The Miami Herald reports:

Public school teachers in Florida will soon be required to dedicate at least 45 minutes of instruction on “Victims of Communism Day” to teach students about communist leaders around the world and how people suffered under those regimes.

Speaking at Miami’s Freedom Tower before a crowd of local lawmakers and supporters, Gov. Ron DeSantis signed House Bill 395, which designates Nov. 7 as the state’s official “Victims of Communism Day,” making Florida one of a handful of states to adopt the designation.

I’d love New Zealand to establish a Victims of Communism Museum which details all the mass deaths caused by communism. It could even include half price entry for people living in Aro Valley.

Stephen Hickson at The Conversation writes:

But the beauty of New Zealand’s tax system is its simplicity. Removing GST on food, or some types of food – for example, “healthy food” – makes that system more complex and costly. …

In Australia, the quesion of whether an “oven baked Italian flat bread” is a bread (so not subject to GST) or a cracker (subject to GST) went to court, and involved flying a bread certification expert from Italy to testify. The only reason why that job exists is due to complexity in tax systems around the world.

In Ireland, the court was required to rule on whether Subway was serving “bread” or “confectionery or fancy baked goods” due to the difference in GST treatment.

In the UK, guidance on how GST on food is applied runs to 40 pages with 130 example categories; in Australia, an 87 page document covers some 1500 food types.

Removing GST on food would be wonderful news to tax lawyers, but terrible for everyone who sells food.

The NZ Law Society’s Rule of Law Committee has been considering the issues raised by the interference of two Bench Heads with a case before Judge Peter Callinicos. Unlike the terrible report from the Judicial Conduct Commissioner, the Rule of Law Committee has found much to be concerned about. Some extracts:

• Engagement to discuss judicial conduct when the proceeding is ongoing is highly unconventional, made even more so by the attempted communication not involving all parties to the proceeding
• A discussion between a party (Oranga Tamariki) and the Heads of Bench and then a consequential discussion between the Heads of Bench and the sitting judge, in the absence of every party, or without their prior consent, cannot be reconciled with the right to natural justice and open justice
• If a party to a proceeding (Oranga Tamiriki) can secure meetings with the Heads of Bench with the sitting judge while a case is part-held, then the same access should be available to all litigants otherwise there is inequality of access to justice
• This has the potential to undermine public confidence in the independence of the judiciary and in open justice
• The informal way in which the allegations of inappropriate judicial conduct have been dealt with is highly undesirable
• Private meetings between a party to a current proceeding and a Head of Bench while the relevant proceeding is part-heard, to discuss conduct in that proceeding, are inappropriate

I’ve embedded below the full memo. This is very significant. The criticisms by the Rule of Law Committee are strong and hopefully the full Law Society had taken them up with the Chief Justice and Attorney General.

I was stunned and saddened to hear that Neil Miller or Millsy had died on Wednesday after a few days in ICU for a previously undiscovered illness. Neil was loved by pretty much everyone who knew him. He was one of the funniest and kindest people around. As news of his death spread, I got messages from former colleagues to former Prime Ministers about him.

Neil and I worked together in Parliament for many years. He was, I thought, the most talented researcher I had seen. He trained up a generation of MPs on standing orders, on speaking in the House and more. And he brought joy to all those who worked with him – through his terrible Hawaiian shirts, his indoor cricket playing in the corridors and his great sense of humour.

Neil was passionate about beer, wrestling, politics, debating, karaoke and cricket. He turned his love of beer into an occupation becoming NZ’s leading beer writer and teaming up with chefs like Martin Bosley to match beers to restaurant menus. He even ended up as a part-owner of a bar, and we would always joke whether his share of the profits ever matched his bar tab.

I doubt there was a bigger fan of professional wrestling in New Zealand. Many of us had watched Wrestlemanias at his old apartment on Molesworth Street, where his Tui couch had pride of place. Neil and I saw the new millennium in at his apartment on 31 December 1999.

Neil was also a legend in debating circles. He was often a celebrity adjudicator and his adjudicating remarks were often the highlight of the debate. A few years ago Neil and I got to travel to most of the National Party Regional Conferences where I would chair the after dinner humourous debate and he would adjudicate it. This basically meant we got to mock John Key and Bill English over dinner and get wild applause for it. To be fair John and Bill would mock us back also.

Neil was very kind, and had a great love for animals. The one thing he couldn’t abide was cruelty to animals. He could often be found feeding the birds at Parliament.

As I said pretty much everyone who knew Neil loved him. He will be missed by so many, and all his friends will have a dozen or more Millsy stories to share. He truly has left us too soon, and we’re all thinking of his family, especially his fiancée Tamsyn who was the love of his life.

Rest in Peace Neil.

The Christchurch Council should can the project. Christchurch ratepayers are facing a bill of over $5,000 per household!

Radio NZ reports:

Cigarettes are being seized at the border in relentless quantities: more than quarter of a million a month, along with an average of 129 kilograms of loose tobacco. 

Customs is bracing for the problem to increase as smoking laws get stricter – and promising to put the heat on the people responsible.

Government policies have led to a huge increase in the black market. This means that instead of smokers buying a regulated taxed product, they are buying an unregulated untaxed product.

Anti-smoking group ASH said there were some estimates that illicit trade could make up about 10 percent of the total tobacco market.

“So you can imagine what that is in the loss of tax take. And it’s probably increasing,” director Deborah Hart said.

As the cost of legally purchased cigarettes creeps up – to a current average of $38 a packet – Hart said illicit trade was becoming more and more lucrative. 

The tax increases worked well for many years as a tool to discourage smoking. But they reached a point where they no longer discourage the remaining hard core smokers – they just fuel the black market.

One News reports:

Māori medicine and health science students from the University of Auckland say they’re tired of receiving racist comments from other students, and the public, suggesting they get special treatment and easier admission into the course.

1News has heard from several students who have been subject to racist remarks both online and during their lectures, singling out their entry into the degree through the Māori and Pasifika Admissions Scheme (MAPAS).

MAPAS is an initiative by the university which sees it allocate 30% of its entries to Māori and Pasifika students.

Such comments claim Māori get special treatment over other students because of the scheme, and that it is easier for them to get into the course.

It is rude and worse to comment to a fellow student about how they got admitted. Anyone who does this should stop. If you don’t like the admissions policy, you should target your comments at the policy makers, not the students. No student should be made to feel unwelcome.

But I’m no expert on the admissions schemes, but as far as I know the “claims” are in fact factual. There is a different academic standard for admission for those who enter through MAPAS. There may be very good public policy reasons for this, but that doesn’t mean the claim is wrong.

This 2020 article states that general entry students at Otago need a 94% average mark while those in a scheme only need 70%.

Now again there may be very good public policy reasons to have the MAPAS scheme. I don’t think admission should be based purely on grades. But this is a legitimate area of debate and discussion. However the debate should be with policy makers, not targeted at students.

MSN reports:

Students trapped in a classroom with the gunman repeatedly called 911 during this week’s attack on a Texas elementary school as nearly 20 officers waited in the hallway for more than 45 minutes, authorities said Friday, according to the Associated Press.

The Police response to the gunman is probably the worst in recent history. Almost everyone is shocked that the Police spent an hour outside while an active shooter was in a school.

Geoffrey Miller writes:

As a new “Great Game” for control of the Pacific escalates, New Zealand’s foreign minister is coming under pressure from all sides.

For those keeping score, China has now signed co-operation agreements with Samoa and Kiribati, while the US has convinced Fiji to join its new Indo-Pacific Economic Framework for Prosperity (IPEF).

It’s staggering that we learn through the media that Samoa and China have signed an agreement. This is a huge diplomatic failure.

In New Zealand, foreign minister Nanaia Mahuta was left to respond to the developments from the bigger players – and to fend off volleys of criticism from New Zealand’s former foreign ministers and diplomats over her perceived inaction. …

While defenders of Mahuta might write off criticism from Brownlee and Peters as standard partisan fare, the views of the former New Zealand diplomats are harder to ignore.

Marion Crawshaw, a former New Zealand diplomat with extensive Pacific experience gained in postings to Fiji, Solomon Islands and Papua New Guinea (PNG), tweeted: “Maintaining the ability to follow our own path in the Pacific has always required focus, attention & careful prioritisation. The need right now is for a visible lift to our attention & [relationships] right across the Pacific.”

For her part, Suzannah Jessep, a former New Zealand deputy high commissioner to India now working for the Asia New Zealand Foundation, wrote: “Feels weird that the Chinese foreign minister is visiting the Solomon Islands, Kiribati, Samoa, Fiji, Tonga, Vanuatu, PNG, and East Timor, but NZ has hardly done any ministerial in-person diplomacy. Hard to argue that the Pacific is our priority.”

And another former senior New Zealand diplomat, Nicola Hill, tweeted that Jacinda Ardern was offering “word salad diplomacy on the global stage at a critical moment about China in the Pacific” that was “incoherent”.

Like Jessep, Hill also highlighted inconsistency in New Zealand’s face-to-face diplomacy: “How often does New Zealand’s MFA [Minister of Foreign Affairs] visit PNG, Solomon Islands, Vanuatu or Kiribati? A flurry of visits in 2019.”

Diplomats tend to be, well diplomatic. For three senior former diplomats to speak out, shows how bad they think things are.

The full results are here.

Party Vote

• National 39% (nc from last poll)
• Labour 35% (-2%)
• ACT 7% (-1%)
• Greens 10% (+1%)
• Maori Party 2% (nc)
• NZ First 1% (-1%)
• TOP 2% (+1%)
• New Conservatives 1% (nc)

Seats

• Labour 45 (-20 from election)
• National 51 (+18)
• ACT 9 (-1)
• Greens 13 (+3)
• Maori 2 (nc)

Government

• Labour/Green/Maori 60/120
• National/ACT/Maori 62/120

Preferred PM (unprompted)

• Jacinda Ardern 33% (-1%)
• Christopher Luxon 25% (nc)
• David Seymour 3% (-2%)
• Chloe Swarbrick 2% (+1%)
• Winston Peters 1% (-1%)

AP reports:

Many voters in heavily Democratic Los Angeles are seething over rising crime and homelessness and that could prompt the city to take a turn to the political right for the first time in decades.

Sounds a bit like Auckland!

One of the leading candidates for mayor is Rick Caruso, a pro-business billionaire Republican-turned-Democrat who sits on the board of the Ronald Reagan Presidential Foundation and is promising to expand spending on police, not defund them.

He is a Democrat, but one of the few moderate or sane ones.

But these are fraught times in Los Angeles, with more than 40,000 people living in trash-strewn homeless encampments and rusty RVs, distress over brazen smash-and-grab robberies and home invasions while inflation and taxes are gouging wallets — gas in a region built on car travel has cracked $6 a gallon. Rents and home prices have soared.

Again sounds like Auckland!

Andrea Vance writes:

How did Covid-19 get in? Was elimination the right strategy? Did we go too far, or not far enough? In protecting the vulnerable, did we condemn others to a future of ill-health, poor mental health, poverty and misery?

As important as the economy, is surely the health system. Why could it not cope? Even after two years, and high rates of vaccination, how is it that we cannot rely on it?

There are judgements to be made. Even before the pandemic, the cracks were evident: staff shortages, dilapidated facilities, treatment delays, and poor cancer survival rates.

Governments allowed our most vital service to be run down. It failed us – so how do we rebuild it? And how can we ensure our essential workforce is no longer undervalued?

Were there mistakes in policymaking – from mask wearing to modelling? Why was the vaccine roll-out so slow – and who should be held to account? And should Rapid Antigen Tests – or RATs – have been prohibited? What really happened with the provision of PPE to healthline workers? …

here are legitimate questions about our preparedness for Omicron. Why were services like rubbish collection allowed to grind to a halt? Did officials not anticipate there would be huge demand for passports as international travel resumed? And could LINZ not have predicted and prepared for staff shortages, instead leaving newly built homes standing empty in a housing crisis?

Should officials, and retailers, have better anticipated that our delicate supply chains would come under extreme stress?

Did we fritter away our rights and freedoms too easily? And did our checks and balances hold up – did the Opposition hold ministers to account? Was the media too compliant – did we question enough, or challenge too much?

Public inquiries are a part of the machinery of government.

We’ve had Royal Commissions investigate the Pike River disaster, the Canterbury earthquakes, the March 15 terror attack, and abuse in state care.

It seems logical that we hold the highest form of official inquiry into an event that saw the death of more than 1000 New Zealanders.

It should be unthinkable that a pandemic which has killed over 1,000 New Zealanders, has cost over $50 billion and led to unparalleled restrictions on freedoms is not the subject of a Royal Commission of Inquiry.

Stuff reports:

Shazly Rasheed has become the second councillor to quit in a term, citing a lack of faith in the Hutt City Council’s leadership.

Rasheed handed in her resignation to council chief executive Jo Miller on Friday morning, severing herself from the role effective immediately. Her letter to the council boss raised concerns that councillors were not free to express their views without fear of punishment.

“I have never worked in such an unhealthy environment. What I have seen is undemocratic and bullying.”

In June last year, councillor and former deputy mayor David Bassett resigned because he felt the council’s leadership was stifling his ability to carry out his duties.

Rasheed said elected officials were divided into two groups, “people who ask questions and people who say ‘yes’ to everything”.

The split had created a toxic environment among councillors, with little to no communication between the two camps.

Councillors who raised concerns about proposed policies and governance issues were liable to find themselves being punished, or ignored when requesting information, she said.

“It’s been almost impossible to perform my governance duties. I’m not going to be bullied and treated like a second-class councillor any more.

“We need to be able to answer questions from the public and to inform our own decisions.”

The tone set by Miller and mayor Campbell Barry was bad for democracy, she said.

The Hutt Council sounds a terrible place to be. They are not meeting statutory consenting targets and Councillors who ask questions are bullied off the Council. Hutt residents deserve better.

Food Ticker reports:

In an in-store demonstrations update on 20 May seen by the Ticker, supermarket chain Countdown advised industry stakeholders, including sales agencies with demonstration divisions, that it has had to pull the plug on in-store activations such as tastings.

The email from Countdown’s demonstration team cited feedback from WorkSafe as the reason for ending the promotional activity, which had returned under the Covid-19 Protection Framework’s orange traffic light setting.

“Back in April, a communication to all demonstration companies and suppliers was sent advising, when New Zealand shifted to the new traffic light system that Countdown would accept demonstrations in both the orange and green traffic light systems,” Countdown said in the email.

“Over the past couple of months, we have all enjoyed the theatre that demonstrations have provided in our stores for our customers, and we thank you for that. 

“Unfortunately, WorkSafe has been in contact with our business and they have asked us to cease all food and drink demonstrations happening in our stores. This means that these demonstrations will cease from Monday 23 May.

“The reason they provided was  – it has been legislated by the government that all supermarket customers, staff and external parties, are to wear marks when working/shopping within the supermarket to help prevent transmission of Covid-19.   

“It has been brought to their attention that food and drink demonstrations are now operating in Countdown supermarkets and have advised that it is inappropriate to ask customers to remove their mask to sample food and drink within the supermarket environment.”

This is just ridiculous. You can go into a crowded bar and don’t need to wear a mask, but can’t take your mask off for 10 seconds in a supermarket to sample some food.

One News reports:

KidsCan was founded by Chapman in 2005, at the time providing services to over 40 schools that were struggling with children in poverty.

In 2022, it’s estimated they will assist 1000.

During his tour of the charity’s Auckland centre, Luxon asked Chapman if the levels of child poverty had changed in New Zealand during that 18-year period.

“To be frank,” Chapman responded, “poverty is the worst it’s [ever] been for families.”

So a group that works with children in poverty says child poverty is the worst it has ever been.

Wasn’t there some MP who said that the reason she entered politics was to end child poverty? I can’t recall her name, but what a shame she isn’t holding some sort of role where she could make a difference.

A guest post by Cr Chris Milne:

How Council’s use accounting standards to over-charge residents and ramp up rates well above inflation.

This article is written from the perspective of a past chair of Hutt City Council’s finance & audit committee and the architect of the council’s previously very successful strategy to keep rates rises to a maximum of inflation.  With the flick of an accounting switch, all that good work is being undone.  HHHHere’s the story. 

In many council’s across New Zealand ratepayers are being hit by rapidly rising rates with no apparent improvement in services, and even services going backwards.  Many councils have now adopted the financial sleight of hand, described below, to extract vast amounts of excess cash from ratepayers.

Why are Council rates rising stratospherically?  If you listen to the Council PR machine it’s all about “getting back to basics”.  While investment in infrastructure is growing, that’s not the primary driver of higher rates.  The real culprit is a 2020 change in the way Hutt City Council calculates its compliance with the Local Government Act’s section 100 requirement for a ‘balanced budget’, specifically the way the calculation is used to set rates.

Official information requests to councils across New Zealand have found that more and more councils are making this change.

At Hutt City Council the previous treatment of depreciation in relation to rate setting supported low rates increases, and had the international credit rating company, Standard & Poor’s, commending Council on its strong financial management. The previous treatment always passed the official Audit New Zealand audit with flying colours. 

But Audit NZ, which audits most councils, is missing in action on the balanced budget calculation.  Providing a formula is applied and explained they are happy to sign it off, even when the impact could be a difference of $1,000 per household in annual rates between councils adopting different approaches.   They will even sign off, without demur, a change in calculation methodology from year to year, with massive impact on the rates calculation.

Audit New Zealand is agnostic about how Council’s use accounting standards to justify rates increases.  It appears that overtaxing ratepayers which is no concern to them.  They focus on compliance with accounting standards and ability to repay debt.  Confused?  You and many.

Let’s use an actual example.  From borrowings, Hutt City Council built a new administration building for $26m.  Assume a building life of 50 years.  Depreciation is charged at 1/50th of the “depreciated replacement cost”.  So, in the first year, the depreciation is 1/50th of $26m.  Revaluations of replacement costs occur every three years.  Over time, construction cost increases raise the depreciation cost basis from $26m to $30m to $40m and so on. 

Over 50 years what cost ratepayers $26m will be depreciated by $57m, fully funded by rates (cash from ratepayers) to ensure a ‘balanced budget’ under the new formula.  To put it another way, ratepayers will be overcharged by $31m (or 220%) over what they borrowed to fund the construction of the building.  This isn’t a ‘balanced budget’ – it’s highway robbery.

Confused?  Then here’s something everyone understands.  Imagine you buy a house for $700k – $200k deposit plus $500k mortgage.  Five years later your house valuation is $1m.  Your mortgage is still $500k, less what you’ve paid off over five years.

But if you are the Council then under the new ‘balanced budget’ treatment of depreciation the increase in your house valuation gets added to your mortgage!  You now have to pay back to the bank both what you originally borrowed and the valuation increase.  In this example, your mortgage would increase from $500k to $800k, even though you only originally borrowed only $500k.  Your repayments go up accordingly. Why should you pay $800k to the bank when you only borrowed $500k?  Good question.

It gets worse.  Take Naenae Pool.  It’s budgeted to cost $68m.  The government paid Council $27m as a Covid ‘shovel ready project’. So the cost to ratepayers is $41m.  But the depreciation charged to ratepayers is based on $68m!  Over the life of the pool ratepayers will be charged $149m in rates to fund depreciation – 360% more than the true $41m cost to Council.  And this does not include the millions of dollars of operating deficits (entry fees don’t cover running costs) of the pool – subsidies – which are also paid out of rates.

It gets worse.  Where central government subsidises capital projects by 50% – very common for roads and bridges – the eventual rates take is over 700% more than the original cost.

So where does all the extra cash go?  Not into a fund ready to replace these assets when they reach the end of their lives.  When the asset needs replacement the whole cycle starts again.  Meanwhile, all the cash has been squandered on a myriad of pet projects, too many to list here. 

One could argue that the real culprit here is poor expenditure control by Councils, but this ignores the practical reality of elected councillors, many of whom have no idea about accountating standards, working to a three year election timetable.  Experience has shown there are few feasible ways of stopping Councils spending all the cash that comes into their possession.  What could work is a change to the Local Government Act requiring Councils to be explicitly transparent about what cash they are collecting and for what, and how they are spending it.  Hiding behind accounting standards where cash and non-cash accounting transactions are merged into one muddy puddle, opaque beyond any normal person’s to understand, facilitates Councils taking more and more cash via rates than can be justified to pay the bills.

If you want to delve into the mathematics of the above examples then it’s all in the link below.  Note that there are multiple tabs with different examples.

https://docs.google.com/spreadsheets/d/1qDqAMUm-Jf_mOEIj2OeHeOxdlEsYxqqS/edit?usp=sharing&ouid=100818649037722727071&rtpof=true&sd=true]

DPF: I never realised that Councils depreciate on the replacement value of an asset, rather than the cost value.

I support depreciating an asset to spread the capital cost over the life of the asset. But to depreciate on the (always growing) replacement cost does mean a huge cash intake for Councils. This should stop.

1. 1st zero for kms of light rail in Auckland
2. 2nd zero for kms of cycleway harbour bridge
3. 3rd zero for cms of road from Let’s get Wellington Moving
4. 4th zero for EV uptake by Govt agencies
5. 5th zero for congestion reduction