2,000 same sex marriages

Radio NZ report:

The bill legalising same-sex marriage passed its final reading in Parliament in April, 2013, and came into effect on 19 August, 2013.

It said people can marry, regardless of their sex, sexual orientation or gender identity.

Statistic New Zealand figures show 2118 same-sex couples have married since the legislation changed.

So 4,000 people who wanted to be married now are. Great. More people are marrying to pledge their commitment to their loved ones.

And the downside has been …. well zero.

Almost 970 of those couples have travelled from abroad to marry here.

Extra tourism spending also.

Union membership drops

Stats NZ reports:

In the June 2016 quarter, around 1 in 5 employees belonged to a union

In a 2012 survey they had union membership at 27.6%, so it has dropped from 27.6% to 20% in just four years.

People under 30 made up 29.1 percent of all employees and 15.4 percent of union members.

And the trend will continue as younger workers don’t join up.

The majority of union members today are public sector workers. With lower incomes jobs getting priced out of the market or disrupted by technology the number of private sector union members will keep declining.

Broadband speeds and data by area

Chorus sent me a spreadsheet of the average connection speeds and monthly data usage by area. Quite interesting

Fastest average connection speeds (Mbps)

  1. Dunedin 151
  2. North Shore 36
  3. Rotorua 34
  4. Auckland 33
  5. Porirua 32
  6. Manukau 31
  7. Palm Nth 31
  8. Papakura 30
  9. Waitakere 29
  10. Lower Hutt 29
  11. Nelson 29

Slowest average connection speeds (Mbps)

  1. Waimate 11
  2. Otorohanga 11
  3. Central Hawke’s Bay 12
  4. Waitomo 12
  5. Wairoa 12
  6. Hauraki 13
  7. Tararua 13
  8. South Taranaki 13
  9. Opotiki 13
  10. Western BoP 13
  11. Waikato 13

Highest Average Monthly Data Usage (GB)

  1. Manukau 155
  2. Waitakere 140
  3. North Shore 139
  4. Papakura 136
  5. Auckland 132
  6. Porirua 126
  7. Palmerston North 119
  8. Rotorua 114
  9. Wellington 114
  10. Dunedin 109
  11. Lower Hutt 109

Smallest Average Monthly Data Usage (GB)

  1. Thames-Coromandel 49
  2. Kaikoura 49
  3. Waimate 50
  4. Buller 52
  5. Central Otago 55
  6. Kaipara 56
  7. Hurunui 57
  8. Southland 57
  9. Central HB 58
  10. Clutha 58

Biggest increase in speed (Jan 15 to Jun 16)

  1. Dunedin 255%
  2. Porirua 88%
  3. North Shore 88%
  4. Rotorua 88%
  5. Auckland 82%

Biggest increase in data used (Jan 15 to Jun 16)

  1. Marlborough 169%
  2. Masterton 144%
  3. Waitaki 137%
  4. Dunedin 130%
  5. Rotorua 129%

The huge increases in data used reflects that many plans have now ended data caps.

Most submitters against runway extension plan

Radio NZ report:

Hundreds of people have lodged opposition to the proposed extension of Wellington airport’s runway.

A summary of 776 submissions made on the the airport’s application for a resource consent shows more than two-thirds are against.

I’m surprised so many were against. But to some degree this is not what is important. Submissions are for reading, not counting. It is the quality of the arguments that matters.

Airlines, residents’ associations and hundreds of individuals do not want a bar of the extension.

Recreational fishing enthusiasts said they were not consulted, and cray catchers said the exclusion zone around the construction site was excessive.

“There are twenty or more commercial pots regularly set in the general area proposed to be closed to fishing during and after construction with an estimated daily value of $2600 and seasonal value of $89,000/tonne,” Power Squadron Marine Management’s submission said.

“Applicant makes no provision to address the impact.”

Many submitters cited environmental concerns, construction noise and the cost of the project.

Some also pointed to tourism as a so-called “false friend” which “increases the proportion of low-wage jobs”.

Better to have more low-wage jobs than more people not in work.

Both Qantas and Air New Zealand opposed the project, along with the Board of Airline Representatives.

Qantas’ submission summarised that while there may be possible economic benefits, “over-investment in infrastructure is likely to result in higher ticket prices in the medium term which could reduce demand and have negative economic impacts”.

That is a big issue. How much would landing fees increase for current flights?

Those in favour particularly cited the opportunities for economic growth.

Submitters included Chambers of Commerce and tourism development groups from Marlborough through to Hawke’s Bay.

It also included local icons such as Weta Workshop and the World of Wearable Arts.

Tertiary education providers, WelTec, Whitireia and Victoria University support the extension and hope it will help them take a larger share of the international student market.

Some heavyweight names in support.

Labour hypocrisy hits a new high

Jenna Lynch at Newshub writes:

The candidate who will benefit from the Labour-Green deal in Mount Roskill has hypocrite written all over him.

Michael Wood supposedly hates dirty electorate deals. In fact these very words came from his mouth just two years ago.

“We are calling for a straight contest and an end to the dodgy deals.”

Wood stood for Epsom at the last election. Epsom. The home of the dirty deal.

And boy, did he tell everyone about it.

In fact he went as far as bringing a bag of flour along to debates to replace National candidate Paul Goldsmith who stepped aside to make way for ACT’s David Seymour.

“Every time that Paul Goldsmith fails to front in this campaign, we’re going to remind people about the dirty deal with this bag of wholemeal flour,” Wood said on The Nation’s Epsom debate.

“This is going to sit in place of Paul Goldsmith, who is not fronting and is facilitating a deal with the ACT Party, to get them back when they don’t deserve it.”

He tugged at the heartstrings of voters, saying they’d effectively been exploited for their vote.

“This is an electorate which has been kicked around and abused and used. And I actually think that the least the ACT party could do at this point in the proceedings is to concede that there is a deal that is on the table or in the offing.”

He told The Nation that voters were sick of dirty deals.

“That is the only way that the ACT party has survived, they don’t stand up on their own two feet. And I think that heaps of people are sick of it.”

He called for David Seymour to call the deal off.

“Call for no deal David. Call for no deal.”

That was all in one debate.

Now the Greens look likely to stand down their potential candidate who’d run against him in Mount Roskill as part of the Memorandum of Understanding. (This is assuming Phil Goff wins the Auckland mayoralty, resigns as an MP, and forces a by-election).

Yes Wood was very vocal at denouncing such deals. And of course in Epsom no candidates were pulled, unlike in Mt Roskill where Wood is so nervous about whether he can hold the seat, Labour are trying to get the Greens to not even stand.

It won’t be easy for Wood – he needs the “dirty deal” he once supposedly despised.

My question is who is bringing the bag of Quinoa to debates to stand in for the Greens?

What a good idea.

WCC Mayoral candidates on spending

Can you give an example of current WCC spending that you would vote against in future?

  • Nick Leggett: I would review all spending and ask CE to find organisational savings. Specially take the $9.6 M “slush fund” away from politicians and more into the hands of those who pay the rates.
  • Nicola Young: Revamp of Frank Kitts Park ($5.5m = 90% of this year’s general rates increase)
  • Justin Lester: I voted to cut spending on Council’s move into new premises and reduce costs on the Civic Square upgrade. I also opposed $1m proposed spend on an auditorium and $25m for a new deep water swimming pool.
  • Helene Ritchie: Any further expenditure on the runway extension or lawyer’s fees.
  • Andy Foster: Reduce cost of Basin Reserve lights from $9m to $2m, Defer $65m concert venue until we can afford it
  • Jo Coughlan: I voted against the Island Bay Cycle way and would do so again on a cycleway that didn’t seem sensible or practical.

If Council had an additional 10% revenue, or $40 million, what would be your priority spending areas?

  • Nick Leggett: Three water infrastructure and dedicated new bus lanes to assist Bus Rapid Transit.
  • Nicola Young: I’m committed to freezing the rates; next would be paying off city’s $500 million debt.
  • Justin Lester: I’d save the funds unless there was a valid project that would benefit Wellingtonians. A priority area within WCC’s existing financial envelope ist be Arts. if elected Mayor I will take on the Arts portfolio.
  • Helene Ritchie: From where??? Yes, if the increased revenue comes from budgeted airport extension costs. Essential services, affordable housing, strengthening and opening the Town Hall, or giving some rates relief!.
  • Andy Foster: Half on urban design, resilience, transport, small amount on natural environment – and leave the other half in the ratepayer’s pockets
  • Jo Coughlan: Pay off debt

A good start for transparency

The Herald reports:

Environment Canterbury is publishing credit card expenditure on their website in a bid to increase its “openness and transparency.”

It said that after media requests for the information, it now recognised the “public interest” in credit expenditure.

The data was published last week and showed about $4000 of spending over June and July.

A useful start. However what I’d like to see is all local and central government payments over a de minimis amount listed online in a searchable database. That would be real transparency.

Sarah Higgins RIP

The Herald reports:

A young Auckland local board representative has died suddenly, shocking fellow politicians who knew her.

Sarah Higgins, a real estate agent for Barfoot & Thompson and member of the Franklin Local Board, 24, died on the weekend.

Andy Baker, board chairman, said the death was an utter shock.

“She was the youngest member ever elected to this board and probably one of the youngest to be elected in the whole Franklin area over many decades,” Baker said.

“It’s left the local board absolutely devastated at her loss. This is a loss not only for the board but for the community. It’s such a tragic waste of a wonderful young life with so much to offer. Our thoughts are with her friends and family,” Baker said.

Higgins was on the board for a three-year term so was in her early 20s when she was elected, Baker said.

Sarah was a lovely and talented young person. I’d met her a few times at party events. Despite her youth, she had already carved out a successful career in business and politics. She had a great future ahead of her, and her death will leave many people shattered – her family and close friends most of all of course.

It’s a sad reminder that mental health challenges can affect everyone in society. People can appear great superficially, be popular, be successful – but still have issues underneath.

Sarah will be missed by all those who knew her. Rest in Peace.

Media want your tax dollars

Stuff reports:

Probably the most common suggestion is taxpayer funding for news as an essential public service, like “schools, hospitals and courts” in the words of Nicky Hager.

“Public funding is the only viable model, and is entirely appropriate since news is a public service,” he writes. He wants “new and greatly strengthened publicly owned news organisations, working alongside the privately owned ones”. This would cost four times what is currently spent on news by central government, he estimates. 

Co-editor Tiso endorses the idea, even as he acknowledges that John Key’s National-led Government is unlikely to make such a commitment.

It is the socialist ideal – the government funds the news. Funding dished out by government appointees.

This also effectively kills off private news companies, which means you get left with the only news available being from the Government.

Wellington academic Peter Thompson offers an alternative to taxpayer funding – a “marginal levy” or small charge added to the price consumers pay for phone and internet services, advertising, subscription and on-demand services such as Netflix and retail goods such as televisions. 

The levy – 0.5 per cent to 1 per cent – would raise between $80 million and $160m a year, which Thompson would devote mostly to Radio NZ, Maori TV and NZ on Air, although a contestable fund would be available to corporate media.

Why not also tax car sales and use that to fund blogs? And yes I am being sarcastic.

Latest poll

I’ve blogged the latest Roy Morgan poll at Curia.

Labour remains at 25.5% in it, and what is interesting is that Labour have polled below 30% in every Roy Morgan poll since September 2015.

Roy Morgan tends to be quite variable for some parties. They have had National from 43% to 53% in the last year. Greens from 11.5% to 15% and NZ First from 6.0% to 12.5%. But Labour have been below 30% in every Roy Morgan poll.

Also of interest is that Greens and NZ First combined are 24% to 25.5% for Labour. So if there was a three way coalition, Labour would be in a very weak position. It is even possible that Labour could end up being under half the combined Government caucus.

Weiner strikes again

The Herald reports:

Hillary Clinton’s long-serving aide Huma Abedin announced Tuesday that she is separating from her husband, former congressman Anthony Weiner, who resigned under pressure in 2011 after sending suggestive and explicit photographs of himself to women he met online.

“After long and painful consideration and work on my marriage, I have made the decision to separate from my husband,” Abedin wrote. “Anthony and I remain devoted to doing what is best for our son, who is the light of our life. During this difficult time, I ask for respect for our privacy.”

The announcement follows a report Sunday in the New York Post that Weiner had recently sent photos and sexual texts to another woman. The newspaper reported that Weiner sent one picture of his crotch last year while his toddler son, Jordan Zane, was curled in the bed next to him.

This is like the 4th or 5th time he has been caught out. He really can not stop.

Amazed that Abedin took this long to make the break.

Palmer proposes euthanasia law

The Herald reports:

Former Prime Minister Sir Geoffrey Palmer has come up with a proposed law change that would allow doctors in limited situations to help terminally ill patients to die.

It would require seven conditions to be met and would involve the Family Court as a means of verifying the conditions.

“My own view is that it is desirable to proceed with caution in this area and not to go further than the circumstances warrant.”

He set out his proposal at Parliament tonight in a lecture in memory of Lecretia Seales whose husband, Matt Vickers, launched a book “Lecretia’s Choice.”

Palmer once worked with Lecretia Seales who died of brain cancer last year. …

Palmer, a former president of the Law Commission, is proposing an amendment to the Crimes Act which would allow a person to be lawfully provided with medical assistance in dying where:

• (a) the person is of at least 18 years of age and capable of making decisions;
• (b) the person is a permanent resident of New Zealand;
• (c) the person has consented in writing to receive such assistance before two independent witnesses;
• (d) two medical practitioners have certified that the person has a grievous and incurable medical condition;
• (e) the medical condition is causing enduring suffering that is intolerable to the person in his or her circumstances and condition;
• (f) the facts have been reviewed by the Family Court and a judge has certified that the criteria laid down in the law have been met; and
• (g) there is a medical practitioner prepared to provide the assistance approved by the court.

Palmer said the proposal had the advantage of avoiding health professional having to take responsibility for decisions about whether the person should be permitted to die.

Looks like a proposal with maximum safeguards, which is good.

McCarten to become de facto Auckland campaign director for Labour

Stuff reports:

Labour leader Andrew Little’s chief of staff Matt McCarten is poised to quit the job and head up a new Labour office in Auckland.

Little said he had not finalised who would staff the Auckland office, though he had been looking at setting it up for some time.

But the move there by McCarten was “voluntary, willingly and with agreement, not in high dudgeon”.

Asked if he had anyone in line to take over as his chief of staff, after McCarten shifted north, Little said: “That’s part of the detail that is to be finalised”.

McCarten’s skill are in campaigning not staff management, so this move makes sense. He will be the de facto campaign manager in Auckland for Labour.

His move to Auckland will leave Little searching for both a new chief of staff and a new chief press secretary after Sarah Stuart quit the latter role in May.

I recall when McCarten was appointed, Labour heralded it as a game changer. His replacement will be their sixth Chief of Staff in opposition and Stuart’s replacement will be their seventh Chief Press Secretary.

Does NZ have the second-worst rate of workplace bullying in the developed world?

Stuff reports:

A 1700-person academic survey showed New Zealand had the second-worst rate of workplace bullying in the developed world with one in five workers afflicted.

Do we?

I’ve certainly worked in jobs where we’ve had bullies, and have even been bullied. It is a hideously nasty experience.

But is NZ the 2nd worst in the world?

The survey cited does not appear to be representative. A 2010 article stated:

One in five Kiwi workers suffer from workplace bullying, one of the worst rates in the world.

The figures are revealed in a university survey released today.

A joint university research team – from Auckland, Waikato, Massey and London – polled more than 1700 workers from the health, education, hospitality and travel sectors asking how frequently they were exposed to “negative acts” at work.

Overall 17.8 per cent of respondents were identified as victims of bullying.

The international range was between 5 per cent and 20 per cent.

So this was a survey of people in four industries only. It was also a survey which was 80% female respondents and (sadly) women may get bullied more than men. Also the workplaces surveyed were not randomly selected. This doesn’t mean that it wasn’t valuable research, but it does mean that you can’t conclude that this is the prevalence rate for all NZ employees and most of all you can not safely compare it to overseas surveys.

David Lowe, of the Employers and Manufacturers Association, was sceptical of the survey, saying the “negative acts” research question was too wide.

“What people would normally describe as bullying and `two negative acts in the workplace’ are not one and the same,” Lowe said.

“If somebody had said to the person, `you’re not doing well enough, you need to do it better’, and told them that twice in one week, that might amount to bullying under this survey, but it is not bullying, it is simply running your business.”

The survey also posed a more direct “self-report” question asking whether respondents felt they were being bullied either “several times a week” or “almost daily” which yielded a smaller figure of 3.9 per cent.

So the definition of bullying is important. Is the one used in NZ the same as overseas?

Stats NZ does research on job satisfaction and has found 85.4% of employees satisfied (or very satisfied) in their main job and only 4.7% dissatisfied. I guess it is possible you can be bullied in a job and not dissatisfied but unlikely. So I think the 20% figure and 2nd worst in the world is not particularly sound as it was a survey of just four industries and had a massive gender skew.

Whatever the level, it is too high. But that doesn’t mean we need to conclude that NZ is a nastier place to work than other countries.

Maori Politics – a Game of Thrones

An excellent article at Newshub by Maiki Sherman who explains what is happening in Maori Politics with Game of Thrones analogies.

  • Seven Kingdoms – seven Maori seats
  • The King – Kīngi Tuheitia
  • The King’s Hand – Tuku Morgan
  • Arranged Marriage – Maori Party-Mana alliance
  • The Princess – Nanaia Mahuta
  • The Outcast – Andrew Little
  • The Gatekeeper – John Key

A good read. I’d caution the Maori Party though that their arranged marriage could well turn out to be the Red Wedding!

Clark 8th out of 10

The net encourages for each candidate in the 3rd straw poll were:

  1. António Guterres +8
  2. Miroslav Lajčák +4
  3. Irina Bokova +2
  4. Vuk Jeremić +2
  5. Susana Malcorra 0
  6. Srgjan Kerim -1
  7. Danilo Türk -1
  8. Helen Clark -2
  9. Christiana Figueres -10
  10. Natalia Gherman -10

I can’t see a path forward for Clark, and think it is time for her to pull out. I suspect Figueres and Gherman will withdraw which would leave Clark at the bottom of the pack.

Guterres from Portugal has consistently strong support. The only thing stopping him is he is not Eastern European.

There are 5 Eastern European candidates ahead of Clark, from Slovakia, Bulgaria, Serbia, Slovenia and Macedonia.

If not an Eastern European then Guterres or Malcorra are better placed.

And there are two women better placed – Bokova and Malcorra.

Lajčák has risen to 2nd in the poll going from two to nine encouragments. He may be the one to watch.

WCC Mayoral candidates on Airport runway extension

Do you support the proposed runway extension for Wellington Airport?

What is the maximum contribution ($ or %) from WCC toward the runway extension you would vote for?

  • Nick Leggett: Yes, In line with its shareholding in the existing airport or greater if it leads to a greater shareholding
  • Nicola Young: No, 34%; in line with WCC ownership
  • Justin Lester: Yes, 33%
  • Helene Ritchie: No, Nil- unnecessary unjustified expenditure on a ratepayer funded $350-$500m project. I do not support it on safety, aeronautical, environmental, cost, local grounds. It won’t fly because no one will pay for it, no airlines want it, including Air New Zealand, and no one has formally said they will fund it. If it is not thrown out of the Environment Court, I will call for a Citizens poll/referendum so that the people paying can have a say.
  • Andy Foster: $90 million – key though is it has to stack up – a lot of major hurdles to cross before I can say ‘yes’ or ‘no’ (Econ benefit, airline commitment, funding, consideration of alternatives, investment vehicle)
  • Jo Coughlan: Yes, It’s important that funding comes from the airport itself and Central Government before the Council makes any contribution. Any contribution from the City must be reflected in some way in the ownership and not just a donation. The City currently owns a third so at this stage it should not be any larger than that.This is all conditional on the business case and appropriate funding being agreed.

So two candidates (Young and Ritchie) are against the runway extension, three (Lester, Leggett and Coughland) are in favour and one says it depends in the final case.

In terms of how much funding the Council should provide, Leggett, Lester, Coughland and Young all say no more than the Council’s shareholding in the Airport. Ritchie is against any money. Foster supports $90 million (presumably on top of any direct Council investment via shareholding) if the case stacks up.

Leggett’s community fund proposal

Stuff reports:

Wellington mayoral candidate Nick Leggett has announced a $27 million plan, which he says will give communities a greater say in governing their suburbs.

Leggett has proposed a “community futures initiative”, which he will trial if he wins the mayoralty in October.

The initiative will allow Wellington’s suburbs to develop their own 10-year plans in conjunction with the council.

These non-statutory documents will guide council decision-making across a range of issues, including hot-button topics like cycleways and medium-density housing.

The 10-year plans will be supported by an annual million-dollar fund, which could grow to $3m a year by the 2019-20 financial year if Leggett’s “devolution of decision-making to the local level” proves successful.

The fund would total $27m over the next 10 years and would be sourced from Wellington City Council’s existing $1.7 billion capital expenditure budget.

Leggett’s policy is similar to an initiative playing out in the suburb of Island Bay in the wake of the cycleway saga that soured relations between residents and the council.

In an attempt to fix that disconnect, the council is consulting with the community again on the future of the cycleway, and is also helping residents create a 10-year plan that will guide how the suburb develops.

Leggett said the concept should be extended to all of Wellington, rather than stopping at Island Bay.

“We’ve got to use the Island Bay debacle for good … what we need to do is change the whole way the council thinks about, and relates to, the community,” he said.

Seems a good idea to me.

Quote of the week

“Deficits mean future tax increases, pure and simple. Deficit spending should be viewed as a tax on future generation, and politicians who create deficits should be exposed as tax hikers.”

– Ron Paul

The quote of the week is brought to you by the New Zealand Taxpayers’ Union. To support the Union’s campaign for lower taxes and less government waste, click here.

Labour’s “state of emergency”

Jenna Lynch writes at Newshub:

Labour’s call for a Civil Defence “national state of emergency” on the housing crisis is insensitive and idiotic.

That’s because under the current law there has only ever been one other national state of emergency – for the Christchurch earthquake.

Yes, Civil Defence says the only time New Zealand has ever made the official declaration under current legislation was the deadly February earthquake. The one that killed 185 people. The one that broke Christchurch.

And now Labour’s housing spokesman, Phil Twyford, wants to use Civil Defence Emergency Management Act (CDEM) 2002 to declare one over the housing crisis – “a homelessness state of emergency”. 

A look at the history books doesn’t help Twyford much either – there was a state of emergency declared for the 1951 waterfront dispute when the army and navy were called in when Prime Minister Sid Holland thought New Zealand was “at war”.

In my opinion, trying to elevate homelessness to the levels of Christchurch as an emergency is both insensitive and idiotic.

Twyford’s call is insensitive when you think about all the people who lost loved ones in what was a true natural disaster.

And it is idiotic to think that putting Civil Defence on alert would help fix the housing issues. 

Labour often manage to be either insensitive or idiotic, but it is more rare for them to manage both at the same time.

Drinnan on Poverty Porn

John Drinnan writes:

An article in the Guardian website recently reported on “New Zealand’s Shameful Secret” and the growing problems of poverty and homelessness in a country held up as the land of milk and honey. It was an important and timely article. But parts of read like Poverty Porn.

“Catch a bus or two from Britomart in central Auckland, and after an hour and a half and you will arrive in the urban slum of South Auckland. Here, houses are wooden, damp and mouldy and often hold in excess of 10 people. Young children walk the streets in mid-winter with no shoes and gummy eyes. Looming over polluted streams and rubbish-strewn parks is the vast Double Brown Beer Brewery. 

Elsewhere.

The (Auckland City) mission is located in busy central Auckland but the most deprived regions of this increasingly chaotic mega-city are in South Auckland, in the ghettoised suburbs of Otara, Papatoetoe and East Tamaki.

The theme of the article was strong.  It exposes a hardening of attitudes and darkening prospects for the poor. The Guardian’s Dunedin-based reporter Eleanor Ainge Roy has a good turn of phrase that makes for very readable copy. But the story was over-egged. South Auckland is not an urban slum. Otara, Papatoetoe and East Tamaki do have a lot of poor people and problems associated with low incomes. But they are not “ghettoised.”

Most South Auckland residents are proud of their homes and communities. They enjoy lives they have created there, and many have no wish to live in Ponsonby. They well be surprised to find they live in a ghetto or a slum.

I suspect the reporter in question has never been to South Auckland, or lived there.

Its one of the tendencies for middle class media that are discovering poverty in their midst. Papatoetoe is Port au Prince. Favona is a Favela.  …

Poverty is a story that media like. But it betrays the middle class background to the majority of journalists that see hardscrabble places as foreign and unsightly. I wonder if local truck stops even offer eggs benedict.

No eggs benedict. It’s a ghetto!

I was in Cannons Creek the other day. It is probably seen as the Wellington equivalent of South Auckland. I had not been there before so had a stereotypical view of what to expect. Far from being a ghetto or slum it was a tidy well maintained neighbourhood with a good shopping centre.

Crampton on Labour supporting regressive policies

Eric Crampton writes:

Chris has things entirely backwards here, in a way that has me not sure if he knows what the word regressive means, or whether he doesn’t know how the student loan repayment system works. Or maybe it’s just a fingers-in-the-ears “If I say right-wing enough times maybe nobody will read the report” thing – I was a bit surprised by the twitter traffic following Labour’s playbook on that one.

First off, we never assumed that the returns to education are entirely private. We noted that students currently cover 16-18% of their costs of study, but we didn’t say that should go to 100%. Reallocating some of the money currently spent on tertiary subsidies back into secondary schools, as we recommend, would increase the private contribution towards tertiary education a bit. If we thought it was entirely private benefit, we would have recommended scrapping the remaining tuition subsidies built into the system. We didn’t do that though.

The regressive part is at least as odd. We recommended taking something that’s currently universal and targeting the spending in highly progressive fashion. Means-tested funding can include debt forgiveness for hard-cases down the track, as the UK does when it wipes out student debt that has no chance of being recovered. The reallocation of spending toward secondary schools with poor track records of sending kids to tertiary would disproportionately go to schools serving poorer kids. And the benefits of better guidance counselling, which we also recommended as part of the package, would disproportionately go to kids whose families don’t know how to navigate NCEA and tertiary – again, not my family.

In my experience Labour MPs are very happy to support what they call regressive policies such as universal support instead of targeted policies that assist those most in need.

The reason for this is they wish to get as many voters as possible dependent on state support. The more voters who get cash from the government, the more who will vote for a party that promises more cash.

They put this political imperative ahead of using taxpayer dollars to do the most good by targeting those most in need.

And remember too that loan repayment under the income-contingent repayment scheme is highly progressive. On leaving study, student debtors are charged 12 cents on every dollar earned above $19,084 until the balance of the loan is paid off. So the marginal tax on every dollar above that threshold is 12%, but the average tax rate starts off very low and then rises. A person earning $19,085 pays 12% on the last dollar earned, but only pays $0.12 in loan repayment tax on $19,085 in earnings: a 0.0006% average tax rate. A person earning $119,084 on graduation pays 12% on the last dollar earned, but pays $12,000 in tax: a 10% average tax rate.

A tax schedule where the marginal tax rate is always above the average rate is the definition of a progressive tax. The income-contingent student loan repayment scheme is then rather progressive. If you take out $100,000 in loans and only ever earn $19,000 per year, you will never pay off your loan, but neither will you ever make a payment on your loan. The effective burden (on the debtor, but not the taxpayer) is zero, except in cases where the existence of the student debt makes accessing other credit more difficult. Those on the *lowest* incomes wind up paying nothing back.

I’d have thought that our policy proposal, which takes money that is currently given indiscriminately as interest rate subsidy to every person taking out a loan for tertiary study, regardless of their means, and targets it instead to poorer cohorts and poorer schools, was really rather strongly progressive. But Hipkins calls it ‘inequitable’.

Hipkins means it is politically inequitable in that it may not create enough Labour voters.

Homelessness in NZ