ODT on KiwiAssure

November 8th, 2013 at 7:00 am by David Farrar

The ODT editorial:

The suggestion KiwiAssure will be run by Kiwibank is not sensible.

The success of Kiwibank will be put at risk by tacking on an insurance company with a domestic focus.

Voters only have to look at the downfall of AMI, a Christchurch-based insurance company which substantially undervalued its reinsurance obligations and ended up with the Government – and taxpayers – having to step in to bail it out.

Of course, a government bail-out is exactly what will happen to KiwiAssure if it does not spread its reassurance risks widely.

Reinsurance for a totally-owned government-controlled insurance company will be expensive.

There can be no discounted policies on offer; it does not make sense. …

Kiwibank appeals to loyal New Zealanders who like the idea of investing their money where it will be used for the benefit of fellow Kiwis in obtaining mortgages, extending businesses and generally contributing to economic growth.

There is no such incentive for taxpayers in owning an insurance company.

Political parties do not have a good history of being in business.

New Zealand Post is the latest state-owned entity to run into problems, even though it is propped up by Kiwibank.

Appointing Kiwibank to prop up an insurance company is the wrong option.

Forcing Kiwibank to set up a full insurance company is daft and damn risky. We already have 92 insurance companies in New Zealand.

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ODT on xenophobia

October 24th, 2012 at 10:00 am by David Farrar

An excellent ODT editorial:

Recently, control of Fisher & Paykel Appliances, the company which maintains a presence in Dunedin, passed quickly and almost quietly into the hands of the Chinese-owned Haier Group. Haier already owned 20% of FPA after effectively rescuing the company in 2009, when it acquired the holding as part of a capital raising that let FPA refinance its debt. FPA got distribution into China as a result of the deal and the ability to further licence its technology.

David Parker has said he wants Ministers to decide on private owners selling their shares to other private owners. What this may mean is companies going bankrupt, as F&P may have gone under if Haier hadn’t rescued them in 2009. We saw this under the last Labour Govt when they refused Singapore Air buying Air NZ, leading to the airline facing bankruptcy.

While the semantics would suggest that 52% ownership means the company is still in Kiwi hands, the reality is that a controlling interest is just that: controlling. (Haier’s offer is still subject to Overseas Investment Office approval, but it seems a formality.)Compare then the ease with which Haier took control of a long-established New Zealand company with the prolonged struggle by Chinese company Shanghai Pengxin to buy 16 central North Island Crafar farms. It now hopes to settle the purchase of the farms after the Supreme Court last week removed the last obstacle to the deal, an appeal by Maori trusts.

While it would be easy for Haier, a global whiteware group, to shift FPA to China, it is impossible for Shanghai Pengxin to shift 16 dairy farms anywhere. It seems xenophobia ruled in the farm debate. Why should the Chinese be allowed to buy New Zealand farms, the critics howled?

Exactly – you can’t move a farm or land. I’d point out that companies can move their manufacturing offshore also, regardless of who owns them.

And compare that reaction with the welcoming of recent news that Canadian film-maker James Cameron continues to expand his south Wairarapa property portfolio.

Incidentally, Mr Cameron’s neighbour, American billionaire Bill Foley, has won permission from the Overseas Investment Office to expand his Kiwi-based wine operation.

However, just like Haier, it is likely both Mr Cameron and Mr Foley paid market rates for their purchases. If the Maori trusts, and their benefactor Sir Michael Fay, had been truly serious about buying the Crafar farms, all they had to do was offer a higher price than that being offered by Shanghai Pengxin.

Xenophobia is not the determining factor in such sales: shareholders make their own decisions based on price and their own circumstances.

Not if Labour gets in. Their policy seems to be that Ministers will approve all sales that are not purely domestic. Decisions will be based on Ministerial opinion, not what is good for shareholders and investors.

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ODT on Hughes affair

June 12th, 2011 at 11:00 am by David Farrar

The ODT editorial:

People who hold positions of high office can expect scrutiny over behaviour that might be said in some respect to impact or reflect upon the performance of public duty. And a police investigation certainly exceeds any objective minimum threshold for justifiable public interest, which is why the original handling of the Darren Hughes matter by the Labour Party leadership was, and is, inexplicable. …

It will be recalled Mr Hughes, some days after the news of the investigation broke, stepped down from his position as senior whip; then, as the furore grew and details leaked into the public domain, he resigned from Parliament. Had his leader, Phil Goff, played a more decisive and firmer hand earlier, it is quite possible Mr Hughes would now be able to resume his place in the House; had Mr Goff, for instance, announced to Parliament and to the people of New Zealand, as soon as he became aware of it, that Mr Hughes was facing a police investigation over an allegation and was immediately standing aside until the investigation was complete, the way for his rapid rehabilitation might still be open.

There is a near universal consensus that Darren would probably still be an MP today, if Phil Goff had handled the issue better. That’s bitter medicine for Labour MPs to reflect upon over the next few months. Their own leader effectively robbed them of one their most popular and effective MPs.

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Questions to a new MP

September 26th, 2010 at 12:00 pm by David Farrar

Have a look at the questions asked by the ODT of new ACT MP Hilary Calvert:

  • Any convictions you would like to declare now?
  • Any misbehaviour, non-criminal, that might come back to bite you?
  • Any family members involved in criminal behaviour?
  • Could you ever contemplate supporting Heather Roy?
  • According to a radio report, you have a pecuniary interest in a licensed massage parlour.

I wonder if the ODT will ask Labour’s new candidate, David Clark, not only whether he has any convictions, but whether he has any family members involved in criminal behaviour, whether he has ever had any non-criminal misbehaviour, could he ever contemplate supporting David Cunliffe and then holding them as a landlord accountable for what a tenant’s profession is.

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Editorials on SCF

September 1st, 2010 at 4:00 pm by David Farrar

The Herald:

In the end, South Canterbury Finance was not, as some had predicted, too big to fail.

The Government, quite correctly, resisted the temptation to support the recapitalisation of the country’s second-biggest finance company, consigning it to receivership. …

There was, however, no point in keeping South Canterbury Finance afloat. Bad governance and loan practices have destroyed a once strong brand.

The Press:

South Canterbury Finance’s decision to call in the receivers yesterday had an inevitability about it. …

But the investor repayments, and the fact that the receivership process means there will be no fire sale of assets or fast call-in of loans, should limit the economic, and perhaps political, fallout. This might otherwise have been more serious at a time when the economy is still fragile, a strong reason for the Government to act.

The Dom Post:

The failure of South Canterbury Finance is a tragedy – for founder Allan Hubbard, for South Island businesses and for taxpayers who must now make good the deposit guarantee made by the last government.

Mr Hubbard, 82, is no Mark Hotchin or Rod Petricevic. There are no multimillion-dollar mansions, flash cars or luxury yachts lurking in his cupboards. He lives in a modest Timaru bungalow and drives an ageing Volkswagen Beetle.

However, the $1.6 billion SCF owes investors is roughly three times the amount Mr Hotchin’s Hanover and Petricevic’s Bridgecorp each owed investors when they collapsed. …

It is time for the loyal band of letter-writing supporters who believe Mr Hubbard can do no wrong to bite their tongues. Their hero is decent, generous and well-intentioned. Earlier this year he put family assets worth more than $150m into SCF in an attempt to shore up its balance sheet. Those assets have now been lost.

The interim report of the statutory managers appointed to run his affairs, plus those of other companies and charities associated with him and his wife, Jean, suggests the acumen that made him the South Island’s richest man has deserted him. …

Many will wonder why the last government ever agreed to guarantee the deposits of investors who went looking for higher interest rates in finance companies. The answer is that both Labour and National, then in Opposition, considered the guarantee the lesser of two evils. Better payouts than the total collapse of the financial system. They may have been right, but the payouts announced yesterday still stick in the craw. This is not what we pay taxes for.

The Dom Post is on the money. It is easy in hindsight to say that one should not have had the guarantee scheme, but in late 2008 the wordl financial system was on the brink of possible collapse, and pretty much every OECD country did much the same as a stability measure.

The ODT:

But with SCF’s investors largely covered by the guarantee scheme, the Government chose to see it go into receivership at least in part so that it could have some degree of control over the impact of the company’s failure on the core South Island economy – and so the fallout could be managed, as far as possible, in an orderly manner.

SCF may be regarded as the biggest single South Island casualty of the recession, and without the greatest care by the receivers and the principal debtor – the taxpayer – the long-term consequences may be a chief cause of slowing the economic recovery.

Everyone in the South will hope that prospect can be avoided.

On the brighter side, some sensible reduction of rural land prices may eventually result from this failure, just as it appears to be occurring in the urban property market once the speculative bubble burst.

None of the four editorials are saying the Government should have stepped in to stop receivership, which is what some were urging.

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Editorials on Carter & Goff

July 31st, 2010 at 9:55 pm by David Farrar

Starting with the ODT who label it a poisonous pen:

Labour Party leader Phil Goff should have learned a harsh lesson about authority from the tragicomic events of the past 48 hours: when the knives are out, leaders must strike first.

He should be regretting that, when Chris Carter’s reluctant apology over the expenses rort finally emerged, rather than merely demoting him he did not suspend him outright, allowing him back only with the lowest rank in the caucus.

Goff wasn’t tough enough then. His leniency towards Carter has now exploded in his face.

The Press also says Goff should have acted sooner:

It’s axiomatic that Labour MP Chris Carter has written his political death warrant. The only question that remains is whether he has sealed the fate of his leader, Phil Goff, as well. Goff’s mistake in dealing with this saga was not to have been tougher on his errant MP quite some time ago.

What will be interesting is what Carter does after the NZ Council makes its decision.

The Dom Post says Carter does not get it:

Chris Carter just does not get it. Thrown an undeserved lifeline by Labour leader Phil Goff after his extravagant sense of entitlement was laid bare by the release of details of ministerial spending, Mr Carter instead chose to defy party rules by taking an overseas trip – albeit one paid for by the Chinese Government, not the New Zealand taxpayer – without seeking permission.

Then he chose to try to derail Mr Goff’s leadership in a particularly inept way. His not very confidential letter shows that not only does he lack any sense of political reality, but also even the most rudimentary grasp of political tactics.

In between all his travel, and all his time on Waiheke, I wonder how often he even appears in Te Atatu?

And finally the Herald:

Mr Goff has ended up with his position fortified even though there is little reason to doubt much of what Mr Carter was saying.

The stark results of recent opinion polls must surely have many Labour MPs and activists thinking the party will lose the 2011 election under its current leader.

Indeed, barring a dramatic change in the political landscape, National’s lead of about 20 percentage points leaves room for no other conclusion.

In such circumstances, it would be totally unsurprising if some in the party were not contemplating a leadership change.

As I said on radio with Paul Holmes, the question is not will Labour win with Phil Goff. They probably will not. The question is will Labour do better with someone else as Leader, and the answer is probably not.

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Employment Law Editorials

July 20th, 2010 at 11:00 am by David Farrar

First the Herald:

Most of the scrutiny of the Government’s planned changes to employment law has focused on the extension to all firms of the 90-day trial period for new workers. But for business, the most welcome aspect of the package will undoubtedly be the sensible reform of personal grievance dispute procedures. Too often, employers have looked askance at the way Employment Relations Authority processes and decisions have come to the aid of workers who have been dismissed for perfectly valid reasons. A rebalancing is long overdue.

The Government has made two particularly notable changes. First, the authority will be able to filter out vexatious or frivolous claims early on, thereby saving time and money. Secondly, and most importantly, the authority will have to pay more attention to the right outcome, rather than subject employer processes to “pedantic scrutiny”. This is intended to stop decisions going against employers because they failed to follow procedure to the exact letter in terms of warnings, areas for employee improvement and suchlike. No longer should loopholes undermine a justified dismissal, sometimes at a cost of thousands of dollars to an employer. …

At times businesses can find it nigh on impossible to dismiss even the most flagrant abuser of workplace standards or productivity requirements. The reform should not be interpreted, however, as the green light for loose or unfair practice. Although the detail of the change has yet to be announced, it will still fall to the authority to decide what is a minor oversight with no bearing on the core issue and what is a dire breach of procedure. This should swing the personal grievance process back into better balance rather than substantially in employers’ favour.

What is interesting is the Government is planning to put into statute, much of the case law on how to legally dismiss someone. This will reduce uncertainty – along with a proposed code of practice.

The most obviously problematic item on the Government agenda is, however, the plan to allow employers to force workers taking sick days to prove they are ill, after just one day. This is intended to allow firms to tackle employees who they suspect are routinely taking ‘sickies’. The Labour Minister says it would be used sparingly. So it will if this is a rare problem. But if used widely, it would create a significant burden for all concerned. If, as the minister suggests, this is not a major problem, there seems no good reason to amend the present law, which serves its purpose well enough.

I agree that at this stage I am not convinced this is a change where the pros outweigh the cons.

In sum, this is not the stuff of a strident assault on workers’ rights. It is more a measured process that, with a little select committee tweaking, will introduce a greater coherence and flexibility into employment law, especially that relating to personal grievances.

They really are quite modest changes – but changes that will be of considerable benefit.

The Dom Post:

In an ideal world there would be little need for employment law. Employers, unions and workers would be fair and reasonable at all times. No-one would take advantage of sick leave provisions to add to their leave entitlement. No-one would be capriciously sacked.

However, this is not an ideal world. Employers and workers do not always act as they should, and that is why a legal framework is needed to govern their relationships.

The Government’s role should be to make sure the balance of that framework is as fair as possible. The changes Prime Minister John Key announced at the weekend are a move towards that. …

It is undeniable that, under Labour, the pendulum swung towards the workers. The just-announced changes are an overdue and small correction – not the catastrophe their opponents believe.

This talk about a council of war is hysterical over-reaction.

Finally the ODT:

Planned changes to employment and holiday laws announced by Prime Minister John Key on Sunday are hardly the stuff of revolution. …

They represent the attitudes of a Government shading towards the right while still keeping within range of the centre.

They reflect policies of a National Party determined to be pragmatic rather then radical.

Nonetheless, the measures, if enacted after passing through parliamentary processes, will, in total, help employers as they try to do business.

They will, in small ways, help New Zealand’s competitiveness.

And that is the key. The changes will make NZ more competitive and will enhance economic growth.

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Editorials 30 June 2010

June 30th, 2010 at 2:00 pm by David Farrar

The Herald focuses on Fiji:

The second was the introduction of a grandly titled Media Industry Development Decree. It means, among other things, that the Fiji Times, the country’s oldest and largest newspaper, has three months to remove Rupert Murdoch’s News Ltd as its owner or face closure.

If the first development borders on farce, the second should remove any lingering illusions about the regime’s view of democratic niceties. The decree effectively eliminates freedom of expression in Fiji.

Aside from the restriction on foreign ownership, a tribunal has been established to ensure nothing is printed or broadcast against the “national interest or public order”.

In essence, Fijians will no longer know what their rulers are up to. Special attention is being paid to the Fiji Times because, according to the Attorney-General, it has been “the purveyor of negativity, at least for the past three years”.

The move against the media is part of an ongoing removal of Fijians’ rights. This has included the abrogation of the constitution, the squashing of dissent and the dishonouring of pledges for a return to democracy.

There is sadly no evidence that there will be a return to democracy. I can’t see a scenario where the Commodore will give up power and let Fijians actually decide on their Government.

This step should also occasion a rethink by New Zealanders who spend their holidays in Fiji. Tim Pankhurst, of the New Zealand Media Freedom Committee has suggested a boycott.

He has a point. Tourists might like to say that Fijian businesses and jobs should not be penalised for the sins of the regime. But they are undermining their own country’s diplomatic efforts.

Fiji’s tourism-driven economy attracts 60 per cent of its patronage from New Zealand and Australia. No official boycott can be imposed, nor should it be.

But a rethink by would-be tourists would apply further pressure. And if, ultimately, it is up to the Fijian people to send Commodore Bainimarama back to the barracks, tourists temporarily moving away from Fiji for other Pacific destinations would hammer home a message about the pariah status of their rulers.

Rather than out all the onus on consumers, the media could play their part. Rather than just write editorials, APN and Fairfax could refuse to accept advertising for Fiji tourism. That would be a sign of solidarity with their colleagues in Fiji, and show real commitment rather than just words.

The Press lashes FIFA:

Football prides itself on being the “beautiful game”, but the current World Cup in South Africa has been marred by too many ugly refereeing decisions.

One of the most egregious occurred this week when England’s Frank Lampard was not awarded a goal against Germany despite the ball clearly crossing the goal line after hitting the crossbar.

This must serve as a wake-up call for Fifa boss Sepp Blatter and his top officials to get their heads out of the sand and harness the electronic technology successfully used by so many other sports.

It is a no brainer.

The Dom Post looks at smoking in prisons:

But surely an outright ban goes too far? How about halfway measures first, such as a prison smoking-room, or a ban on smoking in cells? If she is wedded to a total ban, what are known as “cessation assistance” programmes – already available to anyone, including the incarcerated, who want to quit – must be funded appropriately. …

As usual with any broadbrush proposal, the devil will be in the detail. But that detail should acknowledge union unease. The minister has already attended the funeral of one prison guard this year – a political show that bore an uncanny resemblance to former prime minister Helen Clark’s infamous appearance at the Folole Muliaga funeral in 2007. Ms Collins does not want the option of attending another.

What an incredibly stupid comparison, in terms of funerals. Jason Palmer was employed by the Government and died doing his job, and as a result of his job. I don’t know anyone who thinks a Minister should not attend the funeral of law & order professionals who get killed by criminals. In fact it is almost disrespectful not to go.

What that has in common with the circus generated around the Muliaga’s I don’t know.

The ODT also looks at smoking:

With this background, it may have surprised some readers to learn that the inmates of our prisons are permitted to smoke, including in their cells, unlike in Canada, some British prisons, and those in some Australian states, where the practice is banned.

The intention of the Minister of Corrections to ban smoking in our jails from July next year is certainly easily justified on health grounds alone, and the overseas precedent suggests the fears being raised here by vested interests are largely groundless. …

Objectors have raised two main issues: the right of prisoners to smoke in what is effectively their “own home”; and the potential for violent reaction from prisoners required to cease smoking.

The first claim is groundless.

Prisoners are, in effect, tenants.

The State, as landlord, can and does impose conditions of use.

Additionally, prisoners who do not smoke – and prison guards – are entitled to not be confined in conditions where their own health may be damaged by second-hand smoke.

The department has anticipated prisoner reaction by giving a year’s notice of the measure, and by its intention to offer a cessation programme, including nicotine replacements, for those who seek such help.

That approach is not unreasonable.

Meanwhile 65% of people in Labour’s poll say they back the ban, so I expect we will see them come out backing it shortly.

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Editorials 29 June 2010

June 29th, 2010 at 1:54 pm by David Farrar

The Press examines the smoking ban in prisons:

From the middle of next year New Zealand’s prisons are set to emulate Australia’s and become smokefree.

It is a long overdue move. It was an anomaly that prisoners could still smoke in their cells as the rest of New Zealand moved increasingly towards a no-smoking regime.

School grounds, hospitals, and other government departments have gone smokefree, as have bars, restaurants and businesses, and, in Christchurch, there is even a smokefree policy in parks.

For many prisoners – two-thirds of inmates – an enforced cold turkey regime will seem a hardship or even a civil rights breach. But those who have committed crimes against society should not expect the right to smoke, just as they cannot legally have alcohol and drugs.

What amuses me is the policy dilemma for Labour. They instinctively are in favour of anything that is anti-smoking but against anything that they see as punitive to prisoners.

So how does Labour solve this dilemma? They run a blog poll to decide their policy :-)

The Dom Post looks at the trans-Tasman relationship:

When Julia Gillard became prime minister of Australia, Prime Minister John Key was the first foreign leader to phone in his congratulations.

He needs to hope his fast dialling finger will deliver a better result than his predecessor, Helen Clark, achieved with her swift flight over for a cup of tea with Kevin Rudd when he got the job – in his time as prime minister Mr Rudd never quite made it to New Zealand for an official visit.

Mr Key, like Miss Clark before him, is smart enough to realise the onus is on Wellington to keep reminding Canberra what the “NZ” stands for in Anzac. The reality, however unpalatable it might be to some, is that New Zealand is simply not as important to Australia as Australia is to New Zealand.

Australia is New Zealand’s most important trading partner and its most important security relationship. …

Talk about whether New Zealand and Australia should take their relationship to the next level and look at issues such as a common border can wait until the Australian election is over.

Mr Key’s job is to ensure New Zealand’s interests are not damaged in the meantime.

Miss Clark and John Howard reportedly enjoyed a warm relationship despite their different political ideologies. The hope must be that the state-house son of a refugee and the daughter of a 10 immigrant from Wales can do the same.

The irony is that PM from opposite parties seem to have got on better than PMs from the same side of the spectrum.

The ODT looks at OSH:

It is one of our cultural stereotypes: the rugged, versatile, no-nonsense farmer – the sort of person for whom most regulations are made by townies for townies who have no real understanding of the demands and constraints of a working life in the country; and, further, how the red tape that such people unhesitatingly impose on the rural sector can seriously impact on proven working methods and productivity.

In no other sphere is this more pronounced, or more irritating to some, than on-farm safety: the rules and regulations promulgated by the Department of Labour, Occupational Safety and Health and ACC are frequently seen as at best a brake on freedom and individual responsibility and, at worst, the interfering actions of bureaucrats and the “politically correct”.

Sadly, the reality is that such organisations have reason to be concerned.

According to the latest figures released by ACC, farmers are killing themselves in work-related accidents at the rate of one every 28 days.

Last year, 13 farmers died in accidents on New Zealand farms.

There were 18,600 injuries on farms, with quad bikes, farm machinery and poor animal handling featuring as the most common causes.

Raw figures by themselves mean little. What would be more useful is the injury rate per employee.

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Editorial 28 June 2010

June 28th, 2010 at 2:46 pm by David Farrar

The Herald talks whaling:

The collapse of international whaling negotiations at Morocco is a chilling moment for the future of controlled whaling, let alone the prospect of a complete ban. The collapse is no less disturbing for the fact that it has always been as likely as not.

The International Whaling Commission proposal to the three nations that permit commercial whaling, Japan, Norway and Iceland, never satisfied either side. …

With all hope of a compromise now gone, the New Zealand Government will probably join Australia in its case against Japan at the International Court of Justice.

It is not a course that promises effective policing of the Southern Ocean even if the court can be persuaded the Antarctic is a whale sanctuary in international law. Even if a favourable ruling can be obtained, the case is likely to take years and leave the ocean open to unrestricted whaling in the interim.

Not even Greenpeace and other environmental lobbies at Agidir favoured court action over a negotiated compromise. Mr McCully went out of his way to praise their helpful approach to the negotiations, an approach that helps keep non-whaling governments and most of the public firmly behind the effort to end all whaling.

I suspect we will join the court case now.

The Dom Post looks at Allan Hubbard and the SFO:

The good people of Timaru seem stunned by news that highly regarded local businessman Allan Hubbard, and wife Jean, might have fallen foul of the law. Last Sunday, Commerce Minister Simon Power took the rare step of putting the couple themselves, Aorangi Securities and seven charitable trusts into what is known as statutory management. He said the objective was to “prevent fraud and reckless company management [and] to protect investors …”

The city’s newspaper, the Timaru Herald, said in an editorial last Monday that the Hubbards’ sin, in official eyes, seemed to be the unconventional way they did business. It went on: “If the allegations are unfounded, the officials involved will have humiliated one of the country’s most successful and generous businessmen for nothing. They will also have wasted a good deal of taxpayers’ money at a time when there is no shortage of directors of failed companies to chase.”

It is that latter point that so upsets Mr Hubbard’s supporters.

All those who broke the law should face consequences for that.

Little wonder that Mr Power, aside from rejigging the justice system, is upending securities law, too. He plans to have a new and independent Financial Markets Authority, consolidating the powers and functions of the Securities Commission, some of those of the Registrar of Companies and Government Actuary, and some of the NZX’s regulatory role, operating early next year.

He has also completely restructured the financial advisory industry, and now wants submissions on how to replace the Securities Act and Securities Markets Act, in a bid to strengthen the financial markets, and restore investor confidence. “The Government cannot and will not legislate for risk,” he said this week, “but we can build a regime that makes those risks more transparent.”

A unified regulator makes sense.

The Press farewells Kevin Rudd:

Even by Australia’s brutal political standards, the dumping of Kevin Rudd was spectacular. Sudden, decisive and risky, it cast out the man who had brought his party into power and governed until recently with substantial voter support.

That Rudd at the beginning of the week seemed secure in his job but by the end of the week had so little party support that he could not contest the challenge is testament to a ruthlessness in Labor. The party has shown not a shred of loyalty to the man who won it a landslide election after years in the wilderness, who had done little wrong in government, and who had shaky polls but no worse than John Howard at the same part of the election cycle.

Loyalty is two ways. If you run Government through a inner circle of just four people, you alienate your colleagues.

The ODT focuses on debt:

The economy, it is fair to say, is very gradually improving after the short-lived recession, although the position so far as internal and external debt is concerned remains grave.

New Zealand, fortunately, is nowhere near in as bad a way as Britain, whose economy is practically in ruins, and where after last week’s budget, every household will be worse off as the new government tries to rebuild.

A vast range of cuts has been imposed to try to reduce government spending and pay off the colossal debt load.

New Zealand has dealt with similar problems in budgets of the past two years, but beyond the immediate future the economy faces what may turn out to be a difficulty of very serious proportions: a lack of capital. …

The kind of public service job creation the Clark government indulged in has also proved to be a serious drag on the economy: since 2004 more than half of all new jobs were in public administration, health, and education.

Over the same period 40,000 jobs disappeared from agriculture, horticulture, forestry, manufacturing, and transport – what some have described as the “earning side ” of the economy, the tradeable sector.

The tradeable sector went into recession in 2005 and only came out of it in 2009.

Treasury forecasts show steady economic growth of about 3% a year and that is an extremely modest number.

Clearly, though, there will be no new “value-added” jobs unless and until the confidence of businesses to invest and to employ is restored and investors are willing to risk their money.

Our collective failure to do that will inevitably mean all taxpayers will face what the British and other European disaster economies are now confronting.

We need investment and business confidence.

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Editorials 24 June 2010

June 24th, 2010 at 12:00 pm by David Farrar

The NZ Herald focuses on the topical Afghanistan:

Tensions between generals in the field and their civilian masters are a fact of life. Armed forces chiefs are able to focus solely on battlefield strategy and having the necessary manpower and resources.

The purview of politicians must be wider, not least in considering the popular appetite for war.

Not surprisingly, generals often become impatient at what they consider interference in the prosecution of a war. In moments of candour, they might convey their annoyance to well-trusted aides. Otherwise, they keep their counsel.

They know that if such sentiments become public knowledge, their position becomes untenable. Such is now the case with General Stanley McChrystal, the United States commander in Afghanistan.

And he has paid the price.

General McChrystal’s blunder is the more unfortunate in that his strategy is the best chance of achieving a stability in Afghanistan that will pave the way for an orderly exit.

His approach has eschewed lofty goals, such as embedding a model democracy, and concentrated on “Afghanising” the conflict through the rapid training and arming of Kabul’s forces.

He also understands the importance of gaining a settlement with more pragmatic elements of the Taleban, thereby creating a political consensus. The present “surge”, which has achieved mixed results, is an attempt to accelerate that outcome.

The eminent sense in General McChrystal’s strategy means he has not been without his defenders. One of the more interesting was the much-maligned Afghan President.

A spokesman for Hamid Karzai said he believes General McChrystal is “the best commander the United States has sent to Afghanistan over the last nine years”.

A sad end to a fine career.

The Press looks at the breath testing of spectators for a school by rugby match:

The scene outside the front gate of Christ’s College on Tuesday was extraordinary.

Eight police officers were lined up administering breath tests to spectators arriving to watch the annual Christ’s College-Christchurch Boys’ High School rugby match. The police were required to enforce a zero alcohol policy imposed by Christ’s College for the match in an attempt to stop the drunken yahoo off-field brawling that has, over the last decade or so, become a feature of the encounter.

The policy seems to have been a success. For the first time in years, the game passed off without an outbreak of violence or indeed any untoward incidents at all. No-one was arrested or ejected from the ground, in a striking contrast with last year’s event which was, as Inspector Derek Erasmus observed, notable for “baton charges and multiple arrests”.

Something we have seen recently is that a huge amount can be done within the current Sale of Liquor Act.

The Dom Post opines on the departure of Sean Plunket from Radio NZ:

Broadcaster Sean Plunket has finally made good on his threats to quit Radio New Zealand National to seek fresh fields. Though his willingness to ask hard questions will be missed, his decision – a long time coming, given his testy relationship with his masters – will be good for him and might even be good for the company. …

Plunket’s departure, alongside suggestions that Robinson will retire within two years, gifts RNZ’s chief executive, Peter Cavanagh, and the board a rare opportunity. Does today’s three-hour mix of hard news and the odd joker work as well now, in a multi-media environment, as when the hour-long programme launched 35 years ago?

And the ODT finally comments on the China protest:

According to the police, a number of witnesses were spoken to after Green Party co-leader Russel Norman complained of assault by Chinese security agents attending the visit to Parliament by China’s Vice-president, Xi Jiping, last week.

Presumably, these included members of the force stationed at Parliament Buildings.

Police also studied film footage and photographs of the incident, and had sought, to no avail, to speak to the Chinese alleged to be involved.

It was concluded – quite swiftly in the circumstances – there was insufficient evidence to substantiate a prosecution.

This should be no surprise.

The prospect of the police mounting a sufficiently strong case was weakened as soon as it became clear that Dr Norman had apparently moved from his initial location at the foot of the steps to Parliament’s main building to the entrance of the Beehive to be very much closer to the point at which the vice-president passed, thus himself contributing to a degree to the predictable response by Chinese security guards charged with protecting their leader. …

The fact remains that he was allowed to have his protest – his “free speech” action was not suppressed and could be heard loud and clear, although it must be considered a certainty the Chinese security guards had not the faintest notion who he was.

Successive New Zealand governments have in the past decade or more routinely expressed concern – on behalf of Dr Norman and other protesters – to Chinese visitors about the infringements of human rights in China, while successfully maintaining a relationship that has resulted in China becoming our second largest trading partner.

That relationship is hardly to be jeopardised on the strength of one MP’s needless behaviour.

Working out rules for MPs (or others) protesting should not be difficult.

Should they be allowed in an area where they can be seen? Yes.

Should they be allowed in an area where the target of their protest can hear them? Yes.

Should they be allowed close enough to a VIP that they could seriously humiliate them by grabbing them, spitting on them, throwing or squiriting something at them – no.

So the question is merely how wide should the corridor be, which they can’t cross into. I’d say around 10 – 12 metres. You can protest very effectively still at that range.

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Editorials 22 June 2010

June 22nd, 2010 at 10:00 am by David Farrar

The Herald hails the All Whites:

Hats off to Ryan Nelsen, the captain of the New Zealand soccer team.

Not only for the way he marshalled his side as the All Whites claimed a hugely significant 1-1 World Cup draw against Italy, the reigning world champion, but for his straight talking after the match.

Sport is replete with players who utter only polite noises. Nelsen told it like it was. Guatemalan referee Carlos Batres, who awarded the softest of penalties to the Italians, had had “stars in his eyes” and his partiality had ruined the game.

“If he’s the best that Fifa offer up then, gee whizz, I would hate to see the worst,” Nelsen said. …

Paraguay appears to be the best team in the All Whites’ pool. While many other countries have struggled, it had confirmed its standing as the second-best qualifier from South America.

If New Zealand is to advance to the knockout stage, probably nothing less than a victory will suffice. The odds will, once again, strongly favour its opponent. But who would now bet against the All Whites?

I’ll be in Australia for that game, and making sure there is no doubt the All Whites are not an Australasian team!

The Press defends the right to protest:

Green Party co-leader Russel Norman’s decision to protest at Parliament during the visit of Chinese Vice-President Xi Jinping was eminently predictable.

His party has long supported the free Tibet movement and highlighted China’s shocking human rights record. Just as his predecessor as the Greens’ male co-leader, the late Rod Donald, did in 2005 during the visit of another Chinese dignitary, Norman waved a Tibetan flag as Xi’s delegation arrived at Parliament. Norman did go further than Donald, who mounted a silent protest, by also calling out for democracy. But the attitude of New Zealand authorities in these two cases was quite different.

That is because Rod Donald did not advance on the VIP.

In 2005, police and security staff respected the right of Donald to protest and rejected calls from Chinese security guards to remove him. But no action was taken last Friday by New Zealand authorities when Norman had his flag taken from him by Chinese security personnel and a scuffle broke out. Foreign Affairs Minister Murray McCully later lambasted Norman, saying the Green MP had abused Parliamentary privilege and his actions were calculated to give offence.

McCully was half right. Norman’s protest was a stunt aimed at provoking the Chinese and to attract publicity for the Greens and the Tibetan cause, about which China is hugely sensitive. But McCully is totally wrong to accuse Norman of abusing his position. Unlike members of the public, whose protests at Parliament are carefully controlled, Norman is an MP who has the freedom of the building and its grounds.

Not total freedom. An MP can’t enter the offices of other parties without permission for example.

He was perfectly entitled to exercise his right to freedom of speech where he did. And if his position was perceived as a threat to the personal security, rather than just the sensitivities of the visitors, it is up to New Zealand authorities to take action.

I agree. The NZ authorities should have kept Norman from getting so close to the Vice-President. If he had remained at the foot of the steps of Parliament, I would have expected him to be protected. But he rushed up to the Beehive entrance, right up against the Chinese security guards.

The Chinese security guards were wrong to try and interfere with his flag, but he was also wrong to advance so close. He should have negotiated a position to stand at where he could be clearly seen and heard (if desired) but not within spitting distance of the Vice-President.

The Chinese officials who took the flag and scuffled with Norman probably had limited understanding of Norman’s rights as an MP. New Zealand security personnel still should have stepped in to protect him.

They did.

New Zealand does have a close and valued relationship with China. This has been shown by the recent free-trade deal with it and by the emphasis placed by New Zealand on its participation in the Shanghai Expo.

But these economic ties must not obscure the fact that there are differences between us and one of these is New Zealand’s strong commitment to human rights, including freedom of speech and the right to protest peacefully.

Instead of berating those who, like Norman, exercise these rights, New Zealand ministers should have firmly reminded the Chinese that in this country, unlike their own nation, these rights are sacrosanct and must be respected by foreign guests.

As John Key has pointed out there was a continual protest outside the hotel where the VP was staying, and no one interfered with their right to do so. It’s because those protesters stayed at a distance where they could not be considered a danger.

The Dom Post talks money and morality:

Yesterday The Dominion Post reported that a Napier church had taken at least $20,000 in donations from Whetu Abraham, a rest home resident. Those caring for him had tried to stop the donations, and rest home manager Lucy Dever believes what the Oasis Elim Church has done is unethical, immoral and un-Christian.

Mr Abraham says he gave the money because of his faith, and because of his simple understanding that “you help them, they help you”.

Church pastor Bruce Collingwood says the money was given willingly by Mr Abraham “out of his own heart”, and he was comfortable about taking it after he and Mr Abraham had talked about Mr Abraham’s financial and medical situation.

Others, including the church’s national body, are not.

The relationship between churches and money has been fraught ever since Jesus drove the moneychangers from the temple. …

There is no doubt the money Mr Abraham gave will help the Oasis Elim Church, but churches depend on their moral authority as much as their bank balances. For many, accepting large sums from a sick man who had little to begin with diminishes that authority to near bankruptcy.

And the ODT also praises the All Whites:

Yesterday, much of the nation discovered the round ball belongs to a sport that delivers heroes every bit as outsized as the oval one.

A good portion of the labour force turned up for work emotionally drained, sleep-deprived and running on adrenalin, having just witnessed the best performance – and result – from a New Zealand football side.

The heroics and hyperbole of the 1-1 draw with Slovakia were cast aside as the All Whites took on the might of Italy and held those fancied, fleet-footed, blue-shirted millionaires to a 1-1 draw. …

There is no bigger tournament in world sport than the Fifa World Cup.

To qualify is a mission in itself, full of its own pulsating dramas – witness the fateful decider with Bahrain at Wellington’s Westpac Stadium earlier this year, the Rory Fallon header for goal, the Paston penalty save.

The eyes of the world are upon this tournament as they are no other, even arguably, the Olympics, and in their spectacular form-upending results to date, the All Whites will have had those eyes turning in this direction …

In the lead-up to the tournament, website sbnation.com predicted the All Whites had “as much chance of advancing out of group stage as a paraplegic pig thrown into a tiger pit has of walking out of there unscathed”.

That quote should be read out to the team just before the Paraguay match.

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Editorials 21 June 2010

June 21st, 2010 at 3:15 pm by David Farrar

The Herald calls for transparency around PEDA:

Devolution of social services to community groups is by no means a bad idea. It holds out at least the possibility of having a more effective impact on social problems than large, impersonal bureaucracies that lack the intimate understanding necessary for success. …

The Budget provided $4.8 million over four years to this end. It was a small amount in comparison to Whanau Ora’s $134 million over the same period and its aims were, in a sense, more ambitious.

Rather than a grass-roots social welfare initiative, it seemed that this was intended to advance the economic and entrepreneurial skills of Pacific Islanders.

I think most would agree that the intent is good.

According to the Budget papers, the money has been allocated to an organisation called the Pacific Economic Development Agency about which very little is known. Peda, as it is called for short, has an impressive-looking website that is long on high-sounding jargon and short on evidence of achievement.

And this is the issue. It appears PEDA has no track record in terms of delivering such programmes. Granting them $4.8m with no track record is a somewhat reckless decision. More sensible would be some modest initial funding to give them a chance to prove themselves, and then if they actually produce results consider increasing funding.

The other issue is how were they selected. They obviously made  a pitch to one or more Ministers. Generally work should be tendered as contestable by an agency – not by Ministers. Now of course many agencies design tenders so only one firm can “win”, so it can be better to be upfront and say these guys have an initiative worth supporting, so we will. But you better make damn sure they are actually capable of delivering, and that there is accountability for any funding.

The Dom Post lashes the so called train “service”:

Commuters who rely on Wellington’s dilapidated rail network to get them to and from school, university, work or other appointments can be forgiven for feeling a dejected sense of deja vu.

This time last year, KiwiRail’s passengers were so irate they sought compensation from the company as trains ran late, heating failed, and peak-hour commuter chaos too often reigned.

The result was a significant slump in passenger numbers, leading to a $2.5 million budget blowout for Greater Wellington regional council, which subsidises the commuter service that is owned and operated by the state-owned enterprise.

Last week, those who have persisted with the ageing carriages plying tracks that crisscross the region were grumbling again.

Several thousand passengers were, on average, 20 minutes late one morning, for example, when, in the latest in a series of hiccups this year, points failed.

Particularly grumpy were pupils who have missed many classes or been late for others. Samuel Marsden Collegiate pupil Georgia Smith estimated she had missed 25 classes this year alone because of late-running trains.

KiwiRail’s reluctant owner – the taxpayer, via the Government – acknowledges they are, hence its $550m overhaul of the capital’s entire network.

That major upgrade includes fixing the blessed points, and building a third line in and out of the central city railyards.

I’d be interested in data on what the true cost of a commute from say the Hutt to Wellington is, and how much the passenger pays, and how much taxpayers and ratepayers pay.

The ODT hails justice over Bloody Sunday:

The road to justice is often long and tortuous, but for the relatives of the dead killed on January 30, 1972, in Northern Ireland’s infamous “Bloody Sunday”, it has been interminable.

Thirty-eight years is more than a life sentence for the guilty; for the innocent it is an eternity.

Now, finally, all these years later comes the Saville Report – presided over by British Supreme Court judge Lord Saville of Newdigate – with its unequivocal exoneration of the victims and inescapable conclusion that the shootings were “unjustified”.

Thus, beyond the decades of accrued grief, the pain of false accusation, the chafe of implied terrorism on the part of the victims and their families – which cannot and should not be underestimated – there was the insult of justice denied; and, devastatingly, the unconscionable subversion of all that is right and good about the exercise of power in mature democracies.

What happened on that fatal and fateful day in the Derry winter of 1972 can now be seen for what it was: a blunder by military officers occasioning the needless killing of innocent civilians, followed by years of cynical evasion and cover-up.

Responding to the report on its release last week, British Prime Minister David Cameron told the House of Commons: “I never want to call into question the behaviour of our soldiers and our army, who I believe to be the finest in the world. But the conclusions of this report are absolutely clear. There is no doubt, there is nothing equivocal, there are no ambiguities. What happened on Bloody Sunday was both unjustified and unjustifiable. It was wrong.”

David Cameron handled the issue very well I thought.

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Editorials 17 June 2010

June 17th, 2010 at 2:00 pm by David Farrar

The Herald hits out at dubious pet projects:

The latest example of misuse is the $120,000 that the Auckland City Council’s finance and strategy committee has voted to spend on commissioning a history of the council from 1989 to 2010. …

Never mind, also, that the money is being spent on a work which, no matter how worthy, will be of interest to few and read by even fewer.

Two previous volumes covering the history of Auckland from 1871 to 1989 hardly featured on bestseller lists. …

In time, an uncommissioned historian would surely come up with a far more interesting and relevant work.

I blogged on this, this morning, and agree with the Herald that it is un-necessary expenditure.

The other three editorials are all on Labour and Chris Carter. First The Press:

Last week, before his demotion from the Labour Party front bench over his misuse of his ministerial credit card while in government, Chris Carter spoke of being close to quitting because of the uproar over the matter.

It was apparently only a passing thought but now that he is cooling his heels at home after the Labour leader, Phil Goff, bluntly told him to take some time off to consider his future, it is a question he should seriously consider. Carter’s appalling behaviour in the days after the exposure of his credit card transgressions is only the latest indication that he may lack the temperament, moral compass and gravitas that should be the basic equipment of a member of Parliament and Cabinet minister. …

Carter’s first response, on the other hand, was a pig-headed refusal to accept that he had done anything wrong. Even when Goff finally made it clear to him on Tuesday that his performance had not been acceptable, he still declined to apologise to his fellow Labour MPs and fled from journalists who tried to question him on the matter. It was only after Goff told him to go home and calm down that he finally made the public apology he should have made days earlier. By this time he had forced Goff into the farcical position of having to hold a third press conference of the day to deal with the matter.

The Dom Post:

They show that ministers in the last Labour government thought nothing of spending more on a night’s accommodation, a meal or a taxi ride than some of their constituents could earn in a couple of weeks. The difference between Mr Carter and the other two Labour MPs who misused their ministerial cards for personal expenditure – Shane Jones and Mita Ririnui – is his lack of contrition. …

There are even times when it is in the national interest for them to splash out on a particularly good bottle of wine or expensive meal, for example, when hosting their international counterparts. What the records released last week show, however, is that ministers in the last government lacked the ability to distinguish between spending in their interest and the country’s interest.

That is a problem not just for Mr Carter, who cannot ever hope to hold another ministerial post, but for his party. Bollinger, lobster, massages, limousines, helicopter rides and $700 taxi fares are not the way middle New Zealand lives, let alone Labour’s traditional supporters, the ones Labour’s MPs rely on to give up their free time to hand-deliver mail, knock on doors and ferry supporters to the polls on election day.

Labour has a credibility problem. It will not be fixed by ceremonially beheading three big-spending MPs. It has to reconnect with people who don’t drink Bollinger, stay at luxury resorts or eat like royalty by demonstrating that their concerns are its concerns.

That is the long term challenge indeed.

The ODT opines:

When Labour leader Phil Goff named his shadow cabinet in November 2008, it was clear his natural caution influenced his decisions.

He did not promote any of the new entrants in Labour’s caucus, relying instead on the experience of ministers who had served in the Clark government.

His rationale may have been that they would be best suited to attack the new government and maintain Labour’s poll standings; if so, it was a strategy that failed.

Which is why he will do a full reshuffle later this year.

In that sense, the opportunity presented to Mr Goff by the expenses scandal has proved a godsend.

He was able to remove from the spotlight one serious contender for the leadership in Shane Jones, and in dealing with the other major offenders would finally be able to give a public demonstration of the strength of his own leadership.

Labour has been damaged by this, but Goff personally has come through it ok.

If Mr Carter gets the message, he likely will return in a state of contrition.

If he does not, he will resign, forcing a by-election – a prospect Mr Goff probably would not welcome.

Well who wants to fight a by-election caused by an MP resigning because he resented criticism of his overseas travel?

A leader with better advice than Mr Goff appears to be getting would have acted more ruthlessly, and perhaps Mr Goff – who evidently does not have a personal chief of staff – should consider hiring a political adviser not inclined to shelter him from unpleasant realities.

I recently saw an exceptionally good quote from Solon, a Greek lawgiver in around 600 BC, which was “In giving advice, seek to help, not please, your friend“. This should be pinned up in most parliamentary offices.

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Editorials 16 June 2010

June 16th, 2010 at 10:00 am by David Farrar

The Herald says the reshuffle is only the start for Labour:

Probably the most notable aspect of the Labour Party’s reshuffle was Phil Goff’s acknowledgment that further change is needed.

Halfway through the electoral term, his party is struggling to dent the Government’s popularity, despite the helping hand provided by policies such as the mining of the conservation estate and an increase in GST.

Clearly, Mr Goff will need to place more figures with vigour and political appeal around him before the end of the year. Yesterday’s reshuffle of positions and responsibilities should have been merely the starting point. …

Mr Goff has acted decisively against those exposed for their misuse of credit cards. A tougher test will be orchestrating a thorough Labour renewal this year.

The party’s failure to gain traction leaves Labour that option or one other – a resuffle from the bottom, in which Mr Goff and deputy Annette King are moved by their colleagues rather than the other way around.

I believe Goff is safe until the election.

The other three editorials are on the foreshore and seabed announcement. First The Press:

The 2004 Foreshore and Seabed Act was one of the most contentious and deeply flawed pieces of legislation passed by the previous government.

The act stripped Maori of the basic right to have the courts test foreshore and seabed claims and led to the split in Labour ranks which produced the Maori Party. Labour was subsequently unable to find an acceptable alternative to its legislation but now Prime Minister John Key has achieved just this, with a solution that is fairer for all New Zealanders. …

For Key and Attorney-General Chris Finlayson, the agreement brokered this week is one of the most significant achievements of their first term in the Beehive. It offers the prospect of a balanced and lasting settlement to a divisive issue which has for six years been, as Key aptly noted, a “weeping sore” in New Zealand.

And the Dom Post:

A last-minute pre-Cabinet meeting on Monday, involving Mr Key, Treaty Negotiations Minister Chris Finlayson, the Maori Party and the Iwi Leadership Group, came up trumps. In a deal that is too timid for some Maori and too bold for some Pakeha, the hated 2004 legislation will go, foreshore and seabed now vested in the Crown will become “public space”, which cannot be sold, and customary title and customary rights will be recognised by way of a new court process or direct negotiations with the Crown.

Mr Key seemed genuinely to want this agreement. He has increasingly grasped the uncomfortable fact that the country cannot move forward unless and until Maori grievances are honourably settled. With that at least partially achieved thanks to Monday’s deal, the prime minister, Maori Party MPs and iwi leaders, however, must do more than pat each other on the back. That many Kiwis are unhappy almost goes without saying.

And finally the ODT:

The Government has had its way with its favoured plan, and despite contending otherwise, has made some concessions whose effective outcome may be determined not by elected Parliament but by unelected courts – hardly a desirable situation in a property-owning democracy headed by a Government which purports to have sought “balance” in its scheme.

The Maori Party can claim a long-term gain sufficient to cover any embarrassment about its short-term compromise.

There may yet be room for adjustment, or at least for some acknowledgement of the equal status – if it still exists – of the vast majority of New Zealanders, including urban non-tribal Maori, whose future connection with the foreshore and seabed is apparently to be legally classified as of inferior virtue.

Thus does grievance lie upon grievance.

The ODT very unhappy it seems.

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Editorials 12 June 2010

June 12th, 2010 at 1:59 pm by David Farrar

All four major editorials are on the credit card revelations. First the Herald:

Such scrutiny is, obviously, overdue given some of the ministerial behaviour that has come to light. Equally, it must be recognised that the very functioning of government sometimes requires ministers to dip into the taxpayer pocket.

In this regard, some of the criticism directed at ministers has been well wide of the mark. Take, for example, the fact that Trade Minister Tim Groser paid what, for New Zealanders, represents a lavish restaurant tip while at an Apec summit in South America.

Quite simply, that was the level of gratuity expected in Peru. Equally, the same minister, as part of his official duties, is expected to entertain dignitaries on his many trips overseas.

There should be no surprise that his spending on liquor and food is reasonably substantial.

Likewise, there is nothing out of the norm in Murray McCully spending nearly $2000 of taxpayer money on laundry services.

His role as Foreign Affairs Minister dictates not only that he travels frequently but that he presents a good image when meeting foreign dignitaries.

McCully naturally looks unkempt, so any investment in keeping his shirts wrinkle free is worth it :-)

And there is Shane Jones’ lust for pornography, which led him to watch as many as three pay-per-view blue movies a night in hotel rooms and then charge them to his card.

The revelation will surely lead to the demotion of the former Building and Construction Minister when he faces his Labour caucus colleagues next week.

Labour leader Phil Goff has little option given his strong criticism of Housing Minister Phil Heatley, whose infringements were mild by comparison.

As Mr Jones conceded, he has dug a hole that may well prove to be his grave. It is difficult to see a way back, so deep and enduring will be the taint of the revelations and what they say about him.

Labour MPs are busy lining up to tell Shane that he can recover from this, but the political reality is that if he carries on he will spend 18 miserable months on the backbenches, and then disappear at the next election. They just want him to stay on, to avoid Judith Tizard returning.

The Press slams appalling judgements:

Some might argue that the credit card revelations are a media beat-up, but in the case of the worst offenders there are serious issues. The spending reflects appalling judgment and a misplaced sense of entitlement on the part of several senior politicians who once held ministerial portfolios, with some no doubt aspiring to do so again.

Another disturbing feature thrown up by the release of documentation is the tardiness of some ministers in filing receipts for their spending, with officials having to pester them to do so. Again, this reluctance to be accountable for spending taxpayer money showed poor judgment.

But again some balance:

This helps explain why food and drink receipts loom so large among the released documents. The current Trade Minister, Tim Groser, who was the subject of a complaint about his behaviour on an international flight, has now raised eyebrows with his mini-bar tabs. But Groser should not be judged harshly too quickly. Groser is required to be frequently overseas on portfolio business and should not be begrudged, after a long day of trade talks, winding down in his hotel room with a drink. Perhaps it needs to be explained, however, how he came to buy five $92 bottles of Famous Grouse scotch during the climate change conference in Copenhagen. Whether or not another former Labour minister, Judith Tizard, should have spent $155 on a single bottle of champagne is another question.

People who don’t travel much think that travel is fun. Being in other countries can be fun, but travel itself is not. Spending 200 days a year travelling overseas is a pretty miserable existence.

The Dominion Post focuses on Shane Jones:

Former Labour minister Shane Jones’ biggest sin was not that he watched pornography. It was that he got the taxpayer to pay for the pornography he was watching. Mr Jones’ purchase of porn betrays of mammoth sense of entitlement and a minuscule sense of propriety.

He is not alone. Judith Tizard moved on from being a chardonnay socialist to become a Bollinger bolshevik, charging up a $155 bottle of bubbly to the taxpayers.

Chris Carter felt it was appropriate to use his ministerial credit card to buy flowers for his partner, Peter Kaiser, and for colleague Lianne Dalziel when she was sacked, plus kitchenware in London, and massages in Buenos Aires.

Mita Ririnui used his card for golf clubs and at a bike shop. The list goes on. They can clearly read the menus and wine lists but apparently not the ministerial guidelines on spending.

The lack of remorse is what grates:

Mr Carter says his mistakes were “perhaps inevitable, but never excusable”. That offers no insight into why he thought the taxpayer should be paying for “kitchenware” – apparently mugs bearing the British Labour Party logo – and its postage back to New Zealand from London.

Former agriculture and forestry minister Jim Anderton is little better. He has rejected any suggestion it was improper that spa treatments at a Malaysian hotel were charged to his ministerial card, saying he paid the money back and “it’s just silly to think you’re going to carry a number of cards and pay for this on one and that on another”.

He is wrong. That is exactly what he should have done, and what most in the private sector expect to do when they are travelling with a company credit card.

Exactly. And the excuse that Ministers are too busy to check out themselves is trite. They can give their personal card to staff to use at checkout. They can get the bill the night before and indicate then what items are personal and pay for them.

Mr Jones, once touted as a future Labour leader, will pay a high political price. His credibility is all but gone.

In many ways a pity. He was one of the economically most literate MPs in Labour. But his colleagues are deluding him if they say he can get over this.

The ODT points out not all Ministers have offended:

Many members of the public and probably most of the media have long suspected politicians have so designed their professional way of life in such a manner as to rort the taxpayers as often and as deeply as they can get away with, surrounded such behaviour with a thicket of prohibitions on disclosure, and adopted denial as the first defensive posture when challenged.

The accusatory brush has been broad, yet as the recent disclosures show, unfairly so. By no means all present and former ministers have abused their special privileges at our cost; indeed, several have been quite circumspect, using their ministerial credit card with caution and within the rules. …

The exceptions have been disappointingly cavalier with their private spending and their hypocrisy for doing so while generally railing against wasteful state spending will do their reputations no good whatsoever.

Winston Peters has denied using his credit card, but it is clear from the records that his staff charged many items to it claiming they were expenses, never mind a reminder of the “unarguable” policy that credit cards not be used for personal expenditure, regardless of repayment.

Jim Anderton was also shown to have used his card for a massage and spa services for himself and his wife while on Labour government business.

Others have treated the taxpayer-funded card just as carelessly, but on a far greater scale. The contrast on television between the smirking former Labour minister Chris Carter and his shamefaced colleague Shane Jones perhaps spoke volumes about attitudes.

Indeed.

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Editorials 11 June 2010

June 11th, 2010 at 3:00 pm by David Farrar

The Herald talks OCR:

Money markets expect this tightening by way of small steps to prompt an official rate of 4 or 4.25 per cent by this time next year, and further increases to about 5 per cent by the end of 2011.

We should not, says Governor Alan Bollard, expect the rate to rise as far as the 8.25 per cent peak of the previous cycle.

Hopefully not, but several things could knock the ship off course. One is rising inflation, the central bank’s core concern.

I think the OCR will increase beyond 5%.

The Press also talks OCR:

Now, however, as recovery begins to look more robust here and among New Zealand’s main trading partners, the central bank must consider again the prospect that inflation will spike outside its target 1 to 3 per cent range. The move yesterday was modest – only a quarter of a percentage point – but it is an indication that the bank is determined to keep inflation expectations under control.

Some manufacturers and exporters have suggested that moving now on interest rates is premature. Manufacturers and exporters, like politicians and indeed all borrowers, never welcome interest rate rises, but the criticism in this case is unwarranted. The Reserve Bank under Alan Bollard has hardly been hawkish on inflation. A sign of this is the fact that, in an effort to balance competing forces during the boom years, the bank allowed inflation to nudge outside its prescribed limits three times in the space of six years. At the moment, inflation in the future is a possibility.

I still think the range should be 0% to 2%, so a midpoint of 1% is targeted.

The Press focuses on the Foreshore & Seabed negotiations:

Last year, the Government announced it wanted to restore the right of Maori to seek customary title in court, and acknowledge the foreshore and seabed not already in private title as public domain. It held nationwide hui, with Treaty Negotiations Minister Chris Finlayson at each one. Though that impressed Maori, they did not like the “public domain” concept. They want ownership in iwi hands, the foreshore and seabed being inalienable.

Again I remind people that the Court of Appeal merely said that an Iwi could try and claim title in court, not that they would get it. They also said one would have to show unbroken usage since 1840. That is a world of difference away from saying Iwi own the entire foreshore & seabed.

What the Maori Party thinks at this point is not clear – it definitely wants the Foreshore and Seabed Act repealed but might be having to weigh up pleasing the ILG against pleasing an increasingly implacable prime minister.

As Mr Key found over the Tuhoe/Urewera matter, it is hard to placate Maori without upsetting many Pakeha or to ameliorate Pakeha fears without upsetting many Maori. He might have to reluctantly accept that the Foreshore and Seabed Act has to stay on the books.

That is an option. Another is to simply repeal the FSA and let Iwi test their claims in court.

And the ODT chides North Korea:

The jury appears to be out on the exact state of mind of the North Korean dictator Kim Jong-il, variously regarded when healthy as either cunning like a fox, borderline mad or just pathologically nasty.

It is rumoured that he suffered a destabilising stroke some 18 months ago and, at 68, is ailing. Consequently, the world’s only hereditary communist dictatorship seems to be gearing up for succession to the “Dear Leader”.

Cuba is looking hereditary also. Ironic that communism was meant to be a fight against inherited privilege.

Had there been serious evidence anywhere else in the world that a submarine of one sovereign nation had arbitrarily sunk a warship of another, in what appears to be an entirely unprovoked incident, the clamour for retaliation or justice would have been deafening.

This is my concern. You reward North Korea for being well mad.

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Editorials 10 June 2010

June 10th, 2010 at 12:00 pm by David Farrar

The Herald says NZ Post must not alienate its customers.

What is surprising about the contents of a letter from the NZ Post board to the Government is the extreme nature of one of the options under consideration. That would see mail delivered every second day.

If enacted, this would be the equivalent of NZ Post shooting itself in the foot. In effect, the organisation would be conceding that postal delivery has become something of an irrelevance.

Advocates of such a move would say that is already largely the case. Over the past year or two, letter volumes have been declining by about 6 to 7 per cent annually, an unprecedented rate far in excess of the 1 per cent or so drop of previous years.

Almost all my mail now is junk. 80% of my suppliers now e-mail me statements etc.

That trend is almost certain to continue as more consumers embrace online communications and bill payments. But delivering mail every second day would surely serve only to accelerate the rate of decline.

Yes, but it would accelerate a decline in costs.

Of these, the ending of Saturday deliveries appeals as a reasonable first step towards cutting costs that would have little impact.

Australia and Britain long ago abandoned weekend deliveries, and the United States is about to do the same. It is remarkable that it has remained part of NZ Post’s contract with the Government for so long.

Indeed, it says much about the organisation’s service ethos. But relatively little mail is delivered on Saturdays, and the service would hardly be missed, even by old people, who rely more on mail than other groups.

A sensible first step.

The Press wants more cruise liners to Christchurch:

The idea of building a swept-up dedicated facility at the Lyttelton port to serve cruise liners is an attractive one.

In addition to the fact that the Lyttelton Port Company says that as its other shipping activities grow it has an urgent need for one anyway, a new, modern facility providing a good first impression for visitors to Christchurch and the wider region is certainly worth serious consideration. The port company has so far, however, not been able to persuade others who would have to put some money up to pay for it that the proposal is financially worth-while. Since they are the ones who would most benefit from the project, it suggests that some of the claims made for it may not stand up under closer scrutiny, at least not in the present financial climate. …

If a compelling economic case can be made that a better facility will increase the volume of traffic at the port above what would occur in any event, then the port company will deserve to win financial support for it. But money should not be put into it simply because it would make an attractive building on the waterfront.

The Dom Post says Peter Bethune is fighting the right fight but with the wrong tactics. I agree. The Dom Post incidentally has been a strong campaigner itself against Japanese whaling:

Supporters of New Zealander Peter Bethune, facing a Tokyo court after boarding a ship protecting Japanese whalers in Antarctic waters, are right to describe as bizarre Sea Shepherd’s decision to ban him from future protests because of his bow andarrows.

Taken at face value, it is a late development of responsibility from an organisation that has a well-deserved reputation for protests that cross the line into idiocy and endanger lives.

Its founder, Paul Watson, threatened in an earlier protest to ram his ship into the slipway of a Japanese whaler, saying he would give it “a steel enema”.

He has been reported as referring to Greenpeace as “Yellowpeace” over its refusal to use violence. In a 2007 interview with the New Yorker magazine, he said Sea Shepherd had sunk – in port – 10 ships. (The magazine credited Sea Shepherd with two sinkings and two attempts.)

That sits oddly with Sea Shepherd’s now announced stance of “aggressive but non-violent direct action”.

Indeed. It may be a publicity stunt to try and get a lesser sentence for Bethune.

Another is that, however much Bethune might wish otherwise, the case does not revolve around Japan’s shameful use of the scientific whaling loophole to pursue what amounts to a commercial operation in the Southern Ocean, but around charges of trespassing, vandalism, possession of a knife, obstructing business and assault – charges on which he appears to have received a fair trial.

Bethune chose foolish tactics to promote his views. The Japanese were entitled to use the law to test whether he went too far. He and his family must now be concerned that he will pay a high price for his high principles.

The four charges he pleaded guilty to were fairly minor, and if he is found innocent of assault, I hope he gets to come home soon. If he is convicted on the acid throwing charge, he may be in Japan for a fair while longer.

The ODT notes the retirement of Pete Hodgson:

Mr Hodgson was no novice when he sought public office. He had become the Labour Party’s master election strategist at a time when such essential duties were still of an amateur nature.

He became aligned with Helen Clark’s backers and by the time she achieved the prime ministership, in 1999, he had become a member of her trusted inner circle along with Michael Cullen, Trevor Mallard, Phil Goff and Steve Maharey.

She appointed him a minister from a caucus light on genuine talent and gave him a heavy workload from the start, reinforced by his task in Parliament’s debating chamber as one half of Labour’s heavy artillery in debates – the other half being another Dunedin MP, Michael Cullen.

As a minister, Mr Hodgson’s success was mixed. His generally detached demeanour – that of a strategist and pragmatic thinker – provided no profile with which the public could warm to, and Ms Clark gave him some most unpopular portfolios including climate change, energy and health.

In politics, nothing lasts, and it became clear Mr Hodgson’s star was losing its shine in 2008, when he was replaced as the party’s chief strategist for the forthcoming election by Helen Clark herself.

Mr Hodgson has generally been considered a well-liked and hard-working constituency MP who wore his political colours lightly when it came to representing Dunedin’s interests and the personal matters with which, as Dunedin North MP, he dealt on a daily basis.

Even in this professional political era, Labour will miss his strengths – and Dunedin will certainly miss his abilities and advocacy.

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Editorials 9 June 2010

June 9th, 2010 at 12:00 pm by David Farrar

The NZ Herald criticises Len Brown for his council credit card use:

Today, Mr Brown will be wondering how seriously he has been tripped up by, as is so often the case, a relatively trivial sum of money.

Having admitted making personal purchases on his council credit card, including a $148 mini hi-fi system, he says that he has now reimbursed the council for personal expenditure totalling $579.27.

What has not been absolutely clear to me is when the reimbursements occurred. Was it the day after the purchase? Was it within a month once the statement turned up, or was it only when the media asked for copies of the credit card records?

The episode leaves problems for Mr Brown. First, he has allowed himself to become the subject of questioning at the very time that the issue of politicians’ expenses and allowances has been under intense scrutiny in New Zealand and in Britain.

This, at the very least, smacks of carelessness, while also suggesting a lack of judgment. Mr Brown may well have thought that no harm would be done by charging the hi-fi to his council credit card because he did not have his personal card and it was “essential” to get it that day.

I’m still a bit mystified by this. Most people also have an ATM card as well as a credit card. Did he somehow manage to leave all his cards behind except the Council one?

The Press criticises secrecy at Christchurch City Council:

Trying to extract financial information from the Christchurch City Council is all too often an exercise in frustration, and the dollar signs surrounding the Ellerslie International Flower Show have been an instance of this.

The Press has for several months wanted a cost breakdown of this year’s show. When the council belatedly responded, it did give an overall cost of $2.97 million, but not the detailed breakdown of an event upon which much public money has been spent.

Unfortunately, this secrecy over the show has been typical of the council. It was only last September, almost two years after it bought the show, that the council deigned to reveal how much it had paid for it.

The ratepayers right to have details of what they are funding, should outweigh commercial considerations.

The Dom Post wants an independent inquiry into the Gaza flotilla incident:

It is a basic rule of justice that those accused of a crime should not sit in judgment on themselves. For that reason, Israel should not be ruling on the rights and wrongs of its attack on a Gaza-bound aid flotilla last week.

Determining who is to blame for the deaths of nine people aboard a Turkish ship should be the work of an independent international body, as proposed by United Nations Secretary-General Ban Ki-moon.

Mr Ban has suggested that former New Zealand prime minister Sir Geoffrey Palmer be appointed to head an international panel that would include representatives of Israel and Turkey. It is a sensible suggestion that would ensure the countries directly involved have a voice in the inquiry. But no sooner had he put up the idea than Israel’s Washington ambassador, Michael Oren, shot it down. “Israel is a democratic nation. Israel has the right and ability to investigate itself,” he said.

Israel should think again. The inquiry represents an opportunity as well as a threat to Israel. Mr Oren’s argument is the equivalent of the accused in a criminal case demanding not only the right to defend himself, but the right to present the prosecution’s case and to pass judgment once the evidence has been heard. It is not credible.

I agree that Israel should agree. An internal inquiry will not have credibility.

And finally the ODT looks at a health programme:

Apart from the trendy acronym – B4SC – by which it is known in certain quarters, there is much to be said in favour of the Before School Check programme implemented by the country’s district health boards in 2008-09 at the behest of the Ministry of Health.

The intention of the programme is the early detection of health needs with referral on to appropriate specialists.

This makes good sense: health and general wellbeing issues (for example, growth, dental, vision, hearing) detected early, and remedied, are issues that could otherwise evolve into capital intensive or resource-hungry problems.

Identified and addressed, the expensive ambulance at the bottom of the cliff becomes somewhat redundant, as do the various interventions required as the child makes his or her troublesome descent.

Introduced under the last Labour administration, the initiative came sharply into focus when Health Minister Tony Ryall, unhappy with aspects of its implementation, called for a review last year.

He subsequently announced in April that it would continue.

They key is making sure the programme reaches those most in need.

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Editorials 8 June 2010

June 8th, 2010 at 11:00 am by David Farrar

The NZ Herald says work can make you better:

For some time, the startling increase in the number of people on sickness and invalids benefits has been as vexing as it is worrying. Have we become a sickly society? Is this the logical consequence of an ageing population? The relentless rise in the number of such beneficiaries – from 1.2 per cent of the working-age group in 1980 to 4.8 per cent today – suggested other factors were at work. Indeed, it is now apparent that a major factor is mental illness. Psychological disorders, led by stress and depression, accounted for the entire increase in sickness benefits and a third of the increase in invalids benefits from 1996 to 2002. This has obvious implications for those charged with getting as many beneficiaries as possible back into the workforce. …

Happily, it has just been highlighted by the Royal Australasian College of Physicians, which, in a position statement, noted that “the evidence is compelling: for most individuals, good work improves general health and wellbeing and reduces psychological stress”. The college points to a recent British review, which found the beneficial effects of work outweighed any risks, with the benefits much greater than the harmful effects of long-term unemployment or prolonged sickness absence.

I’ve had a couple of brief periods of unemployment or under-employment. During those times I did volunteer work so I was still doing something, rather than nothing.

The Press focuses on the proposed Gaza flotilla inquiry:

The Israelis also fear what they see as the stitch-up that the Goldstone inquiry into the assault on Gaza a couple of years ago became. Although it was led by a respected South African former judge, Richard Goldstone, and made some efforts at even-handedness, that inquiry’s findings were quickly unpicked by critics as weighted unfairly towards the Palestinians and ultimately were easily dismissed. One of Palmer’s tasks, if he gets the job, will be to ensure that the inquiry is conducted with a scrupulous regard to impartiality. A properly conducted inquiry might help defuse some of the tension that the raid has generated. It might go some way to averting serious and lasting diplomatic damage that at the moment seems inevitable.

I may not agree with Sir Geoffrey on alcohol reform, but I think he would be a very good choice for this role. NZ is one of the few countries seen pretty much as an honest broker, and a proper inquiry would be very beneficial.

The Dom Post talks road safety:

Last year 10 people died on the roads over Queen’s Birthday Weekend. By late yesterday this year’s toll was one. That is good news, but it is still one too many.

Aroha Ormsby was killed when she was thrown from a car. Her death leaves three young children motherless, and friends and family confronting a personal tragedy that will never be revealed by a study of the bald statistics.

The death of Ms Ormsby – and of the hundreds of other New Zealanders killed each year – is why the police were right to trial a lower tolerance for those who break the speed limit. As long as there are New Zealanders dying on the roads there can be no slackening in the effort to make the roads safer.

The sceptics will point to the atrocious weather over the holiday break, and say that the low toll and lower speeds owe as much to people staying home or slowing down in the rain. That will have played a role but so too will the increased prospect of a ticket.

I certainly think the appalling weather was the major contributor. I also think it is unwise to jump to conclusions based on just two data points.

They should remember that the 100kmh limit is just that – a legal limit. It is not meant to be treated as an infinitely flexible guideline, something that applies unless the road is clear and it’s a sunny day, or unless there is a car that needs overtaking

I hope the editorial writer has never over taken a car by exceeding the limit. Never mind that to overtake a car travelling 90 km/hr means you need a straight road with no cars coming for at least 2,000 metres to do so without exceeding 100 km/hr.

The ODT looks at Labour’s mud and smears:

The Labour Party seems unable to get over the fact that John Key is wealthy, and it has frequently made attempts to imply or demonstrate that he gained his wealth deviously, and continues to do so.

None of these efforts has succeeded.

Helen Clark tried it when she claimed Mr Key personally profited from the 1993 privatisation of Tranz Rail, because he had been a former director of Bankers Trust, which won a contract to advise the then National government on the sale.

At the relevant time, however, Mr Key was nowhere near the sale; he was operating as a foreign exchange dealer.

Ms Clark may have been badly advised, but this did not slow her attempts to muddy the Prime Minister’s credibility, especially in the business and commercial world.

Clark and Labour’s view seem to be if you made your money in business, you must be corrupt – the only honest way to earn money is as a teacher, academic or unionist.

The latest attempt has been made by another senior party figure, the Dunedin North MP, Peter Hodgson, who has tried to show the Prime Minister knows what assets are held in his “blind trust”, implying that a conflict of interest has or can arise where government policy is concerned, to Mr Key’s financial advantage.

That is a serious claim to make where public figures are concerned who hold positions where they can influence policy.

Mr Hodgson’s “evidence” – it hardly justifies the description – has been successful to the extent that Mr Key, in responding, seems to have had some knowledge of one asset in particular.

It is no more than that, however: there is no shred of proof that his knowledge – if he had it – has been used to influence policy to his advantage.

Key’s crime is that three weeks after the blind trust was set up, he referred to owning a vineyard that was now in the blind trust.

That appears to be the end of the latest attempt to impugn the Prime Minister for his wealth, but it is unlikely to be the last.

The ODT has got to the heart of the real crime – that John Key is wealthy. You can just feel the envy and hatred blister as they snidely refer to his holiday home in Hawaii. How dare he have become wealthy.

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Editorials 4 June 2010

June 4th, 2010 at 3:00 pm by David Farrar

The Herald wants some trams to play with:

On a broader canvas, cities such as San Francisco and Melbourne are closely identified with their trams.

Auckland chose another route when it removed trams from its streets.

Now, more than 50 years later, they are being readied for a comeback on the city’s waterfront in time for next year’s Rugby World Cup.

They can be successful here as well, but only if other developments in the Wynyard Quarter provide a suitable underpinning. …

The Press focuses on water:

The granting of final approval this week to the Central Plains Water irrigation scheme should now let the proposal finally get under way.

The process by which the decision was reached has been long and impassioned and has wound up costing about twice what was originally estimated.

But along the way, the scheme has been rigorously scrutinised. About 2000 submissions were considered by the independent planning commissioners.

It has been much modified in the light of criticism that was made of the original proposal, and it is now much less ambitious than first intended.

In the end, though, the potential benefits have now been weighed by the planning commissioners against any adverse effects it will have on some people, and the final assessment is that the scheme will be good for Canterbury.

The Dom Post talks promises:

Mr Key has now been burned twice in a matter of weeks for taking positions he cannot defend.

The first was the Crown’s negotiations with Tuhoe. Whatever the Government is saying publicly, it is obvious Tuhoe was led to believe that ownership of Te Urewera National Park was up for negotiation. As Mr Key belatedly realised, it should not have been. But the fallout from Mr Key abruptly removing the park from the table has soured relations between National and the Maori Party and created a fresh source of grievance for Tuhoe.

Mr Key’s second false step – actually it was his first – was his pre-election promise, given both to this newspaper in response to a question from a reader and during a TV3 leaders’ debate five days before the election, that Kiwibank would never be sold. The promise conflicts with National’s policy on state-owned enterprises – that none will be sold during this term of government but that sales could be considered in future.

Key has now restated that Kiwibank will not be sold – not just during this term. He had little choice once he realised that his pre-election statements about sale were not just about the first term.

Key has gone to great lengths to keep faith with the electorate. What he is finding now though is that he should have been more careful with what he said pre-election. It is my belief that no leader should ever give a permanent guarantee on an issue. They should give commitments for the upcoming term of Parliament, but should always retain the right to campaign on a different policy at a future election.

The ODT asks if Peter Bethune is a hero or a victim. Some might say neither!

It is possible to feel strongly opposed to Japanese whaling in the Southern Ocean yet uneasy at some of the actions taken in opposition to it.

That’s me. I joke that the only people I hate more than the whalers are Sea Shepherd.

He continues to blame the captain of the larger vessel for a sudden change in course and a direct attempt to ram Ady Gil, such that a collision became unavoidable.

The exact sequence of events – who did what to whom – remains masked in confusion amid claim and counterclaim, the only certainty being there was a collision and, consequently, the unsalvageable Ady Gil later sank.

It was no surprise. The whalers have never had a collision with Greenpeace or other protest ships. Only Sea Shepherd who have a long history of trying to ram other ships.

It is hard to know at this distance the extent to which his tearful supplication to the Japanese judiciary on Monday was for their benefit – or that of the world at large.

Many activists tread a fine line in their efforts to invoke sympathy for the cause, often teetering but a small mis-step from achieving precisely the opposite.

Nobody, least of all those who believe Japan’s “scientific whaling” in the Southern Ocean to be bogus and unacceptable, would wish a prison sentence on this singular activist; but there might be those prepared to concede he appears, by his actions, to have asked for one.

I hope he does not get a prison sentence, because that is what he wants.

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Editorials 3 June 2010

June 3rd, 2010 at 11:15 am by David Farrar

The Herald wants an FTA with Russia given priority:

Last year, New Zealand exports to Russia were worth $187 million, a modest sum even if well up on the $51 million of a decade earlier. As Russia has a population of 142 million, those figures hint at the potential of a free-trade pact.

But more telling still is the fact that not so long ago, New Zealand enjoyed thriving commercial arrangements with the former Soviet Union despite an often strained diplomatic relationship, not least over the invasion of Afghanistan.

But Keith Locke supported that invasion, so maybe we should make Keith the free trade negotiator for Russia :-)

The Press supports the creation of a new bank:

The proposal to merge three finance organisations to create a new locally owned bank is a timely one.

For the finance institutions themselves, it is an opportunity, driven by necessity, to turn themselves into stronger, more robust entities, particularly after the turmoil of the last three years or so.

For investors, looking to diversify their investments away from the great Kiwi stand-by, domestic real estate, it could provide a worthwhile and productive place to put their money.

And for borrowers, particularly small-business owners who have complained of being cold-shouldered by unsympathetic banks during the financial crisis, it could provide a friendlier, more knowledgeable lender to local business. …

The three entities involved – Pyne Gould Corporation’s finance arm Marac Finance, the Canterbury Building Society and the Southern Cross Building Society – are established names in finance.

They have not been unscathed by the upheavals of the financial crisis, but they have survived it with credit ratings still at very respectable levels for non-bank institutions.

Two have BB+ ratings and the other a BB rating, which is at the high end for entities that are not banks.

But still not great. The acceptable grades are:

  • AAA : the best quality borrowers, reliable and stable (many of them governments)
  • AA : quality borrowers, a bit higher risk than AAA
  • A : economic situation can affect finance
  • BBB : medium class borrowers, which are satisfactory at the moment
  • BB : more prone to changes in the economy
  • B : financial situation varies noticeably

Once you start to get into CCC and below, institutions are officially vulnerable.

The Dom Post talks off shore drilling:

But for recent events in the Gulf of Mexico, the Government would be making more of a fuss of Brazilian oil giant Petrobras’ decision to explore for oil and gas off the East Coast of the North Island.

The world’s fourth-biggest energy company, a world leader in offshore drilling, this week won the right to explore about half of the Raukumara Basin, which extends north and east of East Cape. The company will spend up to US$118 million (NZ$174m) over the next five years gathering seismic data and drilling an exploratory well.

The project will create jobs and draw international attention to New Zealand as a potential source of petroleum.

But the big gains will come if Petrobras makes a commercial find. Already the petroleum sector generates about $3 billion a year in export revenue. Energy Minister Gerry Brownlee has estimated that figure could rise to $30b by 2025 if preliminary estimates of New Zealand’s petroleum resources prove to be correct.

Which would make a huge difference to our standard of living, and ability to fund health and education services.

However, celebrations this week have been muted by the ongoing disaster in the Gulf of Mexico. Six weeks after an explosion on BP’s Deepwater Horizon rig killed 11 workers, the well 1.6 kilometres beneath the sea is continuing to spew between 1.9b and 3b litres of oil a day into the gulf, polluting the fragile Louisiana coastline, threatening fisheries and destroying the livelihoods of fishermen and tourist operators.

For that reason it is essential that the promised overhaul of New Zealand’s health, safety and environmental arrangements for offshore petroleum operations is completed well before any deepwater drilling begins.

Agreed.

The ODT looks at Facebook and privacy:

Facebook, once a small, “free” social networking site for university undergraduates to share personal information, has become a vast subdivision on the information super highway.

It is expected soon to reach a landmark figure of 500 million registered users.

This would make it the third largest country on Earth, bigger than all but India and China.

On Monday this week – “Quit Facebook Day” – Canadian campaigners urged people worldwide to remove themselves from the site.

They, and many others, were riled about the way in which they felt their privacy was being purloined for profit.

Quite why they should have been so surprised is another matter: you do not pay upfront to belong to Facebook, but the company must make ends meet – and a tidy profit – somehow.

That “somehow” is no great secret.

The site sells advertising to companies tailored to the defined demographics of its users.

The “footprint” they create in their Facebook activities is like gold to advertisers and marketers who will pay accordingly.

I was talking last night to someone about Facebook, with the idea being that if a user is aged under 18 then their privacy settings are set by default to not share data with anyone but friends.

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Editorials 2 June 2010

June 2nd, 2010 at 12:00 pm by David Farrar

All four editorials are on the Israeli action on the high seas. First the Herald:

Israel can hardly claim to be surprised by the universal international condemnation of its commando raid on ships taking humanitarian aid to the blockaded Gaza Strip.

There is a sad familiarity about the episode, which left at least nine activists dead.

Here, as in last year’s military offensive against Gaza, Israel has reacted with force completely disproportionate to the situation. …

It should be noted that Israel had suggested that the flotilla should offload its 10,000 tonnes of medical and building supplies at the Israeli port of Ashdod before it was handed over to the United Nations for delivery to Gaza.

That was a reasonable compromise. Indeed, if such moderation were pursued, the people of Gaza might come to recognise an alternative to an extremism that, according to Israel, has led Hamas to place a higher emphasis on the securing of arms than the wellbeing of the Palestinian people.

Hamas has no interest in peace or welfare of its people. Its goal is to destory Israel.

The Press:

Like any nation Israel is entitled to defend itself and protect its citizens.

It regards Gaza, controlled by the hardline Hamas organisation, as a major threat to its security. This view is understandable as there is a history of attacks on Israel from Gaza using rockets and other weaponry undoubtedly smuggled into the territory.

These attacks have prompted incursions into Gaza by Israeli soldiers. They are also the rationale for the three-year Israeli and Egyptian blockade which is designed to prevent weapons being smuggled into Gaza amidst genuine aid.

But as is often the case, sympathy for Israel’s security quickly evaporates when it resorts to excessive force. That was so this week when its soldiers stormed aid vessels in the Free Gaza flotilla.

Two wrongs do not make a right.

The Dom Post:

Israel believes its problems can be solved with bullets. It is wrong, and deserves the condemnation now raining down on its head for attacking a ship bringing aid to Gaza and killing at least 10 of those aboard.

There is no doubt that the actions of the “Gaza Freedom flotilla” were designed to be provocative and turn the world spotlight on the plight of the Palestinians suffering in Gaza as the result of Israeli-imposed sanctions.

However, it was not “an armada of hate and violence”, as Israel’s deputy foreign minister, Daniel Ayalon, has dubbed it.

Israel must explain why it believed there was no other way of reacting to the flotilla than with an assault launched in international waters in the hours of darkness by a highly trained and – by all accounts – lethally efficient commando unit. It must say why other options to deal with what was a policing problem were not used.

The Dom Post is the most condemnatory of the four editorials.

The ODT:

There should be no doubt, now, about the outcome of the most serious waterborne challenge to Israel’s counterproductive blockade of the Gaza, despite the swamp of propaganda and “spin” from all sides.

People died, many were injured, Israel’s global reputation suffered another public relations defeat, and the people of Gaza continued to be pawns in a hostile diplomatic and strategic contest. …

The Government did make the point, however, that the “situation in Gaza is not sustainable”.

Indeed it is not.

It is deeply regrettable that Israel and Hamas refuse to recognise that reality.

A rational description of Israel’s high seas assault is that it was a severe over-reaction to a situation that could – and should – have been managed in a far more moderate, less assertive manner.

The commandos “slid from helicopters into a violent crowd, which attacked them with sticks.

It’s no wonder the troops opened fire in self-defence,” as one Israeli commentator put it, with more than a trace of irony.

By so doing, he added, “Israel walked straight into the trap that the flotilla organisers set . . .”

If this was really a planned effort to meet and contain the flotilla, it must be counted a tactical and military failure; an opportunity for Israel to earn praise ended in fiasco.

This is the reality. The Israeli Defence Forces should have been better prepared for violence and rather than helicopter troops on board would have been better to disable the vessels, user water cannons etc before boarding.

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Editorials 1 June 2010

June 1st, 2010 at 1:00 pm by David Farrar

The Herald looks at the BP oil spill:

As oil has become a scarcer resource, the search for it has, out of necessity, moved to more difficult locations. Oil companies have had to take a greater interest in inhospitable regions such as New Zealand’s Great South Basin and the waters off Alaska. They are also drilling in water so deep that any problems are beyond the reach of divers. This increases the potential for severe environmental damage if companies do not have adequate safety back-ups. Clearly, that was the case with BP and its Deepwater Horizon platform in the Gulf of Mexico. Indeed, it is now apparent that the company has no real idea how to contain, let alone control, the giant oil spill prompted by an explosion at the rig almost six weeks ago. …

The upshot of this ongoing failure is what the White House now says is the worst environmental catastrophe the United States has faced. The Gulf spill has easily surpassed the Exxon Valdez disaster off Alaska in 1989, with estimates of the amount of oil leaking each day ranging from 1.9 to 3 million litres.

And The Press talks tertiary education:

At first glance it does seem to be unfair on New Zealanders who aspire to a tertiary education.

With the Government freeze on funding for extra enrolments, universities are proposing higher standards for students, including courses that had previously been open entry. Yet at the same time the Government is encouraging more overseas students to study here, provided they pay full course fees.

The more overseas students you have, the more domestic students that can be funded. It is not an either/or.

As far as the domestic students are concerned, higher eligibility standards would be a positive development, despite the move being fiscally-driven. For too long there has been an expectation of an automatic right of entry to tertiary study. This unhealthy sense of entitlement among school-leavers should be eroded as universities call for higher NCEA pass rates.

And there should also be a national entry assessment for students over the age of 20 years; they currently have open entry despite the fact that mature students have a higher failure rate than school-leavers.

Finally, all those at universities should be told that they must now perform academically if they are to be entitled to re-enrol or, as the recent Budget signalled, to receive a student loan.

Slackers like myself will need to improve performance earlier, or get a job.

The Dom Post wades into the Andy Haden row:

It is to be hoped that Murray McCully does not apply the same standards to his role as foreign affairs and trade minister as he does to his role as Rugby World Cup minister. Otherwise New Zealand will become an international laughing stock.

It is no more acceptable for Rugby World Cup ambassador Andy Haden to refer to Polynesians as “darkies” than it would be for New Zealand’s high commissioners to Samoa or Tonga to refer to the locals as “coconuts” – another racial epithet Haden considers appropriate in “the right context”.

I don’t think anyone thinks it is acceptable. It is more a matter of whether he gets sacked for it.

Haden represents an old, and not particularly attractive, face of New Zealand. The image New Zealand wants to show the world at next year’s Rugby World Cup is of a young, confident nation that revels in the racial diversity of its makeup. His time has passed. He should go.

Ageism instead of racism!

The ODT also weighs in:

New Zealand’s premier rugby teams of today look very different to those of yesteryear.

They are now much bigger and much browner. Reflecting recent generations of mass Polynesian immigration to New Zealand, as well as Pacific interest and ability in rugby, Samoans, Tongans and Fijians are commonplace.

The All Blacks of the past 25 years would be a shadow of what they have been without Michael Jones, Jonah Lomu, Olo Brown and a long line of others. The Pacific has provided strength, pace, skill and leadership, capped with the appointment of All Black captain Tana Umaga in 2004. …

Selecting sports teams is, in essence, simple.

Pick those most likely to help the team win, whatever their colour, background or connections.

The jobs of coaches are precarious enough without them cutting their own throats by letting other considerations influence their judgements.

At another level, of course, selecting becomes more complex.

Choosing those most likely to help the team win is not the same as picking the most talented individual players. What will the impact of the person be on team culture, so essential for success? How will the player fit in with the style of the team? What is the playing balance of the team? Will the player thrive or shrivel?It is against this background that the extraordinary comments of former All Black lock and New Zealand Rugby World Cup ambassador Andy Haden should be viewed. …

The Crusaders’ primary interest has been to maintain winning ways, and they have, by the length of a rugby field, been the most successful in New Zealand at that.

It is reasonable to maintain that genetic and cultural characteristics influence how many Polynesians play rugby.

And it is fair enough for a team, like the Crusaders, to have a distinct style and therefore to be cautious about the number of its players, brown or white, who play a particular way.

But the Crusaders are too clever to be sucked into the racism that applies generalisations to particular individuals.

Exactly. Generalisations have their place in discussions, but you don’t apply them to known individuals.

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Editorials 31 May 2010

May 31st, 2010 at 11:00 am by David Farrar

The Herald talks All Blacks:

Yesterday’s announcement of the first All Black team of the season, who will play Ireland at New Plymouth, was the subject of even more fascination than usual. …

Henry had already hinted there would be new faces in the squad. Duly, as a matter of necessity rather than of wish, some with high potential as stars of the future were named.

Of the four, Victor Vito, Israel Dagg and Aaron Cruden are players of excitement and skill – potential matchwinners.

The fourth, Benson Stanley, is unfairly painted as a player whose turn has come only through injuries to others. Yet he is a poised, thinking midfielder with a thunderous tackle and highly rated by those in teams he plays in and often leads.

We’ll find out before too long.

Also on rugby, The Press says Haden must go:

The decision by the Rugby World Cup Minister, Murray McCully, to allow former All Black Andy Haden to continue as an ambassador for the 2011 Rugby World Cup, is a serious blunder.

Announcing yesterday that Haden would be keeping his role, McCully wildly missed the point about Haden’s misconduct and tried to suggest that because of some tepid expressions of regret by Haden about the language he used the matter should now be considered closed.

That is very far from the case. Haden has caused deep offence with a false and damaging accusation. He has not atoned for it, or even come close to apologising. Unless and until he does, he is not fit to remain as an ambassador for the Rugby World Cup programme.

Haden is one of the most connected men in rugby. So long as he doesn’t repeat his offence, I think he will be able to add value to the RWC.

Haden’s appointment as a Rugby World Cup ambassador was a questionable one from the outset. His reputation has long been under scrutiny. His dubious display in the lineout against Wales raised persistent questions about his behaviour on the field

Good God, they are carrying a grudge.

The Dominion Post wants a national school of music:

News that the Government is refusing to stump up with $11 million to help fund a New Zealand School of Music is unsurprising, given the economic climate.

But it is disappointing. Wellington is indisputably the country’s cultural crucible, and such a school – to be a joint operation between Victoria and Massey universities – could only enhance its reputation.

Now, however, the school’s backers face a serious obstacle in the shape of Tertiary Education Minister Steven Joyce. He has told the universities to consider their options carefully – they had jointly pledged $10m to the school’s establishment – because the Government refuses to fund capital for new tertiary institutions.

The challenge ahead, therefore, cannot be underestimated, especially since what began as a $20m facility is now estimated to cost $60m.

I’m sure they have looked at this, but music often attracts wealthy patrons. There maybe some philanthropists out there willing to help fund the proposed school.

And the ODT talks three strikes:

There is no doubt many New Zealanders will take comfort in the passing into law last week of the Sentencing and Parole Reform Bill. And if indeed the controversial Act New Zealand three strikes legislation enjoys such a popular mandate, that is understandable.

Crime, especially violent crime, is a slur on society, a source of primal fear and unease and, periodically, the cause of crippling grief, loss and financial hardship for innocent individuals and families. …

National campaigned in 2008 on getting tougher on crime, and Act NZ, more specifically, put forward this law as part of its confidence and supply requirements. …

That is to say, while all agree it is right and proper to be tough on violent crime, that there is a retributive element to any punishment, that there are some recidivist criminals who will never respond to attempts at rehabilitation, the problem is not quite as simple as this law might seem to propose.

Its passage into legislation raises legitimate and fundamental questions: Is it good law? Will it make a difference?

I think it will. Those recidivist criminals often go onto commit scores and scores of crimes, bouncing into and out of jail all their life. Under this law, their third serious violent or sexual offence will see them locked up for a very long time, and the community will be safe from them while they are locked up.

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