Stuff reports:

The Serious Fraud Office (SFO) has declined to investigate a complaint made yesterday by Affco about the finances of the Meat Workers Union.

SFO chief executive Adam Feeley said an immediate evaluation of the information provided to SFO investigators failed to disclose any evidence of fraud.

“We encourage any member of the public to contact us where they have any reasonable grounds to believe that a serious financial crime may be taking place. However, it is equally important that the resources of law enforcement agencies are not unnecessarily drawn into matters where other, more appropriate, courses of action are available.”

Mr Feeley added that any issues regarding regulatory compliance were matters for the Registrar of Incorporated Societies to consider.

I agree it is not a SFO issue. But it could well be an issue for other authorities.

The union has confirmed that the vast majority of their funds are held in their unincorporated branches, whom they do not publicly publish accounts for. They claim their members belong to the branches, not to the main union.

However this is legally not possible. The union as a whole is the registered union, not the branches. Also the collective agreement with Affco is with the NZ Meat Workers Union, not any branch unions. And finally the union membership fees are paid into a bank account in the name of the NZ Meat Workers Union.

Unions have huge special rights and powers under the law.  To gain these powers they must be registered under the Employment Relations Act 2000. S14(1)(b) states a union must be an incorporated society. These branches are either part of the main union (in which case their accounts should form part of their published accounts) or they are not part of the main union, in which case as unincorporated societies they are not unions, and can not receive union dues.

By requiring the union to be an incorporated society, the law also requires them to make publicly available their accounts. Most unions do this responsibly. The Meatworkers Union is not. They are refusing to make publicly available their overall income, expenditure and assets.

You can’t claim that the branches are what union members belong to, and use that to hide all your income.

The normal practice with an incorporated society is your accounts show details for both the parent (in this case the NZ union) and the group (the NZ union and the branches combined). I know this first hand as when I did the accounts for Red Cross in the early 1990s, one of my jobs was to consolidate around 33 branch accounts into the group accounts.

The MWU is obviously refusing to publish group accounts, because they wish to hide their finances. That is incompatible with being a registered union and an incorporated society.

My column in the NZ Herald is titled “Paid Parental Leave Pains“.

Tracy Watkins reports:

Labour leader David Shearer’s chief of staff is apparently set to depart after just a couple of months in the job.

Former MP Stuart Nash was appointed Mr Shearer’s right-hand man after the leadership change late last year but is understood to be quitting to return to his home town of Napier.

Mr Nash could not be contacted yesterday. Sources say he decided to return to Napier to boost his chances of regaining the seat Labour lost in 2005, and to spend more time with his family.

His partner gave birth just a few weeks before he started the job on February 1.

But his departure is likely to fuel speculation over differences of opinion within Labour’s senior leadership team over strategy.

It will be interesting to see, if the speculation is correct, who replaces Nash. It is an absolutely key role, as if Labour wins the election they generally go on to become the PM’s Chief of Staff.

Stuff reports:

George Zimmerman, charged with second-degree murder in the fatal shooting of unarmed black teenager Trayvon Martin, faces his first appearance before a Florida judge on Thursday where his lawyer said he will try to get the crime watch volunteer’s release from jail.

The hearing, currently set for 1.30pm EDT, will be the first appearance by Zimmerman, 28, since he became a national and highly divisive figure by shooting and killing Martin, 17, in a quiet gated community in the central Florida town of Sanford.

I’m of the view that you only use a gun in self defence if in real fear of your life. From what we know, this does not appear to be the case.

However that is not the test under Florida law.

That previous decision cast a spotlight on Florida’s ”Stand Your Ground” law, which allows people to use deadly force when they believe they are in danger of being killed or suffering great bodily harm.

What is great bodily harm? Is it being punched in the face, as Martin allegedly did to Zimmerman.

Arrested and charged with second-degree murder on Wednesday, Zimmerman, who is white and Hispanic, will not appear physically at the court for the hearing, local courthouse officials said. 

The media have tried to make this into a race case. NBC had to sack a staffer who edited a tape recording to make it sounds like Zimmerman was saying he was following Martin because he is black, when in fact they deleted out the 911 dispatcher asking him the race.

Also note how Zimmerman is described as “white and Hispanic’ rather than “Hispanic”. Have you ever heard someone of mixed ancestry before described that way? Is Obama called “white and black”. Would you call someone who is part-Maori “European and Maori”.

The Florida law states:

a person is justified in the use of deadly force and does not have a duty to retreat if He or she reasonably believes that such force is necessary to prevent imminent death or great bodily harm to himself or herself or another or to prevent the imminent commission of a forcible felony

So it will be an interesting and high profile court case. I would makee two observations at this stage:

1. If Zimmerman hadn’t followed Martin (who was not committing any crime at all) on the basis of his suspicions, then Martin would still be alive
2. If Martin had not attacked Zimmerman, after being followed by him, then Martin would probably still be alive also

People will disagree on whether it was reasonable for Zimmerman to follow Martin, and also on whether Martin’s responses were reasonable (if I saw a stranger following me and running after me, I’d not react too well to it either), and finally on whether Zimmerman’s use of the gun was appropriate and lawful.

Also what we do not know (and may never know) is whether Martin was given an opportunity to retreat, after Zimmerman pulled out his gun.

The Wellingtonian has also rated the Wellington City Councillors, through use of a panel. I don’t agree with all of their ratings, but that is probably because of the different perspectives of those on the panel. The panel was:

• Waterfront Watch chairwoman Pauline Swann
• Former Wellington Employers’ Chamber of Commerce chief executive Ken Harris
• Former Wellington mayor Sir Michael Fowler
• Downstage Theatre director Hilary Beaton
• Miramar Peninsula Trust chairman Allan Probert
• Night Shelter manager Mike Leon
• Former city councillor Sue Piper
• Business and sports leader John Dow

The ratings are:

1. Paul Eagle 70.9%
2. Celia Wade-Brown 68.1%
3. Ian McKinnon 64.2%
4. Andy Foster 63.5%
5. Ngaire Best 59.8%
6. Justin Letter 55.1%
7. Stephanie Cook 54.6%
8. Leonie Gill 54.3%
9. Jo Coughlan 54.1%
10. John Morrison 52.1%
11. Simon Marsh 52.0%
12. Ray Ahipene-Mercer 51.9%
13. Iona Pannett 51.7%
14. Helen Ritchie 50.0%
15. Bryan Pepperell 41.3%

I think few people would disagree with the bottom two placings.

Ian Steward at Stuff reports:

A man known as “New Zealand’s most dangerous stalker” has pleaded guilty to two charges of harassing women, taking his tally of convictions to 229.

Glenn Green, 41, also known by the surnames Goldberg, Carlionne, Casellano and Holden, appeared in the North Shore District Court today charged with three counts of harassing women.

Despite saying he “absolutely denied” the charges at his last hearing, Green today pleaded guilty to two of the counts.

I think after 229 convictions, we can safely say he is not going to stop.

Some may think that stalking and harassment are minor crimes, but I do not. I think the victims are terrified, and the consequences may last for years.

UPDATE – Cartoon included. Sorry folks – Kokila Patel

The Tertiary Education Commission appears to be taking action over the attempts by universities to improve their relative PBRF ranking, by hiding staff with low research scores from the census done in June. I blogged extensively on this a couple of weeks ago. It does not gain the university any extra funding from the PBRF, but it does lead to them having a better average rating, and hence a higher rank.

In a consultation paper just released, the TEC states:

36 The incentives for TEOs to maximise the number of PBRF-eligible staff whose EPs meet the standard for a funded Quality Category (ie. “A”, “B”, “C”, “C(NE)”) relate to the funding that those EPs attract, and the positive contribution that funded Quality Categories make to the calculation of the AQS. It is important that the calculation of the AQS for TEOs be equitable and reliable because of the reputational impact of the relative ranking of TEOs based on the AQS.

37 As a high AQS will tend to enhance the reputation of a TEO, there are strong incentives for TEOs to minimise the number of PBRF-eligible staff whose EPs would not meet the requirements for a funded Quality Category (ie. those assigned an “R” or “R(NE)”), either by supporting these staff to develop sufficient evidence of research activity, or by seeking to have them deemed ineligible for the PBRF.

38 There are strong incentives for TEOs to take steps to minimise the number of individuals reported as PBRF-eligible, where their evidence portfolios are not likely to be assigned a funded Quality Category (A, B or C), because unfunded Quality Categories reduce the reported AQS, and by extension the ‘ranking’ of TEOs, subject areas, and nominated academic units.

39 The TEC places considerable reliance on TEOs to apply the staff eligibility criteria in a manner that is consistent with both the wording, and importantly, the intent, of the staff eligibility criteria.

40 As part of the preparations for the 2012 Quality Evaluation, the TEC has contracted KPMG to undertake an audit of TEOs. The first stage of the audit process has indicated that there appears to be differences in Human Resource practices across TEOs. In particular, differences in the way in which TEOs are applying the staff eligibility criteria in relation to staff whose EPs are not likely to meet the standard for a funded Quality Category.

A nice summation of the problem, and nice to see the have sent in auditors who have discovered how some universities are trying to rort the system.

41 The extent of these differences indicates that there is potential for these practices to affect the credibility of the published results of the 2012 Quality Evaluation, including the way in which TEOs are ranked (at both the overall organisational level, and by subject areas), and for the reporting of the relative quality of research by panel, subject area, and nominated academic unit generally.

The translation is no one would believe the results of the rankings, with the current practices employed by universities.

The TEC recommends:

55 This option involves the TEC making changes to the reporting framework for the Quality Evaluation so that any staff whose EPs were assigned the “R” or “R(NE)” Quality Categories would be excluded from the calculation of the AQS at all levels.

56 The main advantage of this approach is that it serves to remove one of the most significant incentives for TEOs to manage the employment relationships of staff for the purposes of maximising their ‘ranking’ through the Quality Evaluation measure. This approach does this by ranking TEOs solely on the basis of staff whose EPs were assigned a funded Quality Category. There would therefore be no rationale other than standard employment practices to make changes to the employment agreements of staff.

57 This approach would also ensure the results of all participating TEOs would be treated equitably and no individual TEOs would be unduly advantaged or disadvantaged by their application of the staff eligibility criteria or HR practices.

This seems a sensible way forward. It is a pity that it is necessary. If the universities were not trying to rort or skew their rankings by manipulating employment contracts, this would not be necessary. But relaying on the universities to act ethically and within the spirit of the policy seem too much to hope for, so the TEC has recommended this change.

It is good to see the Government heeding the concerns over what was happening, as it was going to reduce the rankings to a bit of a joke – the university with the most manipulative HR department would probably end up being the one which got the highest rating.

It will be interesting to see what the Tertiary Education Union says on this proposed change, as they had also expressed concern over the manipulation of employment contracts to improve ratings.

A guest post by David Garrett:

The case of Stuart Murray Wilson – the so called “beast of Bleheim” – has prompted the National led government to finally grasp  one of the most difficult of legal nettles. Our entire judicial system is based on “do the crime, do the time”, and no imprisonment for what one  might do in the future. But what do we do with individuals like Wilson or Lloyd MacIntosh – habitual sex offenders who everyone, including experts retained on their behalf,  agrees will – not might – inevitably reoffend on release?

The problem is not new, and unless or until medical science advances significantly, habitual sex offenders who constitute a serious risk – regardless of advanced age – will always be with us.

Stanley McKissock Reid committed sex offences including  rape in the 1920’s, and served a lengthy term of imprisonment. Despite his file being marked “Never to be released”, he was, and Reid then  raped and killed Lila Hammond in 1944. But for an accident of history – a temporary moratorium on capital punishment – Reid would have been hanged and forgotten.

During his time in jail, there were several attempts to “rehabilitate” Reid, including work placements at Burnham Army Camp near Christchurch. Whenever he was around women, Reid could not stop himself from sexually assaulting them, so he stayed in jail. By the 1980’s Reid was in his 80’s, and there was considerable agitation from well meaning do-gooders to let “poor old Stan” live the remainder of his life in the community.

Reid was released from jail in the mid 1980’s aged 83. He was sent to live with a community of nuns, where, about six weeks after his release, he tried to rape one of them. Fortunately the nun was able to overpower him. Showing considerably more insight than the do-gooders,  Reid told her that he  had “always been a bad bastard”.

The oldest prisoner in jail in New Zealand is an 85 year old paedophile held   in maximum security at Auckland prison. He is still considered to be a serious risk to children, and is unlikely to ever be released. The authorities can hold him indefinitely because he is serving a life sentence.

Lloyd McIntosh, a habitual paedophile who is described as “New Zealand’s most dangerous sex offender”,  is much more problematic. McIntosh was sentenced to ten years in 1993 for sexually assaulting a nine month old baby. He served the full sentence, and shortly after his release in 2003, sexually assaulted and raped a two year old boy.  Although he had been offending since he was a child, the authorities then finally woke up to the reality that in McIntosh, they had an offender who was almost without parallel.

In 2005, McIntosh became the first person to be subject to a ten year supervision order. Initially, by agreement, he lived in a house within the grounds of Rolleston prison, but the following year he was allowed to leave the prison grounds  subject to electronic monitoring and close supervision. Given the consensus among “the experts”  that he will never  be less than a serious risk, it is somewhat remarkable that he has not reoffended since 2006 – or at least he has not been caught. From 2015, McIntosh will be free of all constraints, and given his history, it can then only be a matter of time before he reoffends.

So what can and should we do with people like Wilson and McIntosh, or the ten or a dozen similar offenders identified by the authorities? As in most matters penal, the United States grasped this particularly difficult nettle ten or twenty years ago, with laws requiring notification of communities into which habitual sex offenders are released, and for the worst of the worst, pre-emptive incarceration.

Coalinga state prison is a unique institution designed for those designated “Sexually Violent Predators –  offenders who the state has determined are simply too dangerous to  be released after completing their prison sentences. They constitute perhaps 2% of incarcerated sex offenders. Given the very small number of offenders such as McIntosh and Wilson identified here in New Zealand, the percentage is likely to be similar in this country.

Inmates at Coalinga have considerably more freedom that at a normal prison. They are allowed to move around the prison concourse freely. There is a “mall” with shops, such as a barbershop, a grill, and a canteen. Those prisoners who wish to can participate in various psychological therapy programmes. Significantly, the majority of inmates refuse to undertake any treatment. They do not think there is anything wrong with them. Those inmates have effectively selected themselves as members of the category of prisoners who will never be released.

To be fair, neither will most of the rest, treatment or no treatment.  The Americans at least have accepted that there is a small but highly dangerous category of sex offender who will always be too much of a danger to society, no matter what “treatment” they undergo. It seems that the National led government – probably at the instigation of Justice Minister Collins – has at last woken up to the same realization.

There are of course numerous good philosophical and moral reasons not  to lock people up for what they might or –  even  definitely will  – do in the future. No doubt we will hear many of those arguments in comments on this post.  But for me, the issue is relatively straightforward. Once an offender  has been conclusively identified as a person who will never be safe around the vulnerable – particularly children –  their “rights” very much take second place to the rights of children to play,  or even  to sleep,  without a Lloyd McIntosh waiting for his chance to grab them and  commit unspeakable crimes.

Some very interesting history there from NZ’s past, and also on what happens in the US.

Andrew Geddis at Pundit has posted on the issue also, detailing some of the issues involved.

In his “big” speech, David Shearer said:

Any government I lead is going to be thrifty.

New Zealanders can trust Labour to manage the books.

So the question has to be asked. How would Labour find $150 million a year to fund their bill to increase paid parental leave? Will they just borrow it?

It will be very tough to get back into surplus, as National is aiming to do. But we simply can not afford to keep running deficits, as the interest on the extra debt actually makes less money available for health, education and yes even paid parental leave. We need to live within our means.

So how does an extra $150 million a year fit into Shearer’s pledge to be thrifty? Will he borrow to pay for it, or hike taxes to pay for it?

3 News reports:

Affco has accused the union representing its employees of not complying with its statutory reporting requirements, and says there are “irregularities” in its financial accounts.

The New Zealand Meat Workers and Related Trades Union and Affco have been involved in a tit-for-tat series of strikes and lockouts since February, fighting over changes to union members’ collective employment agreement.

In the latest move, Affco says it is laying a complaint with the Serious Fraud Office on behalf of its employees over the payments they make to the union.

CEO Hamish Simson says the union has not declared its total income, and has failed to disclose what it does with its members’ contributions.

“It appears from the union’s published financial statements that only a fraction of its total income has been declared,” says Mr Simson.

“Affco workers contribute over $500,000 to the union each year, paying $5.95 each per week. Affco workers represent less than 10 percent of the 23,000 members the Union says it has and yet it only declares revenue of just over $700,000 per annum”.

The Meatworkers Union is affiliated to Labour, and donated $18,000 to them at the last election.

Looking at their accounts, I would say that levies are paid to branches, and a fraction of those levies are paid to the main union as capitation fees.

Now if those branches are all incorporated societies also, then probably all is okay. But if they are not, and do not publish accounts, then there is a case they are concealing their overall income. Unions are required to be publicly registered. Do those who pay the unions fees think they are joining the NZ Meat Workers Union or a separate branch union?

The only other incorporated society that has the words “Meat” and “Workers” in its name is the “CANTY MARL NELSON BR NZ MEAT IND RELATED TRADES IND UNION WORKERS WELFARE SOC INCORPORATED”. They have not filed annual accounts for 2003, 2005, 2007, 2009 and 2010. Their 2011 accounts only show income of $37,000 so they do not explain where the “missing” $4 million of revenue is.

If 80% of the money is kept in branches whose accounts are excluded from the incorporated society’s accounts, then that is seriously wrong. Branches are generally regarded as part of the parent body, unless themselves incorporated.

It will be fascinating to see if there is an innocent explanation for the missing $4 million or so.

Whale has blogged on this issue in recent days.

The Productivity Commission has released its final report into housing affordability.

Their findings and include:

• Real house prices doubled between 2001 and 2007
• The house price to disposable income ration increased from 3 to 5.5 from 2001 to 2007
• 58% of renters can not afford to buy a house at the lower quartile price, assuming standard bank lending criteria
• Section prices in Auckland are on average 60% of the cost of a dwelling, compared to 40% elsewhere
• Land 2 kms inside Auckland’s urban limit costs 8.65 times as much as land 2kms outside

And recommendations include:

• Increasing land supply for new housing should include moderate-density development of brownfield sites and development of greenfield sites close to existing centres, local employment, and services.
• Auckland Council should show in its final Auckland Plan how it has considered and reconciled affordable housing alongside its other priorities.
• Bring significant tracts of greenfield and brownfield land to the market in Auckland – identify and assemble land that could be quickly released and made ready for development, signal land with future potential for urban development, and make a commitment to major offsite infrastructure capacity.
• Territorial Authorities to:
  -Take a less constrained approach to the identification, consenting, release, and development of land for housing in the inner city, suburbs, and city edge.
  – Adopt a strategy that allows for both intensification within existing urban boundaries and orderly expansion beyond them.
  -Develop strategies that promote adequate competition between developers for the right to develop land.
• The Department of Building and Housing publish, for each BCA, the total time taken between receiving applications and finally granting consents, and the number of occasions where each BCA has used the ‘stop the clock’ provision.
• The Department of Building and Housing audit the ‘stop the clock’ information from a sample of BCAs.

Now some of the usual suspects will say “No we can’t do it” because they think larger cities means more roads and more roads are of course evil. Now sure you can have that view, but be aware that the price of keeping to that view is that more and more low to middle income families will never get to own their own home, and will probably also end up paying more to rent than in the past.

For those who can afford to buy one, or even more than one house, then refusing to makes changes to reduce the cost of land and housing, will be great for the well off.

I blogged yesterday the positions of the political parties on the MMP review. I’ve amended it for United Future as I had overlooked that they are the one party which supported open lists. Their submission said all list candidates should have to stand in an electorate, and they be ranked in descending order of the percentage of party votes in that electorate their party got. That encourages them to campaign for party votes then. Not a totally bad idea, but you wouldn’t want to be the Labour candidate in Helensville or National candidate in Mangere!

I should also make clear that you can still make written submissions to the review until 31 May 2012. The headline last week was for those who wish to also do oral submissions. These oral submission hearings will start in Wellington on Monday 23 April.

Also the Maori Party submission has now been published. They have some interesting proposals:

• That those of Maori decent be automatically enrolled on the Maori roll, with an option to transfer to the general roll. At present Maori choose when they enrol, rather than have to opt out.
• Lower the party vote threshold (they do not specify to what) as no Maori party has ever gained 5%
• Keep the one electorate seat threshold
• That like the general seats, no Maori seat can be split between the North and South Islands (Te Tai Tonga includes all of the South Island and parts of Wellington)
• To include tribal information in the electoral roll

As far as I know, the Mana Party have not yet put in a submission.

One of the bills drawn out of the ballot last week was the Lobbying Disclosure Bill in the name of Holly Walker, bur originally drafted by Sue Kedgley.

The Herald had a headline “Long time lobbyist lobbies against lobby law”, but in fact the substance of the story was quite different:

One of the country’s longest standing lobbyists says a bill which would force lobbyists to register and disclose their clients and meetings with Government ministers is not necessary in New Zealand.

Mark Unsworth, a partner of government relations firm Saunders Unsworth, said he was not against the proposals in a Green Party bill which will soon go before Parliament but did not believe it was necessary.

I would suggest that this bill is a solution looking for a problem. But as no one wants to be seen as against transparency, it will probably proceed. Like Mark Unsworth, I have no problem in principle with the intent, but people should be aware of how far reaching the bill may be.

The Dom Post editorial is in favour of the bill, as is the Herald.

The proposed bill makes it an offence for any person to engage in lobbying activity, unless they are registered with the Auditor-General. The definition in the bill of lobbying is very wide. I blogged last year:

Arguably I could be regarded as a lobbyist for InternetNZ. For many years I chaired their Public Policy Committee as Vice-President of InternetNZ. As VP I had a small honorarium of $12,000 a year. I’ve retired as VP, but still chair the now titled Policy Advisory Group. This involves literally chairing the monthly meetings, but also meeting with policy staff regularly to help develop submissions, pro-actively identifying policy issues etc. I am now technically a contractor, as I am no longer an officer, and still get $12,000 a year for it.

Now for the last seven years or so, I’ve been one of the InternetNZ people who speaks to our submissions at select committees, and meets with MPs to advocate for what we regard as good for the Internet.

One could argue I am a paid lobbyist for InternetNZ in my current role. I don’t quite see it like that because my advocacy is based on my beliefs of what is good for the Internet, which coincide with InternetNZ. But under the proposed law, I might be classified as a lobbyist. Now that doesn’t worry me at all, but it seems strange to me as I’m not like a lawyer or lobbyist who will argue for a client regardless of their own beliefs. If ever INZ adopted a policy position I disagreed with, I would not take part in the advocacy around it.

Now depending on how you define a lobbyist, my advocacy on behalf of InternetNZ might be deemed lobbying in my role as a contractor to them, but how about when I was their Vice-President? I was doing much the same then, as I was today. I would argue you should say that if I am deemed a lobbyist as a contractor, I am also a lobbyist as an office holder.

Now if you do take that definition, then just be aware that an awfully large number of people will now be classified as lobbyists. I’d suspect 1,000+ people would fall into that definition.

Now if I am classified as a lobbyist for InternetNZ, then under this bill I’d say I’d have to report any tweets I direct towards MPs on Internet related issues.

At Kiwi Foo Camp there was a roundtable discussion with David Shearer, David Cunliffe and Clare Curran on innovation. I’m pretty sure we discussed some Internet issues there, so does that have to be disclosed even though there were 40 people in the room?

What if I go to a Meet the Candidates meeting and ask MPs a question on copyright issues, mentioning my own views on them? Do I face a $10,000 fine for not including that?

How about my blog posts? I know many MPs read this blog. Does that count as a communication towards them, that must be disclosed?

The bill should be supported at first reading. Its intent is worthy. However I think a select committee will have to very carefully consider it to ensure it doesn’t become a bureaucratic monster where (for example) every discussion between a Greenpeace activist and a Green MP doesn’t require forms in triplicate.

The Press has done a report card on the Christchurch City Councillors.

I think such report cards are a good thing, as the average resident does not follow Council business closely enough to gain an informed opinion of which Councillors are performing. It is of course just an subjective rating, but they give reasons. I do think however that the article should list which staffers did the ratings, in the interests of transparency.

I also think the way the Wellingtonian did it, is a good model. Rather than do ratings just from their staff, they assembled a panel and got them to rate the Councillors.

Anyway the ratings are:

• Tim Carter B+
• Yani Johanson B+
• Glenn Livingstone B+
• Sue Wells B
• Claudia Reid B
• Jamie Gough B
• Ngaire Button C
• Aaron Keown C
• Bob Parker C
• Jimmy Chen C-
• Helen Broughton D+
• Barry Corbett D
• Sally Buck D

The Press plans to repeat the ratings before the October 2013 elections.

Jo Moir at Stuff reports:

A promotion for New Plymouth MP Jonathan Young will keep his finger on the pulse of energy issues affecting the region.

The National Party senior team including Prime Minister John Key, his deputy Bill English and Leader of the House Gerry Brownlee have appointed Mr Young to a new role as chair of the commerce select committee.

This article is correct in substance, but not in process.

The PM can not appoint a Select Committee Chair. The Commerce Committee elects its own chair.

However the inevitable process is the PM and senior Ministers and/or advisors decide whom the Government wants as a chair of a select committee, and that person gets elected.

If the Government does not have a majority on a select committee, then the committee can block the proposed nominee, but this is rare.

Generally the Government will consent to some chairs and/or deputy chairs being from non-Government parties. At present these are:

• Commerce Deputy Chair – Clayton Consgrove, Labour
• Foreign Affairs Deputy Chair – Kennedy Graham, Greens
• Govt Admin Chair – Ruth Dyson, Labour
• Local Govt & Environment Deputy Chair – Eugenie Sage, Greens
• Maori Affairs Deputy Chair – Parekura Horomia, Labour
• Primary Production Deputy Chair – Damien O’Connor, Labour
• Regulations Review Chair – Charles Chauvel, Greens Labour

Danya Levy at Stuff reports:

Labour’s proposal to extend paid parental leave looks likely to have enough support to pass Parliament’s first hurdle – but the Government could still block it by using its power to veto costly policies it does not support.

A bill by Labour’s early childhood education spokeswoman, Sue Moroney, drawn from the members’ ballot last week, aims to extend the paid leave from 14 weeks to 26.

The Government’s support partner UnitedFuture, which campaigned during last year’s election campaign on extending paid parental leave to 13 months, could give Labour the numbers it needs to send the bill to a select committee for consideration.

UnitedFuture leader and sole MP Peter Dunne called the bill a “step in the right direction” and said he was inclined to support it.

Even if Labour has the support to pass the bill, Parliament’s standing orders enable the Government to exercise a financial veto on legislation that would have a significant impact on the Budget.

However, there could be enormous moral pressure from both inside and outside Parliament for National not to veto the family friendly bill.

The Government can issue a financial veto certificate under Standing Order 321 if a bill, in its opinion, “would have more than a minor impact on the Government’s fiscal aggregates”.

However Standing Order 323 states a a certificate relating to a bill “may be given only when the bill is awaiting its third reading”.

What this means is that if Labour, Greens, NZ First, Maori, Mana and United all vote for the bill it will have its first reading. It would then go to a select committee for six months, and return to the House for a second reading. If still supported by those parties it would then go to the committee of the house stage, and if reported back from there, then and only then can the Government veto it as it awaits third reading.

So any potential use of the veto is likely to be in 2013, not even this year.

UPDATE: It is worth giving some background to the veto. It was formalised in 1996 in response to MMP, specifically to allow minority governments to govern. If a Government can’t control its own finances, then it isn’t the Government as we know it – we would have a US style Government where the Executive has limited financial powers (and we’ve see how well that system works with earmarks and the lpletoike).

The veto has been used often in the past. From 2000 to 2008 Labour used it on at least a dozen occasions to veto amendments to bills. Also the minority National Government from 1997 to 1999 used it on several occasions, including (I believe) on a bill, not just amendments.

Interestingly even before 1996 there was an effective veto. The Speaker could refuse amendments which had a fiscal impact. The decision was made that it was more appropriate for the Government rather than the Speaker to decide, as they have to manage the consequences.

UPDATE2: The Government has said they will veto the bill, but as I explained above they can not actually do this until after it has completed committee of the house stage and is set for third reading.

Rick Santorum has suspended his presidential bid, which effectively confirms former Massachusetts Governor Mitt Romney as the Republican nominee.

Romney has around 60% of the delegates he needs, but should comfortably win enough in the remaining primaries.

It will be interesting to see if the GOP is able to unite behind Romney. Obama is the favourite at this stage – 61% on Intrade, against 37% for Romney. However the Republicans should now start to target Obama rather than each other.

The Pollster average of the polls has Obama at 46.1% and Romney 44.5%, so the race is definitely competitive. Of course it is electoral college votes that count, not the popular vote, but the two are linked.

Also at this stage the Republicans are favoured to retain the House and gain a majority in the Senate, so if Romney can win, he will probably have a supportive Congress.

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

PAY IT BACK: The kids have been bludging from the taxpayer too long by buggering off to the UK or Oz rather than paying off their school loans, right? True or not, the Government is tackling student debt by making those borrowing more accountable. How? A shorter repayment holiday and the IRD chasing you down. Will this lower the debt? Is the Government being too tough? Is it in the country’s best interest for our youth to get a uni-degree? Do students understand what they’re getting into? And how many are dodging vs. how many are broke?

GETTING THE JOB: Now that you’ve got the student loans, it’s time to get a job. How on earth do you start? Does University prepare you for the work force? What on earth do you do with a BA in History? What are employers looking for? Are there jobs for the Uni-grad? And should we be advising our young what’s in demand?

TIME FOR BABY: How long should new parents stay home with baby? A bill by Labour’s Sue Moroney says 6 months(26 weeks) rather than the current 3.5 months/14 weeks. Is that affordable? Do we need the time for the country to recover financially? Will our country EVER be able to afford extended leave? Or should the leave time be longer? Are there benefits, bigger than financial to consider?

Join us for a night of LIVE pub politics from the Backbencher Pub: Wednesday, 11th of April. Our Panel is representing the Youth Wing of the parties: ACT on Campus Hayden Fitzgerald, Young Greens Wilbur Townsend, Young Labour Glenn Riddell, New Zealand First Youth Curwen Rolinson, and Young Nationals Sean Topham.

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

I’ve blogged previously on the outrageously dishonest spin from Labour that tax revenues are down 4% of GDP over four years, and trying to assert it is all due to the one set of changes in 2010. Even some journalists who should know better have repeated such absurdities.

I’m going to blog in two parts on this issue. The first part will be today looking at what the Treasury macro-economic advice was for the impact of the tax and spending changes, and tomorrow (if I have time otherwise later in the week), I’m actually going to analyse the actual changes in tax revenues through the 2008 BEFU, the 2008 PREFU, 2008 DEFU, 2009 BEFU, 2009 HYEFU, 2010 BEFU, 2010 HYEFU, 2011 BEFU, and finally the 2011 PREFU. This looks at the changes in overall tax revenues, individual tax revenues, corporate tax revenues and GST.

It is important to understand you need both the forecasts of what a change will do, and what actually happened. Neither are the total picture, but together they give us a reasonable picture.

You see the reality is that if Treasury says (for example) hiking the top tax rate from 33c to 39c will bring in $900m/year of extra revenue, and a Government does it, and revenue only goes up $700m, then no-one really knows why the revenue gain was less than projected. It might be that it did increase revenue by $900m, but that economic growth was flatter and so taxable income was lower. Or it could be that the increase lead to greater tax avoidance, and the increase did not achieve as much extra revenue as projected.

It is easy to diss Treasury projections – even I have done so. But it is worth noting how massively complicated it is to forecast tax tax over an entire economy. Many individual companies have problems forecasting income just for that company. Now imagine having to forecast income for the aggregate of every company and person in New Zealand, without having the knowledge of what is happening in individual companies.

What we have below is the official net fiscal impact as forecast by Treasury for National’s tax and spending changes. As you will see the total effect of these tax changes is negative during the 2008 – 2010 period, which is when there was a fiscal stimulus policy to help cushion the recession, and in the first two years, providing support to the economy during the recession, and have been net positive from 2010 onwards.

Net fiscal impact of the Government’s tax changes ($million increase (decrease) in the operating balance)

 1. fiscal impact = revenue (2/3*removal of R&D tax credit + KiwiSaver changes + cancelling remaining tranches of Labour’s tax cuts) minus costs (personal tax + IETC). Source: Cabinet Paper CAB(08)585.

2. cancellation of the 2010 and 2011 tax cuts as announced in the 2009 Budget. Source: Treasury Report T2009/418.

3. SME tax package as announced in February 2009. Source: BEFU 2009, Table 1.7.

4. fiscal impact = revenue (GST increase + depreciation + LAQC + thin cap + WFF + GST base + tobacco + increased audit) minus costs (personal tax + company + PIE and savings vehicles + GST compensation). Source: Budget 2010 Executive Summary, Table 1.

5. savings from changes to KiwiSaver and WFF tax credits. Source: Budget 2011 Executive Summary, Table 2.

It is worth recalling that during this period Labour opposed every single spending cut made by National.

Over the six years of National’s first two terms, the total projected impact of National’s tax changes (and cancellation of spending commitments) has been a net improvement of $4.9b. In other words compared to the policies put in place by Labour in 2008, National’s changes were projected by Treasury to result in $4.9b more revenue over two terms.

It is worth noting these are only the direct tax (and cancelled spending commitments) changes. This is not taking into account National slashing to the contingency for new spending from over $2b a year to $800m and eventually zero. That has also had am impact in the billions.

Now as I said, we will also look tomorrow at what actually happened to tax revenues, but many factors impact tax revenues as well as policy changes. These figures for now show how preposterous Labour’s deception is about how the 2010 tax package is somehow primarily or totally responsible for a decline in tax revenue of 4% of GDP or $7b/year.