A reader writes in:

Should HNZ be harbouring social cancers in our communities, particularly when there are many people waiting for housing?  
 
This is a serious issue, and perhaps worthy of a KB post.  In the Hutt we have blighted areas in Stokes Valley and other parts of the city where gangs terrorise neighbourhoods and trade drugs.  They operate out of HNZ houses.  Apparently single mothers get the HNZ lease and then gang members move in.  It’s very hard to monitor and manage.
 
I have been following this for some time and each time there’s a shooting, stabbing etc involving gangs there’s always a HNZ house involved.
 
See this – clearly a HNZ block:
https://www.stuff.co.nz/national/crime/109900067/reports-of-gang-fight-in-stokes-valley
 
And this:
https://www.stuff.co.nz/national/crime/107674640/communities-fight-fear-as-violence-threat-hangs-over-hutt-valley?rm=m
 
Now I see the same thing in Dunedin:
https://www.nzherald.co.nz/nz/news/article.cfm?c_id=1&objectid=12205774
 
A Google search will show that this situation is widespread across NZ.
 
“A Porirua woman has made an emotional plea to Housing New Zealand to evict gang member tenants causing chaos in her community.  Sala Nimarota says Mongrel Mob members living in a Housing NZ home in her community are making it unsafe for the rest of the community”:
https://www.newshub.co.nz/home/new-zealand/2018/06/woman-s-emotional-plea-to-housing-nz-over-porirua-gang-problems.html

State houses are hugely subsidized by the taxpayer and are a form of targeted welfare. As with other forms of welfare, this should be part of a social contract such as looking for a job etc.

Extreme anti-social behaviour should see people lose their Housing NZ tenancies.

The Guardian reports:

A recent review into Amnesty’s workplace culture warned of bullying, nepotism and an “us v them” dynamic that threatened the organisation’s credibility as a human rights champion. The report, undertaken by the KonTerra Group and led by psychologists, was commissioned after the suicides of two staff members last year.
The report warned that while there was a risk of vicarious trauma due to the nature of Amnesty’s work, most wellbeing issues among staff were driven by the organisation’s adversarial culture, failures in management and pressures of workload. The review was based on a survey of 475 staff, 70% of the workforce of Amnesty’s international secretariat, and on scores of interviews.
“There were multiple reports of managers belittling staff in meetings, deliberately excluding certain staff from reporting, or making demeaning, menacing comments like ‘you’re shit!’ or ‘you should quit! If you stay in this position, your life will be a misery,’” the report said.
In the letter, the senior leadership team acknowledged the review’s finding that structural and cultural challenges had been prevalent in the organisation for decades, and had been exacerbated by a restructuring programme.

So they’ve been a toxic place to work for decades. So busy lecturing everyone else they forgot to practice what they preach.

Amnesty’s work culture problems were first revealed last May, when the Times reported that Gaëtan Mootoo had killed himself after complaining of stress and overwork. Six weeks later, Rosalind McGregor, 28, an intern at Amnesty’s Geneva office, was found dead at her family home in Surrey.

Terrible, especially for a human rights organisation.

Sad it took two suicides for Amnesty to admit they have a problem.

National has released the first of ten or so policy discussion documents. This is the environmental policy paper.

At the end is 20 proposals they are consulting on. Some are specific, others more general. The more specific ones are:

• developing further robust incentives to encourage New Zealanders to take up renewable transport such as subsidies for electric vehicles, increasing regulations on older, less efficient cars, and encouraging older cars to be scrapped.
• working with water stakeholders to put in place a new and more efficient allocation method for the resource
• setting a quality standard for coastal water and a timetable for regional councils to meet those standards plus implementing beach and quality standards/swimming standards.
• rewriting the Litter Act to make it fit for purpose and strengthen enforcement mechanisms against people and businesses breaching provisions of both the Waste Minimisation Act and the Litter Act
• introducing measures to see either by a container deposit scheme in association with existing kerbside and recycling programmes is introduced, or by the beverage sector itself be responsible for ensuring through initiatives they set up, that 90 per cent of beverage containers are saved from being sent to landfill.
• committing New Zealand to a nationwide zero avoidable waste timetable and target
• looking at establishing a new National Park and will investigate establishing one in The Catlins.
• increasing funding to Department of Conservation Rangers to lead biosecurity incursions where threats are of a conservation matter.
• updating New Zealand’s restrictions on the use of biotechnologies in consultation with New Zealanders to bring them into line with the latest science

A lot of people don’t realise that including sales of businesses in a CGT result in very punitive double taxation on business owners. So I thought I’d give an example.

Let’s say Michelle is a plumber. She works for other plumbers for 20 years and then sets up her own plumbing business. She puts $50,000 of her savings into it.

Michelle’s business does well. She pays herself $100,000 salary from it, and any profit beyond that she keeps in the business to allow it to grow reserves and capital.

On average the company makes a $40,000 profit every year for 20 years. Michelle pays company tax of 28% on that profit. So each year we have:

• Profit $40,000
• Tax $12,000
• Increase in Equity $28,000

Now after 20 years Michelle wants to retire and sell her business. It is no longer worth $50,000 but $610,000. If she sells it for its net worth (so not even taking goodwill etc into account) then she gets told by IRD she has made a capital gain of $560,000. She must pay tax at 33% on that capital gain so She has to pay $184,800 CGT.

But that $184,800 CGT is basically taxing her for the annual profit she has already paid tax on. It is double taxation. That increase in the worth of the company is solely due to her keeping annual profits with the company. So here’s the net taxation she pays:

• Profit $800,000
• Company Tax $240,000
• CGT $184,800
• Total Tax $424,800

So Michelle effectively pay 53% tax rate on her plumbing business. Totally unfair right. But this is what the Government wants to do.

Now if Michelle didn’t reinvest any of the profit back into the business allowing it to expand, take on more staff etc then she’d be better off. Instead of paying herself a salary of $100,000 a year she would be best to pay herself $140,000 a year and then she only pays 33% tax instead of 53% tax.

This is why the Government’s proposed CGT is an unfair tax. It is a double tax on business owners.

Stuff reports:

A man tied up in a false rape claim has backed a call for a men’s refuge after he was kicked out of his flat and left homeless for a week.
Brett, who has asked for his last name to be kept secret, says he had nowhere to go after his ex-girlfriend reported a rape that never happened, and rumours began to spread.
Since speaking about how the allegation “destroyed” his life, Brett has thrown his support behind a call for an agency to support men, similar to Women’s Refuge.

The full story is a sad read. Basically he lost his home and hos job because of the made up accusation.

Michelle Duff at Stuff reports:

In the months leading up to the release of a study which asked how safe it is to give birth in New Zealand, health officials were busy.
As a courtesy, researchers from Otago University had advised the Ministry of Health well in advance the study looking into maternity care outcomes would be coming out. Closer to the date, they provided an advance copy to the department.
The study found evidence to suggest all babies were not being born equal. Those in midwife-led care were at risk of poorer outcomes than babies in doctor-led care. The authors, Diana Sarfati and Ellie Wernham, were careful to point out their support for a midwifery-led system.

However, their conclusions were clear: the current way maternity care is provided in New Zealand is not as good as it could be.

So this research found inferior outcomes for babies (on average, not all) in midwife-led care than doctor-led care. And what did the Ministry of Health do? Did they work hard to identify the issues to make childbirth safer for women and babies?

Instead, an investigation by Stuff has found the ministry actively worked to try and obscure the results. Communications in the months before the study’s release show staffers worked on how to avoid “fallout,” and in one case shared plans to discredit the study ahead of its release with industry body the College of Midwives.

Heads should roll for this. The Ministry of Health colluded with an industry body to discredit independent research saying health outcomes were not as good as they should be.

Wernham and Sarfati’s study was the first ever to take an overarching look at the safety of babies within the current system. The differences she and Sarfati found were not small; across the five-year study of more than 244,000 babies, they found those in doctor-led care had lower chances of poor birth outcomes.
This included 55 per cent less chance of oxygen deprivation during delivery, 39 per cent lower odds of neonatal encephalopathy, and 48 per cent less chance of a low Apgar score, a measure of a baby’s wellbeing after delivery.
There was also a lower rate of stillbirth and newborn babies dying under medical-led care. This link was statistically weak due to the small number of baby deaths in the five years covered – 1.84 per 1000 births for midwife-led care (410 total deaths, from 20 weeks gestation to the first 27 days of life) and 1.31 per 1000 births for doctor-led care (27 total deaths) – but it was there.

They are very significant differences.

Of course, comparing women with midwives as their lead maternity carer to those who have doctors is not necessarily fair.
After all, doctors – counting GPs and obstetricians – look after less than ten per cent of mums. It is very possible the types of mothers they see are different – mums who smoke might be more likely to see a midwife, while healthier mums might pay for a private obstetrician, for example.

Correlation may not be causation. But you damn well expect further research to investigate this, not a campaign to undermine it.

Stuff reports:

Now, 72-year-old Environment Canterbury chairman Steve Lowndes has rediscovered his protesting mojo, joining global climate-change campaigners Extinction Rebellion and saying it is time to “panic”. …

Lowndes agreed with the group’s three demands – “that the truth be told about climate change, that we become carbon neutral by 2025 and that a climate emergency is declared”.

The first and third demand are meaningless – almost anyone could agree or disagree with them.

But the second demand that New Zealand become carbon neutral by 2025 is stark raving bonkers. There is no other word for it.

There is a world of difference between becoming carbon neutral over 31 years and six years.

To become carbon neutral by 2025 would mean killing off the entire NZ cattle herd, banning all non electric vehicles, closing down most manufacturing etc. It would plunge many New Zealanders into poverty and joblessness.

Also to go would be household refrigerators. Air conditioning systems also gone.

One can be convinced climate change is a serious issue and significant reductions in greenhouse gas emissions are needed, and also think calling for carbon neutrality within six years is stark raving madness.

But maybe he genuinely thinks we should do all of the above so we can be carbon neutral in six years. So presumably he has removed his refrigerator from his house. He has given up milk. He never drives a petrol car, or takes a plane trip. He doesn’t use any manufactured products. I’m sure he has done all this, if he is sincere with his advocacy.

Newshub reports:

Rocket Lab founder Peter Beck isn’t a fan of the Tax Working Group’s recommended capital gains tax system.
“Just saw the NZ capital gains tax recommendations,” Mr Beck said on his Twitter account.
“Taxing IP and stock will decimate the already fragile NZ start up industry. NZ already has big problems around creating large valuable technology companies and this will not help.”

If you tax something you tend to decrease the supply of it. Tax labour too high and less people work. Tax consumption too high and people consume less. So if you tax capital highly, then less capital will be made available.

The Express reports:

CANADA’S Prime Minister Justin Trudeau is facing a difficult election campaign after a new poll saw the scandal-hit leader’s approval ratings plummet.

Canadians are due to go to the polls in October but Mr Trudeau is battling to maintain his popularity after becoming embroiled in claims his aides pressured former justice minister Jody Wilson-Raybould to ensure construction firm SNC-Lavalin avoided a corruption investigation. The 47-year-old insists there was no wrongdoing but 41 percent of Canadians disagreed with Mr Trudeau in a Leger poll for news agency The Canadian Press. Just 12 percent believed he hadn’t done anything wrong following the allegations which has left his Liberal Party in turmoil.

The Canadian Liberal Party has a long history of corruption.

Newsroom reports:

The United States has delivered the most explicit threat yet to New Zealand’s role in the Five Eyes alliance if it allows Huawei into the 5G network, saying it will not share information with any country which allows the Chinese company into “critical information systems”.
The remarks from US Secretary of State Mike Pompeo call into question claims from Kiwi politicians and officials that outside pressure is not behind a decision to block Huawei equipment from being used by Spark in its 5G network.

The Secretary of State is the most senior cabinet officer after the President. His comments are not random musings but obviously reflect the official policy of the United States.

For the New Zealand Government to still insist that the decision on Huawei was made without any pressure from other countries is ludicrous.

Stuff reports:

Lifestyle block owners may be in for a shock if the Capital Gains Tax goes ahead in 2021.
Under the recommendations of the Tax Working Group, land that is larger than 4,500 square metres will be subject to the tax.
There’s no mention lifestyle blocks will be exempt like family homes, or treated like farms, which allow for the house and surrounds to be left tax-free.
Real Estate Institute chief executive Bindi Norwell said the median size of lifestyle properties sold in New Zealand in the last 12 months is 20,000sqm.

On the basis of that data, she believes 92 per cent of lifestyle blocks sold across the country last year would be taxable.

So don’t believe the claim that the family home is exempt. Only some people will be exempt. If you have flatmates you won’t be exempt. If you use any part of it for a home office, you won’t be exempt. If you have a boarder (even adult children) you won’t be exempt. If you live on a lifestyle block you won’t be exempt. If you get any revenue from AirBnB you won’t be exempt.

Do not think the CGT will apply only to rental investment properties. It is far wider than that.

Newshub reports:

New Zealand has reportedly told Australia it’s not open to settling certain asylum seekers and refugees currently held in detention camps.
Australian media, including newspapers The Australian and the Courier Mail, and the AAP, report New Zealand officials privately told former Prime Minister Malcolm Turnbull single men would not be offered settlement.

So the NZ policy of kindness to asylum seekers on Manus Island doesn’t apply to single men.

Will the Human Rights Commisson condemn this discrimination?

Many decisions in Government are hard but some are very easy.

The UK Home Secretary would have been delighted when ISIS bride
Shamima Begum asked to come home so she could raise her son in the UK.

Begum is unrepetent saying she doesn’t regret her decision to join ISIL, supported the beheading of a man as he was an enemy of Islam and justified the Manchester arena bombing.

There is basically not a single person in the UK who wants her back there. So very easy decision for the Home Secretary to deny her entry and strip her citizenship (she is not stateless as her father is Bangladeshi).

But finally the media found one person who supports her coming back to the UK – the Leader of the Opposition, Jeremy Corbyn:

Jeremy Corbyn has weighed in for the first time on Shamima Begum being stripped of her British citizenship by insisting she not only has a right to remain in Britain but that she deserves “support”.

Jeremy Corbyn really is the gift that keeps on giving.

This is no surprise of course. His claims were so fantastical that they always seemed suspect.

The sad thing is that some people are victims of random violence due to their race or sexual orientation, and Smollett has undermined them.

The Herald reports:

Long-delayed monthly financial performance data shows district health boards are heading for a big combined deficit of $346 million.

How can this be?

Labour said that they were going to provide a huge boost in health funding. How come then that DHB deficits have blow out so much?

Marc Thiessen writes:

If the goal is to build a border wall, then President Trump has made the wrong decision at every turn. In early 2018, Trump had the opportunity to secure $25 billion in funding for his border wall in exchange for legal status for Deferred Action for Childhood Arrivals recipients. Instead of taking the deal, he blew up the negotiations with his “s—hole” countries remark and by demanding changes to legal immigration policy.
Then in June, the Senate Appropriations Committee approved $1.6 billion for 65 miles of fencing by an overwhelming bipartisan 26-to-5 vote. This could easily have passed the House and Senate. Instead, Trump later shut down the government over wall funding and demanded $5.7 billion. Result? After a disastrous 35-day shutdown, he got less — $1.38 billion — than he would have if he had just gone along with the bipartisan deal six months earlier.

Trump managed to turn a $25 billion funding package into a $1.4 billion one. That takes a special level of incompetence.

Now, the smart move for Trump would have been to pocket that $1.38 billion and bolster it with an additional $3.1 billion he could arguably use without a declaration of a national emergency — by reprogramming $600 million from the Treasury Department’s drug forfeiture fund and $2.5 billion from the Defense Department’s drug interdiction program. That would have given him $4.48 billion in wall funding — nearly the full amount he was demanding from Congress. Then, in December, he could demand more money with leverage over Democrats when an automatic sequester kicks in, forcing $55 billion in across-the-board cuts to domestic discretionary spending unless Trump agrees to raise spending caps.

Definitely would be a smart strategy. The Dems hate the automatic sequester cuts. They’d do a lot to avoid them.

Instead, Trump has made the wrong move once again — declaring a national emergency, despite warnings from Senate Majority Leader Mitch McConnell (Ky.) and other Republicans that it could provoke a backlash from within his own party.
His order will face an immediate court challenge, which means he won’t be able to spend the emergency funds anytime soon, if at all. And if he prevails in court, it will be a disaster for the cause of limited government. If Trump can declare a national emergency to build a border wall Congress refused to fund, then the power of the president to override Congress’s power of the purse will be virtually unlimited. As Rep. Cathy McMorris Rodgers (R-Wash.) pointed out, a future liberal president could declare climate change a national emergency and “force the Green New Deal on the American people.” Or, as House Speaker Nancy Pelosi (D-Calif.) suggested, a Democratic president could one day declare the “epidemic of gun violence in America” a national emergency thanks to Trump’s action.

Very true. The fake national emergency, if upheld by the courts, will allow future Democratic Presidents to bypass Congress entirely for their pet projects.

Just as the Democrats’ decision to eliminate the filibuster on lifetime judicial appointments below the Supreme Court backfired — setting precedent for a Republican rules change to put two justices on the Supreme Court and secure its conservative majority for a generation — Republicans will rue the day if they go along with Trump’s executive power grab.

Mr Thiessen is right.

51 countries have now recognised Guaido as President of Venezuela, and a further seven recognise the National Assembly as the legitimate institution.

Of the 36 OECD members, 30 have rejected Maduro. Only Turkey supports him. NZ sits with just Switzerland, Mexico, Norway and South Korea in refusing to say which side they support.

The Tax Working Group report is here.

Key points:

• An 8 – 3 majority support a Capitals Gains Tax
• It would be at a rate up to 33%, making it the highest in the world
• There would be no discount for inflation so people would be taxed even if their assets merely increase to keep pace with inflation
• Every business owner and taxable asset owner would have to pay to get a valuation, costing billions of dollars
• The CGT would bring in $8 billion in its first five years but eventually would bring in over $3 billion a year
• The CGT would not just apply to rental properties but also bachs
• The CGT will apply to the land a family home is on, if it is a lifestyle block over 4,500 square metres. This is mainly in provincial NZ so will be a targeted tax on provincial NZ.
• CGT will also apply to the family home if you run any part of your business from home, unless you stop claiming any home expenses off tax. This effectively means an end to claiming a portion of home expenses off tax, if you work at home.
• CGT will apply to your main home, if you have flatmates who pay rent

PEPANZ commissioned NZIER to analyse the possible benefits and costs of the Government’s decision to ban future oil and gas exploration. The report is here.

They have found that over 25 years:

• The ban will reduce real gross domestic product (GDP) by between $15 billion (3%) and $38 billion (7.4%). The medium scenario is a reduction of $28 billion (5.4%).
• Household consumption (the best measure of economic wellbeing and discretionary income) will reduce by between $7 billion (2.4%) and $20 billion (7%)
• Per household, this represents a $4,800 to $14,200 fall in consumption spending on average for each year between 2020 and 2050, with a $9,400 drop in the medium scenario.
• Export revenue will reduce by between $3 billion (1.6%) and $10 billion (5.2%).
• In Taranaki the ban will reduce real GDP by between 35% and 53%, or $16 billion and $40 billion, with a medium scenario of 46% (~$30 billion).

And will all this economic cost be worth it, for the environmental gain?

Well there is no environmental gain. The ban will increase global greenhouse gas emissions as the reduction in natural gas will see greater use of coal.

The Taxpayers Union has published a list of 19 things to look for in the CGT proposal due out at 11 am. They are:

1. will the capital gains tax apply on death or just on sale of an asset;
2. will the tax apply if capital is simply being recycled within the same asset class (selling a smaller farm to purchase a larger farm, for example)?
3. will there will be a discounted or lower rate, like in Canada, Australia, the United Kingdom, or the United States?
4. will the revenue be offset with tax cuts;
5. if so, who will receive them;
6. will revenue neutrality be maintained in the medium-to-long term as CGT revenue grows?
7. will there be exemption exclusions for large properties (will lifestyle blocks be subject to the tax?);
8. will there be a ‘maximum value’ for the family home;
9. how much tax will be payable if there is an exemption exclusion?
10. will asset owners be required to value their property and businesses;
11. if so, will it be at their expense, or will the general taxpayer be required to pay;
12. if the general taxpayer is required to pay, what will be the estimated cost of ‘V-Day’
13. how much time will taxpayers have to obtain asset valuations;
14. if valuations are not obtained, will other ‘default valuations’ be used?
15. are there any sectoral exemptions (e.g. racing, fisheries);
16. will Maori authorities pay capital gains tax, if so, at what rate;
17. how are vehicles, boats, antiques etc. treated?
18. at what rate are trusts taxed;
19. will they be taxed on accrued or realised gains?