Archive for the ‘Uncategorized’ Category

Project cost over-runs

February 13th, 2015 at 4:00 pm by David Farrar

Jim Rose blogs:

SkyCity is sniffing around the New Zealand government for a $130 million bailout. The initial project estimate was $402 million for a convention centre and enlarged casino.

SkyCity was very clear when the convention centre deal was announced that it would be at no cost to either taxpayers or Auckland ratepayers. That is a clear assumption of the entrepreneurial risks – both the upside of high profits and the downside of cost overruns and losses.

The literature on mega-projects suggests that large engineering projects frequently fail to achieve their intended financial and operating objectives. Nine out of ten mega-projects have cost-over runs:

  1. Miller and Lessard (2000) studied 60 large engineering projects with an average size of $1 billion. Almost 40% of the projects performed very badly and were abandoned totally or restructured after a financial crisis.
  2. Merrow et al. (1988) found that four of the 47 megaprojects they studied came in on budget – the average cost overrun was 88%. Of the 36 projects that had sufficient data, 26 failed to achieve their profit objectives
  3. Flyvbjerg et al. (2003) analyzed 258 large transport projects (toll roads, bridges, railroads, etc.). Cost overruns of 50% to 100% and revenue shortfalls of 20% to 70% were common.


As Jim Rose says, both the risks and the benefits should be borne by Sky City.

If it transpired that they could do the convention centre for say $50 million less than budgeted, would they be offering to give that $50 million to the Government?

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Almost got it early!

February 13th, 2015 at 2:00 pm by David Farrar

Stuff reports:

For an ever-so-brief moment, rabid fans of the Netflix series House of Cards had a glimpse into Season 3, two weeks before its scheduled release. 

If users did managed to log into Netflix on Wednesday afternoon (US time) and clicked on Season 3, the stream worked. A description of Episode 1 says the Underwood presidency gets off to a “rocky start.”

The third season of the drama starring Kevin Spacey as scheming President Frank Underwood was taken down within 20 minutes of its posting. Netflix blamed the incident on a technical malfunction.

“Due to a technical glitch, some Frank Underwood fans got a sneak peak,” Netflix said in a statement. “He’ll be back on Netflix on Feb. 27.”

Just two weeks to go!

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NZ goes from 9th to 6th for press freedom

February 13th, 2015 at 11:00 am by David Farrar

The 2015 World Press Freedom Index is out and NZ has gone from 9th place to 6th place, which is great. Few things are more important than a free press.

This is the highest ranking for NZ since the index began in 2002.

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Student representation on university councils

February 13th, 2015 at 10:00 am by David Farrar

NZUSA have said:

The Government passed its widely-panned Education Amendment Bill in a rush through Parliament last night. The bill shrinks New Zealand’s university councils down to a maximum of 12 and removes the requirement for student and staff representatives on councils.

The new law makes New Zealand’s university councils amongst the smallest in the world, with none of the world’s top universities having councils so unrepresentative and dominated by government appointees.

The move now leaves it up to each of the eight universities to determine how they allocate their few seats by rewritting their constitutions ahead of the Minister’s deadline of 2016. That gives national student president Rory McCourt hope that all universities will use this opportunity to choose to keep students and staff at the top table.

The new law says that the Minister appoints 3 -4 members out of a Council of 8 – 12. I predict every Council will go for 12 members, so Government appointees will be 4/12 – one third.

I do agree with NZUSA that all universities should ensure that at least one of the Council members is a student representative. Student fees fund around 25% of the university and they have a strong interest in how the university is governed, its costs, its quality etc.

I’m more equivocal on staff representation. Staff are a vital component of a university, but they do face a conflict of interest when they are on the governing body. I don’t think it would be sensible to have no staff representation, but you don’t want an excessive number because then the Council will be dominated by its own staff.


General Debate 13 February 2015

February 13th, 2015 at 8:00 am by Kokila Patel

The PM’s carpet

February 12th, 2015 at 12:00 pm by David Farrar

From Hansard yesterday:

Rt Hon WINSTON PETERS (Leader—NZ First) to the Prime Minister : Does he stand by all his statements?

Rt Hon JOHN KEY (Prime Minister): Yes, especially that one when I said yesterday that “There’s no dye in these locks, baby.”

Rt Hon Winston Peters : Well, how come the curtains don’t match the carpet? [Interruption]

Mr SPEAKER : Order! If the member managed to hear it, I will—

Rt Hon JOHN KEY : I take offence that the member is telling New Zealand he has seen my carpet.

Good to see Winston focusing again on the big issues.

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General Debate 12 February 2015

February 12th, 2015 at 8:00 am by Kokila Patel

General Debate 11 February 2015

February 11th, 2015 at 8:00 am by Kokila Patel

General Debate 10 February 2015

February 10th, 2015 at 8:00 am by Kokila Patel

General Debate 9 February 2015

February 9th, 2015 at 8:00 am by Kokila Patel

An anti-Semitic Bishop in NZ

February 8th, 2015 at 10:00 am by David Farrar

Stuff reports:

Senior Anglicans have been forced to apologise for one bishop’s inflammatory comments at an inter-faith gathering.

Bishop John Gray shocked visiting Jews in Christchurch last month when he told them the Holocaust “should have taught you a lesson”.

This man should not be a Bishop. He shouldn’t even be a priest if he thinks that Jews somehow deserved the Holocaust and hence should have learnt a lesson from it.

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General Debate 8 February 2015

February 8th, 2015 at 8:00 am by Kokila Patel

General Debate 7 February 2015

February 7th, 2015 at 8:00 am by Kokila Patel

General Debate 6 February 2015

February 6th, 2015 at 8:00 am by Kokila Patel

General Debate 5 February 2015

February 5th, 2015 at 8:00 am by Kokila Patel

UK Labour learns you need to do more than attack

February 4th, 2015 at 3:00 pm by David Farrar

The Telegraph reports:

Don’t let it be said that Ed Miliband’s political leadership is useless. It has, in fact, just provided an instructive demonstration in how not to play your strongest electoral card. Over the next three months, his team may well proceed to offer a degree-level course in How to Throw Away an Election – but last week’s introductory module was an education in itself. Having “weaponised” the NHS, Mr Miliband then – choose your metaphor – had it blow up in his face, or shot himself in the foot, or fired a succession of blanks. By the end of the week, Labour’s ace vote-winning issue had become one more grotesquely embarrassing morass of internecine warfare, contradictory statements, ill-thought-out policy and, finally, unconvincing denials that the whole initiative had gone horribly wrong. …

Andy Burnham came spectacularly unstuck in a series of major broadcast interviews because he could not answer the most obvious challenges: why is the NHS in Wales, which is run by Labour on precisely the lines you advocate, performing significantly worse than the NHS in England? Where will you find the extra health funding that you are promising? Revenue from the mansion tax will not provide enough money, and besides you’ll be spending that elsewhere.

Oppositions do need to be able to highlight areas of Government failure. But they also need to have a competent and viable alternative.


Save the cockroaches

February 4th, 2015 at 1:00 pm by David Farrar

The Age reports:

The owner of a popular Dickson vegetarian restaurant was morally opposed to wiping out a cockroach infestation because it would have involved “killing little insects”.

They take being vegetarian seriously!

Mr Hoang attended an interview with the Health Protection Service in June 2013, where he admitted he had been aware of the cockroach infestation but did not carry out pest control measures as it involved “killing”.

A noble belief, but rather incompatible with running a restaurant.

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General Debate 4 February 2015

February 4th, 2015 at 8:00 am by Kokila Patel

General Debate 3 February 2015

February 3rd, 2015 at 8:00 am by Kokila Patel

An activist King?

February 2nd, 2015 at 11:00 am by David Farrar

The Herald reports:

The Prince of Wales’ preparations for an activist monarchy have prompted a backlash, as a new book revealed a dysfunctional and divided court around him.

Someone who has worked closely with him said: “He is dying to have his go with the train set. He does cause concern with his outbursts. He’ll struggle to restrain himself.”

The book, Charles, The Heart of a King, by Catherine Mayer, claims he is a tortured individual who endures moments of “extreme despondency” and feels guilty about his privileged upbringing. …

The Supreme Court is expected to rule this month on whether his “black spider” letters to ministers should be published. But some observers are concerned he is pushing for a more active role in national life even before he succeeds to the throne. Someone with close links to the Palace said: “It is no accident that he writes all those letters to ministers. He does see himself as a kind of saviour of the nation, someone who can mend the broken country. Some might see that as presumptuously messianic.” …

He is also understood to support the case for proportional representation in Westminster elections and he opposes the Human Rights Act. Whether he would keep his counsel on such issues is debatable at best.

Our future King of New Zealand – a messianic zealot with a saviour complex. And we don’t even get a choice as to our next head of state as we have a system where the UK decides effectively decides it for us.

Let’s just have a Governor-General appointed by Parliament for a five year term.


Jon Stewart’s Rosewater

February 2nd, 2015 at 10:00 am by David Farrar

Alexander Bisley interviews Jon Stewart:

IT’S SLIGHTLY SURREAL interviewing Jon Stewart, The Daily Show interviewer. His debut film Rosewater tells the story of Maziar Bahari (played by Gael García Bernal), imprisoned in solitary confinement for 107 days in Iran in 2009 after appearing on Stewart’s satirical news programme.

Bahari was detained for 118 days and tortured merely because he did a satirical interview on The Daily Show. The name of the fim refers to the smell of his integrator. Bahari was usually blindfolded when tortured and interrogated.

Stewart’s original idea was a film in Farsi, with an all Persian cast. “Maziar was the one who said, ‘I really don’t want to do that. I want it to be in English, and I want it to be as universal as it can possibly be, because these are issues that need to be seen as universal issues and need to be placed in as wide a context as we can place it.’

In a way a pity they couldn’t do a version in Farsi, for Iran.


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General Debate 2 February 2015

February 2nd, 2015 at 8:00 am by Kokila Patel

First TV poll

February 2nd, 2015 at 7:35 am by David Farrar

3 News had a poll last night. Details are at Curiablog.  National and Labour up and Greens and Conservatives down. On the poll National could govern alone.

National’s lead over Labour is 21%. By comparison in the same poll in 2006 (Labour’s third term), their lead over National was just 6%.


General Debate 1 February 2015

February 1st, 2015 at 8:00 am by Kokila Patel

Piketty’s Errors

February 1st, 2015 at 7:00 am by David Farrar

An interesting paper at SSRN. The summary:

Thomas Piketty’s Capital in the 21st Century has been widely debated on theoretical grounds, yet continues to attract acclaim for its historically-infused data analysis. In this study we conduct a closer scrutiny of Piketty’s empirics than has appeared thus far, focusing upon his treatment of the United States. We find evidence of pervasive errors of historical fact, opaque methodological choices, and the cherry-picking of sources to construct favorable patterns from ambiguous data. Additional evidence suggests that Piketty used a highly distortive data assumption from the Soviet Union to accentuate one of his main historical claims about global “capitalism” in the 20th century. Taken together, these problems suggest that Piketty’s highly praised and historically-driven empirical work may actually be one of the book’s greatest weaknesses.

You can download and read the full 43 page analysis. The sheer number of errors made Piketty are so large it is difficult to do a concise summary.  He gets dates wrong, amounts wrong, data wrong.

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