Fiscal responsibility

Bill English has announced:

“The Government is proposing introducing some additional principles into Part 2 of the Public Finance Act that ministers would have to take into account when setting fiscal policy.

“The proposed changes are designed to ensure greater transparency around how government decisions affect the wider economy and future generations.”

The proposed changes would require governments to:

  • Consider the impact of their fiscal strategy on the broader economy, in particular interest rates and exchange rates.
  • Set out their priorities for revenue, spending and the balance sheet, rather than focus narrowly on debt as is currently the case.
  • Take into account the impact of fiscal policy decisions on future generations
  • Report on the successes and failures of past fiscal policy.

I especially like the impact on future generations. They are the ones that have to pay the interest on the debt.

“We are also proposing to add a spending limit based on the rate of growth in inflation and population as a new principle of responsible fiscal management, as set out in the National-ACT Confidence and Supply Agreement.”

It would exclude spending on natural disasters, finance charges, the unemployment benefit and asset impairments, as they are either outside the Government’s control or they help stabilise the economy in a downturn. 

This is a major win for ACT, and a very good thing.

“Under the proposal, if a government decided to temporarily exceed the limit they would need to clearly explain the reasons and outline how they intended to ensure future expenses remained within the limit.”

You can’t have one Government bind future Governments, but you can have a law like this which makes it politically more difficult for future Governments to increase spending in an unsustainable way.

Speaking next week

For those interested, I’ve got three speaking engagements next week.

On Monday evening I’m speaking in Auckland on the MMP review to the National Party’s Northern Region Policy Committee. That is open to party members only.

On Tuesday I’m speaking at a forum organised by the Legal Research Foundation on media and new media regulation. This is also in Auckland and open to the public. There is a fee to attend.

On Wednesday I’m speaking at the “Privacy in the age of big data” forum, organised by the Privacy Commissioner. This is in Wellington and open to the public. Also a fee to attend.

A somewhat diverse range of subjects. Hence, blogging may be lighter than normal next week.

Are private schools good for the poor?

Professor James Tooley writes:

One of the internation­ally agreed-on development goals the heads of state reviewed was the achieve­ment of universal primary education by 2015. The UN was not happy with progress. There are still officially more than 115 million children out of school, it reported, of which 80 percent are in sub‑Saharan Africa and Southern Asia. But even for those lucky enough to be in school, things are not good: “Most poor children who attend primary school in the developing world learn shockingly little,” the UN reported.

Something had to be done. Fortunately, the UN could call on Jeffrey D. Sachs, special adviser on the Mil­lennium Development Goals to Secretary-General Kofi Annan and author of The End of Poverty. He’s also director of the Earth Institute at Columbia University. He proposed as the way forward “Quick Wins,” which have “very high potential short-term impact” and that “can be immediately implemented.” Top of his list is “Eliminating school fees,” to be achieved “no later than the end of 2006,” funded through increased international donor aid. To the UN it’s as obvious as motherhood and apple pie.

But the UN’s “Quick Wins” are backing the wrong horse. For the past two and a half years I’ve been directing and conduct­ing research in sub-Saharan Africa (Kenya, Nigeria, and Ghana) and Asia (India and China). And what I’ve found is a remarkable and apparently hitherto unnoticed revolution in education, led by the poor themselves. Across the developing world the poor are eschewing free, disturbed by its low quality and lack of accountability. Meanwhile, educational entrepre­neurs from the poor communities themselves set up affordable private schools to cater to the unfulfilled demand.

When you receive a “free” service, you are less concerned about its quality, than when you pay for it. This is basic logic.

Take Kibera, in Nairobi, Kenya, reportedly the largest slum in Africa, where half a million people live in mud-walled, corrugated iron-roofed huts that huddle along the old Uganda Railway. Kenya is one of the UN’s showcase examples of the virtues of introducing free basic education. Free Primary Education (FPE) was introduced in Kenya in January 2003, with a $55 million donation from the World Bank—apparently the largest straight grant that it has given to any area of social serv­ices. The world has been impressed by the outcomes: Former President Bill Clinton told an American prime-time television audience that the person he most want­ed to meet was President Kibaki of Kenya, “because he has abolished school fees,” which “would affect more lives than any president had done or would ever do.” The British chancellor of the exchequer, Gordon Brown, visiting Olympic Primary School, one of the five gov­ernment schools located on the out­skirts of Kibera, told the gathered crowds that British parents gave their full sup­port to their tax money being used to support FPE. Everyone—including Sir Bob Geldof and Bono—raves on about how an additional 1.3 million children are now enrolled in primary school in Kenya. All these children, the accepted wisdom goes, have been saved from ignorance by the benevolence of the international community—which must give $7 billion to $8 billion per year more so that other countries can emulate Kenya’s success.

The accepted wisdom, however, is entirely wrong. It ignores the remarkable reality that the poor in Africa have not been waiting helplessly for the munificence of pop stars and Western politicians to ensure that their children get a decent education. The reality is that private schools for the poor have emerged in huge numbers in some of the most impoverished slums in Africa and southern Asia. They are catering to a majority of poor children, and outperforming their government counter­parts, for a fraction of the cost.

Really? Can this be true?

 Inspired by what I had found, I recruited a local research team, led by James Shikwati of the Inter-Region Economic Network (IREN), and searched every muddy street and alleyway looking for schools. In total we found 76 private schools, enrolling over 12,000 students. In the five government schools serving Kibera, there were a total of about 8,000 children—but half were from the middle-class suburbs. The private schools, it turned out, even after free public education, were still serving a large majority of the poor slum children.

It seems it is.

Calculating the net decline in private-school enrollment, it turned out that there were many, many more children who had left the private schools than the 3,300 reported to have entered the government schools on Kibera’s periphery and who were part of the much celebrated one million-plus supposedly newly enrolled in education.

In other words, the headlined increase in numbers of enrolled children was fictitious: the net impact of FPE was at best precisely the same number of children enrolled in primary school—only that some had trans­ferred from private to government schools.

Well intentioned policies often end up not working.

Parents compared notes when their children came home from school and saw that in the state schools pupil notebooks remained unmarked for weeks; they contrasted this with the detailed atten­tion given to all children’s work in the private schools. They heard tales from their children of how teachers came to the state school and did their knitting or fell asleep. One summed up the situation succinctly: “If you go to a market and are offered free fruit and vegetables, they will be rotten. If you want fresh fruit and veg, you have to pay for them.”

Indeed.

Perhaps these poor parents are misguided. Certainly that’s what officials believe. But are they right? We test­ed 3,000 children, roughly half from the Nairobi slums and half from the government schools on the periphery, using standardized tests in math, English, and Kiswahili. We tested the chil­dren’s and their teachers’ IQs and gave questionnaires to pupils, their parents, teachers, and school managers so that we could control for all relevant back­ground variables. Although the gov­ernment schools served the privileged middle classes as well as the slum chil­dren, the private schools—serving only slum children—outperformed the government schools in mathemat­ics and Kiswahili, although the latter had a slight advantage in English. But English would be picked up by privi­leged children through television and interaction with parents. When we statistically controlled for all relevant background variables, the private schools outperformed the government schoolchildren in all three subjects.

And it gets better:

But there was a further twist. The private schools outperformed the government schools for considerably lower cost. Even if we ignore the massive costs of the government bureaucracy and focus just on the classroom level, we find the private schools are doing better for about a third of teacher-salary costs: the average month­ly teacher salary in government schools was Ksh. 11,080 ($155) compared to Ksh. 3,735 ($52) in the private schools.

Free primary education in Kenya, a showcase exam­ple of the UN’s “Quick Wins” strategy, has simply transferred children from private schools, where they got a good deal, closely supervised by parents, with teachers who turn up and teach, to state schools, where they are being dramatically let down. One parent was clear what the solution was: “We do not want our children to go to a state school. The government offered free education. Why didn’t it give us the money instead and let us choose where to send our children?” For this parent, a voucher system was the obvious way forward, putting her right back in control.

Now what works in the slums of Kenya is not applicable to all situations. But this is a good lesson about how slogans and good intentions and even money do not necessarily improve things.

I recommend people read the entire article. James Tooley has won several prizes and awards for his work on education.

Cameron gets the job

Claire Trevett at NZ Herald reports:

Labour leader David Shearer has appointed lawyer and NZ Aids Foundation chairman Alastair Cameron as his new chief of staff after the resignation of Stuart Nash.

Alastair Cameron is a long-term Labour activist, and generally regarded by Labour people as a good operator. He was on the NZ Council when he was a student, as the party’s youth vice-president around 2002.

Mr Shearer last week led the charge on the Crafar farms sale, but the previous strategy of keeping him away from subjects on which Labour had a negative line gave rise to speculation about the leadership after his deputy, Mr Robertson, was left to lead Labour’s reaction on major issues such as Nick Smith’s resignation as minister over troubles in ACC.

Mr Shearer said he did lead reaction on many issues but also recognised that his other MPs were “very able” and should be allowed to contribute.

The changes are a disruption Mr Shearer could do without as he tries to make an impact in the polls. Although it is not yet serious, he is already having to contend with speculation about his leadership and the ambition of his deputy. …

Mr Robertson has dismissed the speculation, but it has spread to others, including the left-wing blog the Standard.

Contributor Irish Bill observed that it was no secret Mr Robertson wanted the job and, although he hoped he was wrong, “it’s starting to feel like a leadership challenge is inevitable”.

Interesting that the Herald quotes an alias in a news story.

Mr Shearer said it was a long process to get Labour back to being “match fit” and there was an acceptance of that. He said he was not aware of tension within his office.

Really? If David is not aware of the tension within his office, he is the only person in Wellington who isn’t aware of it.

A sex offenders register

Andrea Vance at Stuff reports:

Opposition parties are challenging the need for a sex offenders’ register, saying they often become public and are historically prone to mistakes which can devastate innocent people’s lives.

Police Minister Anne Tolley is considering introducing such a register, and police and the Corrections Department began work on proposals earlier this year after it was revealed a convicted paedophile was working as a teacher.

The register will not be open to the public and will only be viewed by officials with security clearance.

I’m staggered anyone could be against such a register, if it is private.

Labour’s justice spokesman Charles Chauvel said Labour would want to see evidence there was a need for a register.

“It’s all very well to say let’s have a sex offenders’ register for officials but what we need to do is be satisfied it actually served some purpose.”

A register was a “slippery slope”, he said.

“You start with an undertaking it would be a private document used for internal purposes and then in a year or two it’s a full blown public document.”

With that reasoning, the Government should have no private registers of anything at all.

However, Sensible Sentencing Trust spokesman Garth McVicar said it was “fantastic”; the lobby group had been calling for a register for years.

“It protects the public. It is the best tool which encourages offenders to change their ways.”

The Trust already had a sex offenders’ and violent offenders’ database on its website.

“We get phenomenal feedback from the public on those.”

I use both databases often. They are a very good tool. Criminal offending is not a private matter.

UPDATE: A reader emails;

The reason why Labour are opposed to a register is they think the current system is working. But who introduced the current system?

 Yet, if it is working, and the toughest in the world, how did Miki, the offender/teacher who was on an extended supervision order, get away with it for so long?

A very good point.

Income distribution

The Press reports:

Children raised in poor families will earn less and achieve at a lower academic standard but will not have higher crime levels, a Christchurch study has found.

The Christchurch Health and Development Study (CHDS), run by Otago University, has been following the lives of more than 1000 people since 1977.

The latest study, published in Social Science and Medicine, has looked at the impact of family poverty on children up to the age of 10 and how this is reflected in adulthood.

“Being brought up in an affluent family is advantageous to your education and career,” he said.

This is not a huge surprise.

Fergusson said the cohort was split into 20 per cent groups, with the bottom group earning an average of $43,000 a year and the top group earning $55,000.

“It’s not a huge difference but it’s definitely there, and we have seen that it definitely makes a difference.”

I am surprised it is not greater. This is saying the bottom quintile earn 80% of the top quintile. Sure that is a gap, but not as large as many would have predicted.

One of the reasons why the gap is less than other studies of income distribution, is these are people all the same age. Age is a large factor in income. That is why I have little time for the notion that an 18 year old with no experience should earn at least 60% of the income of someone with 25 years experience.

“Contrary to popular belief, being brought up in a poor family does not mean increased rates of crime or mental health problems in adulthood,” he said.

So let us stop blaming crime on poverty. There may be a correlation but that is not causative.

NZ Post

Vernon Small at Stuff reports:

NZ Post has warned 2012 is crunch time, with the state-owned enterprise needing hundreds of millions of dollars in capital for subsidiary Kiwibank as well as flexibility to cut store numbers and halt post delivery on some days.

I’ve always wondered if Kiwibank actually delivers a return on capital greater than the cost of capital. What would be very interesting is an analysis of Kiwibank’s profits since inception, compared to the cost of capital (Treasury bond rates). Ideally such an analysis should exclude profits from the bill payment service they operate, as that was operated by NZ Post before Kiwibank was set up.

A key element would be a review of the Deed of Understanding (DOU), which stipulates NZ Post must maintain six-day-a-week delivery to most of the 1.9 million “delivery points” and operate a network of no less than 880 outlets.

I’m okay with fewer delivery days and fewer stores.

However, mail volumes are in free fall. It had forecast a drop of 5 per cent a year as the long-term trend to electronic mail bit. But in the six months to the end of December 2011 the decline had steepened to 7 per cent; the fastest ever, “which may be the new norm”, Cullen said. “The trend will not reverse and cannot be ignored.”

it is a dying business model.

But while a cut to delivery days is not imminent, the NZ Post board is keen for planning to start. A shift to deliveries every second day could be on the table over the next two to three years. Cullen said the DOU, as it stood, limited the changes that could be made.

Monday, Wednesday, Friday would be fine. If anything is needed the next day you tend to courier it.

So far the NZ Post parent has poured $550m into the bank, but as its own profitability declines that is seen as unsustainable.

Again, an analysis of returns vs cost of capital would be very interesting. If Kiwibank’s profits do not exceed the cost of capital, then the taxpayer us effectively subsidising Kiwibank customers.

“Our preference would be for the Crown to inject capital, providing we are able to satisfy them that they will get a long-term return on that capital, which we believe they will, and that it fits with the Government’s overall economic strategy.”

One source of new capital could be the proceeds from partial asset sales.

That would be ironic. I’d love to see Labour complain about that.

People Power Ohariu

Danya Levy at Stuff reports:

The Government has been accused of treachery during emotive pleas for it to dump its plans to partially sell state-owned assets. …

People Power Ohariu was formed after last year’s election to convince UnitedFuture leader and MP for Ohariu Peter Dunne to vote against the bill.

United Future’s policy was very clearly known before the election and Peter Dunne got re-elected on it.

Her voice breaking and close to tears, People Power Ohariu spokeswoman Ariana Paretutanganui-Tamati told the committee the sales were “nothing less than treachery”.

“It is absolutely ludicrous that in our country a group of 61 people can make decisions that have serious, serious, implications for our country and our children’s future and our land.”

That is an unusual name. Presumably the same person who is a Mana Party activist.

And it is interesting to see how she thinks it is treason to announce a policy 10 months before an election, have it as the most contested issue of the election, and have parties than supported it gain 61 out of the 121 seats.

And the implications for the children’s future and the land is just ridiculous hyperbole. My God, its some minority shares in some power companies. Contact Energy got wholly sold off in 1998 and the world didn’t end. In fact, barely anyone noticed.

People Power Ohariu spokesman John Maynard said it was particularly concerned about the Trans Pacific Partnership free-trade agreement being negotiated among New Zealand, the United States and at least eight other countries.

This is the John Maynard that Whale pointed out was President of the Postal Workers Union of Aotearoa.

Reading Cinemas

Off to Avengers movie tonight, which I am looking forward to.

However for some inexplicable reason, Reading Cinemas no longer allow you to book tickets online.

I could understand a cinema not having yet implemented online booking, but why would you have it, and then remove it?

It was actually a good system. You could look at a map of the cinema, and select specific seats.

Some companies just want to lose customers I guess.

Back Benches 25 April 2012

THIS WEEK ON BACK BENCHES: Watch Wallace Chapman, Damian Christie, the Back Benches Panel and special guests discuss the week’s hottest topics!

ANZAC DAY: It’s ANZAC Day on Wednesday—a day to remember the sacrifices made by our military. But what does the day mean to our younger generations? Is it more than a veteran’s day? Is it our national day? And do we need to mondayise the holiday?

LET’S MAKE A DEAL…: The Government’s still facing criticism over the Sky City convention centre deal. The opposition is saying the Government sold law changes for the $350m centre. While National says Sky City were the only ones with the numbers to make the build work. So, we’re getting a new convention centre and more pokies. We’ve already got 1600 pokies at Sky City—what another 500 going to do? Is it better to have pokies at the casino rather than pubs? Or are more pokies a bad idea full stop?

DRAWING A BLANK: Should cigarette packets be brand free? Tobacco companies, obviously, are not fans of the idea. Australia’s doing it and we’re thinking about it. But will this bring lawyers for the tobacco companies out in force? And will they be successful? Will the TPP (Trans-Pacific Partnership) give U.S. companies the right to change our laws? And should we be using plain packaging on all addictive or dangerous products?

Join us for a night of LIVE pub politics from the Backbencher Pub: Wednesday, 25th of April. Our Panel: Green Party MP Jan Logie, Labour MP Trevor Mallard, New Zealand First MP Richard Prosser and National MP John Hayes.

Wednesday at 9.05pm and Saturday at 10.05pm | TVNZ 7

Jumping the shark

The Government today announced:

  • Housing New Zealand has today closed a tender to speed up repair of over 600 of its quake damaged properties
  • The Earthquake Commission (EQC) has just agreed to pay $21 million to Christchurch City Council, its largest individual claimant, allowing the council to begin repairs to around 280 quake damaged properties in its social housing portfolio
  • The Department of Building and Housing (DBH) is making good progress toward establishment of a new temporary accommodation village at Rawhiti Domain in New Brighton, with 20 two bedroom units due to be on site by mid-July and the ability to provide further units as required
  • The Government has already built 63 houses in two temporary accommodation villages at Linwood Park in Christchurch City and Kaiapoi Domain in the Waimakariri District

Idiot/Savant at No Right Turn says the package is too little too late (which is a legitimate point of view) but goes on to say:

Brownlee’s inaction and denial means we are going to see a spike in cold-related deaths in Christchurch this winter. People will die needlessly, largely of flu and respiratory diseases, because he did nothing. And that makes him nothing more than a murderer.

This is jumping the shark in a massive way. Its pathetic, and erodes his credibility. I really wonder what happened to I/S so that his hatred of the right makes him so irrational at times.

Grey Power on power prices

Danya Levy at Stuff reports:

Residential consumers with state-owned power companies face on average a $265 a year increase in their electricity bills if the Government continues with its plans to partially sell them, Grey Power has told Parliament.

The Finance and Expenditure Select Committee is today hearing submissions on legislation to enact the Government’s controversial “mixed ownership model” and sell up to 49 per cent of Mighty River Power, Genesis and Meridian.

The Government also plans to reduce its shareholding in Air New Zealand but is not required to pass new laws to do so.

Grey Power spokeswoman Molly Melhuish said a Ministry of Economic Development comparison showed consumers with state-owned energy companies paid on average 3.31 cents less per kilowatt for their power than those with private companies.

That meant consumers with private companies paid $265 more a year.

I debunked this claim by Labour a few months ago.

Go to the Consumer Powerswitch site which has monthly data for the four main centres. Look at Auckland as that is where one third of the population is. Their estimated annual cost for a medium sized household (8000 kWh/year) is:

  • Genesis (SOE) $2,204
  • Meridian (SOE) $2,046
  • Contact (private) $2,020
  • Mercury/MRP (SOE) $1,953

Some of the other companies owned by the four big generators may charge more or less, but to state private pays $265 more a year is clearly false. Contact Energy is Auckland is cheaper than two of the three SOEs.

Also it ignores that people can swap. This is like arguing that because some banks charge more than Kiwibank, then all banks should be owned by the Government.

In Christchurch the prices are:

  • Meridian (SOE) $2,110
  • Mercury/MRP (SOE) $2,019
  • Genesis (SOE) $2,007
  • Contact (private) $1,955

So in Christchurch Contact Energy is by far the cheapest.

In Wellington the prices are:

  • Genesis (SOE) $2,146
  • Contact (private) $2,143
  • Meridian (SOE) $1,999
  • Mercury/MRP (SOE) $1,980

Contact is not bottom in Christchurch, but not top.

In Dunedin the prices are:

  • Mercury/MRP (SOE) $2,066
  • Genesis (SOE) $1,997
  • Meridian (SOE) $1,980
  • Contact (private) $1,958
So in Dunedin they are cheapest of the four big companies.
Do not believe the spin.

PPTA supports Parata

The PPTA have praised Hekia Parata:

PPTA president Robin Duff congratulates education minister Hekia Parata for taking a firm stand against the board of Northland’s Moerewa School .

The board was sacked yesterday after extending classes to years 11 and 13 without the Ministry of Education’s (MoE) permission, with seriously questionable results.

“Primary schools may have the best of intentions, but it is wrong for them to believe they can adequately provide specialist subject delivery to students over year 9,” Duff said.

However the Principals Federation thinks the school should be above the law:

“The decision to sack the Board of Trustees at Moerewa School is a sad day for self-managing schools and their communities,” said Phil Harding, Vice-President of the New Zealand Principals’ Federation.

“Moerewa is a tiny community, working with its people to do all in its power to provide high standards of education, while achieving success as Maori,” said Harding. “Rather than being celebrated for its efforts and excellent ERO reports, the Moerewa School Board has been punished, and its senior students excluded from their school of choice,” he said. …

“Few schools would come through an NZQA audit of 84% of their students’ work unscathed, and the protracted process has kept these students in limbo,” he said. “The Ministry has funded the unit for three years, and it is tragic to see a positive innovation ended in this way.”

It may be sad it has ended, but the fault is with the school. It is a pity the NZPF defends a school with such a low achievement rate. Radio NZ reported:

The Education Ministry says the school is not offering senior students a quality education and its NCEA results are alarmingly low. An audit by the New Zealand Qualifications Authority found that 11% to 33% were passing NCEA.

“If you look at the nearest school, they are achieving results twice as high for their Maori students than have been achieved at Moerewa. The outcomes are just not good enough, I’m afraid.”

TVNZ reported:

The New Zealand Qualifications Authority (NZQA) audited students’ work and said it had concerns about Wikipedia being used word-for-word and work being submitted with two different types of handwriting.

Radio Waatea reports:

The Education Minister says the audit of Moerewa School’s NCEA results was launched after discrepancies picked up in a review of paperwork at Otara’s Kia Aroha College.

 Moerewa held on to its senior pupils by enrolling them in the South Auckland Secondary School run by the mother of Principal Keri Milne-Ihimaera.

 Hekia Parata says rather than scoring better than most other schools, outside assessors found just two out 16 students passed NCEA level one, two in six passed levels two and two in three passed level three.

Only 12% passed NCEA Level one. Incredible.

Lovelock says global warming slower than predicted

James Lovelock is a well known environmentalist, and has been a loud voice proclaiming that the impact of man made global warming would be massive. In 2006 he said:

billions of us will die and the few breeding pairs of people that survive will be in the Arctic where the climate remains tolerable

He was referring to the year 2100 – just 88 years away. He said that 80% of the world’s population will have perished due to climate change, and by 2040 parts of the Sahara desert will have moved into middle Europe, and there will be almost no food grown in Europe.

In 2010 he said “Even the best democracies agree that when a major war approaches, democracy must be put on hold for the time being. I have a feeling that climate change may be an issue as severe as a war. It may be necessary to put democracy on hold for a while.”

He is quoted on the Green Party website 24 times, including blog comments.

MSNBC reports:

James Lovelock, the maverick scientist who became a guru to the environmental movement with his “Gaia” theory of the Earth as a single organism, has admitted to being “alarmist” about climate change and says other environmental commentators, such as Al Gore, were too.

Lovelock, 92, is writing a new book in which he will say climate change is still happening, but not as quickly as he once feared. …

“The problem is we don’t know what the climate is doing. We thought we knew 20 years ago. That led to some alarmist books – mine included – because it looked clear-cut, but it hasn’t happened,” Lovelock said.

“The climate is doing its usual tricks. There’s nothing much really happening yet. We were supposed to be halfway toward a frying world now,” he said.

“The world has not warmed up very much since the millennium. Twelve years is a reasonable time… it (the temperature) has stayed almost constant, whereas it should have been rising — carbon dioxide is rising, no question about that,” he added.

He pointed to Gore’s “An Inconvenient Truth” and Tim Flannery’s “The Weather Makers” as other examples of “alarmist” forecasts of the future.

I’ve often said that the “alarmists” are significantly responsible for the huge levels of disbelief in greenhouse gases causing global warming. There is little dispute that increased greenhouse gases has a direct impact on the average temperature, but what is unknown is how other factors either multiply this impact, or reduce it.

Brown on Sky City

Abby Gillies at NZ Herald reports:

Auckland mayor Len Brown is conditionally supporting a controversial government decision to negotiate a convention centre deal with SkyCity.

The Government has faced mounting criticism over discussions with the casino that would see the company fund a $350 million convention centre in Auckland in return for an extension to its casino licence.

Mr Brown, speaking to Radio New Zealand this morning after returning from a trade mission to China, said there was a huge need for a convention centre in Auckland, but if the deal goes ahead controls should be put in place to minimise harm to gamblers.

“I’m not anti gambling at all. I think there is a place and time for it and people are entitled to make their choices and they do that.”

Very sensible. Len is showing the responsibility of being in office. Those who do not have to live with the consequences can oppose everything and anything.

10% power discounts

Winston is a lot like Shane Jones – lots of natural talent, but allergic to actually doing the hard work. One example of this was when he fronted to the Electoral Commission’s review of MMP yesterday and rather then address any of the issues they are actually tasked with reviewing, talked about spending limits.

We see this lack of attention to detail, or well basic facts, in the request for a 10 per cent winter power discount for Super Gold Card holders to be included in next month’s Budget. Peters said:

New Zealand First is asking the Government to include a 10 per cent winter power discount scheme for SuperGold Card holders in the Budget next month.

Now this is a legitimate request. Personally I disagree with it, as assistance should go on the basis of need, not on the basis of age. Why should Winston himself get a 10% power discount, but not a poor struggling family? But lets even put aside the desirability of the policy, and look at the facts.

Rt Hon Winston Peters says a discount on winter electricity prices for SuperGold Card holders is the responsible thing to do in times of sharply increasing prices.

Actually he CPI records electricity costs have increased only 2.0% in the last year. Over the last three years the increase was 10%, of which 2.2% was the GST increase (which was compensated for), so an underlying increase of 7.8% over three years.

During the last term of Labour (when Peters was a Minister), electricity costs went up 22.9%. The previous three years it went up 23.8%. So the annual increase has fallen from almost 8% to just 2%.  But let’s ignore both the policy flaws and the false rhetoric.

Under the New Zealand First scheme, the cheaper electricity would be supplied by the three State Owned Enterprise-power generators – Mighty River Power, Meridian and Genesis.

Okay here is the real flaw, which shows that this is just a press release masquerading as a policy. First of all, it can’t possibly provide a rebate to all SGC holders, when only some of the generators are included. Contact Energy is the second largest generator, providing 24% of the market.

The other flaw is that generators do not know whom the end customers are unless they are also retailers. You can not ask generators to provide a discount for retail customers. It’s like asking Fonterra to supply cheaper milk to pensioners.

Mr Peters says these power companies and the Commerce Commission act as a “price-fixing cartel” which sees domestic users pay more than their fair share.

“Domestic users are paying more for power than both commercial and industrial electricity users. This imbalance will only get worse if the government proceeds with its plan to sell off the power stations to foreign companies.

This is false. My apartment and business are with the same company. As a domestic user I pay 27.35c per unit (includes line charges), and my commercial business pays $33.43c per unit.

It would potentially benefit more than 590,000 SuperGold Card holders by about $100 on their cold weather bills.

“It would cost the highly profitable state-owned power companies about $34 million a year but these companies would benefit from a larger customer base.

So in fact Peters is proposing trying to wipe out Contact Energy by having the taxpayer subsidise the SOEs.

“The power companies can easily afford it and the changes can be enacted swiftly under existing legislation, or the Government can use new legislation already prepared by New Zealand First.”

Given Peters appalling attention to detail, I’d hate to think what their legislation would look like.

The issue of electricity affordability for those on fixed incomes, in winter, is a valid one. The proposed solution, is a typical PR stunt.

Incidentally the Government has said they won’t be legislating for a 10% discount, noting that the value of the pension for a married couple has increased $194 per fortnight since the 2008 election.

The Bach case

The Dom Post editorial:

One what would happen should a State Services Commission employee approach chief executive Iain Rennie, place his or her hands on his head, and inquire what is going on in there.

Till a few days ago conjecture would have been irrelevant. The employee would have been stood down while an inquiry was conducted, then, once the facts were confirmed, dismissed for unacceptable behaviour. The whole process would have taken a matter of days. Some things are simply unacceptable in the workplace. One of them is employees manhandling their bosses; another is bosses manhandling employees.

I’m not sure this is the case. Certainly such behaviour is unacceptable. But one can not sack without warning someone for doing something unacceptable unless it meets a threshold. I suspect an employment tribunal would find in favour of an employee sacked for the above, if it was a one off, and they were otherwise a good employee.

Hence I am not one of those saying Katrina Bach should have been sacked. She should have been disciplined, warned and (unlike most employees) is suffering a financial penalty for her misconduct.

Again I am not defending her conduct. I’m just saying that the law applies equally to all employees.

Gamefroot

Luke Appleby at Stuff reports:

If you remember playing Super Mario Brothers and thinking “I wish I could make my own game” – now is your chance.

A new website called Gamefroot launched this week which allows you to build an Adobe Flash game which can be played in a web browser or on an iPhone.

The creation section looks great and is based on an easy foreground-and-background grid system, although I found it was a bit slow to load and respond in some browsers, or even non-functional.

This may have been due to it being built with HTML5, so you’ll need a late-model browser to use it, and the latest Flash Player update to play it.

Gamefroot provides lots of default material to get you started on your side-scrolling game – terrain, enemies, weapons, music, items and more are provided.

The creation engine also has a fairly extensive scripting section, using which you can make objects carry out complex tasks using Boolean operators and variables, which allows for some advanced customisation.

I’m off to the Wellington launch of it tonight.  From what I have seen, this is a great innovation. The interface allows people to create their own games, without needing to know how to code. It opens it up to the masses.

I’m even going to try and create a game myself – set in Parliament where you play a new backbench MP, and you have to defeat certain enemies such as journalists, opposition MPs and even your own colleagues to reach the 9th floor of the Beehive 🙂

Definitely won’t complete the game tonight, but will complete it as time allows.

Am looking forward to seeing what sort of games people create at the launch tonight.

Public Bar

Hayden Donnell writes at NZ Herald:

A lesbian couple is complaining to the Human Rights Commission after allegedly being kicked out of a Wellington bar for kissing.

But the bar’s owner is rejecting claims her staff member discriminated against the couple, saying their removal for “inappropriate behaviour” had nothing to do with their sexuality.

In an open letter on her Facebook page, Rebekah Galbraith said she was kicked out of Public, on Courtenay Place, at about 2:50am on Sunday when a male staff member spotted her kissing her girlfriend goodbye.

Putting aside for one moment the discrimination issue, the bar is also displaying stupid business sense. Two girls making out is not going to offend patrons and drive them away. Kicking them out for doing so, will.

He would not justify making them leave – only giving a repeated command; ‘you need to leave, both of you now’, she said.

Once they were outside on Courtenay Place, she accused him of targeting her because she was gay.

“He agreed, and shrugged, and said ‘it’s not my place’, and with a smirk, claimed he ‘wished it could be different’.

I can’t see any reason Galbraith would be making this up, and so this is blatant discrimination. Either the bar bans all PDAs (not necessarily a bad thing), or it allows all PDAs. You can’t say it is okay for some couples to kiss, but not others.

Public owner Gina Mills said her staff member did not discriminate against the couple because of their sexuality.

She said Ms Galbraith and Ms Leadbeater were behaving inappropriately.

In the absence of any details, this must be treated as spin.

They were asked to leave after they became aggressive at being told to “tone it down”, she said.

“It was absolutely irrelevant, their sexuality. Actually I feel discriminated against.

“Now I’m being called anti-gay, that I’m discriminating. It’s become personal and it’s absolutely wrong.”

Ms Mills would not reveal any details about the couple’s inappropriate behaviour.

Again, in the absence of details, the denials ring hollow.

UPDATE: The couple have withdrawn their complaint. It has been suggested their kissing extended to making out on a table. If so, then Public Bar was well within their rights. The CCTV footage though doesn’t show the alleged table incident.

Offending on both sides of the Tasman

Stuff reports:

A New Zealand journalist who called Australian World War I soldiers “bludgers”, “scavengers” and “thieves” says he has “nothing to apologise for” despite the backlash his comments have received.

Jock Anderson made the comments on Radio New Zealand’s The Panel last week.

“The Aussies have been reluctant soldiers at the best of times. They’ve been essentially lazy, bludgers, some of them, and excellent black marketeers, scavengers, poachers and thieves,” he said on the radio show.

“Occasionally they’ve actually been quite good soldiers, but there is no way, in my opinion, that they can hold a candle to the Kiwis.”

Jock is normally offending NZ judges and lawyers, so it makes a change for him to branch out internationally with his outrage causing.

I have great respect for all those who have served in combat, on both sides of the Tasman.

Tiwai Point

David Shearer in his big speech last week said:

Tiwai point could have been an obsolete aluminium smelter decades ago, but it didn’t work out that way.

That’s because management and workers at NZ Aluminium came together and looked at what they had to do to keep the operation running.

Through their ingenuity they began producing the highest quality aluminium in the world. They identified their niche, they got the business, they scored the contracts 
and today everyone shares in the success.

They are well paid for working well and it’s an important business in a regional area.

It is good to see a Labour leader championing Tiwai Point.

But there is a problem. Labour’s ETS policy would close Tiwai Point down. Labour opposed the changes National made to the ETS to protect trade-exposed industries, and their policy is still to undo those changes.

So the poster boy employer heralded by David Shearer would close down under their policies. Whoops.

Parker offends Mexico

Remember all the fuss over Gerry Brownlee offending Finland. Well I trust as much attention will be paid to David Parker offending Mexico. The Mexican Embassy has put out a release saying:

Is Mexico A Cigarette-Based Economy?

Following the recent comment made by Hon. David Parker about Labour’s concerns for New Zealand becoming ‘Australia’s Mexico’, the Mexican Ambassador, Mrs Leonora Rueda, has written a response to the MP noting that Mexico has been awarded the privilege of assuming the annual Presidency of the G20 this year not only because of its being the 14th largest economy in the world, but also through the good performance of its economy over the past 20 years.

Amongst other points, she notes that thanks to a highly developed infrastructure and a modern multimodal transportation system, including a vast network of commercial corridors, ports and airports, Mexico is one of the largest recipients of Foreign Direct Investment (FDI) in the world.

FDI in Mexico is nowadays concentrated in high value-added products, such as the aerospace, telecommunications and biotechnology industries, which opens up careers in technology and creates specialised education and allows the integration of academies into the productive sector, thereby increasing research and development and productive chains based on the knowledge economy.

No visits to Mexico for Mr Parker. He will have to join Jeremy Clarkson on the “off-side” list.