Kiwiblog

One of the posters (not commenters) at The Standard posted this over the weekend:

As you can see he calls Fran O’Sullivan a traitor, enemy and sell-out who will be shunned and reviled. This is because Fran dared to support the Crafar farm sale. It shows how demented some of the opponents have become. Redlogix of course cowers behind his alias, and would never ever dare to write such stuff under his own name – unlike Fran.

But as you can see, not content with just having Fran labeled a traitor and enemy to be shunned and reviled, a commentor Millsy calls for her to executed, saying “the likes of O’Sullivan, Key, Williamson, and Coleman will find themselves … rewarded for their treachery with a one way trip to the gallows”.

Now Millsy is just a commenter, and this is not the first time he has advocated violence against those whose political views he opposes. I of all people would say you don’t judge a blog on the basis of a comment by a commenter. I mean, after all it is possible they didn’t even see the comment (I read a small proportion of total comments on KB). If they did, surely they would delete it and at least kick him off?

But no, as you can see Red Logix (who is an author, not a commenter) effectively endorses the comment, saying that while it was a marginal call, it is okay because he said “the likes of” and that Millsy is correct in general.

Fran actually had been contributing to the thread (and kudos to Fran for standing up to people who call you a traitor and enemy) and pointed out that Millsy is Brendon Mills (easily found through Google). Now get this – The Standard deleted Fran’s comment, but left up the one effectively calling for her to go to the gallows!

Fran sums it all up nicely, with this tweet from Fran:

The Standard? Internet version of the Ku Klux Klan. Happy to string up people behind web cloak of anonymity.

There is a reason so many of their authors (not all) wear virtual hoods to hide their identities.

Fran O’Sullivan writes in the NZ Herald:

It seems pretty obvious that the ports company has been determined to ensure productivity at its downtown Waitemata Harbour operations is markedly increased. Particularly in the vital area of crane productivity, where rival Port of Tauranga sub-contracts its container stevedoring work and boasts a superior performance to its Auckland competitor.

If the Maritime Union didn’t see this one coming, then they haven’t been paying much attention to the Ministry of Transport report on container productivity at New Zealand ports. Nor has the union been paying attention to the Productivity Commission which estimates exporters and importers spend upwards of $5 billion a year on freight and has forecasted annual trade could be boosted by $1.25 billion if transport costs were shaved by 10 per cent. There is a national interest issue at stake here.

$1.25b if costs are down 10%. The Ports of Auckland are definitely working in the national interest if they can make themselves more efficient.

I note the Port of Tauranga sub-contracts its stevedoring work out. Maybe that sub-contractor could apply to do the work for Ports of Auckland also?

Fran O’Sullivan writes in the NZ Herald:

In his bones, Key will know that in the longer term the partial privatisation policy will prove very popular indeed, particularly if the sales are sweetened with a sprinkling of “popular capitalism”.

Australia’s Queensland Government – run by Labor’s Anna Bligh – did just this by offering incentives to mum and dad investors in a highly successful string of assets sales.

There were no brokers’ fees, a specified maximum price per share and a loyalty bonus to incentivise small shareholders to hold on to their shares, as well as a free parcel of shares for relevant workers; particularly with the float of Queensland Rail (now QR National) – the second largest IPO in Australia’s history.

 People did not like Telecom and NZ Rail being sold off entirely to large foreign corporates. But the floats of Auckland Airport and Contact Energy to local investors were actually relatively uncontroversial at the time.

But on this side of the Tasman, Labour leader Phil Goff – who was an integral member of the David Lange Cabinet that privatised many state assets – is hell bent on re-erecting Fortress NZ.

What I dislike about Goff is that he reneges on policies he previously promoted when he believes he can score a naked political advantage.

Hence at the 2005 election he blithely stood by while a fellow Cabinet minister made untrue allegations that the United States was writing New Zealand’s policy even though he knew full well that an American slagged off as a National “bagman” had partially under-written a New Zealand lobbying programme in the US capital.

The same bagman who has been our most generous donor to the arts. What shameful treatment.

So when Goff gets all pumped up and red-faced and hyperbolic, Key only has to dip into the recent history books to underscore the Labour leader’s hypocrisy.

In fact, the partial asset sales will provide an investment home for KiwiSaver providers, the NZ Superannuation Fund, iwi and retail investors. They will also release capital for the Government to reinvest in much needed new infrastructure and to help get the budget back into the black.

Labour is going into an election campaign which they say they want to fight on asset sales, yet their leader was once the most enthusiastic advocate for. Do they really think they will get much resonance?

NBR carry an NZPA story on Winston’s latest claim:

Overseas ownership of New Zealand news media outlets is in the political spotlight, with New Zealand First leader Winston Peters saying it has eroded journalism standards.

A traditional opponent of overseas ownership, Mr Peters told NZPA he was concerned about the profits of domestic media, banking and forestry companies going off shore.

“It has also led to serious erosion of media standards and journalism reporting because people are given no time to do any work properly, instant sound bites have become the name of the game, and that is sliding its way into tabloid journalism,” Mr Peters said.

International companies that owned New Zealand media outlets had failed to support investigative journalism and had “squeezed the professional capacity” out of the industry, he said.

“I’m the last one in the world that should be making a sympathetic argument for the journalists of this country, but I’m telling you that’s exactly what happened.”

Proper investigative journalism was essential for the democracy of a nation, Mr Peters said.

Now normally I ignore what Winston says, but the irony here is too great. I actually agree we need more investigative journalism, but we do have some sterling examples of good investigative journalism by Fairfax and APN journalists. Namely the superb work done by reports Phil Kitchin, David Fisher, Audrey Young and others in exposing the tissue of lies Winston told about the funding of NZ First and himself by various wealthy businesspeople. It was investigative journalism at its finest and exposed Peters as a charlatan whose reality was the direct opposite of what he railed again.

The comments thread on the NBR story has some superb contributions, such as Phil Kitchin:

Attended the annual Herald’s Mood of the Boardroom breakfast yesterday. A big crowd gather to hear the results of the survey by Fran O’Sullivan, plus speeches and Q&A with the Finance Minister and normally the Opposition Spokesperson. For some reason David Cunliffe couldn’t attend this year, which was a pity.

Around 350 CEOs took part in the survey. Now before anyone states the obvious, no of course they are not a representative sample of New Zealanders. But as a group they manage a greater share of the economy than the Government does, and their view on business conditions determines whether or not billions of dollars of investments and purchases occur. So I regard it as a very good group to get views from.

Some of the findings were:

• 79% support there being a Regulatory Responsibility Act
• 70% support mining on the conservation estate, so long as conservation values are retained or restored
• 62% are focused on reducing energy costs
• 60% support foreshore & seabed reform
• 76% want ACC opened up to competition
• 58% want the NZ company tax rate to be below Australia’s
• 57% support partial listings of some SOEs on the NZX

I found it interesting that partial sales of SOES had the least support, even though still a majority.

The budget was rated 3.63/5 (think 73%) as a solid foundation for future growth, 3.8 (76%) as business friendly and 3.92 (78%) as making the taxt system fairer.

The eight top ranked Ministers were:

• John Key 4.58
• Steve Joyce 4.50
• Chris Finlayson 4.47
• Tony Ryall 4.09
• Simon Power 4.08
• Judith Collins 4.08
• bill English 4.06
• Jonathan Coleman 4.03

Individual Labour spokesperson were not ranked but 98% of CEOs said Labour’s leadership has yet to begin carving out a credible alternative to the Government.

The top ten domestic issues of concern (out of 10) were:

1. Labour productivity 7.2
2. Regulation 6.9
3. Skills and labour shortages 6.9
4. Level of govt spending 6.9
5. Adequacy of infrastructure 6.8
6. NZ dollar level 6.7
7. Wage increases 6.4
8. ETS 6.2
9. Level of NZ Govt borrowing 6.1
10. Access to capital 5.9

The top ten international issues affecting confidence are:

1. Instability in capital markets 8.5
2. Protracted global recession 8.4
3. Level of borrowing by govts 8.0
4. Strength of US recovery 7.7
5. Exchange rate volatility 7.7
6. US dollar value 7.2
7. Competition for global talent 6.5
8. Protectionism 6.3
9. Commodity prices 6.2
10. Global inflation 6.2

They also ranked the two leading candidate for Mayor on several attributes on a 1 to 5 scale

• Leadership skills – Banks 3.47 v Brown 3.06
• Puts interest of Auckland over political alignment – Banks 3.33 v Brown 2.74
• Vision and strategy – Banks 3.33 v Brown 2.99
• Management – Banks 3.27 v Brown 2.63
• Experience – Banks 4.11 v brown 2.84
• Judgement – Banks 3.26 v Brown 2.51
• Trustworthiness – Banks 3.37 v Brown 2.86
• Ability to form support within Council – Banks 2.98 v Brown 3.15
• Economic management – Banks 3.65 v Brown 2.56
• Courage – Banks 4.30 v Brown 3.46

But 50% of CEOs want a new candidate to also enter the race.

Also 85% of CEOs support compulsory superannuation, as in Australia.

And ratings of various aspects of the budget:

• Closing loopholes for Working for Families 4.73
• Increase in GST 4.44
• Personal tax cuts 4.24
• Corporate tax rate cut 4.21
• Aligning top personal and trust rates 4.09
• Change tax treatment for LACQ’s 4.06
• Axe depreciation for residential housing 4.01
• Cuts to savings vehicle tax rates 3.95
• Reduction in thin cap threshold from 75% to 60% 3.63
• Ace depreciation on commercial buildings 3.17
• Axe 20% depreciation loading on new assets 3.16

Fran O’Sullivan writes:

John Key’s refusal to postpone the implementation of the next phase of the emissions trading scheme (ETS) is setting the scene for a ‘winter of discontent’ with New Zealand business.

In just two days the perception of the Key Government as a climate change laggard has morphed into an unwitting climate change leader as our major trading partners, like Australia and the United States, prepare to defer their own schemes leaving this country out in front of the pack instead of the “fast follower” the PM promised.

The decision by Kevin Rudd to delay his ETS until 2013 does place pressure on NZ. It is almost ironic that National is at risk of accidentally achieving Helen Clark’s aim of being a global leader rather than a fast follower in terms of responses to climate change.

Of course the Australian ETS has never been passed into law – it is easy to delay something not yet legislated for.

The NZ ETS was passed into law by Labour in 2008, and them amended by National in 2009. It is already in effect for sectors such as forestry.

The Auckland Regional Chamber of Commerce has been adding fuel to the fire by asking its membership to email Key directly to ask for the July 1 cost hikes to be deferred.

The chamber reckons it will increase electricity prices by 5 per cent and add 4c a litre to the cost of petrol and diesel. Its boss Michael Barnett reckons the cost hikes will jeopardise the profitability of small to medium businesses as they get back on a growth curve after the lengthy domestic recession.

I’ll have to read the ETS legislation to check, but am unsure whether or not the Government can defer the entry of those sectors, without amending or repealing the ETS law. If a law change is needed, it couldn’t realistically be done by 1 July.

Fran O’Sullivan writes:

Australia now earns more than A$1 billion annually from exporting uranium ore concentrate. By 2014, that figure is expected to be A$1.7 billion.

There are tight controls: Australian uranium is produced only for export and is used only for peaceful purposes in civil nuclear power stations outside of Australia and is trumpeted as a contributor to global climate relief.’

The reason Australia doesn’t have a suite of nuclear power stations is it burns cheap coal for power.

But NZ is stuck in a 1980s cul de sac: Nuclear equals bad.

Secondly, is the PM now expected to order the administrator of his blind trust not to invest in any company that could be mining uranium simply because New Zealand has anti-nuclear laws?

If so, that rules out many companies with diverse interests. Bizarre really.

I thought it was bizarre. Nuclear power is indeed a way to reduce carbon emissions, so wy the fuss over the PM having shares in a company that helps reduce carbon emissions.

The EU had a reception at the Backbencher last night, so lots of MPs and journalists there to chat to.  The typical opening line from a National MP was “So about that B grade” while from Labour MPs it was “Unlike Annette we won’t use Farrar and respect in the same sentence unless there are some other words in between”

Phil Goff was there also, so I said I looked forward to him quoting me more often in future . Actually had an interesting chat generally on economic stuff, such as land tax. If Labour are bold they could consider proposing a land tax (tied to income tax reductions) for 2011. That could attract some support from economic reformers.

General consensus I got from pundits there was that there was definitely some good stuff in the Government’s work plan – in fact more detailed plans that most Governments announce in the PMs statement.

But what may trip the Government up is they misplayed the expectations game. Building the statement up as the “most important” one ever was a mistake, as was talking about it being a “step change”. Again, there is some good stuff there that certainly will help lift economic growth. But will the announcements alone close the gap with Australia? Of course not. But the rhetoric leading up to it, got expectations artificially high.

With the benefit of hindsight, it would have been better to have positioned the statement as a typical PMs statement – a general overview of the Government’s achievements and workplan, and then surprise the media and opposition when it turns out to have close to 30 specific initiatives in it.

As I said yesterday, I welcome the focus on growing the economic cake, not just how to split it up, and look forward to more details in the budget.

Reaction from others:

• John Armstrong – 4/10 for economic boldness
• Fran O’Sullivan – John Key deserves an A- for intent. But a mere D for the dreadful prime ministerial statement that buried a coherent economic agenda in a mass of confusion.
• Tax Working Group members seem happy
• NZ Herald editorial calls it a stutter not a step-change
• Bernard Hickey hits new levels of hyperbole
• Canterbury Employers call the package welcome but light
• Solid Energy is excited
• Colin Espiner gives it a pass, but with much more to do
• Tracy Watkins looks at the risks
• The Press editorial says it was lacking boldness
• The Dom Post editorial says it was a welcome focus on growth, not slogans

Fran thinks big:

Instead of tilting at windmills, the dairy industry should think big.

If cows are housed indoors for much of the time, their poop can easily be captured for commercial biogas.

And while they are about it, why not invent a gas exchange system to extract methane from the air inside cowsheds.

We could even follow the Swedes and run a railway on biogas produced from digesting the parts of cows that usually get discarded at slaughterhouses to extract residual methane.

The big upshot is our tourism industry will also be protected. And I will get my fishing back.

Is this genius or lunacy? Or both?

The moment there is a small upturn in the economy, Labour is already pushing for a splurge o Government spending. This is reckless, and fiscal restraint is needed for not just a year or two, but probably a decade. Brian Fallow explains:

The net effect of a reduced tax take and much higher public spending will have given a boost roughly equivalent to 6 per cent of gross domestic product over the two years to June next year.

That was entirely appropriate.

But the recession’s legacy of a shrunken tax base, a string of deficits and mounting debt servicing costs will cast a dark and cold shadow over next year’s Budget. …

It will be 2016, if we are lucky, before surpluses return, and every year in the red adds to the public debt burden.

It is a recipe for interest costs to eat up more and more of the future tax dollar, well before the echo of the baby boom sends health and superannuation costs through the roof. It is not sustainable.

Spending needs to be restrained, and to shrink as a proportion of the economy.

Fran O’Sullivan writes:

It doesn’t want to “rip the guts” out of the Government’s expenditure line. But if the Government holds new Budget spending to a constant $1.1 billion increase each year, over time this will have the effect of pulling Government spending back down towards 30 per cent of GDP and, in Key’s words, “force change through the system”.

This is around half the new spending that Labour had, and keeping spending increases to this level for more than a couple of years will be pretty bloody difficult. But we do need to get Government spending down to under 30% of GDP.

And Colin Espiner reports:

The Government remained committed to a new spending limit of $1.1b and was investigating a total spending cap, English said.

Total Crown spending is expected to reach $65b this year and rise by about $3b each year.

“Demand-driven” expenditure such as health and education, benefits, superannuation and KiwiSaver payments are not currently included in the Government’s sinking lid on public spending.

Under a total cap, any increases in expenditure would have to be offset by cuts in other areas or approved by the Cabinet. English said he was looking at “better and more coherent methods of knowing where spending is occurring and what the alternatives are”.

The Netherlands and Sweden had spending caps, he said. “We’ll be talking more about that in Budget 2010.”

I think the Fiscal Responsibility Act should be amended so that the Government has to set a target (like it does for CPI for the Reserve Bank) for spending as a percentage of GDP and for what level of surplus is desired. This would require political parties to be more transparent about what they propose. If Labour wants to spend an extra $6 billion a year, then they’ll have to be open about it, and let people see the consequences.

Fran lets loose:

John Key’s celebrated faux pas at his first National Party conference as leader (“Under a Labour Government I lead … ) was portrayed as simply an inadvertent slip born out of nervousness.

But after Key’s outright panning of the Don Brash-led 2025 Taskforce report his 2007 slip-up is starting to look almost Freudian.

What I would like to know is how the Government thinks it will close the gap with Australia, if it does not adopt some of the recommendations of the 2025 Taskforce. The gap will not close by magic. Action is needed, not rhetoric.

Brash and his four taskforce cohorts: former Labour Finance Minister David Caygill, Wellington economist Bryce Wilkinson, Icebreaker CEO Jeremy Moon and Australian Productivity Commission part-time member Judith Sloan, were deliberately cute in delivering Key and English a ready rationale for cutting spending back to 29 per cent of GDP.

This after all was the level of core Government expenditure registered in 2004-2005 before former Finance Minister Michael Cullen opened the floodgates on social spending.

All it required was for Key and English to start taking the axe to some of Labour’s sacred cows, urgently review some major spending programmes, and get serious about setting measurable goals to turn this economy around.

No one is underestimating the political difficulties in making such substantial change. But unless substantial change is made, New Zealand will not catch Australia. Ever.

The 29% goal is not politically possible by 2012, but that is no reason not to have it as a longer term target. Or to have a slightly higher target. Or something. What is not acceptable is having no target. I want both National and Labour to say what their target is for spending as a % of GDP, and for them to offer different targets so we have a choice.

A factor which English seemed to concede yesterday by saying the 2025 goal was merely “aspirational”.

Aspirational means they did not mean it.

Problem is the top Government duo reckons its options are constrained because they don’t want to break National’s 2008 election pledge to keep Labour’s own big-ticket election bribes such as interest-free student loans and the expansion of Working for Families which Key had demonised as “communism by stealth”(before the 2005 election).

And I accept no breaking of election promises. But that doesn’t mean the other recommendations can’t be implemented, and it also doesn’t rule out National having a more flexible set of policies for 2011.

Fran compares John Key to Barrack Obama, and not in a good way!

The “Mr Nice Guys” like Prime Minister John Key – and US President Barack Obama – who have soared high on the basis of personal popularity and feel-good vibes – are now finding out the hard way thatthere is more to making a good political hamburger than mere sizzle. …

Less than one year into his reign as New Zealand Prime Minister, Key’s popularity – like that of his party’s – is rocketing high in the opinion polls.

Much more so that Obama incidentially. Obama has only a net 11% positive rating, and the Democrats are polling only 4% ahead of the Republicans nationally.

Like Obama, Key has succeeded in one critical area: changing “the vibe” around his nation’s capital. Like Obama he is perceived as a Mr Nice Guy in large part because he is not his predecessor: Helen Clark in Key’s case, or George W. Bush (Obama).

That is a fair point. Of course John Key hasn’t won the Nobel Peace Prize simply for not being his predecessor!

It is a political truism the crucial strengths that underline a leader’s popularity are also their weaknesses.

Key – like his alter ego – is now in desperate need of the vital machine skills to ensure his Government does make progress on controversial flagship policies.

Key will be hoping he doesn’t have another week like the last one. The public are fairly forgiving of stuff ups, if they are corrected quickly. But if they start to form a pattern, then confidence gets shaken.

Fran O’Sullivan had what I consider a really good idea, during her speech on political blogging yesterday.

Part of the discussion was around the increasing commercial pressures on newspapers, and their diminishing resources to do investigative journalism etc.

Fran said she thought it was very unbalances that the Government (taxpayer) funds some media through NZ on Air, but this is restricted to broadcasters only.

She advocated that NZ on Air should become NZ on Media, and all media should be able to apply for worthy “local content” projects whether they be TV, radio, print or Internet.

I think that is a concept with some merit. First of all it does make for a more level playing field. But also because a contestable funding pool for print (and Internet) journalism could help turn around the decline in quality research intensive journalism (which is often not commercially viable).

Now as print and Internet has much lower costs than broadcast, I don’t think opening up the field, would lead to a huge amount of money being drained from the broadcasters. Maybe a couple of million out of the tens of millions they grant every year.

Note this is not about increasing the total amount of funding for NZ on Air, but increasing the range of eligible applicants.

Someone like No Right Turn could (for example) have applied for a grant for his research and series of posts on the sedition laws (which helped lead to the law being unanimously repealed).

A newspaper could apply for a grant of say $25,000 to allow a journalist to spend three months working on a story about (for example) the immigration system.

There would be some challenges such as editorial independence, but I think it is a proposal worth considering. Why should TV and radio retain exclusive rights to NZOA funding?

It is worth mentioning that NZ on Air does sort of fund stuff on the Internet – the very worthy NZ on Screen archive of iconic NZ TV shows. However that is funding Internet storage and access of TV shows, which is different to funding contemporary material regardless of medium.

Fran O’Sullivan addressed several dozen people at breakfast this morning on the topic of the Accidental Empire of Political Blogging. Rural Women NZ hosted the breakfast.

Fran was mainly positive about the impact political blogging has had in NZ, saying the diversity is useful, as is the competition for the media to some degree.

She did have some criticisms, such as accuracy and fact checking, and most of all political bloggers who blog anonymously. Her big call was for more political bloggers to post under their names so there is some accountability for what they say – as journalists have.

She was full of praise for Red Alert and said it has obviously replaced The Standard as the most influential and useful blog on the left.

Whale Oil got a mention with praise for his willingness to savage members of his own party (she joked that his father must be glad he has a life membership that can’t be revoked) but said she thought the pre-election scuttlebutt on Damien O’Connor was a serious error of judgement.

Lots of questions and discussion ranging from has a blogger been sued yet, to press gallery membership. Fran nicely refers to the gallery as a cartel

Was a very good breakfast and even better drinks afterwards, finally escaping around 10.30 am!

I’m not a woman, or rural, but am attending a breakfast meeting of Rural Women New Zealand to hear Fran O’Sullivan talk on “An Accidental Empire: The Rise of Political Blogging and its Effect on Conventional Media.”

Other interested people are welcome to attend:

Speaker: Fran O’Sullivan

Topic:        An Accidental Empire: The Rise of Political Blogging and its Effect on Conventional Media.

RWNZ is delighted to have special guest Fran O’Sullivan – a columnist for the New Zealand Herald – speaking at this month’s breakfast meeting on the rise of political blogging. Fran’s expertise is in politics and business. She was labelled a “right-wing blogger” by Helen Clark – but has yet to launch her own blog.

Date: Tuesday 29 September

Time:        7.15am – 8.15 a.m.

Venue: D4 on Featherston Street
Level 1, 143 Featherston St
Wellington

Breakfast:  There is no charge for attending RWNZ breakfast meetings. A D4 Breakfast Special costing $12 has been arranged for this occasion. The Special includes bacon, a choice of eggs on toast, and tea or coffee and juice. Or, you can order a continental breakfast with jam and marmalade served with juice, tea or coffee for $12. If you have a little more time, you may wish to order from any of the full range of dishes available on D4’s superb breakfast menu which can be viewed at www.d4.co.nz/menu

Please RSVP to Noeline Holt: noeline.holt@ruralwomen.org.nz

or Tracy Galland: tracygalland@xtra.co.nz

Fran O’Sullivan is not impressed if Labour is only going to apologise for shower and lightbulb restrictions:

Fessing up to an unhealthy preoccupation with Nanny State might buy Phil Goff a few brownie points with bored news media looking for a headline at Labour’s first post-election defeat conference tomorrow.

But seeking redemption for such egregious – but ultimately inconsequential – policies like trying to force Kiwis to adopt eco bulbs, or, switch to barely dribbling shower heads, or, stop smacking kids is sublimely absurd.

Only in New Zealand could a leading politician fall prey to the erroneous belief that this factor alone cost the ruling Labour Government and its cronies the last election.

They were a factor, but I agree not the dominant one.

The Labour leader could start with offering up an apology for his party’s savage assault on democracy, the Electoral Finance Act, which it had the gall to steamroller into existence after being caught red-handed ripping off the taxpayer to the tune of hundreds of thousands of dollars to fund its 2005 election campaign.

To be fair to Goff he has admitted they got parts of the EFA wrong and voted to repeal it. But an apology at his party’s conference would carry sincerity.

He could follow that with another mea culpa for an even more egregious matter – Labour’s economic policies – which had the effect of driving this country into recession fully nine months ahead of the Lehman Brothers collapse which heralded the beginning of the global financial crisis.

I think Fran will be disappointed here.

And the three-ring circus called Winston Peters that Labour continued to inflict on New Zealanders from ministerial heights long after journalists exposed the extent of his secret big-business backing.

This for me is probably the most important one. Their defence of Peters was disgraceful, and voting against the Privileges Committee recommendations was a shameful act. I don’t think one could ever take Labour serious on issues of electoral funding transparency after their pandering to Winston.

And Helen Clark’s con act that positioned New Zealand as a leader on combating greenhouse gas emissions when it did nothing on that score till weeks before losing power.

And gross emissions relative to 1990 under Clark rose faster than the US under Bush.

Goff’s real challenge is to break out of the robotic style that has become his political leitmotif; stop contaminating his leadership style by authoring personal attacks on other MPs which fail at the authenticity stakes. And to stop playing situational politics with the US on defence issues like Afghanistan and get back into the main game.

He should get National to a climate change deal that will ensure a real reduction in emissions rather than simply allowing Kiwis to trade out of their responsibilities – and take some political credit.

It will be interesting to see if Goff can deliver his caucus on such a deal. I am unsure that he will be able to.

An insightful column by Fran:

But with China poised to overtake the United States within a decade as the world’s largest economy, it is no surprise that the implications of China’s rapid economic rise were given considerable focus during New Zealand and Australia’s first joint Cabinet meeting in Sydney eight days ago.

Herald inquiries indicate Rudd went to considerable lengths to outline why the two Australasian countries should move closer together at a strategic level through maintaining “close foreign policy settings” during a lengthy overview he gave as co-chair of the joint Cabinet.

The issue barely rated a mention in the two prime minister’s joint press statements. But Herald inquiries indicate that Rudd strongly positioned the impact of China’s rise on Australasia during a lengthy strategic overview.

Several Cabinet Ministers from both sides privately credit the “risks based” analysis – above all other factors – as paramount in the Rudd Government’s decision to focus on New Zealand’s strategic utility to Australia, by moving to finalise single economic market negotiations by 2015. And to increase military co-operation to protect (if needed) supply lines between Australasia and the region during possible fractious times ahead.

This would explain why Australia has gone from luke warm to highly receptive on the move to a single economic market.

For most of our existence our location has been a barrier economically. In the next century, we may find being so close to Asia is a life saver. The US economy, and to a lesser degree the EU, could struggle to match Asian economic power in a few years.

Under this scenario, Australia – as a country with “middle power” pretensions – will increase its regional impact by drawing New Zealand further within its own strategic sphere of influence.

This is where NZ needs to be a bit careful. While I am fully supportive of closer economic ties with Australia, we must not lose our identity. NZ is generally held in higher esteem than Australia with most Asian countries – partly because we are non-threatening, but also because we have never been seen as the US Deputy Sheriff.

Rudd – who thinks deeply about strategic issues – believes that unlike previous downturns, Australia and New Zealand cannot rely on American consumers to quickly refuel global economic growth through another debt-fuelled spending binge. Both New Zealand and Australia thus needed to focus on how to sustain their respective economies.

Both prime ministers share the belief that it is in the countries’ interests to strongly brand Australasia as an investment destination focused on quality products and lifestyles, and, are concerned at the upcoming “war for talent” implied by changing demographics.

Key, in particular, sees a future where both nations will have to pay “near global price” to attract and retain highly-skilled people such as doctors, lawyers and engineers.

By drawing closer together the two “Europeans in Asia” will be able to more strongly position themselves as the Asian century develops.

This makes us closing the gap with Australia even more important. You want to keep doctors, lawyers and engineers? Well maybe then allowing mining on 0.0001% of the conservation estate is not the end of the world.

Fran O’Sullivan writes:

The Government will soon launch a Productivity Commission designed to run its ruler over key sectors in the NZ economy and advise on initiatives that might ultimately help bridge the income gap with Australia.

The proposal for a Productivity Commission has grown out of the post-election agreement National and Act made for a “high quality advisory group” which would be tasked with the challenge of investigating how NZ would close the income gap with Australia by 2025.

I think a productivity is one of the most important things we can do, for increasing long-term growth. The Australian equivalent is one of the reasons they have done better economically – for them reform is not just something that happened in the 1980s, but has been an ongoing work programme under Hawke, Keating, Howard and now Rudd.

One of the first initiatives for the new Productivity Commission should be to examine why New Zealand has so many ports.

Ports productivity is a major issue – for both exporters and importers – given NZ’s distance from markets. Just two NZ ports have agreed to transparently provide benchmarking data to overlay on the Australian Productivity Commission’s benchmarking studies in this area – other ports declined to participate.

Given the fact that Australia is New Zealand’s biggest export market, it is important to get ports’ efficiency increased.

That does sound like a good first project.

It is still unclear who will chair the commission.

Minister for Regulatory Reform Rodney Hide favours former Reserve Bank Governor and now company director Don Brash.

Economically my views are very close to Don Brash. From an economic point of view, I think he would do a great job.

But, and this is a big but, the sucess of the Australian Productivity Commission is that it has been supported by both the Coalition and the ALP. Sure they don’t agree with every recommendation, but they recognise its importance and don’t try and demonise and undermine the Commission.

Getting NZ Labour to support a NZ Productivity Commission will be difficult enough. However Goff and Cunliffe are more moderate than Clark and Cullen, and I hope they will be constructive towards it. Just because it will sometimes recommend unpalatable reforms is not a reason to silence or marginalise it.

And this is where politically having Don as inaugural Chairman may be inadvisable. It would almost guarantee Labour’s opposition to it. And in most cases I wouldn’t care about that. But I have heard multiple times that the success of the APC comes down a lot to the bipartisan support for it.

The Australian Productivity Commission’s work programme gives some insights into the type of issues that the New Zealand commission could be invited to examine.

The Australians are examining the relative performance of the public and private hospital systems looking into comparative hospital and medical costs for clinically similar procedures.

It is examining Australia’s anti-dumping system, executive remuneration, the contribution of the not-for-profit sector and gambling.

They all look interesting topics. I would be most interested in a study of gambling from an economic point of view.

Fran O’Sullivan says the allegations that Richard Worth promised appointments for “favours” were so serious they should have gone to an inquiry.

Key should not be allowed to get away with ducking his own basic democratic responsibility to ensure a “favours for jobs” allegation that casts doubt on the integrity of his Government is tested.

Mrs Choudary could always file a complaint with the Police, as I suggested, as what she alleges is a crime under s107(1) if the Crimes Act

Corruption and bribery of Minister of the Crown

(1) Every Minister of the Crown or member of the Executive Council is liable to imprisonment for a term not exceeding 14 years who corruptly accepts or obtains, or agrees or offers to accept or attempts to obtain, any bribe for himself or any other person in respect of any act done or omitted, or to be done or omitted, by him in his capacity as a Minister or member of the Executive Council.

Maybe Phil can help her with the complaint.

No one emerges from this affair unscathed. In Goff’s case, his campaign looks decidedly shabby. First, another senior Labour Party official identified Choudary by leaking telling details about her. Then, secondly, right-wing bloggers chipped in with revelations about the immigration scams her husband, Kumar, orchestrated.

Toss in the additional factor that one of Kumar Choudary’s victims alleges he has since been offered a $15,000 hush payment by associates to shut up about the pair and this whole episode is starting to take on very serious connotations.

The reality is that Goff tabled no real evidence to support his allegation that Worth tried to entice the “strikingly beautiful” Choudary (Goff’s description, not Worth’s) with the offer of a job on the Lottery Grants Board. Even the allegedly saucy texts that have been published by the Labour leader give the appearance of little more than an obsession.

They are not sexually explicit. They do not corroborate the most serious allegation against Worth – that he was prepared to use political patronage for favours.

Fran also criticises Key:

After Key’s own ham-fisted announcement of Worth’s ministerial “resignation”, the MP was subjected to a ceaseless barrage of innuendo from both Goff and Key as they shamelessly plumbed Worth’s peccadilloes for their respective political advantage.

Both political leaders need to grow up. New Zealand is surely not Malaysia, where a political opponent (or even a former colleague) can be drummed out of Parliament or jailed without a fair go. Or is it?

List MPs can be – they basically serve at a party’s pleasure. Electorate MPs are very different.

At the weekend I blogged agreement with Fran O’Sullivan that the Police inquiry into Don Brash’s stolen e-mails was a disgrace (and headed by the same officer who cleared Labour of ther $400,000 overspend in 2005 despite it being an offence of strict liability!).

However I disagreed with her that John Key and Judith Collins were somehow being unhelpful by not ordering an inquiry, pointing out the Police Act explicitly prevents the Minister of Police from giving directions over the investigation and prosecution of offences. You can be sure if that clause did not exist there would be new inquiries into Labour’s 2005 overspending!!

Whale Oil originally agreed with me, but now has done a backflip, saying that in a word first, he is wrong. He says:

In fact, Fran was right and I was wrong.

According to the Cabinet Manual and the Department of Internal Affairs’ very useful document “ Setting Up and Running Commissions of Inquiry“, any Minister, including the Police Minister, can set up a Commission of Inquiry. Commissions of Inquiry can inquire into any matter of major public importance or concern to the government of the day. Any Minister may propose an inquiry, but must consult the Prime Minister and the Attorney-General first, prior to submitting the proposal to Cabinet. Before giving its approval, Cabinet should seek advice form the relevant Minister’s office, the relevant department, DPMC and the Crown Law Office. …

PS. Over at Kiwiblog, Farrar made the same mistake. Will he admit he was wrong, and join WOBH’s call for an inquiry?

But I disagree with Whale. Neither the Police Minister nor the Prime Minister can set a Commission of Inquiry. The Cabinet as a while has to agree.  Fran said “It is within Key’s powers to direct an independent review of the police investigation” and it simply is not. The PM is not the Cabinet, and Cabinet have been known to over-turn PMs (except Muldoon). Lange for example often lost at Cabinet.

You can argue that Fran was right in saying [Police Minister Judith Collins] “has not asked for a review” but this implies her status as Police Minister allows her to do so. It does not. Sure she can ask the Cabinet for a commission of inquiry, but if you take it literally, and member of the public can ask for a review. The implication was that Collins had some special power to get a review. She does not.

Now people may say, why not a full Commission of Inquiry? Well 4.83 of the Cabinet Manual says:

While it is appropriate for inquiries to investigate instances of impropriety, they should not cut across the role of the police or the role of the courts in determining criminal or civil liability.

Now you could argue for a Ministerial inquiry – but they have no powers to compel witneses to tell the truth, so would be useless.

So I stand by my original post – neither Key nor Collins have the power to inquire into the Police investigation. I have little doubt both would love to know who stole the e-mails.

Nicky Hager has said that he got the information from six National party sources, all concerned about the party under Brash. I have always thought that beyond improbable. No one from National would choose to give e-mails to Hager, as oppossed to say the media. And while one can never rule out one disaffected staffer, the fantasy of six people all leaking to Hager is well a fantasy.

But here’s a challenge to Nicky. If he stands by his story, why doesn’t he agree to do a Deep Throat and pledge he will reveal how he got the e-mails in x years, or have the so called sources reveal it in their wills. Then one day the truth will be known.

Fran O’Sullivan writes:

Police HQ have repeatedly thumbed their nose at the former political leader by assigning a hopelessly inept cop (when it comes to prosecuting politically aligned crimes) to take charge of the investigation. The top cop was allowed to get away with tarrying for the best part of a year before getting down to business, then refusing to release the full file of his on-again off-again investigation.

The investigation was almost as pitiful as the investigation into Labour’s 2005 overspending.

Brash has had no help from Prime Minister John Key. It is within Key’s powers to direct an independent review of the police investigation. But though he was the direct beneficiary of Brash’s downfall he is reluctant to give the case oxygen.

Ummn which power is this?News to me that the PM can direct a review of a police investigation.

Brash has had no help from Police Minister Judith Collins either. Collins was Brash’s close political chum during the dying days of his leadership when it seemed as if he might just survive. But she has not asked for a review.

In her well intentioned sympathy for Don Brash, Fran has over-reached. I refer people to the Policing Act 2008, specifically s16(2):

The Commissioner is not responsible to, and must act independently of, any Minister of the Crown (including any person acting on the instruction of a Minister of the Crown) regarding—

(a) the maintenance of order in relation to any individual or group of individuals; and

(b) the enforcement of the law in relation to any individual or group of individuals; and

(c) the investigation and prosecution of offences; and

(d) decisions about individual Police employees.

The Minister can not interfere, and in fact it would be highly undesirable for Ministers to get involved in a case involving their former Leader.

If Ministers could get involved, then I am sure they would love the Police to redo their investigations into Painertgate, the 2005 overspending and the stolen e-mails.

Two good articles on MFAT and NZ Aid. Fran O’Sullivan has a look at MFAT and what the (yet to be announced) appointment of John Allen means. Fran says:

The commission’s panel was encouraged to look at the top MFat job in an “expansive way” and select a new chief executive who could (and this is the most important point) provide leadership for New Zealand – not just the Foreign Affairs Ministry – to help propel a much more aggressive approach offshore.

Fran says it is about getting less silos and better co-operations from not just MFAT, but also NZT&E, Immigration Service, Education NZ, and Tourism NZ.

Meanwhile in the Dom Post, Nick Venter looks at NZ Aid:

He starts with why NZ Aid was made semi-autonomous:

Eight years ago an independent review of New Zealand’s  aid programme raised major  concerns about the way aid  money was distributed.

The reviewers reported that the Foreign Affairs and Trade Ministry, which administered the aid programme, regarded aid as “an instrument of foreign policy”, that almost a quarter of the total aid budget of $250 million was spent on tertiary education scholarships – despite poor completion rates and the failure of many students to return home.

The ministry had used $500,000 of aid money to relocate the Samoan Department of Lands, Surveys and Environment so a new New Zealand high commission could be built, that the ministry used its development agency as a “dumping ground for non-performers” and that there was no “formal documented system of analysis or defined criteria used for determining the annual allocation process”.

McCully says:

“You don’t make changes like this if you don’t have to,” he said. “But in terms of the audit reports that have been brought down and some of the examples that I have looked at, over months now, I made up my own mind that I wasn’t going to carry the can for those things.”

Mr McCully has publicly questioned NZAid’s priorities, the amount of money it puts into “unproductive” regional bureaucracies, the size of its staff (281) and the proportion of the aid budget spent on internal overheads (about 8 per cent), but concern about accountability persuaded him to put it back under the umbrella of the ministry.

He says the agency, headed throughout its existence by former diplomat Peter Adams, wrongly assumed that being a semi-autonomous body entitled it to operate outside the normal state sector controls. “NZAid looked at the word autonomous and ignored the word semi.”

One of the consequences was that NZAid did not tell the ministry things it needed to know, “sometimes involving large amounts of money or serious matters of national interest”.

McCully also seems to think overheads were too high:

Mr McCully said he had also been concerned by NZAid’s response to questioning of its overheads. “I was annoyed to find that we were running overheads that were about 8 per cent of the total budget and that NZAid regarded themselves as being immune from any sort of scrutiny in that respect.

At a time when I was putting MFAT through the wringer, I was being told that NZAid were not open to that degree of scrutiny because we just gave them a bulk number and they decided how much of it was going to be overheads . . . . When I said, ‘Okay, presumably that will go down quite a lot when the budget goes up to $600 million,’ I was told, ‘No, it will go up to 9 per cent.’ I said, ‘How is that?’ They said, ‘That is just what we have decided.’ “

The story also focuses on what the goal should be:

He is also sharply critical of Mr McCully’s decision to abandon the poverty alleviation focus favoured by other Western governments as well as the International Monetary Fund and the World Bank.

“Economic development is an important contributor to poverty alleviation, but it’s a means to an end, not an end itself.

“The key to poverty alleviation is benefiting those most in need. Traditionally the elites benefit when money is pumped in with an economic development focus. You achieve poverty alleviation through investment in education, health, literacy and governance.”

Mr McCully, who has described poverty alleviation as a “rather nebulous concept”, says the success of the new focus will be measurable in, among other things, improved trade statistics.

“It is unacceptable that we should be exporting a billion dollars worth of goods to the Pacific and having empty ships coming back here. It shows that we are spending too much of our money on stuff that might help alleviate poverty this year but it does not do anything about next year and the year after.”

One thing is for sure – all eyes will be focused on NZ Aid for the next few years.

Some interesting parts to the Clark and Davis interview on Q&A. I do have to say though that I hope it will not become a permanent feature having an MPs partner on with them.

PAUL Exciting times. Looking back, what was the biggest mistake you made as Prime Minister, I’m sure you’re not gonna tell me your biggest mistake, can I change the question. What is the thing that you did which if you looked back you might do differently?

HELEN No I wouldn’t even go there because I never look back, that’s part of my style, I know journalists often got fed up with me saying move on move on, but I do. You know in politics there’s always an opposition employed to pick over the things you’ve done and why this why that why not the other way, well let them do it but I’m moving on to the next thing.

It is a real pity that Clark won’t answer this question, because I think you learn a lot from a person when they talk about what they would do differently. And while one should not dwell over long on mistakes, I find it useful to acknowledge them and learn from them.

PAUL Not so the one MP who’s name we cannot remember who did not stand up. Peter can I ask you this seriously, what was Helen like in the weeks or the days and the weeks after last year’s electoral loss?

PETER I think she felt rejected basically, because she felt she’d done a good job which I also believe and had put her best foot forward and had been frankly an almost incomparable Prime Minister and yet somehow the public had not seen that the same way. So it took some time for her to frankly come to terms with that and if I was in that position I’d feel the same way I guess.

This has a bit of an attitude about how the public made the wrong decisions, and Labour/Clark did nothing wrong. The reason I say this, is not to swipe at Davis, but because from all accounts most of the Labour Caucus are still in this space. They think John Key just conned the public and all they have to do is wait for him to be exposed.

FRAN Yes she has but I think it’s more than just you know meet and greet and all of that, I think where Helen Clark has scored is she’s also made a contribution and I saw her for instance one example chairing the OECD ministerial in Paris in 2003, and that was probably her first forum where she brought together a number of players, it was after September 11, there was a big you know fracas going on between Europe and America at that stage over the invasion of Iraq which had just happened but she brought together some disparate players to talk about what they could do to move economies forward and particularly also on the trade dialogue, so she chaired that, other actors paid tribute to her, so I’ve seen it there and I’ve also seen her at APEC where she has quietly moved a number of issues on to the agenda, for instance climate change in Korea, it wasn’t on the agenda, Australia claimed credit for it later but she put it there.

I quote this part from Fran, partly because it does highlight where Clark was skilled, but also to balance Fran’s later comment.

FRAN Well that’s right and it was interesting that she said she’s been empowered to do exactly that by Ban Ki-moon the Secretary General. I’d like to just go back, I think she will shake it up and she’s had that track record in New Zealand but one thing that struck me from that interview was that slight disconnect about not understanding why Helen Clark was voted out despite being competent, and to bring to the point one of the issues really was this issue about democracy in New Zealand with the Electoral Finance Act, that and together with Winston Peters that long running scandal that basically cost her her leadership here.

Disconnect is the right word for it. Now Labour have at least done a mea culpa over the Electoral Finance Act, but that was only one part of an arrogance the Government displayed on everything from the pledge card to Winston Peters. Frankly Labour should apologise for their disgraceful behaviour at the Privileges Committee and afterwards. Those MPs are not stupid and they all know that Winston knew about the donation. Yet they covered up for him. Until we get some mea culpas for that also, I’m not convinced they have understood why they lost the election.

Fran O’Sullivan focuses on Muray McCully:

Cabinet Minister Murray McCully is under strict orders from his boss to do “whatever it takes” to ensure the 2011 Rugby World Cup is an outstanding success. …

The timing of the tournament couldn’t be better for New Zealand. Amid the incessant doom-and-gloom talk, it is easy to overlook the fact that in just over two years 60,000 to 70,000 visitors will likely track here for a contest that has the potential to generate more than $1 billion of economic activity and pump more than half a billion dollars into the New Zealand economy.

That is what goes with the territory of being host country for the world’s third-largest sporting contest.

It hasn’t really sunk in how big the event has become.

The RWC organisers have so far done a stirling job by opting for 13 venues that have capitalised on their pledge to the International Rugby Board to provide a “stadium of four million people”, and ensured that virtually all regions of New Zealand have an opportunity to drive extra business.

That has gone down very well.

The rapport between McCully and Groser is palpable, with either politician easily able to represent the full range of New Zealand’s interests in their meetings with other foreign or trade ministers either at home or overseas.

For instance, it was McCully who fleshed out the timetable for the recent announcement of negotiations on the bilateral trade deal with Korea during the visit of Korean Foreign Affairs and Trade Minister Yu Myung-hwan to Wellington in January.

This is a return to normality after the embarrassing charade played out under the Labour Government when its Foreign Minister, Winston Peters, sat outside the Cabinet and not only “didn’t do trade”, but reserved the right to oppose deals like the Chinese free trade agreement which did not fit with his party’s agenda.

Even worse the Foreign Minister was running large newspaper ads trying to stir up opposition to the deal, before the ink was barely dry from the PM signing it.

Both McCully and Groser favour a shake-up at the Ministry of Foreign Affairs and Trade to ensure greater concentration on the relationships likely to bear greatest economic fruit for New Zealand and/or bolster the country’s presence on the world stage.

The foreign affairs establishment is already kicking back at plans to bring NZAid back within MFAT’s firmament and ensuring more of the aid is directly tied to New Zealand’s interests. McCully has not handled this issue as smoothly as he could. But overall he has made an impressive debut in his prime portfolios.

It’s good to have Fran writing on an issue other than why National should cancel the tax cuts

Fran O’Sullivan seems quite impressed with John Key’s willingness to consider bailing out F&P:

Key’s activist approach is a far cry from the prime ministerial style used by some of his predecessors like David Lange (Labour) and Jim Bolger (National) when they were confronted with the prospect of major Government hand-holding operations and bailouts during the fag-end of the 1980s and early 1990s.

It would be hard to imagine either Lange or Bolger lapsing into banker-speak as Key did at his press conference when he precisely defined the impact of mark-to-market rules which had resulted in F&P’s recorded debt blowing out to 43 per cent in January in response to exchange rate movements. Net debt is now forecast to reach $570 million.

It’s true Key is very smart on issues of finance, but any intervention will set a precedent that we might regret one day.

I tend to agree with the Dominion Post editorial:

Prime Minister John Key should think very carefully before he acts on his inclination to use taxpayers’ money to help Fisher & Paykel Appliances, The Dominion Post writes. There is a real risk it would be the first step on a very slippery slope.

And Fisher & Paykel executives should, if the offer is made, think very carefully about accepting it taking the Government’s shilling inevitably means allowing politicians into your business.

And this is a real issue for F&P. What if you accept some Govt money, but you still need to cut some jobs. However you know cutting jobs will make the Govt look bad, and they did bail you out. So then you don’t cut any jobs and you need a further bailout, or you go broke. Govt money always come with strings. Do you want the Govt (as in the US) telling you how much you can pay your top management?

Fisher & Paykel has not gone to the Government for help, but Mr Key is clearly contemplating using public money to help it out as a last resort. The advantage of that is it stops the company being held to ransom by financiers taking advantage of the recession to offer unreasonable terms. The danger is in deciding where to draw the line. If it is justified to use public money to save 1600 jobs, what about 1000 jobs, or 100?

And think of the protests from any company you decide not to bailout.

Mr Key should not close off any options, but picking which firms deserve taxpayers’ money should be very low on his list. He should look first at further moves that would make life easier for all New Zealand businesses by reducing their costs, and removing red-tape barriers.

New Zealand politicians have a sorry record when it comes to picking winners. There is no reason to suspect they would do any better at picking survivors.

Very well said.

In the Herald, they report support for a bailout from EPMU’s Andrew Little and opposition from the NZ Manufacturers and Exporters Association.

Will the EPMU now seek to join the new National Party?