Page 1009 of the 15 March NZ Gazette reveals that the Progressive Party has officially disbanded, in that it has had its registration as a registered political party cancelled.

I’m a bit surprised the Electoral Commission hasn’t announced this on their website, or updated their list of parties. Normally I find out from their website, not from obscure Gazette notices.

While the Alliance had a distinct place on the political spectrum, I never worked out what the Progressives stood for, except to have Jim Anderton as Leader.

Stuff quotes NZUSA:

The NZUSA presumably has a few budding economists at its fingertips and has calculated putting interest on a $50,000 loan would see it grow to a $90,000 repayment, yet the extra value to the Government would be only $3000 out of the extra $40,000 paid.

So who would the extra $37,000 go to? Can someone in NZUSA provide their calculations, because on the surface,  I don’t see how this works.

Maybe they are saying that students would end up spending the $40,000 on goods and services, which would generate economic activity which would produce $37,000 of income for the Government? Any economists out there want to take a stab?

UPDATE: NZUSA have kindly responded:

The $50K becoming $90K if interest was added (and taking 15 years to repay instead of 8) was John Key’s. You’ll have to ask him where he got those numbers from.

According to IRD’s student loan calculator, to pay back a $50K loan in 8 years requires a salary of just over $80,000 – about twice the (university) graduate average. Of course as we all remember from 2005, IRD’s calculator doesn’t have income growth – or growth in the repayment threshold – built into it.

$70+2.5% gets a similar result.

The average graduate salary is around $40K. $45K – $48K if you believe the marketing on the NZ Immigration website. Not sure about salary growth rates in the midst of the Great Recession.

 The Net Present Value of $50K in 8 years is ~$29K; that of $90K in 15 years, is ~$32K. Hence $3,000. That’s at a 7% discount rate. Key’s interest rate seems to be higher than this, but it always was much higher than the actual cost of capital.

 These are terminal payments. Of course this is an unlikely scenario. However, since it depends on the actual cashflow, it is hard to know without the Prime Minister’s numbers. If the money comes quickly, high starting salary, low growth (to still get the repayment time), then the difference between the two would be greater, if it came later, lower starting salary with high growth, then the difference would be relatively smaller, especially if there was a break in payments – unemployment, travel overseas. These could likely be quite reasonably be factored in.

Okay this makes more sense.  What would be good is to model an actual scenario based on actual repayment times for say the average graduate. I don’t think any policy change is likely here (which will please NZUSA) but it would still be good to understand what the “cost” of no change is.

Danya Levy at Stuff reports:

Prime Minister John Key has confirmed old regional prisons are set to close and be replaced with a new privately-built prison at Wiri, in South Auckland.

The Government announced earlier this month that Serco, the private company managing Auckland’s Mt Eden prison, would also run the new 960-bed jail which would be built by Fletcher Construction.

Although the prison muster has been falling, the Government says it needs extra capacity in Auckland.

Serco is expected reduce reoffending by more than 10 per cent and will face financial penalties if it fails to meet the target.

Excellent incentives.

Labour’s justice spokesman Charles Chauvel said Wiri was expected to cost the taxpayer about $1 billion over 25 years but its “indirect” costs were becoming clear and were “disturbing”.

Normally politicians talk about a cost over three or four years to make a small number sound even bigger. Charles has gone even further and is talking about a 25 year figure.

“National seems to have made a decision that, rather than refurbish many regional state-owned institutions, it will simply close them. Prison closures will be a big blow to regional economies. Job losses will be significant.”

Heh, mourning the fact a prison is closing. I suspect the reality is that there are not enough local prisoners in Invercargill and New Plymouth to justify them keeping dedicated prisons. An interesting argument though that one should keep prisons going, even without enough prisoners, to keep jobs. It reminds me of the Yes Minister episode about the best hospital in Britain, which had no patients!

Salient have kindly added me to their distribution list, and have just been reading their first few issues. Had a good laugh at a satirical article on Trevor Mallard’s scalping, which they have on their website also. An extract:

In a shocking turn of events, it has emerged that the sell-out sales to this week’s O-Week events was not due to popular student demand, but was rather the result of a new business venture by Labour Party politician and entrepreneur, Trevor Mallard MP.

Salient understands that the MP had bought all 1,000 tickets to the Mt Eden and Roots Manuva shows, set to be held as part of Victoria University’s O-Week 2012, in an attempt to scalp them on Trade me for a negligible to modest profit.

In a written statement to Salient, Mr. Mallard stated that the initiative was part of a broader fiscal scheme to bolster his personal income.

“The pay down at Parliament is bloody dire, to be honest,” he said.

“I mean, for fuck’s sake, what else was I meant to do?” …

In the face of these accusations, Mr. Mallard has refused to capitulate to demands to return the tickets to the student body, vowing to fill the venue himself.

“It’s a matter of honour now,” he said, “But it’s all good. I’ll bring my Parliament bros along. Trev and the boys can always bring the party!”

Mr. Mallard claims he may just be able to scrape together a half-capacity crowd. All he needs to do is round up in one room everyone who wanted Phil Goff to be Prime Minister.

Heh, very good. Even better was Michelle A’Court on the same topic Seven Days on Friday night. I won’t quote her exact words, but let’s just say it was very funny.

New Labour MP David Clark blogs:

The Government has continued to spout the line that its tax ’switch’ in 2010 was ‘broadly revenue neutral’.

This is an outrageous claim.  It was nowhere near revenue neutral.

According to the IRD’s 2011 Briefing to the Incoming Minister (BIM), Government tax-take dropped from 35.1% of GDP to 31% of GDP during National’s first term.  In a time of high borrowing, and a projected $12 Billion deficit, a drop in the tax base of more than 10% is plain irresponsible. Falling revenue means we don’t have the funds to support our schools and hospitals.  Either that, or we have to borrow to fund them.  This ain’t good.

The ‘broadly revenue neutral’ claim has been relegated to the status of a bad joke by the honesty of the Government’s own tax officials.  In their 2011 BIM, officials made clear that only about 1.5% could be blamed on the Global Financial Crisis.  About 2.5 percentage points of its 4% revenue drop can be directly explained by Government policy changes (ie the 2010 tax package).

This is not a good start for a former Treasury official. He is comparing two different things. He is comparing the impact of the tax changes in 2008, 2009 and 2010, and using them to come to a conclusion about the 2010 tax changes only.

This would get you failed first years stats at even Waikato University.

What Clark leaves out of the equation was that Labour itself instituted some of the tax changes, which led to tax dropping as a percentage of GDP. It’s nice of him to give National all the credit for them, but it is not quite the case.

What the true comparison should be is whether the totality of National’s tax changes dropped tax revenue by more or less than what would have happened if Labour’s 2008 tax cuts had been fully implemented. And the answer is that over around four to five years, National’s changes look to have slightly less impact on tax revenue. This is because of course National cancelled their planned tax cuts for 1 April 2010 and 1 April 2011.

One can dispute the impact of tax changes, as it is not an exact science. It is impossible to know for sure how much revenue one would have got if a tax change had not occurred. But what one can not do is use the results of tax changes in 2008, 2009 and 2010, to come to a conclusion about the 2010 changes only. It is quite dishonest.

Paul Holmes writes in NZ Herald:

 I formed the view that the ports company have not been ungenerous in their offers to the union. In fact, even Auckland Mayor Len Brown himself agreed that the company’s first offer made early last September should have been accepted.

The offer would have rolled over the collective agreement and given the workers a 2.5 per cent pay increase each year for three years. There were several offers but early on the company decided it could no longer tolerate its workers getting paid for sitting around doing nothing.

I do not believe the union when it says that it’s a lie that the workers earn in excess of $90,000 for an average 26 hours work. Ports of Auckland had Ernst and Young audit the figures. And that’s something you notice about the ports’ conduct throughout the dispute. They’ve done things very thoroughly.

The union’s argument that its people ceasing to be permanent staff would mean that their families couldn’t plan things was obliterated by the company’s offer to roster the men for 160 hours a month, and the roster delivered a month ahead. For the life of me, I can’t see what’s wrong with that.

I think the union was dyed in the wool. I think they didn’t read the signs. Before they knew it, it was all over. Nearly 300 men were made redundant, just like that. End of story. I think there were some hardliners who’ve buggered things up for everyone. Hysteria is never a good thing.

MUNZ turned down a sgnificant pay rise and a guarantee of 160 hours a month, with rosters known a month in advance. By turning it down, their name is now going to stand for More Unemployed New Zealanders.

If you have 10 spare minutes, the interview of John Key on Campbell Live is well worth watching in my opinion.

Michael Field in the SST writes:

Women are rapidly disappearing from the frontline of New Zealand’s diplomatic service, with Foreign Minister Murray McCully overseeing a halving in the number of females serving as ambassadors and high commissioners.

In the last year of Helen Clark’s government 30 per cent of posts were held by women; under McCully it is 16 per cent.

McCully, who gets the final say in the appointments, blames the Ministry of Foreign Affairs (MFat) while the ministry has told the Foreign Service Association (FSA) women themselves are at fault.

“We have had some explanation from the ministry that women are not applying for the posts,” FSA representative Warren Fraser said. “It is not something we instinctively feel is true but we have not been able to verify ourselves.”

It is a pity neither the story nor the FSA has verified this, because it is quite central to the story. If the decline in the number of women at high Commissioners and Ambassadors is because they keep getting rejected in favour of men that is a very different story, to one where simply few women have applied.

Political commentator Matthew Hooton blogged during the week that McCully’s agenda was to promote “Gen X” men, people now in their late 30s and early 40s.

I blogged what Matthew said in NBR (it was the print edition not a blog incidentally), and he never said McCully’s agenda was to promote men. The addition of “men” is made up, and I note not in quote marks. Matthew said:

To the fury of ageing baby boomers, Mr McCully has aggressively promoted top Gen X talent.

Vangelis Vitalis, 43, has been appointed ambassador to the EU and Nato; Taha Macpherson, 40, to Turkey, Israel, Jordan, and the Palestinian Authority; Reuben Levermore, 36, to the Philippines; and Justin Fepuleai, 38, to Afghanistan. Ben King, 39, is John Key’s new chief foreign policy advisor in the Department of Prime Minister and Cabinet.

While a late baby boomer, Patrick Rata has been appointed ambassador to South Korea after Mr McCully discovered him in a back-office role having committed the ultimate Mfat sin – taking a couple of years off mid-career, to be Mr Moore’s right-hand man at the World Trade Organisation.

Yes the examples given were all men, but there is a world of difference to say that his agenda is to promote men.

All his six recent appointments were men and only one, Afghanistan ambassador Justin Fepuleai, was not white.

Good God, so now they are trying to paint McCully as racist and sexist. The trouble is, rather than five in six being “white”, I think it is “two” in six. If anything, someone could accuse McCully of bring politically correct in recent appointments.

I understand Taha Macpherson is Samoan and Patrick Rata is NZ Maori. Adding them to Justin Fepuleai and in fact three out of six are Maori or Pacific Island. And a fourth is a Greek immigrant, which arguably doesn’t fit the rather bizarre categorization in the story of being “white or “not white”.

Stats Chat again exposes stories that do not match the data:

Roy Morgan have released their “State of the Nation” report, and the Herald has twostories. In the first

According to the Roy Morgan State of the Nation March 2012 report, there has been an upsurge in the number of New Zealanders who consider Maori culture to be an “essential component” of New Zealand society.

 If a change from 52% to 61% is an upsurge, then yes, but the upsurge happened from 2001-2005.  Since 2006, the proportion has been flat at over 60%, as is clear from the Herald’s own graph

Herald quiz is here. Got 10/10 in 49 seconds.

John Armstrong writes in NZ Herald:

But Thursday’s speech contained enough hints of a change in the party’s direction to put several feral cats among Labour’s pigeons.

It made it clear Shearer will ditch policies that made Labour feel good about itself but which left voters cold – policies like Goff’s “tax-free zone” for the first $5000 of income, the promise to remove GST from fresh fruit and vegetables and the manifesto commitment to introduce a new top tax rate on income above $150,000.

That is the first suggestion I have seen that Shearer is also looking to dump the proposed rich prick tax. I hope they do. The top tax rate was dropped to 33% by Labour in the 1980s in return for bringing in a 10% GST and getting rid of tax loopholes. There is no need to raise it, except envy.

Perhaps most significant of all was the speech’s incursion into what has been an effective no-go area – the seemingly unfettered power of the teacher unions to run a ruler over the party’s education policy.,

However, education is central to Shearer’s plan to build the “new New Zealand”. It was here the speech was at its most blunt in putting bad teachers and badly run schools on notice. He later acknowledged it might be necessary to pay teachers more. It can only be assumed he was reserving any such salary increases for the good ones despite performance pay being viewed with intense suspicion by the teacher unions.

Shearer can leave National behind here. National has not committed to performance pay. If Labour does, that would make National look a follower not a leader.

Shearer intends shifting Labour’s mind-set away from not upsetting the practitioners of policy – be they teachers, public servants or whomever – to satisfying the consumers of policy, parents in this case.

I look forward to this being applied to industrial relations also.

James Weir at Stuff reports:

New Zealand’s GST is the best value-added tax in the world and should be protected from any exemptions that undermine it, according to Treasury secretary Gabriel Makhlouf.

Hopefully Labour is listening. The saddest thing of the Goff leadership was his turning his back on 25 years of sensible tax policy, for basically a political stunt.

Makhlouf said New Zealand’s GST was a simple tax that raised a large amount of revenue, with minimal distortions.

“Using GST to promote particular policies comes at great cost,” he said.

Removing GST from food would see the tax take from GST drop about 20 per cent.

The compliance costs, uncertainty and complexity of bringing in exemptions and multiple rates “are overwhelming compared with the asserted benefits”.

There were far more effective ways to promote social outcomes than by “fiddling” with the consumption tax on a good or service, and far more effective ways to redistribute than taking GST off swathes of goods and services.

“GST remains our best designed and more efficient tax,” he said.

The signs are looking reasonably positive that Shearer will have a more sensible tax policy than his predeccesor.

Countries looking for ways to raise more revenue should follow the advice of the OECD and “tidy up their tax codes to remove tax expenditures” which typically favour higher income taxpayers, so more money could be raised without increasing tax rates.

Tax “expenditure” – short for tax concessions or exemptions to particular industries or groups not available widely, were just subsidies “by another name”, Makhlouf said.

“Work on tax expenditure is focused on identifying such expenditures in the interests of transparency”.

With a broad-base, low rate approach and a comprehensive GST system, New Zealand did not have many “tax expenditures”, but they have been listed in the Budget since 2010, he said. The aim was to get a complete tally of all the implicit and explicit subsidies the government awards, “so they can be appraised on their merits”.

That’s a very good thing to do. And I agree with having as few exemptions as possible. That is why I don’t support health insurance being tax deductible.

By John Stringer, Answers on Monday, 7 am

Sir Loin at Roarprawn blogs:

These men are sought in connection with a violent gang rape of Dunedin City Council ratepayers and BNZ shareholders last night. Another man, Steve Tew , is assisting police with their inquiries. Police advise members of the public that this organised criminal group is hazardous to local body financial health and should under no circumstances be approached. Any siting should be reported to 0800 ORFU FU.

“Otago Rugby Football Union Staff List and Office Holders

President Sir Eion Edgar
Vice President Adrian Read
Chairman Wayne Graham
Deputy Chairman Laurie Mains
Director Richard Bunton
Director Dave Callon
Director John Faulks 
Director Willis Paterson
Director Russell Cassidy
Director Andrew Rooney
Director John Hammer”

Heh, sadly true.

Have blogged at curiablog the latest Roy Morgan poll out today.

On this poll, there would be a hung Parliament. The CR would have 61 seats and the CL 58 seats. The Maori Party on 3 seats could enable National to govern or force a new election.

The CTU and MUNZ have been holding up the Port of Tauranga as a bad unsafe port, with low wages. Whale Oil did something which I haven’t seen anyone in the media do – ask them if it is true. He has blogged the CEO’s response, which I extract below:

We have been really disappointed with the factual inaccuracies and unprofessional misrepresentation of the safety record of our port by the CTU President, Helen Kelly.  Unfortunately, we have had to waste shareholders’ money (which ironically includes >90% of our staff who hold shares in the Company) to instruct our solicitors to warn Ms Kelly against recklessly continuing in this regard.  Her statements about the safety record of this port are factually incorrect and we believe deliberately misleading.

We are aware that the CTU have made an Official Information Request to the Accident Compensation Corporation (ACC), seeking our port’s claims history.  We are aware of this because ACC asked for our consent to release this information as they are bound to do under the Privacy Act.  We of course agreed to this information being released as we are proud of the improvement in safety performance at the port.

The actual ACC claims history shows Port of Tauranga to have one of the best safety records of all New Zealand ports – less than half the NZ ports’ average.  Ms Kelly is in possession of this information, but chooses to ignore it, as it clearly does not fit her argument.

The graph shows PoT to be half the average. Only two other ports seem to be at the same low level. Of course not all accidents are of equal harm, but nevertheless to have half the ACC claims of other ports is commendable.

Safety is our number 1 priority at the Port and in fact we have a goal of achieving a zero harm work environment and considerable management effort is focused on striving to achieve this goal.  Our Board set a target this financial year to try and achieve a 30% improvement in Total Injury Frequency Rate – we are proud to have just achieved this improvement last month.

I imagine a port where 90% of employees are also shareholders would be motivated to have as safe a workplace as possible.

Ms Kelly also goes on to suggest there is a race to the bottom between the two ports with respect to pay and working conditions.  I would dispute this: many of our skilled workers actually earn more than the Ernst & Young figures for Ports of Auckland’s average stevedoring income.  I am very comfortable with this – our employees and contractors are highly skilled and work very hard to consistently deliver upper decile productivity. I guess the main difference though is that they expect to be working, when they are paid to be working!

This is at the heart of the dispute. MUNZ resisted any changes in the current structure that sees someone paid for 40 hours work only 26 on average.

Maybe this explains why our Port of Tauranga has net crane productivity rates 38% greater than Ports of Auckland’s (Ministry of Transport data) or on a gross measure (not allowing for netting out smoko breaks and any industrial action), the difference in gross crane rate between Ports of Auckland and Port of Tauranga is some 60% (shipping line data).

I’ve got an idea. Why not sell Ports of Auckland to the Port of Tauranga – then you’d have employees able to become shareholders of their employer – something which works so well at PoT.

In my column at the NZ Herald I look at the ten goals announced by the Government, and assess how challenging each one may be.

Not often a blog on why you left a company becomes major news, but this one by James Whittaker on why he left Google has. Some extracts:

The Google I was passionate about was a technology company that empowered its employees to innovate. The Google I left was an advertising company with a single corporate-mandated focus.

Technically I suppose Google has always been an advertising company, but for the better part of the last three years, it didn’t feel like one. Google was an ad company only in the sense that a good TV show is an ad company: having great content attracts advertisers.

Under Eric Schmidt ads were always in the background. Google was run like an innovation factory, empowering employees to be entrepreneurial through founder’s awards, peer bonuses and 20% time. Our advertising revenue gave us the headroom to think, innovate and create. Forums like App Engine, Google Labs and open source served as staging grounds for our inventions. The fact that all this was paid for by a cash machine stuffed full of advertising loot was lost on most of us. Maybe the engineers who actually worked on ads felt it, but the rest of us were convinced that Google was a technology company first and foremost; a company that hired smart people and placed a big bet on their ability to innovate.

From this innovation machine came strategically important products like Gmail and Chrome, products that were the result of entrepreneurship at the lowest levels of the company. Of course, such runaway innovative spirit creates some duds, and Google has had their share of those, but Google has always known how to fail fast and learn from it.

In such an environment you don’t have to be part of some executive’s inner circle to succeed. You don’t have to get lucky and land on a sexy project to have a great career. Anyone with ideas or the skills to contribute could get involved. I had any number of opportunities to leave Google during this period, but it was hard to imagine a better place to work.

The Google described above is the traditional image of it.

It turns out that there was one place where the Google innovation machine faltered and that one place mattered a lot: competing with Facebook. Informal efforts produced a couple of antisocial dogs in Wave and Buzz. Orkut never caught on outside Brazil. Like the proverbial hare confident enough in its lead to risk a brief nap, Google awoke from its social dreaming to find its front runner status in ads threatened.

Google could still put ads in front of more people than Facebook, but Facebook knows so much more about those people. Advertisers and publishers cherish this kind of personal information, so much so that they are willing to put the Facebook brand before their own. Exhibit A: www.facebook.com/nike, a company with the power and clout of Nike putting their own brand after Facebook’s? No company has ever done that for Google and Google took it personally.

Larry Page himself assumed command to right this wrong. Social became state-owned, a corporate mandate called Google+. It was an ominous name invoking the feeling that Google alone wasn’t enough. Search had to be social. Android had to be social. You Tube, once joyous in their independence, had to be … well, you get the point. Even worse was that innovation had to be social. Ideas that failed to put Google+ at the center of the universe were a distraction. …

As it turned out, sharing was not broken. Sharing was working fine and dandy, Google just wasn’t part of it. People were sharing all around us and seemed quite happy. A user exodus from Facebook never materialized. I couldn’t even get my own teenage daughter to look at Google+ twice, “social isn’t a product,” she told me after I gave her a demo, “social is people and the people are on Facebook.” Google was the rich kid who, after having discovered he wasn’t invited to the party, built his own party in retaliation. The fact that no one came to Google’s party became the elephant in the room.

I’ve used Google+ once. A few people say it is quite good, but I couldn’t see it providing anything better than elsewhere.

Google+ and me, we were simply never meant to be. Truth is I’ve never been much on advertising. I don’t click on ads. When Gmail displays ads based on things I type into my email message it creeps me out. I don’t want my search results to contain the rants of Google+ posters (or Facebook’s or Twitter’s for that matter). When I search for “London pub walks” I want better than the sponsored suggestion to “Buy a London pub walk at Wal-Mart.”  

The old Google made a fortune on ads because they had good content. It was like TV used to be: make the best show and you get the most ad revenue from commercials. The new Google seems more focused on the commercials themselves.

Perhaps Google is right. Perhaps the future lies in learning as much about people’s personal lives as possible. Perhaps Google is a better judge of when I should call my mom and that my life would be better if I shopped that Nordstrom sale. Perhaps if they nag me enough about all that open time on my calendar I’ll work out more often. Perhaps if they offer an ad for a divorce lawyer because I am writing an email about my 14 year old son breaking up with his girlfriend I’ll appreciate that ad enough to end my own marriage. Or perhaps I’ll figure all this stuff out on my own.

The old Google was a great place to work. The new one?

-1

Powerful stuff.

Pat Brittenden used to be on NewstalkZB and is now a host on Radio Rhema. He blogs:

Let me start by saying this, I am not anti union. If you look at my record I have supported Union’s causes more times than I have criticized them as can be seen in a post I wrote about the NZEI and National Standards 18 months ago. The interactions and opinions I share now about the Unions and the Ports are solely based on this issue and not a a past of blindly supporting either the Left or Right of this, or any other conversations, about Unions past, present or future.

I wrote a post last week about an interview I did with Garry Parsloe from the Maritime Union but as most talkbacks listeners will be aware this conversation has continued on. Prior to this conversation I had no position on who I believed was right in the debate, and to be honest to this date I would still say that I don’t believe there are any innocent parties here, I don’t believe either side truly bargained in good faith and through obstinate belligerence from both sides we are now at an impasse. For me though the case set before the public now has demonstrated that the Ports in this case are ‘closer’ to being correct that the Unions without the ‘rose tinted glasses’ idea that they have done no wrong.

And now to the specific issue:

Subsequent to yesterdays show we received a call to my producers cell phone from Helen Kelly from the CTU.

Couple of things about the answer phone message. If there has been a slandering of a Port worker I would of course retract and apologise, but from listening to the audio I don’t believe there has been. For me to ‘give [Cameron Slater] space’ on the station being a concern for Helen Kelly is ironic as we have had on Garry Parsloe so many times the news room jokes about giving him his own slot. The opinions and spokespeople for the union position have had far more airtime on my network than the counter view which you heard via Cameron Slater and for Ms. Kelly to say we needed to‘rectify’ the situation implies that we have done something wrong, which I don’t believe we have. I also got the feeling that there were threatening undertones when Ms. Kelly informed us that ‘[we] were liable for that as well’.

Pat has a recording of the phone call at his site.

The Herald interviews Owen Glenn:

Most outrageous request received in a letter/email, asking you for money?

“Please send me Fiji dollars 10,000 my Auntie is sick.”

I had never met Auntie but I sent the money regardless and then four weeks later I receive another email, “Auntie died and I need another Fiji dollars 100,000 for her wake, can you help?”

This confirms what I thought would happen.