Jones and Little would have been goners

July 5th, 2013 at 11:47 am by David Farrar

A the last election Labour got 34 MPs. 22 were male and 12 female. Under Labour’s proposed quota, the bottom five men on the list would have to have been placed below the next five women. So who would have been the lucky five women to have got in:

  1. Carol Beaumont
  2. Carmel Sepuloni
  3. Deborah Mahuta-Coyle
  4. Steve Chadwick
  5. Kate Sutton

The next after that is Josie Pagani and Lynette Stewart.

More interesting is who are the five men who would have been dumped:

  1. Raymond Huo
  2. Rajen Prasad
  3. Shane Jones
  4. Andrew Little
  5. Charles Chauvel

Next on the list to be dumped would be Clayton Cosgrove and David Parker!

This shows well the problems of quotas. You’d get gender equality, yet knock out a Maori, two Asians and a Pacific Islander which means less diversity in other areas. Diversity is important (well to me anyway), but you need to balance up many competing factors. A quota removes discretion and is a vote of no confidence in a party to be fair to women.

This may explain why David Shearer has said he against the quota and the man ban (it took him a day to decide though!)

Labour leader David Shearer has come out against proposed party rule changes that would ensure half of all its MPs were women by 2017 and would allow “women-only” candidate selections in some seats.

The proposed rule changes, to be decided at the party’s annual conference in November, would force the party’s list selection committee to ensure women would make up 45 per cent of the party’s caucus in 2014 and 50 per cent by 2017.

However, Shearer said targets, not quotas, was a better way to go.

Absolutely, which is National’s position also.

However just because Shearer and some MPs are against, does not mean it will fail. Quite the contrary. The Party President is a strong supporter of it, and they have been agreed to by the party’s ruling NZ Council – which Shearer is on. Activists could well vote to humiliate Shearer by voting for them in November.

One has to wonder did Shearer vote against them at the NZ Council meeting? If so, then he must have got rolled. If not, he has flip-flopped. Either way a leader not in great control of his party.

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The Press on Shearer

July 1st, 2013 at 9:00 am by David Farrar

The Press editorial:

Shearer’s concerns are the more immediate. An opinion poll last week delivering a dismal ranking for both the party and Shearer personally was devastating to Labour. With National halfway into a less than easy second term, Labour was hoping that by now it would be shaping up much better. Shearer is not helped by his backers saying that if the poll results were converted to seats the party would be doing a little better than it had at the last election, because, as the critics point out, that election was a catastrophe for Labour.

Inspired by the brutal rolling of Julia Gillard across the Tasman, and keenly aware that the procedure here for Labour to remove its leader is much more drawn out and cumbersome, some in the party are saying that Shearer must start to do better by spring or be replaced.

We know this because one or more Labour MPs has spoken to both the One News and 3 News political editors. In fact it looks like more than one MP according to Q+A:

JESSICA Some of the MPs that we’ve been talking to behind the scenes this week have said two months is-

DAVID Well, nobody’s spoken to me about it, and I can tell you, I’d like to know who the MP is.

Not a good look to have to ask a reporter who is briefing against you!

JESSICA Is it hard not having the support completely of your caucus?

DAVID Look, I have the support of my caucus. I mean, the fact that you’ve spoken to one anonymous person, and I haven’t heard of any-

JESSICA I’ve actually spoken to several people.

That should ring some alarm bells. However I think Shearer will remain safe, so long as the ABC faction thinks there is a chance Cunliffe could win a ballot in case of a vacancy.

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65 days to go …

June 29th, 2013 at 9:30 am by David Farrar

Now 65 days until the September deadline a Labour MP told TV3 Shearer had to improve his performance.

Hamish Rutherford at Stuff reports:

Yesterday Shearer dismissed the talk of a leadership battle.

“There is going to be me leading Labour into the election in 2014,” he said.

“I can absolutely and utterly assure you of that. It’s a very united caucus.”

Really? You look desperate when you say such nonsense. When Charles Chauvel departed in February he pleaded for an end to internal witchhunts, called for a purge of those responsible for the last campaign failure, and asked for those in the wrong faction to stop being shut out of the shadow Cabinet. How is that a united caucus?

This morning iPredict, the forecasting website owned by Victoria University of Wellington, pointed to a 40 per cent chance that Shearer would depart as Labour leader in 2013, with the possibility climbing in recent weeks.

I think Shearer has problems, but they are not yet terminal. In fact I have a bit of money on iPredict that he won’t be rolled in 2013. However I may change my position as events unfold in the next few weeks.

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Tick tock

June 28th, 2013 at 7:00 am by David Farrar

Patrick Gower at 3 News reports:

Labour leader David Shearer has been put on two months’ notice by his own MPs – if the poll ratings don’t improve, his leadership will be challenged.

A Labour MP told 3 News today that Mr Shearer had until spring – two months away – to pick up his and Labour’s performance.

The MP, speaking on condition of anonymity, said: “The caucus is just really flat. It’s not panic or anxiety just yet, but a couple more bad polls and it will be. David’s got a couple more months. A change in leadership cannot be ruled out before the end of the year.

Will Cunliffe do a Rudd?

The MP who spoke to 3 News is not a loyal supporter of leadership rival David Cunliffe. That makes the comments more significant as it shows there are broader concerns in the caucus about Mr Shearer’s performance

That does make it more significant.

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“We’re going to be doing exactly what we are doing now”

June 26th, 2013 at 3:00 pm by David Farrar

In response to the 6% drop in the Herald Digipoll, David Shearer has said:

‘We’re going to be doing exactly what we are doing now,”

This response was greeted with huge cheers from all National MPs. They hope Labour will carry on doing exactly what they are doing.

He fended off questions about what it would take for him to step down as leader.

Shearer can’t stand down. There is too much of a risk that David Cunliffe would win the battle to be his successor. This is as anathema to the ABC old guard faction as Kevin Rudd is to the ALP Caucus. It doesn’t mean they won’t stomach it eventually, but they are not desperate enough yet.

John Armstrong says that time has come:

Is it time for Labour to rethink the unthinkable and think David Cunliffe? Probably not. At least not yet. Labour’s MPs would not be human, however, if they were not asking themselves – if not each other – the Cunliffe question after the latest Herald-DigiPoll survey. …

The poll is a horror story of Stephen King proportions for Labour. The party has dropped close to six percentage points since the last such survey in March to register just under 31 per cent support.

David Shearer’s rating as preferred Prime Minister has been slashed by a third and is back into “also ran” territory.

The survey uncannily resembles the result of the last election, leaving the observer to draw the obvious conclusion – that Labour has gone nowhere since.

Except David Shearer was quoted as saying that the long-term trend has been positive for Labour. So I graphed the results of the Herald Digipoll since the election.

heralddigipolls

 

If that is a positive trend for Labour, it’s an unusual one.

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Manhire says Labour needs Cunliffe

June 21st, 2013 at 2:00 pm by David Farrar

Just as pundits are saying Australian Labor needs Kevin Rudd back, Toby Manhire is saying NZ Labour needs to promote David Cunliffe. He writes in the NZ Herald. First he looks at the Sky City issue:

For the decision by a quartet of Labour MPs to accept the invitation from SkyCity to enjoy their generous hospitality and a sweet view of the first France test was staggering in its myopia.

Then the bank account:

David Shearer’s admission in March that he had overlooked and failed to declare several thousand dollars in a New York bank account was a nightmare for Labour, skewering two of the attacks levelled at the prime minister: that his wealth distances him from normal people, and those forgetfulness issues.

And the recent debate:

On its own, the SkyCity box thing does not a Labour party crisis make. But it fits a pattern. The commanding effort by David Shearer at the party conference late last year increasingly looks like an anomaly. In his contribution to the urgent parliamentary debate on the Peter Dunne resignation the other day – a debate Shearer personally demanded – the Labour leader appeared to be reading from a script that had been torn up and sellotaped together at random.

There has been much chatter about Shearer’s performance in that debate.  What makes it really bad is that this was a snap debate demanded by Shearer. It was almost as if he didn’t expect to get it and hadn’t prepared.

It’s true that Labour could end up leading a government if it continues in the current vein, but it would be one of hell of a shaky coalition, with the party outnumbered in Parliament by National by some distance.

They need a shake. An adrenaline shot. A risk, even. It’s now seven months since David Cunliffe was sent to the naughty step – expelled from the front bench for failing to squash talk of an insurrection.

Clearly he continues to be seen as a divisive figure, but he’s also shown, even from the backwater of the tax spokesmanship, that he remains a formidable politician. Confronted with National’s niggly, muscular front-row of Joyce, Brownlee and Collins, Labour can’t afford to leave Cunliffe in the shed.

But how about the ABCs?

As for the – ahem – optics, the promotion of an MP who had served his time would project strength, evidence of the leader’s vaunted experience in conciliation. To those MPs who continue to feel aggrieved on Cunliffe’s part it would send a message that the infighting must end.

A risk, yes. But a necessary one. Shearer’s elevation to and retention of the leadership has been enabled, so we’re told, by the weight of the Anyone-but-Cunliffe sentiment in the Labour caucus.

Less than 18 months out from the election, that ABC needs rethinking. Anything but carry on like this.

I would be surprised if Cunliffe was promoted to the front bench. His supporters are all being weeded out. Chauvel has gone. Dalziel is going. Mahuta has been demoted.

The real battle will be if Shearer loses in 2014. Then we see Cunliffe vs Robertson for the leadership. Cunliffe could win the membership vote by 2:1 so Robertson will need to win the caucus vote by at least 2:1 to balance that out (they get 40% each). Hence they will continue to try and weed pro-Cunliffe MPs out of caucus.

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Keep digging

June 14th, 2013 at 3:14 pm by David Farrar

Oh dear. David Shearer is just making it worse for him and Labour.

First we have this interview in Stuff:

Today Shearer admitted that the MPs accepting the hospitality looked bad.

“I would have said, this is pretty unwise guys, given what we know,” Shearer said, adding that he believed the MPs had learned their lesson.

So Shearer is saying his office didn’t even know the MPs were attending?

But Shearer denied the situation undermined Labour’s arguments against the terms of the convention centre deal.

The invitation was “obviously a gift, on one level it is a perk of the job”, he said, adding that his MPs went to a large number of events which they would probably prefer not to.

Oh my God. Now he is arguing that the poor Labour MPs didn’t event want to attend. It was just their duty to go. How awful – getting to see an All Black test from a corporate box with free food and alcohol.

Shearer had gone into the box to speak to someone he knew was there, whom he declined to name. He would not explain how he knew the person was in the box.

He said he did not know his colleagues were being hosted by SkyCity until he got there. 

So Shearer was popping into the box to see some one else? And no one had told him Labour MPs were there. I think Shearer is fundamentally an honest person so is telling the truth. But it says volumes about their internal communications.

Also Whale has audio from Radio Live where David Shearer says, well listen to it yourself and try and work it out.

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Two departures?

June 14th, 2013 at 1:59 pm by David Farrar

Have heard from two separate sources that two very senior staff in David Shearer’s office are departing.

Have been wrong once before on this issue so not naming staff, but as I said have heard from two different people. No doubt will be confirmed one way or another this afternoon.

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In brief

June 12th, 2013 at 2:51 pm by David Farrar

Stuff reports:

A select committee hearing has descended into acrimony after Labour MP Trevor Mallard appeared to threaten the job of a senior police officer.

Mallard abruptly left a select committee after an exchange of angry words with Police Minister Anne Tolley after he questioned the decision of Deputy Police Commissioner Mike Bush to speak at the funeral of former police officer Bruce Hutton.

Is it newsworthy anymore when Trevor Mallard storms out of the House or a select committee? He’s done it so often, it is probably more newsworthy when he doesn’t.

After Mallard attempted to question Bush on the issue Government committee members objected that his questions were out of order.

But Mallard hit back and appeared to threaten Bush’s job.

“We’re deciding whether or not to continue his salary, that’s what we’re deciding now,” he said.

Really. A select committee can approve the salary of an individual police officer?

Also of interest is this tweet from Hamish Rutherford:

David Shearer confirms he was in SkyCity corp.box after ABs test at Eden Park on Sat for “5 to 10 minutes” to say hello. No drinks or hospo.

So against Sky City making money from dirty pokies, but will pop into their corporate box.

And a great rejoinder from Steven Joyce:

I think he’s saying he didn’t inhale

Great sledge.

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Labour enjoying Sky City hospitality

June 10th, 2013 at 3:00 pm by David Farrar

A number of Labour MPs were seen enjoying the hospitality of Sky City at Eden Park on Saturday night.

Rather amusing that they rant and rail about how Sky City destroys people lives through addictive pokie machines, and a deal with the Government to allow them some more. But then they are happy to take their hospitality, funded by the very same pokie machines.

Have to at least give the Greens credit for consistency.

Anyway here is my question, and I genuinely don’t know the answer. Was David Shearer one of those Labour MPs in the Sky City corporate box at Eden Park?

Surely no opposition leader would be so foolish as to lead a charge against Sky City’s pokie machines and deal with the Govt – and then turn up to their corporate box a few weeks later? Would they?

As I said, I know of at least two Labour MPs who were there. I don’t know if Shearer was there also. But I do hope someone asks.

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Labour vows to terrorise

June 4th, 2013 at 2:15 pm by David Farrar

I thought this press release was a parody, but it seems it was genuinely put out by David Shearer. The key extract:

“Labour will campaign relentlessly to once again earn the trust of the people of Ikaroa-Rawhiti. We will organise, mobilise and terrorise our political opponents. …

“Let the games begin,” says David Shearer.

The Mana Party and Maori Party are not impressed.

How on earth did Shearer and his staff think that sentence was a good idea.

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Will cost money, not save it

May 17th, 2013 at 1:00 pm by David Farrar

Stuff reports:

However, critics seized on the state housing shakeup. Labour Party leader David Shearer said tenants would be “really worried”, as the Government was trying to push social housing on to private providers to save money.

What a stupid thing to say. The extension of income related rents to other social housing providers will not save the Government money – it will in fact cost them tens of millions of dollars as more low income families get subsidised rents.

The Opposition’s job is to oppose, but they should at least understand what they are talking about.

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I’d keep my money off-shore also!

April 23rd, 2013 at 4:00 pm by David Farrar

3 News reports:

Labour leader David Shearer is headed for the United Kingdom and United States for a series of top-level political meetings, including helping lobby for a United Nations Security Council (UNSC) seat. …

A spokeswoman for Mr Shearer said he has no plans to close his US-based UN bank account – where his salary was paid for about 20 years while he worked for the organisation – while he is overseas.

Of course. You’d be mad to bring your money back now. You have Winston wanting to nationalise KiwiSaver funds, and Labour and Greens wanting to nationalise the energy industry – plus Greens planning to print money which means a huge devaluation for NZ.

Every sensible investor will avoid New Zealand.

Tim Hunter at Stuff reported:

The Labour and Green parties’ power policy could wipe as much as $1.4 billion off the values of Contact Energy and Trustpower, says a Forsyth Barr analyst.

And they’re just two of 14 electricity generators.

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That didn’t take long

April 22nd, 2013 at 12:50 pm by David Farrar

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Just yesterday David Shearer made the immortal line on television that “John Key is just talking out of his mouth” and today Grant is already leader!

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Greens don’t even know their own joint policy

April 18th, 2013 at 11:25 pm by David Farrar

Steven Joyce pointed out today:

Labour and the Greens have jumped the shark with a half-baked Soviet Union-style nationalisation “plan” for electricity in New Zealand, Economic Development Minister Steven Joyce says.

“This is truly wacky and desperate stuff obviously made up in the last minute in the Koru Lounge between comrades Norman and Shearer,” Mr Joyce says.

“Their crazy idea to have both a single national purchaser of electricity and to exempt Government-owned companies from both company tax and dividends would effectively demolish private investment in the electricity industry overnight. It would also raise real questions as to why any individual or company would want to invest in businesses in New Zealand.

I never thought we’d see parties in NZ advocating socialist nationalisation policies from decades ago. Stuck in a time warp.

Anyway Russel Norman responded:

Minister Joyce’s release on the Greens and Labour’s electricity announcement is full of basic inaccuracies: he says that NZ Power would exempt electricity companies from corporate tax and dividends, which is completely false and not backed by anything in the discussion document.

So is Russel correct that Joyce has it wrong? Let’s look at the press release from no less than David Shearer:

The Crown will forgo dividends and tax revenue from the power companies.

I say game and set to Joyce.

Bad enough to have a mad Soviet style policy. Even worse to not even knowing what is in it, when you are auditioning to be Finance Minister for a Labour-Greens-Mana Government.

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Another secret foreign bank account scandal

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

The Herald reports:

Radicals both right and left are sensing that France’s political tide is rising in their favour, driven by a President plumbing record unpopularity less than a year after taking office.

Francois Hollande, a Socialist already under fire for economic mismanagement, is bogged down in a scandal unleashed by his Budget Minister, Jerome Cahuzac.

Svelte and smooth-tongued, Cahuzac had been leading Hollande’s campaign to fill the state’s coffers by raising taxes, urging citizens to pay their fiscal dues as “solidarity” towards others.

Last week, Cahuzac quit after admitting he had had a secret bank account in Switzerland for decades.

David Shearer is lucky he remembered about his foreign bank account while he was Opposition Leader. Imagine the impact if he been a Minister or Prime Minister and it emerged.

Hollande romped to the presidency on May 6 on campaign promises to govern France competently, fairly and cleanly. He declared he would roll back unemployment, meet the EU’s targets on borrowing and, after decades of scandals embroiling both left and right, give France an “exemplary” government.

Today, his approval rating stands at only 27 per cent, the lowest of any president in modern French history at such an early point in his tenure.

Unemployment has risen like an express lift, affecting 3.188 million people, or nearly one in nine of the workforce – a tad short of a record set in 1997.

The budget deficit is 4.8 per cent of GDP, compared to Hollande’s pledge, since abandoned, to meet the EU’s limit of 3 per cent last year.

Public debt rose in 2012 to an astronomical 90.2 per cent of GDP, compared with 85.8 per cent in 2011 – and Hollande’s own target of 89.9 per cent.

Socialism doesn’t work. He’s hiked taxes and spending, and I think Labour’s housing plan is based on his pledge to build 500,000 homes a year.

To get some idea of how unpopular he has become, Reuters reports that National Front Leader Marine Len Pen has a higher approval rating than Hollande.

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Wood interviews Shearer

April 7th, 2013 at 3:00 pm by David Farrar

People may be interested in this transcript from Q+A. The video at the link is even better:

SUSAN WOOD

On Friday we found out some of the details about the partial sale of Mighty River Power. The price range for the shares estimated to be between $2.35 and $2.80. That should bring around $2 billion into the government coffers.

Good morning, David Shearer.

DAVID SHEARER,

Good morning, Susan.

SUSAN         $2 billion on schools, on things that are public good. Money well spent?

DAVID          No, because you also miss out on the revenue over a longer period than that, and as soon as you do that, 50 per cent of your revenue goes, and over time, obviously, that’s nonsensical. But the other thing about selling these shares is that a small group are going to get ownership of those shares-

SUSAN         400,000 people is not a small group of New Zealanders.

DAVID          Well, if you actually add it up, it’s going to be well less than 10%. More than 90% of New Zealanders will not have the opportunity to buy shares, and they will lose, in a sense, what they already owned before, which is a national asset.

SUSAN         So without selling assets, and we know you don’t want to, how will you balance the books without borrowing?

DAVID          Well, what we had been saying before is a whole programme of economic development, capital gains tax, and in the short term-

SUSAN         So tell me how you’ll raise $2 billion. This government’s raising $2 billion doing it. How will you come up with $2 billion?

DAVID          Let’s start from the beginning, then. Do we need to have exactly that $2 billion or not? The way the government’s put its books in order, or not in order, is by putting forward an argument that we need to sell our state-owned assets. I don’t believe that that’s the way that we should be going forward. There are other alternatives.

SUSAN         Do you agree, though, that the government should be running a surplus? They should not be in deficit? Households have to tidy up their act. Do you agree that the government books should be in surplus?

DAVID          Well, of course we should be in surplus, and that’s what the Labour government did for nine years while it was in government, and that’s what it handed on to the National government – government books that were in surplus.

SUSAN         Yeah, but to be fair, there’s been a GFC.

DAVID          When you sell a state-owned asset like Mighty River Power you forego the income that that brings in.

SUSAN         I understand that.

DAVID          So what you’re effectively doing- It’s like selling your business, putting an extension on your house – you feel much better for that, but you lose the income from the sale.

SUSAN         OK, but they are getting the books back into surplus. They are getting their house in order. Give me a few ideas of how Labour would get the house in order without borrowing more money.

DAVID          Well, at the moment we don’t have a growth agenda in New Zealand. We are not growing our economy as we should.

SUSAN         But give me some specifics here of what you would do. We know what this government is doing. How would you raise a couple of billion to get the books back in balance?

DAVID          Well, what I’m saying is that what we need to do is to grow the economy in a way that it’s not growing at the moment, and we’ll be talking about Tiwai Point in a little while…one of the big problems about – no, no, let me finish – one of the biggest problems about that is that the exchange rate is so low that we’re seeing many of our businesses actually going out of business because they’re not being able to succeed. We’re not putting our money in the profitable sector; it’s going into the property market because we don’t have a capital gains tax that will help us direct money into those areas. And if you’re wanting to raise money, then at least put money into businesses- invest in businesses through the incentives of capital gains, and that brings, obviously, money into the government as well.

SUSAN         Let’s talk about the GCSB spy boss, Ian Fletcher. Is he the right man for the job?

DAVID          I don’t know Ian Fletcher, but I can say that the way he has been appointed-

SUSAN         No, no, there is nothing negative about him, is there? There is no suggestion that he is not the right man for the job. Let me phrase it that way.

DAVID          Well, let’s put it another way. Just last year, when the whole Dotcom issue was running, Ian Fletcher was the person who went to the prime minister and said, ‘Sign this, because I want to cover up the fact that we’ve been illegally spying on Dotcom.’ That was the ministerial certificate that Ian Fletcher took to the prime minister. Now, I don’t think that was a good move. I don’t have an opinion of him per se, but-

SUSAN         Well, you don’t like that.

DAVID          Of course I don’t. No, I’ve just said that. But what I don’t like is the way that he was interviewed and the process that went through. I don’t like the idea-

SUSAN         But hang on-

DAVID          Hang on, no, no, just let me finish- John Key has shoulder-tapped one person, put him into that position. We now have in our most secret agency in New Zealand a friend of John Key’s who reports directly to him. John Key is the only person who has democratic oversight over that agency.

SUSAN         And it’s his right. It is his right to select whoever he wants for that job.

DAVID          There is a real problem in New Zealand now with the confidence that we have in our intelligence agencies, and if I was coming into office, I would have a full independent inquiry into our intelligence agencies to restore that confidence, because if we don’t do that we will not be able to hold ourselves up as the transparent nation that we are.

SUSAN         Rebecca Kitteridge has been looking into it.

DAVID          That’s an internal report. I would want this to have a terms of reference that would be agreed by parliament. It would report back to parliament so that we all have confidence in it. It’s something the Australians did a few years ago when there was a crisis in their intelligence agencies, and they’ve had regular independent outside reviews going on. Now, we have the SIS at the moment. The SIS is about to look at its legislation, reform its legislation, and I think that we need to have that independent review before we get to that point.

SUSAN         Much made this week of the Prime Minister’s memory loss. You, of course, have had your own memory loss over that $50,000 US or more, how much was it?

DAVID          I’m not going to say. It’s my family business. I don’t talk about my savings online, but I do-

SUSAN         Tony Ryall said in the house it was a couple of hundred thousand dollars US. Is that correct, or is it more than that?

DAVID          I’m not going to say. It’s my family business.

SUSAN         Didn’t you lose your right for privacy around it when you forgot to declare it? When you broke the rules and did not declare it?

DAVID          No, I absolutely did not. I said that I made an error. I myself came forward and corrected that error. I took it on the chin and said ‘here it is’. And I expect that to be the standard by which all politicians operate if they do make a mistake.

SUSAN         That’s what John Key did this week. He said he’d made a mistake and he fessed up. Exactly the same scenario.

DAVID          I think what John Key was doing this week-

SUSAN         He came forward.

DAVID          No-

SUSAN         Yes, he did. He came forward and he said, ‘Actually, I’ve checked by records and I did call Ian Fletcher.’ He came forward.

DAVID          What he was doing this week was that he was deliberately trying to move opinion away from and deflect opinion away from his friendship and relationship with Fletcher.

SUSAN         Is your problem with this money- Is your problem with this more than $50,000 US in the bank, is your problem that there is so much money there that it would not resonate? You would not resonate? I mean, Michael Cullen very famously called John Key a ‘rich prick’. Are you, Mr Shearer, a rich prick?

DAVID          Look, I worked for my money working for the United Nations in Iraq. I put it in the bank. It’s my family’s savings. I didn’t put it on my pecuniary interest. I declared that and I came forward and I was honest about it.

SUSAN         And you were very well paid in that job, sometimes up to half a million Kiwi dollars a year.

DAVID          No, I think you need to do your research on that, quite frankly, Susan. But, look, working in Iraq, where we lost 25 people, there was a- people do get paid hazard money in those situations.

SUSAN         What’s the money sitting there for?

DAVID          Look, it’s my family- Look, people put money in the bank for any- Look, this is my private savings, my family’s savings. Do you ask John Key what he does with $50 million when he comes on to your show?

SUSAN         John Key actually does have scrutiny over his money all the time. There are reports about how much money he has; he’s on the NBR Rich List – all those sorts of things. So, yes, he does have the same sort of scrutiny.

DAVID          Well, I haven’t heard you asking the same sorts of questions-

SUSAN         I haven’t had him on the programme yet, but when I do, I will ask him. So, are reports that it’s around $1 million correct or incorrect?

DAVID          Look, I am not going to put a figure on it, and I resent the fact that you are asking me to reveal how much is in my bank account. Nobody needs to do that. I have done-

SUSAN         You do need to.

DAVID          I have done what I was obliged to do under parliamentary rules, which is to declare any account that had more than $50,000 in it. I did do that. I regret, obviously, not putting that on my pecuniary interests, and that’s where it stops.

SUSAN         So you’re not a rich prick?

DAVID          I’m- Obviously, as a New Zealander, I’m fortunate, but I’m not in the same league as our prime minster, no.

SUSAN         Tiwai Point – what would you do if you were in government?

DAVID          Oh, look, Tiwai Point needs to be negotiated. It obviously needs the government to have a look and see what it can do.

SUSAN         What would you offer, though? Would you be offering Rio Tinto some sort of extra funding to stay here?

DAVID          Oh, look, I think what we would need to do is take a look at what’s on the table, and I don’t know what’s on the table.

SUSAN         Nothing’s on the table. The government’s pulled it off the table, haven’t they?

DAVID          We don’t know how far apart they are. We’ve only just got indications about that. I think what we need to do, though, is look at the national interests about what this means to New Zealand, what it means to Southland, what it means to jobs. And at the moment the government is not in the business of creating jobs. There are jobs going and for Southlanders obviously they are very, very -

SUSAN         I think you could actually say that the government has played Rio Tinto pretty well on this. And the numbers – let’s talk about them. $250 million a year they pay for power. That’s about a quarter of what you pay for power, of what all of our viewers pay for power. They pay one quarter. They then return about $150 million. Effectively, we’re giving them a $750 million discount. Should they even be here? I mean, what are they really adding?

DAVID          Well, that was what they were set up for, obviously, and they were guaranteed that power for a long time. I mean, you have to play out what does it mean for jobs, what does it mean for the Southland economy, what does it mean for our current account deficit? But the bottom line is you would try to, obviously, secure a deal-

SUSAN         Really? Because those numbers I’m looking at there, there are other things you could do. The power could be in other uses.

DAVID          But you wouldn’t be going into a negotiation with a blank chequebook.

SUSAN         And the government hasn’t. They’ve walked away.

DAVID          Well, the government, what it did, was it was trying to-

SUSAN         The government put pressure on Rio Tinto.

DAVID          What the government was trying to do was actually get the sale of Mighty River Power across the line and reduce the uncertainty around the electricity price. That’s what it was trying to do, and that’s why it went into negotiations. Now, it went into negotiations with Rio Tinto aware that the government was wanting to do that. So it went in with one hand tied behind its back.

SUSAN         Well, they haven’t paid it one cent, which I think would be the public mood at the moment – no mood to give a lot of money to a foreign multi-national. One final question – there is some confusion around Labour, and I’ve been trying to press you during this interview about what you would do differently. So let me give you a specific example. You’re a 26-year-old woman. You’re living in Auckland. You’re earning $65,000 a year. You’re paying off your student loan. You’re renting. What would Labour do for this woman that National is not doing?

DAVID          Well, two things – first of all, we would have a healthy home guarantee to make sure that where she’s living, in the rental accommodation that she’s living in, is actually up to scratch; it’s both heated and it’s insulated. The second thing that we would do is we’re building 10,000 houses, affordable homes, a year, and that would enable her to have an opportunity to get on to the housing ladder. So there are two specific things that I believe that would help that case.

 SUSAN         Thank you for your time this morning.

DAVID          Thanks, Susan.

I like how Labour goes from condemning the Government for negotiating with Rio Tinto on Tiwai Point, to complaining they didn’t secure a deal.

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Gower on Shearer and errors

March 27th, 2013 at 4:00 pm by David Farrar

Patrick Gower blogs:

The full extent of the political damage caused by David Shearer’s “forgotten” stash of cash in an offshore bank account became all too apparent in Parliament yesterday.

That’s because Shearer got absolutely owned by John Key in question time in a classic stones-in-glass-houses scenario. Absolutely owned.

Shearer was trying to pierce the Key Government’s defence that the EQC privacy leak was down to “human error”. Putting it down to a human error wasn’t good enough, according to Shearer.

It was a tactic doomed for failure from the get-go.

Because Shearer himself was just a week before defending “forgetting” to declare a figure that could be anything north of US$50,000 – possibly even US$1 million – in the MPs Register Of Pecuniary Interest.

I have never before seen Key given such an easy hit in the Parliament.

Shearer himself took to his feet and actually uttered the words I was thinking: “This is unbelievable” – although we were both thinking of it for different reasons.

So Key smashed Shearer not once, not twice, but five times from what I saw.

Key’s line was that the EQC worker made a mistake – just like the mistake Shearer claims he made. Over and over and over again.

Was it “human error” that led Shearer to think he could attack Key over “human error”?

This is the real significant of the error in not disclosing the foreign bank account for four years. It negates the ability of the Labour Party Leader to attack the Government over lesser errors.

And highlighting Government errors is a major part of what being in Opposition is about.

Part of the problem for Shearer is that there has been no real explanation of the error. If the explanation was he was aware of the bank account but didn’t realise he had to disclose it – then that would be understandable.

But it seems to be merely that he forgot he had the bank account, despite including it in his tax returns every year.

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Hide complains National too soft on Shearer

March 24th, 2013 at 1:00 pm by David Farrar

Rodney Hide writes in the HoS:

The frightening part for Labour leader David Shearer forgetting to declare his $50,000-plus offshore bank account is National’s response: next to nothing. The Prime Minister said simply that Shearer’s memory lapse was “unfortunate”.

Unfortunate? That’s scary.

The usual political playbook is straightforward: 1. Make the account suspicious; 2. Keep the story alive; 3. Ensure a public inquiry; 4. Bust Shearer.

The political play is best run by an up-and-coming backbencher. Ministers must be seen as too busy running the country to be bothered.

The backbencher doesn’t allege any wrongdoing. That requires evidence. The only concern is perception.

The backbencher kicks off by asking why an MP and party leader would ever need an offshore bank account. “The political leaders who have secret offshore accounts aren’t the sort we usually have in New Zealand.”

The story is kept alive by pressing hard through the media with new questions every day. Day Two: “Mr Shearer must come clean with just how much he has in his secret account.” Of course, Shearer will refuse. Good.

Day Three: Allege it’s over a million dollars.

Journalists do the rest. They put the million-dollar figure to Shearer. If he doesn’t deny it, then a million dollars it is. If he denies it’s a million, the journalists won’t let go until he declares how much it’s below a million. The account’s dollar value is secured easily enough.

A new day, a new question. When did he last use the account? Who put the money in? When and why? Why hasn’t he closed the account? On and on it goes.

The public inquiry is achieved by making a Breach of Privilege complaint. It’s impossible for Parliament’s Speaker to refuse. If failing to declare $50,000-plus in a foreign bank account is not a breach then MPs are free to declare Mickey Mouse or whatever on their register of interests.

The resulting Privileges Committee is media gold. Shearer must front to a committee of senior MPs, most of whom are on the Government’s side. The questioning is in public, on camera. Week after week he must explain to incredulous MPs how he forgot about having tens of thousands of dollars in an offshore bank account but somehow remembered every year when he completed his tax return.

The whys and wherefores of his overseas banking would be dragged out of him. The committee would want his banking records. He would have little choice but to supply them.

I have absolutely no doubt that what Rodney describes is what would have happened if it was a National Party Leader who failed to disclose for four years in a row a foreign bank account.

Rodney has a theory about why:

But National has done none of this. That means only one thing. National want Shearer right where he is: leading the Labour Party into the next election.

Heh. I think that is reading too much into it. I think it is rather not wanting to appear to be too sanctimonious.

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The problem for Shearer

March 21st, 2013 at 11:00 am by David Farrar

The undisclosed bank account is posing some challenges for David Shearer, beyond just the transparency issue.

Stuff reports:

Shearer told Fairfax Media yesterday there was no advantage to having the account and there was “nothing special about it”.

Asked what that said about his financial expertise, given low interest rates in the US and the exchange rate losses he may have suffered from a rising New Zealand dollar, he shrugged and said: “The bottom line is it is there, and I have nothing more to say about it really.”

Banks today also questioned why Shearer would keep such a large amount of money in an account that paid such low interest – maybe 1.5 per cent – when he could earn more in New Zealand.

Shearer had also disclosed a mortgage in the register, which would charge a higher interest rate than the banks paid on deposits in New York.

“Why doesn’t he transfer some across and pay off his mortgage?” Banks asked.

How an MP arranges his or her personal finances should generally be of no concern to the public – it is a private matter. But when due to a stuff up, you force it into the public arena, people naturally get curious. You just can’t help it.

Now some people have got over-excited and have been saying that Shearer has a conflict of interest with Labour’s policy to spend billions of dollars pushing down the exchange rate, as that would allow him to convert his US dollars into NZ dollars at a higher profit.

I’m sorry, but that’s ridiculous and is the sort of paranoia best left to some of the extremists on the left who likewise allege that John Key was asking questions in Parliament on Tranzrail to help their share price, rather than because he was (then) Opposition Finance Spokesperson.

Labour want to waste billions of dollars intervening in the exchange rate because they think it will be popular, not to help their leader make money on currency transactions.

So I don’t think the public will have a bar of the conspiracy theories.

But what the public do understand is paying down your mortgage. It’s something common to most families. You pay much more on your mortgage than you get in a bank, so you always transfer surplus savings against your mortgage.

And what the public will be wondering, even though it is none of their business, is why would you have several hundred thousand dollars in an US bank account, and not use it to pay down or off your mortgage. I mean no one sensibly wants to pay more interest to your bank than they have to.

The only three answers I can come up with are:

  1. You’re financially incompetent and it never occurred to you.
  2. You’re so well off, that saving thousands or tens of thousands of dollars off your mortgage doesn’t matter in the bigger scheme of things.
  3. There is some other reason to want to keep the money in the offshore account.

Have I missed a significant possibility?

Vernon Small also touches on the political side of the non disclosure:

The blunder shows a slackness and a lack of attention to detail unbecoming a prime minister.

Even having the account – rather than closing it quick-smart when he became leader – is problematic.

What of Labour’s views on economic nationalism? What about investing in local enterprises rather than leaving the money at low interest rates to be invested in the US?

And why not close it and bring it back now? Surely not because he is waiting for the exchange rate to move back in his favour? Mr Shearer, currency speculator?

It isn’t necessary to get overexcited by the ramifications of all this to see the potential for political harm for Labour and Mr Shearer.

By far the worst is that at a stroke he has neutralised attacks he could make, come the 2014 campaign, on John Key’s “brain fades”.

It is not hard to see how they will be turned back on him.

Which is worse: forgetting a swift mention of Kim Dotcom in a briefing by spooks or failing to remember for three years in a row your nest egg tucked away in a New York bank?

Labour had a very obvious campaign around Key having so called brain fades. It is now in tatters.

UPDATE: We have has some useful additional possible explanations. The list now is:

  1. You’re financially incompetent and it never occurred to you.
  2. You’re so well off, that saving thousands or tens of thousands of dollars off your mortgage doesn’t matter in the bigger scheme of things.
  3. Deliberately not paying off the mortgage, so he appears “an everyday bloke”
  4. Is writing the NZ mortgage payments off tax as an investment property
  5. Waiting for the exchange rate to drop, before he moves the money back to NZ
  6. There is some other reason to want to keep the money in the offshore account (US itunes purchases?)
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How much was in the undisclosed bank account?

March 20th, 2013 at 11:00 am by David Farrar

Colin Espiner blogs:

I don’t know about you, but I’m forever forgetting about my offshore bank accounts with large amounts of cash in them. It’s a job to remember to tell the IRD about it, let alone to declare them where I might have a conflict of interest. 

But then, I’m not an MP. More particularly, I’m not the leader of the opposition, nor the head of a party that has made something of a habit of calling for the heads of other MPs whose memory has been somewhat imperfect. 

David Shearer claims he “forgot” about his account with Chase Manhattan Bank in New York City when he came to declare his financial interests to Parliament, as is required under the MPs’ Register of Pecuniary Interests.

Well, we all make mistakes, and none of us are getting any younger except policemen. But Shearer didn’t just forget the one time. He forgot four times in a row – 2009, 2010, 2011, and 2012.

To compound matters, though he forgot to disclose the account to Parliament and therefore to the public, he did remember to tell the IRD about it. He also remembered to tell Parliament about his other bank account with Westpac.

Given that only accounts with more than $50,000 in them must be publicly disclosed, it’s highly surprising that this slipped Shearer’s mind. Either the Labour leader is extremely forgetful, or he has a lot more money stashed away than any of us thought.

We don’t know the actual amount, since Shearer hasn’t disclosed that, because he doesn’t have to, but it could be considerably more than $50,000.

I was on NewstalkZB yesterday with Colin, and this issue came up. While $50,000 is a lot of money to overlook, it looks even worse if it is even more than that.  So how much could be in the account? Well it was used to collect his UN pay.

According to the UN, the salary of a senior manager in a Middle East post would be around US$190,000 a year. Now consider that this is tax free, and that when you are on assignment basically all your living and travel costs are work expenses. So the vast majority of your salary can be saved.

Shearer worked for the UN from 1989 to 2000 and 2002 to 2009, which is a total of 18 years. The total UN salary over that period could have been a bit over US$3 million tax free and expense free. To have an account balance of only US$60,000 means you saved only 2% of it. If you saved 20%, then the account might have over US$500,000 in it.

Note I’ve got absolutely no issue with how much David Shearer earnt at the UN – he did good work there. And good on him for saving a lot of it. That’s prudent.

But if you forgot to disclose an account for four years in a row, then there is a credibility issue around how you forgot that is linked to how much was in it.

On the lighter side, enjoy this satire from The Civilian:

The revelation is the latest in a string of surprising admissions from David Shearer that began yesterday after he was suddenly reminded of an overseas bank account he’d forgotten to disclose on the Parliamentary Register of Pecuniary Interests. Since then, Shearer has also remembered that he hasn’t paid taxes in four years, and last week burgled a small dairy in central Wellington.

When asked what he stole, Mr. Shearer replied “Snickers.”

A number of Labour MPs stood alongside their leader at today’s press conference to offer him their support. Not amongst them was backbench MP David Cunliffe, who had volunteered to phone constituents on Shearer’s behalf to let them know of the affair first-hand.

Heh.

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Shearer declared bank account to IRD but not Registrar

March 19th, 2013 at 2:00 pm by David Farrar

Claire Trevett at NZ Herald reports:

Labour leader David Shearer says his failure to declare a US-based bank account with more than $50,000 in it on the MPs’ Register of Pecuniary Interests was simply an oversight. …

Mr Shearer would not reveal how much was in the account, but MPs are required to include accounts with more than $50,000 in them.

He had included his UN pension scheme in the register since becoming an MP, but Mr Shearer said he realised, while he was doing his tax paperwork recently, he had not included the bank account in the register. Inland Revenue had known about the account, for tax purposes.

This is the puzzling part. You are filing a tax return every year where you include the bank account and interest earned, but it never twigs that you should also include that is your Register of Pecuniary Interests.

I am sure it is a genuine mistake, but it is very sloppy.

Prime Minister John Key yesterday would not comment on Mr Shearer’s omission, saying it was up to Mr Shearer.

Could you have imagined what would have happened if the situation is reversed.

We already have the precedent that Trevor Mallard called for Chris Finlayson to be stood down over a non-substantive omission.

If John Key had forgotten to include a foreign bank account, I have no doubt that Labour MPs would be calling him corrupt and a liar. They would be demanding an inquiry into what other bank accounts he hasn’t disclosed, and they would have filed contempt of Parliament charges with the Speaker to refer to the Privileges Committee.

Rather than be a minor story in the Herald (and it seems no mention at all at Stuff), it would be the lead item for at least a week.

Personally I’m glad National MPs are acting like decent human beings and not accusing Shearer of anything. I believe it was a genuine sloppy mistake. But I have no doubt at all that if the situation was reversed there would be hysterical language used against Key by Labour MPs.

Scott Yorke adds a typically humourous touch to the issue:

Labour Party leader David Shearer has moved quickly to discipline one of his MPs for failing to declare a pecuniary interest.

“I expect high standards from my MPs” said Shearer, as he announced that MP David Shearer would be stood down from all duties. …

Labour’s leader said he hoped the move would be a “wake-up call” to members of Labour’s caucus.

“These rules exist for a reason, and we have to take them seriously” Shearer said.

Shearer agreed that the failure by one of his MPs to follow the rules was a “bad look” that “let the side down”.

But he refused to be drawn on whether he would reinstate the MP for Mt Albert after a spell on the backbenches. …

The demoted MP last night refused to comment on the decision by his leader. But he confirmed that he still fully supported David Shearer as leader of the Labour Party.

Heh.

John Banks has also pointed out Labour’s double standard:

Labour Leader David Shearer should apply his own ethical standards to himself and stand down, ACT Leader John Banks said today. 

“Shearer is on record as saying those who suffer from a memory lapse aren’t fit to hold office,” Mr Banks said.

“But yesterday, Shearer admitted he ‘forgot’ to declare more than $50,000 he has stashed away in an overseas bank account.  

“Worse, he didn’t forget once, he forgot four years in a row.   Shearer’s hypocrisy is staggering.    

The Local Electoral Act amendment bill will be debated soon. It was going to be open season on John Banks, but now when Labour point out his failure to disclose, they’ll have their own leader’s failure thrown back at them.

An updated story has John Key saying:

“In the end it’s a matter for him,” Mr Key said today.

“People make mistakes. I make mistakes and when I do, I try and tell people I’ve made them. It’s just that you don’t get cut any slack from the Labour Party when you say you’ve made a mistake, but when they make one they don’t want anyone to have a look at it.”

Again, incredibly mild.

You can vote in my sidebar poll on What are you least likely to forget?

The options are:

  • A 5 second mention of Kim Dotcom in a powerpoint briefing
  • The existence of a foreign bank account with at least $50,000 in it, for three years
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Shearer failed to disclose his offshore bank account

March 18th, 2013 at 1:23 pm by David Farrar

Patrick Gower has tweeted:

David Shearer has corrected MPs Register of Pecuniary Interests after not disclosing United Nations bank account. Says it was mistake.

This means that his declaration to the Registrar has been incorrect for 2008, 2009, 2010, 2011 and 2012.

Mistakes of course can happen, and maybe it only had a trivial amount of money in it, such as $50.

But it would be good to know how material the non-disclosure was and how it was over-looked.

UPDATE: Trevor Mallard blogged in 2010 that Chris Finlayson must be stood down for a minor non-disclosure that year. I can only presume that Mr Mallard regards failing to disclose an entire bank account as far more serious and also warrants a stand down. Also note that the Finlayson incident was entirely technical and non-substantive. What we are still awaiting is how large was David Shearer’s forgotten bank account.

UPDATE 2: NRT on Twitter has pointed out the bank account must have had at least $50,000 in it to be required to be disclosed.

UPDATE3: I/S at NRT has blogged:

 Shearer clearly knows the rules around bank accounts, because he already declares one (a term deposit with Westpac). So he can’t claim ignorance as a defence. If he deliberately tried to deceive the New Zealand public about his assets, then he’s morally unfit to be leader of the Labour Party, or an MP for that matter. But even if we accept his excuse, and ascribe it to sheer forgetfulness (something which I think the New Zealand public would find extremely difficult to believe), then he’s too incompetent for the job. 

Meanwhile, its worth pointing out: knowingly making a false return is Contempt of Parliament, and the argument that this was not knowing requires superhuman credulity. Will Parliament hold its own to account? Or will they once again collude in their cozy conspiracy of silence around these matters?

I’m not as harsh as NRT. I am assuming it is an honest mistake. But it is a pretty big omission, so there is a need for David Shearer to fully explain the omission.

UPDATE4: Cactus Kate has raised an interesting point. Did Shearer declare the bank account to the IRD? If he did not, then that is even bigger trouble. If he did, then how was it included for tax compliance but not for transparency requirements? If every year you are filing a tax return that includes income from the foreign bank account, that should prompt you to remember it for the Register of Pecuniary Interests.

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More clear stances from Labour

March 15th, 2013 at 12:00 pm by David Farrar

David Shearer was on The Farming Show and asked about whether he will go along with Winston’s policy to confiscate the shares of people who purchase Mighty River Power shares.

As before, he won’t rule it in or out. How can you fudge a policy of this magnitude?

But the best is yet to come. David Shearer explain why they are unlikely to buy the shares back because the proceeds from asset sales will be spent on schools and hospitals and they couldn’t afford to buy them back.

That’s a stunning implicit admission that the schools and hospitals would not be affordable without the asset sales. He also agrees that spending money from asset sales on irrigation would be money well spent but warns that most of the proceeds will go on schools and hospitals, not irrigation!

You have to listen to it yourself to believe it.

Later on is also a clip with Larry Williams on the car park tax. Now it is obvious to almost everyone that the Government is going to back down on this tax. So you’d think it would be a simple thing to do and say you will abolish it, if it is implemented.

Larry Williams asks him if he would wind it back – the equivalent of an easy pitch. And the answer is “We’ll certainly look at it”.

The audio is embedded above. If that doesn’t work you can listen to them here. It’s great to have the Labour Party Leader talking about how the asset sales will be used to fund schools and hospitals!

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Such a clear stance

March 13th, 2013 at 3:00 pm by David Farrar

Audrey Young at the NZ herald reports:

Labour leader David Shearer won’t rule out supporting Winston Peters’ policy of buying back Mighty River Power shares at cost if they form the next Government. …

Mr Shearer said, “We won’t rule it out but we won’t rule it in either.” Labour would not be able to make any commitment on it before an election.

Incredible. They are saying we might confiscate your private property but we’re not going to tell you whether we will or not before the election.

No Right Turn is outraged, saying it is “spineless chickenshit” behaviour.

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