Stuff reports:

Apple and Google’s Motorola Mobility unit have agreed to settle all patent litigation between them over smartphones, ending one of the highest-profile lawsuits in technology.

In a joint statement on Friday, the companies said the settlement does not include a cross license to their respective patents.

“Apple and Google have also agreed to work together in some areas of patent reform,” the statement said.

This is a very welcome step. In certain areas patents have gone from protecting innovation to harming innovation.

Rodney Hide writes in the HoS:

There’s much about politics that’s stupid but nothing beats Budget Day. It’s a day when ordinarily sane people spout nonsense.

Ministers hoot and holler that they are spending more money than ever before. Opposition MPs scream and shout it’s not enough.

We don’t do that at home. We don’t do that at work. To do so would be to be labelled insane and end up poverty-stricken.

Imagine it. “How was your day, dear?” “Great. I spent more on fishing gear than ever before!” “Well done, honey. I bought a dress that cost even more than last year’s.”

In the real world we must economise and judge our spending by what we get not by how much we spend.

Rodney has a good point. Judge on results, not spending.

If you spent what you didn’t have at home and bragged about it, your wife would dump you. If you did it at work, you would be sacked. Do it in politics and we vote for you. It’s nuts.

Spending other people’s money!

Stuff reports:

Problem Gambling Foundation will this week take legal action to stop the Ministry of Health dumping it in favour of the Salvation Army.

The move comes as papers released under the Official Information Act show the PGF and the ministry embroiled in a long-running argument over the foundation’s right to speak out on gambling issues. It includes the ministry threatening to terminate the foundation’s contract if PGF didn’t halt a campaign called “pokie free and proud of it” promoting pokie-free pubs. The PGF has engaged Wellington lawyer Mai Chen to act for it.

So the PGF will use its existing taxpayer funding to try and force the Government to keep funding it – rather than the Salvation Army (which was judged better by an independent panel of public servants and experts).

The PGF has always been a vocal critic of pokie machine rorts and gambling harm. It believes, as an independent body with other income streams, it has the right to speak out. The ministry argues there should be no perception government money is being spent on campaigns.

The ministry fielded a series of complaints between 2010 and 2012 from Martin Cheer, chief executive of pokie trusts, Pub Charity, that PGF was “abusing the funding stream” and was not politically neutral. Cheer wrote to Dunne saying: “We would welcome any attention you could bring to bear on this matter.” Cheer was unable to comment. But an industry source said PGF had “not just shot themselves in the foot but blown it off” by not concentrating on their core work.

If the PGF was not overwhelming funded by the Government, then it could campaign for whatever it wants. In fact it should welcome losing the contract, because it frees itself up to be an advocate. They claim that they never spent government funds on their lobbying – so ipso facto the loss of the government funds can’t impact their lobbying.

The PGF was a partisan lobbyist. Their founder is the husband of a Green MP. Their campaigns manager is standing for Labour. Their original lawyer was a Labour Party office holder. Their just retired chairman is a former Labour MP. The Salvation Army also speak out on gambling issues – but they don’t make that the major focus of their work.

Less than 1% of their funding is from private donations. Just $3,143 out of $5.04 million. So the lawsuit is inevitably being funded by taxpayers to try and force us to keep funding them.

Stuff reports:

Will the real David Cunliffe please stand up?

That’s the message from experts who claim the Labour leader is failing to connect with the voting public because he’s not being true to himself.

It’s a sentiment reflected strongly in the latest Stuff.co.nz/Ipsos political poll in which people were asked to play a word association game with Cunliffe and Prime Minister John Key.

Asked to sum up the leaders in one word, people opted for “good” when describing Key, but words included confidence, arrogance, charismatic, leader and a suite of words lumped together as “profanity”.

For Cunliffe, words like untrustworthy, arrogant and shifty were more likely to be used along with trying, promising and inexperienced.

What would be interesting is to see the breakdown by how people say they will vote.

Former TVNZ political commentator turned media trainer Bill Ralston said Cunliffe came across like he “doesn’t know himself”.

“He always appears to be acting. You know, ‘I’m going to be angry now, I’m going to be funny now, I’m going to be serious’. I don’t know what or who the real David Cunliffe is but we haven’t seen him yet. It’s that inauthenticity that’s the issue. He just is not pitching himself as a normal person.”

Ralston, who helped train Key, said the Prime Minister and New Zealand First’s Winston Peters were leaders who had “clearly identified characteristics and personalities – you can almost guess what they are going to say or do next whereas Cuniffe, there’s something that just doesn’t ring true”.

Cunliffe, who at times proved he had the ability to connect, was a thoughtful man who was likely to be over-analysing problems, he said. “He shouldn’t try to be anything else other than himself.”

Media trainer Brian Edwards, who has worked with Cunliffe, said the Labour leader was coming across poorly “which is curious because in the past he’s come across very well indeed. He doesn’t look relaxed, he doesn’t look spontaneous, he looks like he is reciting extended sound bites that he has been given by advisers.”

I think Ralston and Edwards both have perceptive comments.

The Economist reports:

THE armed forces and homosexuality do not make natural bedfellows. Though tales from ancient Greece vaunt the heroism of gay soldiers, modern armies are mostly squeamish on the subject. So when New Zealand’s brass let its soldiers participate in a gay-pride parade, it helped put the country first on a new index that ranks 103 of the world’s armed forces by how open they are to lesbian, gay, bisexual and transgender (LGBT) people. Countries at the bottom of the list—compiled by The Hague Centre for Strategic Studies, based on 21 indicators across five categories—are mostly those where homosexuality is a crime or considered an illness. Yet surprises abound. America’s relatively low ranking at 40th is largely because it bans transgender personnel, though it has gay-friendly policies. In Israel, where military issues are ever-present, the army seems more progressive than society. Only 40% of the population accept homosexuality, whereas the armed forces completely opened up to LGBT people in 1993, almost a decade before Britain (which is tied for second).

Anyone who thinks gays or lesbians shouldn’t be soldiers should go try saying that to an Israeli combat unit!

Asenati Lole-Taylor said:

New Zealand First says the Government has seriously compromised community safety by using the Budget as an electioneering tool and neglecting essential areas like law and order.

“The Department of Corrections has had their funding cut by $100 million,” says Spokesperson for Corrections Le’aufa’amulia Asenati Lole-Taylor.

“The question needs to be asked, where will they slash and burn to save $100 million. Do they seriously think they can reduce the prison population.

Umm yes. There are 8,520 prisoners currently, down from 8,755 three years ago.

“The Minister is crowing that there is less re-offending and crime is decreasing but that is just lies and statistics.

Obviously a conspiracy between the Police, Corrections, Stats NZ and the Government.

 It’s clear that the Minister has been in cahoots with Finance Minister Bill English to make cuts so the government can sell a ‘surplus’ story.

Now it is true the 2014/15 vote is $100 million less than the previous vote. But most of that is reduced capital expenditure because they’re not needing to build any new prisons next year.

Maybe NZ First is demanding we build prisons that are not needed?

“They cannot possibly expect us to believe that less funding is required when there is more crime, violence, drug and alcohol abuse. The reality on our streets is devastating.

Actually crime, violence, drug and alcohol abuse are all down.

“The Government would rather justify budget cuts with an artificially low prison population but inmates are being released without proper rehabilitation, and that puts the public at risk,” says Mrs Lole-Taylor.

Reoffending is down also.

Never before seen a release ignore reality on pretty much every single issue.

Fran O’Sullivan writes:

When the Prime Minister is on top of his game – as he was at yesterday’s post Budget luncheon – he is world-class.

John Key spoke without notes. He was completely fluent. No “ums” or “ahs” or stumbling Mr Average here. He was very much in the mode of a former top-flight international businessman. The guy who served on the board of the New York branch of the Federal Reserve. The persona that I prefer to the one that he has created to make him accessible to all New Zealanders.

He held the audience in his hand. Even the joke about his daughter Steffie being in the news again for “taking off another item of clothing” was delivered with sufficient panache to have the audience laughing with him rather than wincing.

Key has already launched the phony election campaign.

He did that in Parliament on Thursday afternoon when he slaughtered Labour leader David Cunliffe in a rambunctious speech designed to rally his troops, during which he compared the National-led Government’s record with Labour’s on well-chosen metrics ranging from house price inflation, interest rates, the number of Kiwis turning their backs on New Zealand to pursue their fortune in Australia – and more.

Slaughter is probably the right word for it.

The Herald reports:

Children born in New Zealand in 2012 are likely to live into their 80s – almost at the top of the 194 countries covered in a recent World Health Organisation report.

The report ranks New Zealand males as having the fourth-highest life expectancy and females seventh.

The figures were for a baby born in 2012, and showed an increased life expectancy around the world, which does not surprise a local demographer. In poor countries it was because fewer children were dying before their fifth birthday and in wealthier countries it was because fewer people were dying of heart disease and strokes before their 60th birthday, the WHO said.

New Zealand men were expected to live to, on average, 80.2 years of age – the same as Singaporean, Israeli and Italian men. Women should live to 84, the same as Portuguese women.

The highest life expectancy overall is Japan at 84 years. The lowest is Sierra Leone at 46 years.

For women, the highest is Japan at 87 tears and lowest Sierra Leone at 46 years.

For men the highest is San Marino at 82 years and lowest Sierra Leone at 45 years.

The Dom Post editorial:

Kiwirail wants to “move on” from the saga of the Aratere. It’s easy to see why. The ferry has had years of trouble and has earned an enormous amount of bad publicity. Politicians like Winston Peters question its safety. The ship started breaking down soon after it arrived from a Spanish shipyard in 1999 and quickly earned its nickname The Lemon. The name has stuck.

If taxpayers didn’t own the ferry, then it would not be our concern. If a private company has a lemon as a ferry, then its competitors will pick up more business, and their shareholders lose money.

The NZ Initiative explains:

‘The labour market’ refers to all the places where firms look for people to hire, and where workers look for job opportunities. It exists because firms need workers and workers need jobs.

Employers need workers who will do the work at an affordable wage, while workers need jobs that pay an acceptable wage to meet their needs.

So both sides need to search for what they want, and employers have to compete with other employers while workers have to compete with other workers.

The employment contract is a deal between a willing employer and a willing worker about what the worker will do for the employer, and what the employer will do for the employee. The agreed wage is part of the deal, but as with any market, the outcomes of labour markets offend some notions of virtue and fairness.

The scarcer a worker’s skills relative to society’s willingness to pay, the bigger the pay check. Luck also plays a big role, particularly in one’s country of birth. The lower the quality of a country’s economic institutions, the poorer the job opportunities.

To illustrate, according to ESPN, Kobe Bryant’s salary for the 2013-14 season with LA Lakers is US$30 million. Yet, the United Nations reports that 1.2 billion people, about 20 per cent of the world’s population, live on less than the equivalent of US$1 per day.

Views about the labour market are often intensely ideological. Marxists believe that government involvement is necessary to stop fat cat capitalists from exploiting workers. Firms are rich and powerful, while the worker is weak, and regulation is necessary to offset this imbalance.

This view ignores the power that competition between employers confers on workers. Would anyone pay Kobe Bryant $30 million otherwise? Johnny Paycheck’s 1977 country classic: “Take this job and shove it, I ain’t working here no more” epitomises the liberating power of choice.

The problem with much of the labour market regulation is that it effectively says that ‘we’, meaning those with jobs, would rather see others unemployed and on welfare rather than in a job that we think is not up to standard.

In New Zealand we have tolerated high youth unemployment because governments preferred to see young people without work than in a job paying less than the adult minimum wage. Just how does that make sense?

A deeper concern with labour market regulation at the expense of the most vulnerable, such as those with few skills trying to get their first job, is that it violates their very being. It is an awful thing to be unable to find a job, to feel that society puts no value on what you have to offer.

Adam Smith expressed this non-Marxist view over 200 years ago:

The property which every man has in his own labour; as it is the original foundation of all other property, so it is the most sacred and inviolable … To hinder him from employing this strength and dexterity in what manner he thinks proper without injury to his neighbour is a plain violation of this most sacred property.

Very true about high youth unemployment.

The Herald reports:

Paedophiles, scandal-hit politicians and others seeking to cleanse their online reputations are demanding that Google remove any links to inconvenient truths about their past, in the wake of a historic legal judgement, it has emerged.

The ‘take down’ requests to the world’s biggest internet search engine came after a European Court ruling on Tuesday that people have the “right to be forgotten.” The controversial decision, by the Court of Justice of the European Union, was in response to a case brought by a Spanish man who complained that an auction notice of his repossessed home on Google’s search results had infringed his privacy. 

So who will benefit from this barmy ruling?

And it has emerged that a former British politician seeking re-election has demanded that links to information about his behaviour in office be removed, while a man convicted of possessing child abuse images has requested links to pages about his conviction be deleted. And a doctor wants negative reviews from patients removed from the results, according to the BBC.

Good on the European Union Court of Justice for ensuring paedophiles can demand information about their convictions be hidden. What a blow for human rights.

Stuff reports:

A Muslim-by-birth Sudanese woman who married a Christian man has been sentenced to death after she refused to recant her Christian faith, her lawyer says.

Meriam Ibrahim, whose father was Muslim but her mother was an Orthodox Christian from Ethiopia, was convicted of “apostasy” – literally the rejection of a religion – on Sunday (local time) and given four days to repent and escape death, lawyer Al-Shareef Ali al-Shareef Mohammed said.

The 26 year old, who is eight months pregnant, was sentenced after that grace period expired, Mohammed said.

The sentence drew immediate condemnation from Amnesty International, which called it “abhorrent.” Mohammed called the conviction rushed and legally flawed since the judge refused to hear key defence witnesses, as well as ignored constitutional provisions on freedom of worship and equality among citizens.

“The fact that a woman could be sentenced to death for her religious choice, and to flogging for being married to a man of an allegedly different religion, is abhorrent and should never be even considered,” Amnesty said in a statement, quoting its Sudan researcher, Manar Idriss.

Maybe the UN Human Rights Commission could focus on this.

No state should be imposing any sanctions on a citizen for their choice of religion, let alone the death sentence. No state that does so, should be allowed a vote in international fora.

The Herald reports:

Labour MP Darien Fenton will leave Parliament at the next election.

The list MP announced today she would not seek re-election at the September election.

“I’m grateful for the opportunity to have served in Parliament as a Labour MP for nearly nine years,” she said.

I wish Darien well. She always stood up for her views, and is a very approachable MP.

The retirement makes sense. It helps Labour rejuvenate, and even in the unlikely chance of a Labour-led Government she was unlikely to be a Minister (not close to Cunliffe).

This brings the number of retirements to four – Ross Robertson, Shane Jones, Rajen Prasad and now Darien Fenton.

I’ve grabbed these four slides from the Budget presentation, as I think they show a powerful story. The first is that welfare reforms are working. Benefit costs are around a billion lower than forecast in 2010, and continue to drop.

Labour bang on about the current account deficit a lot. You’ll note how huge it was in 2008. Anyway in 2010 it was projected to hit 7% of GDP. In reality it has improved in the last two years and is still at a historically low level.

This one is very powerful. You see how Labour were ramping up spending massively, and especially in 2008 they basically spent every dollar they could find. And then when the recession hit, we ended up with our structural deficit.

National has imposed considerable fiscal restraint. No, not cutting spending in absolute terms, but having very little extra spending in the first four years, and just modest increases since.

And this is the key one. The settings inherited by National saw a structural deficit and debt ever increasing. In five years, it has been turned around. Labour and Greens complain about the increase in debt, while at the same time they bitched and moaned about every single decision to restrain spending.  This is the essence of their problems – no consistency. They think you can fool people by bitterly opposing spending restraint for five years, and also complaining about increased debt.

Stuff reports:

More than 90 per cent of rental properties in a nationwide survey have failed a ”warrant of fitness” (WOF) check.

About 140 rentals across Christchurch, Auckland, Tauranga, Wellington and Dunedin were given the once-over by home assessment experts earlier this year.

The rental housing WOF trial involved councils, the Accident Compensation Corporation (ACC), the New Zealand Green Building Council and the University of Otago.

It aimed to test whether draft WOF checklists and methodologies were practical for landlords, assessors and tenants.

About 94 per cent of the 144 houses inspected did not pass at least one of the 31 checklist items, but the majority failed on only a handful.

This should ring major warning bells that the proposed WOF checklist would push up costs and eventually rents for pretty much every tenant and landlord in New Zealand.

There might be some merit in some sort of WOF test which highlights the very worst properties as being sub-standard. But a test which sees 94% of properties fail is just some sort of unworldly wishlist. It’s fine as a voluntary branding test (you advertise you have passed it) but any notion of Councils making it compulsory should and must be rejected if it means 94% of properties are failing it.

Having the Government say that only 6% of NZ rental properties are good enough to allow people to live in them, would push housing prices and rentals up massively.

Mai Chen writes:

Did the Labour Party fail to follow fair process such that its decision not to allow Shane Taurima to contest the candidacy for Auckland’s Tamaki Makaurau seat can be challenged in the courts, or did TVNZ’s report into Mr Taurima’s behaviour justify the party council’s decision?

Allegations have been made by Shane Taurima’s advocate that the Labour Party used the excuse of the TVNZ review of Mr Taurima’s alleged conflict of interest to side-line him in favour of another higher-profile candidate, Julian Wilcox from Maori Television. I do not know the truth of these allegations. But I have read the TVNZ report, and I can tell you what the courts can do if a political party has not followed the process in its own constitution. …

Although, the Labour Party is unincorporated, the courts can intervene to ensure it followed its own constitution. Rule 240 of the Labour constitution says “Any bona fide member of the Party or Affiliated member of the New Zealand Labour Party for at least one year immediately prior to the date of the calling for nominations shall be eligible for nomination as a parliamentary candidate.” So Mr Taurima was prima facie ineligible because he had not been a member long enough.

But Rule 241 states that “Waivers to the length of membership requirement may be granted by the New Zealand Council. The selection meeting shall be notified of any waiver granted for any nominee seeking selection at that meeting. Such notification shall be provided formally in the notice to nominees and the notice to the local party members about the selection meeting and verbally by the chair both before and after all nominees have addressed the meeting.”

The Labour Party Council resolved that granting Mr Taurima the waiver was not in the best interests of the party, and in reaching that resolution took into account the contents and conclusions of the TVNZ report. It has been suggested Mr Taurima might take the matter to the courts. But courts have traditionally been wary of substituting their judgment for that of a political party on matters political.

I doubt Taurima will take Labour to court, let alone win. But some are unhappy. RNZ reports:

A former Labour MP for Tamaki Makaurau has accused the Labour Party president of abusing her power over the Shane Taurima case. It follows a request from the Tamaki Makaurau electorate committee for a review of the Labour national council decision not to let Mr Taurima stand.

John Tamihere told Morning Report that independent sources have confirmed party president Moira Coatsworth met with another broadcaster, Julian Wilcox.

“It’s OK for a president to shoulder tap a high profile candidate or nominee like a Wilcox, but where it goes a bit awry is when you use your authority and power to then skew the scrum completely by taking out a major adversary on the pretext of an error of judgement in his employment” he said.

Mr Tamihere went on to say he believed Mr Taurima had good grounds for a judicial review of the Labour Council decision.

Matthew Hooton in a paywalled article at NBR notes that almost all of the Labour Party hierarchy must have known Shane was running the Tamaki Makaurau electorate out of TVNZ. The leader even attended a hui hosted by Taurima. So can they use the report to veto him, when they had implicitly condoned his activities previously?

UPDATE: In the article by Mai Chen, there is a section I did not quote (as it is on another topic) but has caused some confusion. Mai has said the disclosure limit for donations is $14,999 for parties and 1,499 for candidates. This is saying that donations of $15,000 and $1,500 must have their identities disclosed. This is incorrect. It is donations *in excess* of $15,000 and $1,500 respectively that must have the donor disclosed.

The Herald editorial:

The Budget manages the election-year trick of appearing both fiscally responsible and socially generous. The provision of free medicine and visits to doctors for children under 13 is the main surprise. It is not restricted to families on lower incomes, it will be equally available to those who can easily afford to pay for their children’s medical needs. It is not the most efficient use of funds for health, which absorbs an ever increasing slice of the annual Budget.

By contrast, a parental tax credit is to be increased by $70 a week and extended from eight to 10 weeks but it will be better restricted to low and middle income households. As expected, paid parental leave is to be extended from 14 weeks to 16 next year and 18 the year after. It will also become available to those in seasonal or casual employment or who have recently changed jobs.

Those are the main gifts in a Budget that reflects a good economic outlook. …

The Budget’s best feature is the value Bill English seems to be getting for little extra spending on public services. Departments know the results he wants and seem to be delivering them without complaint from providers or the public.

They have stopped demanding endless increases in funds and he shared the credit with them yesterday for his surplus.

The public sector have done well in providing more, with less.

The ODT editorial:

Budget 2014 was handed down yesterday without much fanfare.

We all knew it was coming, of course, and most believed the pre-Budget hype of a predicted surplus after six years of fiscal restraint.

Many hoped there would be some loosening of the purse strings. Finance Minister Bill English has largely delivered.

This was the Budget that National – right from the time of its re-election in 2011 – would have hoped it could produce leading into this year’s election.

Mr English has not swayed from his path of fiscal restraint. Sure, he has had to borrow heavily during the past six years, but not to the extent the country plunged into recession.

Now, the return to surplus gives options such as paying down debt.

The careful management of the country’s finances by Mr English, and his team of ministers, has helped ensure New Zealand has been mainly immune from the worst of the global decline affecting Europe, parts of Asia, the United States and, latterly, Australia.

Economic growth has been one of the highest in the OECD and, for once, all Treasury indicators are pointing in a positive direction.

Also some interesting comments from Bank economists.

Tony Alexander from BNZ noted:

The return to surplus is a very positive development which stands in contrast with many more years of deficits projected in Australia. Across the ditch taxes have been increased and spending slashed. In the NZ budget it looks like scope exists for some tax cuts down the track and spending has been increased by small amounts in a variety of areas.

In his e-mail newsletter he commented:

The government’s budget this afternoon contained no surprises with a return to surplus predicted for next year and a complete absence of the horror underway across the Tasman where chickens have well and truly come home to roost after years of fiscal laxity. The divergence in the annual budgets with spending slashed in Australia and tax rates rising, versus scope for tax cuts here in NZ down the track will reinforce the massive switch in Trans-Tasman migration flows underway. Before the end of this year it is likely that for the first time since 1991 there will be a net gain to our population from Trans-Tasman flows.

That will be incredible if that happens. Globally, migration is almost always from smaller cities to bigger cities. People migrate from Wanganui to Wellington. From Wellington to Auckland. From Auckland to Sydney. From Sydney to New York or London.

What you don’t generally get is people migrating from Melbourne and Sydney to the smaller Auckland.

The ANZ noted in a newsletter:

The broad policy agenda from today’s Budget hit all the right notes at the macro level. A return to surplus is now within sight and the Government remains focused on the same key priority areas, including managing finances, improving productivity, better public services, and rebuilding Christchurch.

• The fiscal numbers look good. A return to surplus continues to be pencilled in for 2014/15 ($372m) and rising thereafter, although the projected surplus of 1.3% of GDP in 2018 is marginal and not much of a buffer. Net core crown debt is forecast to fall to 20% of GDP by 2020.
• While fiscal responsibility rhetoric is strong, an improving fiscal position and better economy have shifted the strategic focus of policy to managing an expanding economy and choices relating to future surpluses.
• The growth projections look reasonable,which give the fiscal projections a sense of realism.
• The Budget hits all the usual high notes and we like the emphasis on building the economy’s capacity; and the collection of small initiatives which we view as critical if the current expansion is to endure. 

And also some comments from Alastair Thompson at Scoop:

Six years ago after Lehman Brothers hit the wall this Treasurer set his course. Today the first milestone has been delivered with a return to surplus.

And six years hence the second target is now in sight, a Govt. debt to GDP ratio under 20% by 2020.

Even two years ago in I was a little sceptical about the result being achieved in the time and manner Treasury was forecasting. Back then the Christchurch re-build was failing to thrive. Forecast wage (and income-tax take) growth seemed to be a over-egged. But on the other side of the equation Treasury was forecasting a veritable explosion in trade with China.

Two years later Christchurch’s rebuild is gathering steam, wage inflation was indeed over-stated but the forecast China trade boom delivered and then some. And NZ’s current account deficit problem, the one thing that everybody agreed was our achilles heel, has made a remarkable turnaround.

Looking through this year’s Budget Economic and Fiscal update it is hard to find anything to be concerned about. Whichever way you look at it NZ’s economic outlook is starting to look remarkedly benign.

That may depend on the election outcome!

Very impressed with the new fibre plans from Chorus. Less impressed that I phoned Vodafone three days asking to be switched to fibre and they have not yet ring me back, despite saying they’d do so in 20 minutes.

Anyway here’s the plans now available at a wholesale level:

• Fibre 100/20 $40
• Fibre 100/50 $45
• Fibre 100/100 $50
• Fibre 200/20 $55
• Fibre 200/50 $60
• Fibre 200/200 $65
• Fibre 1000/1000 $275

The 100/100 plan looks very attractive to me.

Great to see Chorus responding to demand.

Very enjoyable rarking up by the PM. To be fair, here’s the Leader of the Opposition also.

A bit of a contrast.

The Green Party boast their values are intrinsic to who they are, and how it makes them different from other parties.

One value is:

Engage respectfully, without personal attacks

Green Party List MP Jan Logie tweeted this earlier today:

Hat Tip: Jessica Williams

The tweet speaks for itself. what you might expect from a demented activist, but not an MP. If Logie was an electorate MP, I have no doubt she would never make such a tweet – she’d lose her seat.

Anyway the next time Green MPs goe on about their values, and how they “engage respectfully”, just recall this tweet.

Forecasts

• Growth to almost hit 4%
• An extra 170,000 jobs by 2018
• Average annual wages to go up by 14% to $62,330. Inflation projection is 10% over four years so net 4% gain.
• Budget surpluses to grow from $372 million to $1.3 billion in 15/16 and $3.5 billion in 17/18
• Net debt to be under 20% of GDP by 2020
• NZ Super Fund contributions to resume in 2019/20

The growth projections are positive, and are the most important aspect. Without economic growth, a surplus becomes a deficit. The projected increases in jobs and real wages are also a positive.

The net debt to be under 20% by 2020 is a huge turnaround. The last projection in 2008 had it ever increasing to 70% or so.

However the surplus is still fragile. There isn’t any wriggle room in 2014/15, but I believe 2015/16 should have room to consider tax cuts.

Last year

• 84,000 more jobs
• Average weekly wages up 3.2%
• Inflation has been 1.5%, so real increase in average wages is 1.7%

This Year

• New spending of $5.7 billion over four years, including $1.6 billion of reprioritisation ore revenue measures
• Budget surplus projected to be $372 million
• Operating allowance of $1.5 billion a year, growing at 2% a year, Under Labour they ranged from $2 billion to $7 billion, averaging $3.5 billion over last five years – so under half the previous rate

2008 was the shocker year. A $7 billion increase in annual spending, which meant that when the recession kicked in, we got the projected decade of deficits.

Treasury has released advice that spending increases in excess of $1.5 billion a year will force interest rates to rise more quickly. So political parties promising spending in excess of that will need to explain how they will stop interest rates increasing more quickly.

Tax

• The 6% who earn over $100,000 pay 37% of income tax
• The 12% who earn over $80,000 pay 51% of income tax
• The 51% who earn under $30,000 pay 5% of income tax
• Cheque duty to be abolished, reducing revenue by $4 million a year

Remember when Labour introduced the rich prick tax on those earning over $60,000. Well 23% of New Zealanders now earn over $60,000 and they now pay 69% of all income tax.

The only tax cut in this budget is abolishing cheque duty. Next they’ll be abolishing excise duty on horses and carriages!

Sure tax cuts are not affordable in the 2014/15 year. But they are in the out years, and hopefully all political parties will outline policies to reduce income and other taxes in the lead up to the election.

Spending

• Total spending now $73.1 billion
• $375 million loan to NZTA for Auckland transport projects
• $69 million for trade & enterprise
• $57 million for science
• $58 million for research and development
• 6,000 more apprentice places
• $136 million for tertiary education science and research
• $100 million more to assist people from welfare into work
• $536 million for Defence
• Of $4.7 billion raised from asset sales $200 million for health capital projects, $198 million for Kiwirail, $172 for school property and $40 million for irrigation infrastructure

Nothing too surprising here. As with previous budgets the focus is on science, research & development, schools and hospitals.

I do wish they would stop throwing good money after bad into Kiwirail.

Families

• $500 million more spending on families
• Additional four weeks paid parental leave (to 18)
• Parental tax credit goes from $150 a week to $220 a week and from eight to ten weeks for $42 million
• $90 million more to extend free GP visits to under 13s
• $156 million more for early childhood education
• $33 million to assist vulnerable children

This is the major focus. The paid parental leave was well signalled. The extending of free GP visits to under 13s was a surprise (and a better policy than merely paying more to parents), as was the extra $1,000 for the parental tax credit.

Education

• $858 million over four years more spending
• $359 million to pay top teachers and principals more
• $85 million more for school operations
• $11 more for school property

No extra details on the package announced in January around up to $50,000 per year more for the top principals. Lots of interest in the final package.

Health

• $1.8 billion more over four years
• $110 million more for 4,000 more elective surgery ops
• A new Grey Base Hospital for $200 million a week

Tony Ryall remains determined not to have Health become an area of weakness for the Government.

Overall

Overall I can’t imagine this will go down as a controversial or memorable Budget. It is significant as the first Budget to project a surplus since 2008, and the difficulty of achieving that should not be under-estimated.

The Australian Budget on Tuesday shows what happens, when you don’t have a Government that can’t impose fiscal restraint, as happened with Labor. It also shows the political danger of responding to a huge deficit with a huge slashing of spending (and tax hikes), rather than a gradual reduction in spending increases.

Sometimes slow and steady does win the race, and in New Zealand’s case it looks like it will.