … been going on for years and years.

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  49. ross69 (3,652 comments) says:

    We get to discharge our obligation to that other country

    We discharge any obligation if we build locally, which would result in considerable benefits to the local economy and therefore to taxpayers. There are no benefits from the deal that’s been struck.

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  50. bhudson (4,741 comments) says:

    There are no benefits from the deal that’s been struck.

    Yes there is – it is $14m less than the lowest NZ tender for the same boat.

    If you can’t see that is a better deal for NZ, given we won’t even end up owning the boat – it is foreign aid – then I feel real empathy for you. And real dread for NZ under a left-wing govt.

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  51. flipper (4,330 comments) says:

    jcuk and rossie69 are to of a kind… well sort of, since there one or two others.

    But I wonder why they never pause to think, WHY?

    The fact of the matter is that the Atlee Government fucked Britain. All the talk of unemployed workers is/was crap. The great unwashed and their left wing union manipulators fucked the British economy, screwed colonies and former colonial nations, including New Zealand, while Europe recovered by following different economic/political policies. Of course the Marshall plan helped, but Europe was is in greater strife. The Soviet bloc nations were offered access to Marshall plan aid, but the great socialist brain in Moscow stomped on that. Stalin forbade his serf nations from participating. One accepted, but was forced by their benevolent socialist comrades to withdraw.

    What does all this have to do with a New Zealand contract for an $8million dollar foreign aid gift?

    It is a way of understanding the danger of the idiotic economic policies advocated by jcuk, rossie69 et (small number) al, which are still firmly anchored in the 1920-30 era, and practised with disastrous consequences in the UK, until Atlee was booted out, by Churchill. And we have all seen what over- application of Keynes has done for Europe, have we not? F/wits like jcuk, rossie69, the red melons, Cunners minus T, would infect us with the Greek or PIGS diosease, without a second thought. Thank the Lord that we have English/Key/Joyce et al at the helm of this sell put together “ferry”. :-)

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  52. ross69 (3,652 comments) says:

    it is $14m less than the lowest NZ tender for the same boat.

    Which of course ignores the many benefits that would accrue if it was built here, and the net cost of only $5 million, much cheaper than being built overseas. Oh and it wouldn’t be the “same boat”.

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  53. ross69 (3,652 comments) says:

    it is $14m less than the lowest NZ tender for the same boat.

    Which of course ignores the many benefits that would accrue if it was built here, and the net cost of only $5 million, much cheaper than being built overseas. Oh and it wouldn’t be the “same boat”.

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  54. ross69 (3,652 comments) says:

    Updated at 9:25 pm on 26 March 2013

    Tokelau is hoping for a number of high quality tenders to choose from for the construction of their new vessel.

    The New Zealand government is handling the tender process for the new ship that’s expected to take two years to complete.

    The Apia based general manager of Tokelau’s National Services, Joe Suveinakama, says it remains a top priority under their National Strategic Plan development goals.

    He says alternative transport plans, such as for an airstrip, are now on hold and whoever wins the tender faces several challenges.

    “I mean Tokelau shipping demands are quite different from everyone else in the sense that in other countries you have a passenger vessel, or a cargo vessel or a vessel that carries fuel. But imagine if you try and put all those needs in one vessel, that is the kind of landscape we are dealing with. We expect it to be tough.”

    Goodness, I think Mr Suveinakama is going to be in for a shock. High quality tender indeed! :)

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  55. bhudson (4,741 comments) says:

    and the net cost of only $5 million, much cheaper than being built overseas. Oh and it wouldn’t be the “same boat”.

    Except it isn’t only a net cost of $5m for being built here. A combination of voodoo magic from an industry spokesperson speculating on what it ‘should’ cost in NZ and the Keynsian multiplier (which has actually been shown to be less than 1, based on US stimulus packages since the GFC.)

    No, it wouldn’t be the same boat. It would be a lower cost boat to the same specifications.

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  56. All_on_Red (1,743 comments) says:

    “Goodness, I think Mr Suveinakama is going to be in for a shock. High quality tender indeed! ”

    I see, you think the Bangladeshis are sub standard. You are such a racist ross69.

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  57. All_on_Red (1,743 comments) says:

    “you don’t have to quote Keynesian”

    We won’t. Keynes was wrong and his economic theories should be ignored. I’m more of an Austrian School follower myself.
    Have you heard of Says Law?

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  58. Psycho Milt (2,423 comments) says:

    And we have all seen what over- application of Keynes has done for Europe, have we not?

    We certainly have – European countries are always at or near the top of whatever measure of well-being people come up with. What a prick that Keynes was, eh? Leaving a lasting legacy of wealthy countries with excellent education, public health and social welfare systems, it’s just appalling – he should have been drowned at birth.

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  59. All_on_Red (1,743 comments) says:

    Yeah nah. The EU is fucked and drowning under massive debt as their stimulus just hasn’t worked. Their social welfare systems are unaffordable, the education is poor (just check out what Michael Gove in the UK is saying). The results are stagnating economies, huge youth unemployment and no productivity.
    Same for the US. And there are 17 trillion reasons proving why they are screwed.
    All down to Keynesianism and the ignorance of fuck wit lefties like you.
    But hey, you don’t care about the poor or our youth do you.

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  60. ross69 (3,652 comments) says:

    I see, you think the Bangladeshis are sub standard. You are such a racist ross69.

    You throw the word “racist” around so easily. When you have to resort to name-calling, you’ve lost the argument.

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  61. All_on_Red (1,743 comments) says:

    Actually first time Ive used it. Your own words condemn your attitude.
    I think its well established you are an ignorant fool and your comments just prove that every day.

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  62. jcuk (756 comments) says:

    The arguments that Ross69 and I am putting forward have nothing to do with the ability of the overseas people to build a good boat suitable for the job but rather keeping NZ workers employed and maintaining the skills in NZ. I have no idea who or what Keynes was or what he stood for … that seems all gobbledegook promoted by RWNJs as a sort of swear word LOL.

    I agree that the unions, quite justifiably in their view pressed for better conditions for workers but with the very bad industrial relations of the time it breed a unionist who was totally opposed to working with management, rather always against without rime or reason … it was the same in NZ but we had a National government to break the watersiders stranglehold on the ports … it wasn’t nice but then war seldom is very pleasant.

    If the support for Tiwai was indeed to keep kiwis working then I support it and simply say “a pity about Hillside and all the other outfits which have lacked support because of an absence of holistic costing” But it was strongly suggested it was to prop up the sale of the electricity shares … which maybe good or bad … I don’t know.

    The crux of my argument is that it is better to have Kiwis working when government money is concerned than sending our taxes overseas to support foreigners … and the difference with holistic accounting reduces considerably the differences between quotes when you add the social cost to the cheap o’seas quote … it becomes pretty much a toss up and my coin comes down in favour of Kiwis.

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  63. jcuk (756 comments) says:

    If the EU is ‘fucked’ as All_on_red puts it it is becuase they adopted and continue to pursue the extreme rightwing nonsense of austerity but sensible people know that in a downturn you stimulate the ecconomy and the resulting inflation makes it easier to repay the debt. It is when there is a boom that government can safely practice austerity but human nature being what it is the pressure groups say ‘why ecconomise things are so good’ … if it wasn’t so sickening it would be amusing.

    Europe adopted total austerity and is a basket case while the United States stimulated itself to a small and insufficient degree and does seem to crawling out of the recession but at a pathetically slow rate due to the inept timidness of Obama, but probably the rightwing doctrines are so imbedded in the States that it is very hard for the system to behave sensibly so one probably should n ot be too hard on the guy with all the racist agro he faces on a daily basis.

    Here National adopted a ‘steady as you go’ approach which seems to have worked quite well and we should all be grateful for that.

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  64. adze (2,130 comments) says:

    @ross69

    No, but if the choice was to lose the jobs, or swallow a dead rat and pay them, is it still a good pragmatic investment or not?

    That depends if the numbers stack up. I doubt they do in that case. But in the case of building a boat here, the numbers do stack up.

    Why do they not stack up? Is it because Rio Tinto is a big nasty overseas owned corporation? Or is there something else about saving local jobs that requires mysterious double standards?

    And why do the numbers stack up in the case of the ferry contract? We are talking about existing local jobs (with resulting money flowing into the economy) in both cases. The only clear difference is that there was a strong possibility that the Tiwai Point jobs would go without government support – we don’t know that with the local shipbuilders.

    Of course it gets worse if local [boat] builders become unemployed.

    Which they are unlikely to, if they are competitive as you claimed to me. If they rely on government contracts to survive in the marine industry, they do not have a sustainable business model.

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  65. wat dabney (3,840 comments) says:

    jcuk,

    The arguments that Ross69 and I am putting forward have nothing to do with the ability of the overseas people to build a good boat suitable for the job but rather keeping NZ workers employed and maintaining the skills in NZ.

    So why did you settle on the boat-building industry of all things?

    Why should all other sectors – IT, electronics, aeronautics, medical etc – be forced to payer higher taxes and higher costs, and therefore conduct less economic activity and employ fewer people, so that the boat building industry of all things can be subsidised?

    Truly, I’d like to know: how did you pick on boat building above the other sectors I mention?

    Oh wait. I know why. It’s because boat building was simply the last thing you read in the newspaper.

    Apparently you have no problem causing reduced growth or unemployment in all those other sectors. Because, as we have tried to explain to you, you are focussing purely on the economic activity you stimulate and ignoring all the activity you suppress and eliminate.

    And by ‘you’ I mean you, ross and George Bush. Because Bush notoriously imposed tariffs on imported steel to ‘protect’ American jobs. Of course, all he protected were the politically sensitive steel workers’ jobs. It was estimated by economics that “more Americans lost their jobs in 2002 to higher steel prices than the total number employed by the U.S. steel industry itself.”

    You and ross are in the position of George Bush, pointing at the jobs you save whilst ignoring the even great number of jobs you destroy.

    As a wise man once said, economics is all about that which is seen and that which is unseen.

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  66. jcuk (756 comments) says:

    Indeed this is the latest of a whole run of failures to look after kiwi jobs as I mentioned … Hillside and all the others ignored.

    Much of my working life I paid above average taxes happilly becuase as one of the more fortunates I know it is my responsibility to contribute what I can instead of selfishly thinking only of myself as many of my workmates frequently moaned about.
    All those other businesses only pay becuase they can, if they cannot then they don’t.
    Here we have a case of the government throwing money overseas when a bit of realistic accounting would justify it staying in the country to pay taxes to help other struggling industry and keeping kiwis employed.

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  67. wat dabney (3,840 comments) says:

    a bit of realistic accounting would justify it staying in the country to pay taxes to help other struggling industry and keeping kiwis employed.

    It’s not “realistic” accounting, it is fraudulent accounting. You are still not considering all the economic activity which doesn’t take place when the government takes resources out of the general economy and gives them to a special-interest group.

    In other words, your “realistic” accounting considers all the income whilst completely neglecting to consider all the outgoings.

    Your economically illiterate idea allows you to feel smug because you can point at those jobs sustained or created by the subsidy, whereas all the jobs lost or never created are diffused across the economy.

    In short, you are smugly congratulating George Bush on those steel workers’ jobs he protected, whilst ignoring the vastly greater number who were chucked out of work. Why would anyone with a conscience do that?

    If one group (boat builders) consumes more resources then others must consume less. That’s the basis of all economics. Until you face that fact you are simply deluding yourself with economically damaging but politically potent feel-good emotions.

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  68. Kea (13,559 comments) says:

    Why is the government buying a boat ?

    Why is private enterprise not doing it, if it is economically viable ?

    Why is the government using our money to buy boats and compete with private business ?

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  69. jcuk (756 comments) says:

    Kea … typical RWNJ nonsense … it is the responsibility of bigger countries to look after smaller ones and they need a boat to escape the rising sea with global warming.
    Just as Wat’s last bit of nonsense LOL

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