Archive for the ‘NZ Politics’ Category

NZ Initiative on teacher quality

October 9th, 2013 at 2:00 pm by David Farrar

The NZ Initiative has released the first of three reports on improving teacher quality. The first one is mainly setting out where we are at, and later reports will look at potential improvements. Some highlighted facts:

NZ is a top-performing system

  • NZ’s 15-year-olds rank among the top performing countries in reading (7th), science (7th) and mathematics (13th)
  • NZ (along with Shanghai and Singapore) has the highest proportion of top readers (one in six)

But the system is not reaching everyone

  • NZ has one of the largest gaps in the world between high- and low-performing students
  • The 2009 PISA study of 15-year-olds showed NZ has one of the widest ranges of reading scores in the OECD
  • Māori and Pasifika students are consistently less successful than Pakeha and Asian students at all three levels of NCEA and they do not perform as well in international tests of achievement

 Teachers are the education system’s most valuable asset

  • A meta-analysis of half a million studies found teachers were the most important in-school factor for student achievement
  • Teacher salaries make up 61% of the education budget

NZ has good quality teachers, but we can improve in key areas

  • Our teachers are highly qualified – 86% hold a bachelor’s degree
  • But one-third of year nine mathematics teachers do not have a mathematics qualification
  • 18% of schools say a lack of mathematics teachers hinders the ability to teach the subjectThe quality of teacher education is variable – only 57% of schools are satisfied with the quality of teacher graduates
  • Low expectations of Māori and Pasifika students are partly to blame for low achievement

 We struggle to attract and retain talent

  • Despite the importance of teachers, their status in NZ is low, and has been eroded by top-down changes
  • Teacher morale in secondary schools slipped from 70% in 2009 to 57% in 2012
  • Teacher appraisal is a ‘tick the box’ exercise. It is rarely used as a tool for development and only 5% of teacher goals are related to student outcomes
  • There is a lack of career structure and recognition of excellence. The pay scale sends a signal that teachers have reached their maximum capability after eight years

It’s a good area for focusing on, as teacher quality is almost beyond dispute the most important factor in educational outcomes.

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Regional spending

October 9th, 2013 at 1:00 pm by David Farrar



This table comes from a just released Regional expenditure report by the Government.

What is interesting is that less spending by the Government occurs in Auckland than their share of the population. Wellington gets proportionally more direct Government spend, but apart from that most of the country is pretty proportional.


Flavell looking safe

October 9th, 2013 at 11:00 am by David Farrar

TVNZ has results of a Te Karere DigiPoll in Waiariki.

The party vote results (and change from the election) are:

  • Maori Party 35% (+14%)
  • Labour 29% (-6%)
  • Greens 8% (-1%)
  • Mana 6% (-11%)
  • National 4% (-2%)
  • NZ First 3% (-8%)

The electorate vote:

  • Maori Party 43% (nc)
  • Labour 17% (-8%)
  • Mana 8% (-25%)

The changes are comparing election vote (with no undecideds) with current preferences (with undecideds) so take that into account. However it is very clear that the Maori Party is benefiting in Waiariki from Flavell’s accession to the co-leadership, and he looks rather safe to retain the seat.

59% of voters said Flavell does an above average or better job as a local MP and only 4% say below average. That’s an incredibly high rating.

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Sky TV gets a competition warning

October 9th, 2013 at 10:00 am by David Farrar

The Herald reports:

Sky TV has been issued with a warning that its contracts with telcos were likely to have previously harmed competition, says the Commerce Commission.

However, market developments mean those particular parts of the contracts are unlikely to have that effect now or cause harm in the future, says commission chair Mark Berry.

As such, the commission issued Sky a warning and said the pay-tv provider was on notice that the regulator would continue to monitor its contracts.

The Commission said it will take no further action right now over what it called “historical breaches”.

“We believe that Sky entered into historical agreements with RSPs [retail services providers] that had the purpose, effect, or likely effect of substantially lessening competition,” Berry said.

“However due to market developments, the key commitments Sky has with RSPs are unlikely to continue to have the same effect. For example the new sports pay TV product from Coliseum and the recent exemption granted by Sky to Telecom to market this product,” he said.

“As a consequence, a warning letter and notice that we will continue monitoring Sky’s contracts and conduct was the prudent course of action,” Berry said.

I’m very keen to see market developments that get us more competition and choice.

It also said Sky’s contracts with content providers were not likely to have breached the law.

“There appeared to be sufficient content of all types available outside of Sky’s exlusive contracts to put together an appealing pay TV package,” a statement from the commission said.

My preference is for contracts to be non-exclusive. By this I mean of course a contract for a TV series will exclude another TV channel showing that series – but they shouldn’t restrict other outlets such as DVDs or Quickflix from being able to offer the material in different mediums.

Labour have said:

Sky should consider itself extremely lucky today. The ruling is a cop out from the Commission. A monopoly as powerful as Sky should not be able to get away with uncompetitive behaviour. It is a kick in the guts to consumers.

“The Commission appears to have decided not to take any action because a case would cost too much and take too long. That’s not good enough. It should do its job as a regulator,” said Kris Faafoi.

I do wish Labour would think about the internal consistency of their public positions.

How can you argue that the Government should not second guess the Commerce Commission when it comes to copper broadband pricing, yet jump in yourself and claim they got it wrong in this case and should do what politicians say in this area.

Effectively Labour have now undermined their own arguments on the copper pricing issue. It’s an own goal, and an annoying one, because as people know I’m one of those saying leave the Commerce Commission process on copper pricing alone.

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Guest Post: Gareth Hughes on copyright

October 8th, 2013 at 3:00 pm by David Farrar

A guest post by Greens MP Gareth Hughes:

London School of Economics on copyright.

A new report out by the London School of Economics busts some of the myths around copyright infringement and the laws passed that try to punish online file-sharing. 

The London School of Economics Media Policy Project has published a report entitled “Copyright & Creation: A Case for Promoting Inclusive Online Sharing”, which argues ‘The creative industries are innovating to adapt to a changing digital culture and evidence does not support claims about overall revenue reduction due to individual copyright infringement,’ and that a punitive approach risks ‘incentives for innovation and growth will be weakened.’

It’s a timely report that challenges the claims the music industry is at mortal peril from online file-sharers and that graduated response regimes like our Copyright (Infringing File-Sharing) Amendment Act, or more popularly known as the ‘Skynet Law’ are the best way forward to address the challenge of copyright infringement.

I am a Spotify premium subscriber and I just love being able to access a lot of the world’s music conveniently, portably and legally for a small monthly charge. It is one example where the music industry is innovating and adapting to the digital world profitably. The report notes in 2013, for the first time UK revenues for online music was higher than for CDs and vinyl combined as part of overall revenue growth. The report recommends a review of the UKs stalled Skynet-style law, the Digital Economy Act and that ‘a copyright enforcement model that is out of touch with today’s online culture will only supress innovation and dampen growth.’

Another recent paper, this one published from Australia’s Monash University on copyright enforcement also found graduated response or three-strike laws internationally, including New Zealand’s own ‘Skynet Law’ were not working. In New Zealand’s case the report found the law was hardly acting as an effective deterrent to reduce online copyright infringement and people were simply switching from Peer-to-Peer (P2P) file-sharing sites to other methods such as cyber-lockers to obtain content

The New Zealand Government unfortunately has decided to delay the anticipated copyright review and with more reports published challenging the effectiveness of graduated response regimes to copyright infringement as seen in our Skynet Law it’s time the Government reopened the copyright debate and let evidence set policy. I would much rather the Government put their energy into promoting legal content over punitive laws that stifle innovation and plainly don’t work.

The London School of Economics report is a very good read at debunking the myth of revenues dropping.

I wouldn’t rush to judgement on how the NZ law is working. The level of fines have been reasonably modest, and what I will be interested in is how many infringement notices in total got issued over a year, how many went to a second and a third strike.

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Goff vs Cunliffe on trade

October 8th, 2013 at 2:00 pm by David Farrar

Audrey Young reports:

Labour’s trade spokesman and a former Trade Minister Phil Goff says he understands why the Government is not releasing text of the Trans Pacific Partnership agreement but says it could be doing more to communicate with New Zealanders.

His position is more moderate than that of new Labour leader David Cunliffe, a former diplomat, who called on the Government to release the draft text on his first day in the job. …

Asked for a response to the online campaign by some New Zealand celebrities to release draft text of the TPP, Mr Goff said that would probably not be possible.

The 12 parties would have an agreement that the text could not be revealed.

“You probably can’t breach that agreement but what you can do and what the Government hasn’t done is broadly spell out its negotiating position,” he told the Herald.

Goff is playing this straight, while Cunliffe has been talking nonsense on this (and he knows it as a former diplomat). I’m all for more openness in some of our treaty or trade negotiations, but it is simply impossible to unilaterally release a negotiating text. You’d be effectively expelled from the negotiation.

All countries need to agree to to release a text. New Zealand has no authority to release a draft text. At the beginning of negotiations, it is agreed whether drafts will be released or not, and the international default is they are not. If you do not have agreement from other countries to release a draft text, and you do it anyway, then they’ll never trust you again. You won’t be allowed into any negotiations more significant than the protection of small snails convention.

Personally it would be good if there had been agreement when the talks began (under Labour) for draft texts to be released at certain stages. But you can’t unilaterally change or ignore the rules later on.

What is a worry is that Cunliffe knows this beyond any doubt. He has been a trade negotiator (according to his CV). When he called for NZ to release the draft text, he knew absolutely that it was impossible and if NZ did so, they’d be effectively expelled from the negotiations.

I’m glad to see Phil Goff is not acting so irresponsibly.

But what will Cunliffe think of Goff contradicting him? If Goff the one MP that has yet to swear loyalty to Cunliffe and Cunliffe has pledged to expel from party membership if he doesn’t get it? It’s probably Mallard, but might not be.

Personally I think Goff should pledge to be just as loyal to Cunliffe as Cunliffe was to him. How could he complain about that as a loyalty pledge? :-)

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The no bus lanes Mayor

October 8th, 2013 at 1:00 pm by David Farrar

Bernard Orsman reports at NZ Herald:

Len Brown has not built a single metre of bus lane in his first term as mayor of the Super City.

Mr Brown, who says fixing public transport, including better bus services, is his top priority, has splurged $770 million on public transport and $1.2 billion on roads and footpaths in the past three years.

But not a cent has gone on new lanes to improve bus services, which have drawn criticism and seen a fall of 2.9 per cent in patronage over the past year, from 55.1 million bus trips to 53.5 million.

I use buses in Wellington several times a week. Measures like bus lanes can make a huge improvement to public transport. Buses are flexible – their routes can change, their stops can change, and they are far easier to utilize for changes in capacity.

Good public transport needs buses and trains. Those who prioritise trains over buses unfairly do public transport a dis-service.

The pro-public transport blog said it was not good enough that no bus lanes had been built when more were needed. It said bus lanes carried more people than general traffic lanes, made buses faster, more reliable, roads more efficient and reduced operating subsidies.

Mr Brown does not have a strong record of building bus lanes. Manukau City, where he was a councillor and mayor, has just 3km of them, compared with 31km in the Auckland City area. North Shore has 9km. Waitakere – the so-called Eco City – has no bus lanes, only short bus “advance” lanes at some big intersections.

Wellington has some bus lanes. They do make a difference.

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Herald on TPP talks

October 8th, 2013 at 12:00 pm by David Farrar

The Herald editorial:

New Zealanders will be mildly amused that their Prime Minister has stepped into the breach left by US President Barack Obama’s inability to be at Bali this week to chair an important meeting of the proposed Trans-Pacific Partnership trade agreement. But we can be proud, too, that New Zealand still has a leading role in this project. …

It would be easy for such an ambitious project to become unwieldy and lose focus as more countries join the talks. There is always the risk that late-comers are joining the talks for the sake of appearances rather than with a serious intent.

But the last to join, Japan, seems serious. In fact its reformist Prime Minister, Shinzo Abe, may be the leader keenest to have something definite agreed by the end of this year. That goal, set by President Obama, should concentrate the minds of the meeting that it falls to John Key to chair.

If Japan agrees to a phasing out of agricultural tariffs, that would be huge.

But if it can lower barriers to our exports, New Zealand may have to make concessions in other areas. Since trade negotiations typically proceed in secrecy so that positions are not solidified by political pressure, the possible concessions can arouse fearful speculative opposition.

Opponents of TPP in New Zealand fear the Government will have to compromise on pharmaceutical purchasing, forcing Pharmac to buy prescription drugs on terms dictated by suppliers, particularly in the United States. More generally, opponents warn that the foreign companies will be able to claim damages in international courts against any Government decision that harms their investment here.

The other area of potential concern is around the US proposed intellectual property chapter. It has provisions in it such as extending copyright from life plus 50 years to life plus 70 years. I think life plus 20 is more than enough personally.

To date the NZ Government position has been to reject clauses that would require a change to our existing IP laws. I hope that position continues. There can be economic costs to having overly restrictive IP laws – as Australia has calculated.


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Auckland growth

October 8th, 2013 at 11:00 am by David Farrar

The Herald reports:

Statistics Minister Maurice Williamson says new Census data which show that New Zealand population growth has halved since the last Census could prompt revision of Auckland’s infrastructure plans such as an increase in high-rise apartments and the construction of a city rail loop.

But Auckland Council is standing by its plans for growth, saying that Auckland is expected to grow faster than the rest of the country.

The council’s planning for the next 30 years is based on the prediction that the number of residents will grow by 1 million.

Mr Williamson said the first Census data in seven years indicated that this projection was far too high.

Statistics New Zealand figures released yesterday showed that on Census night, there were 214,101 more people in New Zealand than at the previous Census in 2006. This meant the population had grown by 31,000 a year over the past seven years, compared to 58,000 a year in the previous period of 2001 to 2006.

“This is a huge surprise – bigger than Ben Hur,” Mr Williamson said. “It’s nearly half the growth rate that everyone had been basing their historic numbers on.”

This is why I think the Government’s funding position on the CRL is smart. Budgeted to start in 2010 2020, but with the provision to start earlier if there is sufficient population growth etc leading to inner city employment growth.

The planning documents assume that the region will grow by 2.2 per cent a year. As a result, they include proposals for more high-rise, small apartments in the suburbs and 160,000 homes outside the existing urban boundaries.

The Census data showed a national average increase of 0.75 per cent in population per year, but regional growth would not be revealed until next week.

One can make a dirty estimate if you ignore changes in the Maori roll.

The 21 electorates mainly in Auckland had an electoral population of 1,205,678 in 2006 and of 1,318,141 in 2013. That is growth of 112,463 or 9.3% over seven years.

That equates to an average growth of almost 1.3% a year – well below the 2.2%.

What difference does this make over time?

Well 2.2% a year for 30 years is a 92% growth while 1.3% for 30 years is a 47.3% growth.

What difference does that make to projected population? Well on 1.5 million current population the 2.2% figure means an extra 1.4 million residents while the 1.3% figure means an extra 710,000 – so a difference of around 700,000 Aucklanders.

I look forward to people claiming that we should ignore the census data and not change the Auckland plan. Of course we should wait for the official figures next week.



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Looks like IRD are doing their job

October 8th, 2013 at 10:00 am by David Farrar

James Weir at Stuff reports:

Some wealthy multinationals are thumbing their noses at the taxman and are not paying their fair share of tax, according to Labour.

Not sure what a fair share is. I think the requirement is to pay your legal share.

An example is the Wellington power lines company which appears to take an “optional” approach to paying tax, says the party’s associate finance spokesman David Clark.

Companies Office documents show Inland Revenue is auditing the books of the company, Wellington Electricity, which is linked to Asia’s richest man Li Ka-Shing.

If IRD is auditing them, then they are presumably checking that they are paying the amount of tax they should.

Wellington Electricity has paid no company tax since its sale by Auckland-based Vector in 2008 for $785 million.

The tax losses came despite healthy profits at operating “ebit” level of close to $50m a year in 2012. Clark claimed the lines company looked to be avoiding tax and was an example of “those who are wealthy finding it optional to pay tax in New Zealand”.

EBIT is earnings before interest and tax.  Money doesn’t grow on trees. Of course a company deducts the interest on debt off their profit to decide taxable income. Is Labour proposing that tax be levied on EBIT rather than net profit? I think they once suggested it be based on turnover which was beyond scary.

The electricity lines company may not be doing anything illegal, but getting around the law, “doesn’t make it right”, he said.

So what is the point of this story? Is Labour proposing a law change? The IRD are already auditing. What more does David Clark think should be done?

The debt looked “very aggressive” and it was perhaps no surprise IRD was carrying out an audit of past tax years.

If a company was being “aggressive” it was more likely to face an audit, but that was not to suggest it was doing anything illegal, the tax expert said.

Again, it is good IRD is auditing.

There were tax rules limiting debt to no more than 60 per cent of total assets, down from 75 per cent a few years ago, but even that 60 per cent was high and could make a mess of profits.

The Government is looking at rules around debt ratios. “You can expect some announcement around thin capitalisation rules later in the year, so the settings are appropriate with no incentive for multinationals to structure their affairs to avoid tax in New Zealand,” Revenue Minister Todd McLay said.

Thin cap rules limit the ability of a company to extract profits as interest payments while paying no tax.

So the Government is making changes in this area. So again what is Labour proposing that the Government is not doing. It’s easy to fire off a whining press release. It’s harder to come up with a policy position that one can meaningfully assess for pros and cons.


The fiscal turn-around

October 8th, 2013 at 9:00 am by David Farrar

The accounts released by Treasury just before the 2008 election showed a decade of deficits projected. A few weeks later the books had deteriorated further that the fiscal settings inherited from Labour were projecting a permanent structural deficit – which means debt increasing until you end up like Greece.

In just five years there has been a remarkable turn-around. Labour and Greens have fought and opposed every piece of spending restraint done by the Government. They fought for every single public sector job there was. They decried the reductions in the subsidies for KiwiSaver. I hate to think what the books would be looking like now if the Government had not changed.

Bill English has announced the final accounts for 2012/13:

Higher tax revenue and lower than forecast core Crown expenses helped to more than halve the Government’s operating deficit before gains and losses to $4.4 billion in the year to 30 June 2013, compared with a $9.2 billion deficit the previous year.

Halving the deficit is well done.

The result was considerably better than the $7.9 billion deficit forecast by Treasury at the start of the financial year in Budget 2012, and confirms the Government’s prudent approach to fiscal management is paying dividends, Finance Minister Bill English says.

Coming in $3.5 billion under the budget is even better.

“The National-led Government has consistently examined how public services are delivered,” he says. “This has allowed us to reduce costs while improving the services New Zealanders receive, as well as helping the people of Canterbury following the earthquakes.

“We are well on track to return to Budget surplus in 2014/15. It’s important we get there because, until we do, we will continue to increase our debt. Despite the considerable progress we are making, there is no room for complacency.

“In the past financial year, we were still borrowing a net $110 million a week, compared to almost $260 million a week in 2010/11. Once we reach surplus, we will then have choices about reducing our debt and investing more in priority public services and important infrastructure.

The Government have had to fund billions of dollars for the Christchurch rebuild. I recall Greens (and I think Labour) demanding New Zealanders be hit with a special extra tax to fund the rebuild. Their solution was to tax more rather than restrain spending elsewhere and prioritise.

The Government remains on track to reduce expenses to 30 per cent of GDP by 2016/17, down from around 35 per cent of GDP in 2010/11, Mr English says.

30% is still too high when you consider the size of the local government sector also. But it is a positive trend.


An appointed commissioners option

October 8th, 2013 at 6:21 am by David Farrar

Sir Gil Simpson writes in The Press:

When we see evidence of “no one fit to govern” we need to find a democratic way of telling our politicians exactly that. Low voter turn out is viewed (secretly) by some politicians as a good indicator that they will be re-elected – not as voters dissatisfied with the choice.

Starting with local body elections we could make a change that would enable voters to demand better performance from our politicians.

In Canterbury we have some experience of this by commissioners being appointed to ECan. At the time there was a protest campaign to describe this as the government taking away our democracy.

Why should the government do this? Perhaps we should have the democratic right to ask the government to appoint commissioners?

I suggest that on every local body ballot paper an additional candidate is created which says “Appoint commissioners”. The local citizens would be democratically choosing, if in sufficient numbers, an action for the government to take.

If “appoint commissioners” were added to the next ballot for Ecan then the voters view would be made clear.

If, say, 50 per cent voted for this then the government could appoint half of Ecan’s council members from the best-polling candidates and half from suitable technocrats.

If we look forward to the Christchurch City Council elections in 2016 and “appoint commissioners” was going to be a choice on the ballot paper.

Aware of this, the elected members of our 2013 council would be suitably encouraged to act responsibly so that the voters will retain or regain confidence in them.

It’s not a bad idea. It is a type of no confidence option. Such an option could be very popular in Wellington City as well as Christchurch City.

Even if a threshold of appointing commissioners is not reached but if, say, more than 15 per cent of those who voted said appoint commissioners, then it would be a very foolhardy politician who ignored the clear message of dissatisfaction from the voters. When commissioners are appointed no seat is “safe”.

Worth looking at this option for next year’s review of local electoral laws.

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One new North Island electorate

October 7th, 2013 at 12:52 pm by David Farrar

Stats NZ has announced that higher population growth in the North Island compared to the South Island will see one extra electorate seat there. This will mean 16 SI seats, 48 NI seats and seven Maori seats. So there will be 71 electorate MPs and (if no overhang) 49 list MPs in the next Parliament.

The number of new seats is well down on what many were expecting, as the long gap between censuses and the expected drop in Christchurch population had most people expecting three new seats.

When MMP started it was 65 electorate seats to 55 list seats, and now will be 71 to 49. At some stage in the future there won’t be enough list seats to retain proportionality unless one has a fixed ratio.

The three quotas for electorate boundaries are:

  • SI 59,679 (56,696 to 62,662 5% tolerance)
  • NI 59,731 (56,745 to 62,717)
  • Maori 60,141 (57,134 to 63,148)

Since the 2006 census, the SI electoral population has grown by 3.7%, the NI by 6.6% and the Maori electoral population by just 0.9%.

The seats that are the most over quota and must lose territory are:

  1. Auckland Central 70,406
  2. Hunua 68,951
  3. Helensville 68,026
  4. Selwyn 67,818
  5. Rodney 67,134
  6. Wigram 65,433
  7. Waitaki 64,962
  8. Hamilton East 64,577
  9. Waimakariri 64,454
  10. Wellington Central 64,374
  11. Rangitata 64,142
  12. East Coast Bays 64,005
  13. Maungakiekie 63,274
  14. Epsom 62,990
  15. Tāmaki 62,779
  16. Tauranga 62,741

So those 16 seats must shrink. What seats are under the 5% tolerance and must grow:

  1. Christchurch East 45,967
  2. Port Hills 53,667
  3. East Cost 53,960
  4. Christchurch Central 54,104
  5. Rangitikei 56,364

The other 49 seats can stay the same size in theory. But it is likely many will have some change because of flow on effects from neighbours.

So where might the extra seat be. Well the seats that are most over quota and in the same city are:

  • Auckland Central 70,406
  • Hunua 68,951
  • Helensville 68,026
  • Rodney 67,134
  • East Coast Bays 64,005
  • Maungakiekie 63,274
  • Epsom 62,990
  • Tāmaki 62,779

Those eight seats are together around 50,000 over the quota so the new seat will be in Auckland. Where in Auckland is harder but Rodney, East Coast Bays and Helensville are close together and are around 25,000 over quota so it could well be up around that area.

Auckland Central is the seat that will lose the most territory – it is 18% over quota.

In Christchurch you have Wigram, Selwyn, and Waimakariri 33% over quota combined and Chch East, Central and Port Hills around 42% under quota. So those three electorates will take territory off Wigram, Selwyn and Waimakariri. You will probably also see Selwyn ahift South to take some of the excess from Rangitata and Waitaki.

In Hamilton, Hamilton East is over the tolerance so will lose some territory.

In Wellington, Wellington Central needs to lose 5,000 or so. Ohariu is over quota (but within the 5% tolerance) and Rongotai is on quota. You could just have Rongotai take some territory off WC, but more likely is Ohariu takes some also and Ohariu loses some territory to Hutt South (which is under).

The two Dunedin seats are under quota but within the tolerance. They could grab some territory off Waitaki and Clutha-Southland,

Tauranga needs to lose a bit of territory also. Bay of Plenty also at the max, so East Coast, Coromandel and Rotorua are the logical places to pick up some territory from them.

Rangitikei needs to expand. Rangitikei may take some off Palmie. Whanganui is under quota so if they lost some they would need to take some off TKC who are also under quota so you could have a ripple effect there.

East Coast also needs to expand. Bay of Plenty is the easiest option. Napier is under quota so can’t give up much.

The Surveyor-General will draw up draft boundaries and bring them to the Representation Commission. The Commission will then consider them, modify them and release proposed boundaries. After that there are public submissions and then the Representation Commission will determine the final boundaries early next year.

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The neo-nazis HQ

October 7th, 2013 at 12:00 pm by David Farrar

Christchurch Mayoral candidate Kyle Chapman, of the so called NZ right wing resistance, has a profile page on VK.

Some people claim that Kyle and buddies are not really neo-nazis, just so called white pride etc.

Well these photos from his page should clear up any doubt.


So they worship the Nazis who exterminated millions of people based on their race. That is what they call white pride? Sad little fuckers.



They even appear to get turned on by wearing pretend uniforms.

The Police may wish to note this comment from Mayoral candidate Kyle Chapman:

Also will create the enforcer patches soon for those who have done violence for the crew.

Kyle has big plans also:

Retaliators SC is the future street force in this country and Australia, its sad that some people cant see these things untill its too late. They bury their heads in pride and over indulgent egos. Only the brotherhood of a mass movement will carry this movement forward, unleashed and focused…

They are mainly a threat to themselves, but I do hope none of them have a firearms licence:



I presume the fat one is Kyle?

He has been convicted of fire-bombing a marae, so one can’t be entirely complacent that their neo-nazi fantasies will remain in their bedrooms.

I wonder if any of them actually have a job? I doubt it.

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How to strengthen the teaching profession

October 7th, 2013 at 10:00 am by David Farrar

Rose Patterson writes at the NZ Initiative:

What kinds of things matter for student achievement? Is it class size, school journals, the school building, or a flash new gym?

These may play a role at the margin, but they pale in significance next to what research conclusively shows is the most important in-school factor for student achievement: the teacher.

On Monday, The New Zealand Initiative releases its first education report on teacher quality, and it comes at quite a precipitous time. As the ageing teacher workforce moves into retirement, New Zealand needs to not only replenish this workforce but attract the best and brightest into the teaching profession. And then, for teachers to develop to their full potential and to retain the best teachers, teaching must be a challenging and rewarding career.

Yet our report has uncovered some major problems in the career development of teachers in New Zealand. Aside from going into school administration, there is little opportunity, challenge, and recognition for a teacher to further develop their skills and capability. Also, the maximum salary point is reached after eight years. It is obvious what kind of signal this sends: teachers have reached their maximum ability after eight years.

One of the problems of fixed salary scales. I think our top teachers should be able to earn over $100,000 a year (without having to take up administrative roles). But I also think you shouldn’t have poor teachers earning the same as the best teachers.

I’m looking forward to reading the report, and seeing what ideas are promoted to help with teacher recruitment and retention.


Key subs for Obama

October 7th, 2013 at 9:00 am by David Farrar

Audrey Young reports:

Prime Minister John Key will replace US President Barack Obama as chairman of a top-level meeting in Bali this week.

On Friday afternoon, Obama cancelled his trip to the leaders’ summit of the Asia-Pacific Economic Co-operation forum on the island because of the American Budget crisis that has resulted in about 800,000 Government workers not being paid.

US Secretary of State John Kerry will represent Obama at the summit, and at the Trans Pacific Partnership meeting on the sidelines.

NZ Trade Minister Tim Groser said it was decided yesterday that Key should chair the meeting of the 12 countries negotiating the TPP agreement.

The 12 countries are Australia, Brunei, Chile, Canada, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore, the United States, and Vietnam. Their combined GDP is around US$25.4 trillion.

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Armstrong on Labour and Reserve Bank

October 6th, 2013 at 10:00 am by David Farrar

John Armstrong writes:

Not wanting to compromise the bank’s independence, Key had to accept the bank’s right to write the restrictions in its own terms.

Not so Labour. Cunliffe made vague noises about not interfering with the bank’s independence. But he intimated a Labour government would effectively instruct the bank to have regard for first-home buyers by writing that requirement into the policy targets agreement that a new government signs with the bank soon after taking office.

Cunliffe’s stance reflects his intention to give Labour a more bolshie image. He is exploiting the fact that Opposition parties can promise more than governments can. And he knows interest rates are likely to rise before the election.

But Cunliffe has to be careful. With Labour also committed to making the Reserve Bank take heed of exchange rate fluctuations, Cunliffe has to avoid leaving the impression that Labour’s answer to every economic problem is to fiddle with the Reserve Bank’s mandate – and thereby neutering the institution in the process.

I think it is clear the Reserve Bank will cease to be an independent entity under Labour. It will be back to the 70s.

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The $676 million we almost lost!

October 6th, 2013 at 9:00 am by David Farrar

The Herald reported:

Making the movie trilogy The Hobbit has cost more than half a billion dollars so far, double the amount spent on the three movies in the “The Lord of the Rings” series.

That figure includes the major 266 days of filming with actors that was completed last year, although it doesn’t include an additional two months or so of “pick-up” shoots done this year. There will likely also be additional post-production costs as the next two movies are completed.

Through March 31, production had cost NZ$676 million New Zealand dollars, according to financial documents filed Friday.

Are Labour still vowing to reverse the law change that helped keep The Hobbit in New Zealand?

I can’t wait for The Desolation of Smaug in December.


Rutherford exposes Greens financial illiteracy

October 6th, 2013 at 7:00 am by David Farrar

Hamish Rutherford (a former business journalist) writes at Stuff:

With co-leader and economic spokesman Russel Norman overseas this week, it fell on the shoulders of Green Party energy spokesman Gareth Hughes to reveal what he sees as the Government’s latest skulduggery.

With “the stroke of a pen” Solid Energy has been privatised, Hughes said, and not to mums and dads, but to foreign banks.

But what has really happened:

Hughes based his claim on a Beehive announcement that banks which lent hundreds of millions to Solid Energy were converting $75m of loans into “non-voting redeemable preference shares” as part of a rescue deal.

Suddenly at least 14 per cent of the company was owned by four Australian banks, Hughes reasoned, putting “privileged, powerful banking interests ahead of New Zealanders”.

For a start this overlooked that a New Zealand building society, TSB, also loaned Solid Energy tens of millions of dollars and was facing the prospect of losses, a detail made public months ago.

That aside, even though the banks are technically acquiring equity in Solid Energy, the lack of insight as to who was on the receiving end of the deal was striking.

Since revealing the scale of Solid Energy’s problems in February, with debt spiralling to near $400m, Finance Minister Bill English has promised those who funded its ill-fated expansion would not get off scot-free.

The negotiations dragged on for months, and now we know why.

The Government is about to mete out the kind of treatment the Greens seem to wish they could hand out to big business, and the banks are signing up only because the alternative is writing off the debt entirely.

Yes, the Crown is injecting $25m cash into Solid Energy, but for every dollar it is putting up, the lenders face losing three.

The banks are not getting any sort of reward or return. They are in fact taking a big hit.

What do the banks get in return? Shares which will never be worth more than the original amount – Solid Energy can buy the stock back at any time at face value.

It is unclear whether Solid Energy has any motivation to buy the stock back, ever, but certainly it won’t do so before it pays off all or most of the rest of the hundreds of millions of dollars of debt it still carries.

Even if coal prices recover, that will take years. During that period the value of the equity will evaporate through inflation and the lost opportunity to earn interest.

Worst of all (for the banks) is that although English has signed off on fresh loans worth at least $100m, in return he takes security over all of Solid Energy’s assets.

Looks like a very good commercial negotiation from the Government, doing its best to protect taxpayers. As I said, the real shame is that Solid Energy wasn’tt sold off years ago. The next time someone claims the Government must own these commercial companies, think of Solid Energy.

In terms of repayment, the banks’ “equity” stands somewhere near the contractor who cleans the windows at company headquarters.

If the Green Party really believes that kind of ownership is a kind worth buying, then heaven help the taxpayer when it gets near the purse strings of the Treasury.


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Another charter school

October 5th, 2013 at 10:00 am by David Farrar

Stuff reports:

The Vanguard Military School chief executive is defending charter schools against the threat of a teachers’ union boycott and promises from opposition parties to scrap them.

Nick Hyde is running the North Shore’s first partnership school and says he wants to “dispel the myths”.

He says the current education system is good for 80 per cent of students.

“Our place on the education map is to provide a place for those who are struggling.”

To be fair, I think it is around 85% who are doing well. The tail is around 15% not 20% according to latest research.

Vanguard Military School in Albany will be sponsored by Advance Training Centres (ATC), the military prep school Mr Hyde manages in Rosedale.

It is one of five partnership schools due to open at the start of 2014 in Auckland and Northland.

Labour and the Green Party have promised to repeal charter schools and the Post Primary Teachers Association (PPTA) is considering a boycott of any sporting, cultural or professional contact with them.

PPTA junior vice-president Hazel McIntosh says they are “a terrible experiment on New Zealand’s children that must be stopped in its tracks”.

A terrible experiment that is 100% voluntary. Not one family will have their kids attend a charter school unless they choose to do so. Unlike most state schools where uif you are in their zone, you have basically no alternative but to attend.

It is the choice that the PPTA opposes. They do not believe in it.

Vanguard Military School will cater for 108 year 11 and 12 students and expand in 2015 to include year 13.

Registered teachers will be used for core NCEA subjects like science, Maori, English and physical education. Non-registered teachers will take defence force studies and engineering classes.

“We felt someone with experience in these roles would be a better fit,” Mr Hyde says.

Students will also be taught computing, CV writing, leadership skills and will work towards their driver licences.

There will be a student-teacher ratio of 1 to 12.

Sounds terrible eh?

And they are not getting any extra state funding. They are getting the same as any new state school would get.

One of the reasons Mr Hyde decided to set up a charter school was over-demand for places at ATC.

“The horrible part of my job is to write to parents and say ‘Your child is eligible but we can’t take them on’,” he says.

ATC is entitled to have each student for only a year.

“It’ll be nice to have them for two or three years and we can take some of our most gifted students all the way through to university which is exciting,” Mr Hyde says.

He says charter schools have a place in the system as long as they are of a high quality.

The focus should be on quality. The five approved to date look promising.


Anyone know whose billboard this is?

October 4th, 2013 at 3:00 pm by David Farrar



An interesting billboard on Featherston Street. Personally I think it is the job of parents to restrict their kid’s access to unsuitable websites, not the Government. Plus the huge number of kids who have access on mobile phones means any home based filtering is ineffectual at best.

I note the Australian Liberal Party said they planned to introduce a filtering requirement like the one mooted in the UK. They dropped the policy two days later due to the backlash.

Anyway there is nothing on the billboard that says who is responsible for it There is no legal requirement to do so, but it is unusual to have an anonymous billboard. Anyone know who may be behind it? It isn’t Family First as they always put their name and logo on their publications.


Best deal ever

October 4th, 2013 at 1:00 pm by David Farrar

The Herald reports:

New Zealand’s exports to China have more than trebled since the free trade pact between the two countries came into force.

New Zealand exports to China were worth $7.9 billion in the year to August (the most recent trade statistics available). That’s up from $2.2 billion five years earlier, an increase of 260 per cent. China is now our largest export market.

The China FTA is our best deal ever and Phil Goff’s greatest legacy.

People should remember though that both Greens and NZ First voted against it. They voted against a deal that has seen an extra $5.7 billion a year of exports. Imagine the state of the NZ economy if their views had prevailed.

“It has exceeded all expectations, I think,” says Charles Finny.

Now with consultancy Saunders Unsworth, Finny was the Ministry of Foreign Affairs and Trade official who in 2004 was tasked with building the case with the Chinese for beginning negotiations, the first with a developed country, and then launched the negotiations in 2005.

They were to take three years.

And five years after the agreement took effect, the transition to free trade still has some way to go. Tariffs on beef, sheepmeat and kiwifruit will not go until the start of 2016, and not until the start of 2019 on whole and skim milk powder and wool. But by then 96 per cent of New Zealand’s exports to China will be duty-free.

This is key information. The full benefits of the FTA are yet to be realised.

New Zealand now has a network of free trade agreements which covers all of Asean and all three Chinas – Taiwan and Hong Kong as well as the People’s Republic – and that provides options to diversify, he says.

“If you look at markets like Taiwan, Singapore and Hong King where you have a proxy for a Chinese population at certain income levels, you see a disproportionately large spend on food and on things like high quality fruit. Look at Hong Kong and wine; it is just absolute upside.”

Rabobank, in a report last week, is bullish about the prospects for lifting beef exports to China as rising incomes drive demand for what is considered one of the foods of affluence.

Yet some parties remain hostile to international trade.

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The pitfalls of public ownership

October 4th, 2013 at 12:00 pm by David Farrar

The Herald editorial:

The Green Party has called the Government’s bail-out of Solid Energy “privatisation by stealth”. Would that it were so. The state coal company will cost the taxpayer $155 million under the terms of the bail-out. It would have been more if the banks holding most of the company’s $380 million debt had not agreed to exchange just $75 million of it for shares in the company.

The banks could have insisted on repayment of all the debt, liquidating Solid Energy and costing 1,000 jobs.

But State-owned Enterprise Minister Tony Ryall is saying little to suggest there is any prospect of Solid Energy going back on to the partial privatisation programme with the power generators and Air New Zealand. More is the pity. The rise and fall of Solid Energy is a textbook example of the pitfalls of public ownership.

There is a case for the Government to own some monopolies like Transpower. There is no case (in my mind) for the Government to own a coal company.

Labour’s state-owned enterprise spokesman, Clayton Cosgrove, never tires of the phrase “asleep at the wheel” when blaming ministers for the company’s ambitious investments. But Treasury records show that in 2010, when coal was still booming on China’s continuing steel production and the board of Solid Energy was making big plans to diversify, the Government was cautious.

Indeed. The Government turned down the funding for the big plans. I suspect Labour would have handed over a billion dollars and renamed Solid Energy KiwiCoal.

If world prices pick up and the company can entertain wider ambitions again, it should be sold to the biggest bid. There is no reason for coal to be a state concern and every good reason to relieve the taxpayer of further risk.


We should sell TVNZ also, while someone will still pay money for it.

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Auckland mayoralty polling

October 4th, 2013 at 10:00 am by David Farrar

Horizon have released a exit poll showing John Palino only 4% behind Len Brown in the Auckland mayoralty.

Before people get too excited by this, I would point out Horizon’s final pre-election poll in 2011 had Labour winning the general election and only 5% behind National (in fact they got 20% behind National).

An August UMR poll had the gap at 23% (47% to 14%).

Could things have changed that much in the last six weeks? We’ll find out in a week when the results come in.

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The parliamentary prayer

October 4th, 2013 at 7:00 am by David Farrar

Gareth Hughes blogs on the parliamentary prayer, which is:

Almighty God, humbly acknowledging our need for Thy guidance in all things, and laying aside all private and personal interests, we beseech Thee to grant that we may conduct the affairs of this House and of our country to the glory of Thy holy name, the maintenance of true religion and justice, the honour of the Queen, and the public welfare, peace, and tranquillity of New Zealand, through Jesus Christ our Lord. Amen

Gareth says:

Speaking in my personal capacity, I think it’s time to have a discussion around it.  Like many Kiwis and MPs I am not a Christian and I don’t think the prayer reflects the rich and varied religious and spiritual life in New Zealand in 2013. To me, it’s an issue of having Parliament – the representatives of the people of New Zealand – actually reflect the people of New Zealand rather than only one religious group. We should have an inclusive ceremonial opening that all kiwis can feel comfortable with, whatever their faith.

Not all Parliaments around the world have a prayer, though most inherited the practice from growing out of Britain’s Westminster model. South Africa’s National Assembly and parts of Canada have a moment of silence for personal reflection for MPs. In Scotland, they rotate speakers of different affiliations to reflect the make-up of the census. One week they might have a Christian speaker, and another a speaker with no religious affiliations.

There are three major options as I see it:

  1. The status quo of a Christian prayer
  2. Change the prayer so it isn’t exclusively Christian, but a general spiritual prayer
  3. Have no prayer at all

My preference is 2. I could make a case for 3, but people don’t have to take part in a prayer if they don’t want to. However having a prayer which is exclusive to one religion is not a good thing, and is a bad precedent.

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