Recent revelations that the National Party may have benefitted from a deal involving a resort hotel in Niue, by receiving a $101,000 donation has been in the headlines since 18 April, when Radio NZ’s political reporter, Benedict Collins, broke the story;
In October 2014, New Zealand’s Scenic Hotel Group announced it had “secured” the Matavai Resort in Niue.
The Niue Tourism Property Trust, whose trustees are appointed by Mr McCully, carried out what the minister said was a fully commercial process to find a company to run the resort.
The month before, Mr Hagaman, Scenic Hotel Group’s founder, had donated $101,000 to the National Party, making him National’s biggest living financial donor in 2014. Only a man who had died and left his estate to National gave more.
But Mr McCully said there was no link between the contract and the donation.
Radio NZ further reported;
Scenic Hotel managing director Brendan Taylor said Mr Hagaman didn’t know the company was in the running for the Matavai Resort contract.
“Earl wasn’t actually even aware that we were negotiating in Niue, because basically that was me and I had it all in-house until such time that we knew we had been awarded the contract.
I did get [Earl’s wife] Lani Hagaman to sign the contract because I wasn’t actually available to do it, but apart from that Earl really had no involvement in Niue whatsoever.
His donation is something he did purely from a personal situation, and basically the hotel company and what Earl does from a personal point of view we kind of keep separate.”
It simply defies credulity that the two events are not somehow connected – especially when, as Radio NZ discovered that “RNZ News could find no record of Mr Hagaman having ever made a large donation to the National Party before“.
It also beggars belief that Scenic Hotel managing director, Brendan Taylor, is asserting that “Earl wasn’t actually even aware that we were negotiating in Niue” when Brendan Taylor got “Lani Hagaman [Earl’s wife] to sign the contract”?!
As the story began to gain traction elsewhere in the msm, National Party president, would be making no further comment about the donation“.
Three days later, on 21 April, our esteemed Dear Leader, John Key, attempted to close down the growing scandal;
Mr Key, speaking in China, said today that, while he hasn’t followed the issue closely, he’s not at all concerned.
“People make political donations and that’s well and truly disclosed.
“But actually Scenic Hotels have been operators for a very long period of time, that’s a management contract from what I can see in Niue – there’s nothing untoward there.”
It is intriguing that even though Key says “he hasn’t followed the issue closely, he’s not at all concerned“.
How can he be “not at all concerned” if “he hasn’t followed the issue closely“?
This is not the first time that National has been revealed to have benefitted from donations made by businessmen who have been closely involved in commercial activites with this government.
In early 2011, National was roundly criticised for spending millions on thirtyfour new BMW limousines at a time when the country was experiencing recession after the Global Financial Crisis.
At first, Key denied all knowledge of the purchase, claiming he had been “kept in the dark” over the multi-million dollar upgrade;
But our esteemed Dear Leader, John Key, did know, as was revealed four days later in late February, 2011;
However, the BMW scandal becomes more serious than Key merely ducking responsibility and patently lying when he denied all prior knowledge of the limousine upgrade.
In May 2011, it was revealed that the suppliers of the BMWs had made a $50,000 donation to National prior to the vehicle-purchase. As reported in the NZ Herald at the time;
A private BMW dealer has rubbished the suggestion that a $50,000 donation from his company to the National Party had anything to do with the Government’s new fleet of BMW cars.
Labour’s internal affairs spokesman, Chris Hipkins, revealed that the BMW dealer’s donation came two days after a July 2010 meeting between Mr Key’s chief-of-staff, Wayne Eagleson, and the Department of Internal Affairs, which approved the BMW upgrade.
It was a month after a function that Mr Key attended at Auckland BMW dealership Team McMillan.
Radio NZ reported;
Prime Minister John Key says he has no responsibility for a $50,000 donation made to the National Party by a BMW dealership the day after the Government renewed its VIP transport contract.
Bob McMillan, the owner of BMW Team McMillan, says the claim he donated money to National the day after the party agreed to a contract for ministerial cars is ridiculous.
As senior Labour MP, Trevor Mallard said at the time;
“They sat down with Ministerial Services and agreed to a renewal of [the BMW] contract, and two days later $50,000 went to the National Party. If that was overseas, we would say it was corruption…”
Mr McMillan’s denial of any link between his donation of $50,000 to National, in return for the contract for the limousine up-grade sounds remarkably similar to Scenic Hotels managing director, Brendan Taylor, denying any link between Earl Hagaman’s $101,000 donation to the National Party and his company securing the contract with Matavai Resort.
To compound matters, the BMW dealership at the center of the donations scandal then expressed an interest in acquiring the soon-to-be-replaced government limousines (to re-sell, at a profit);
Whether or not the purchase went ahead is unclear.
In 2010 and late 2011, another apparent conflict of interest was reported when Shanghai Pengxin put in a bid for the Crafar dairy farms. Shanghai Pengxin, under various guises, gave hundreds of thousands of dollars to the National Party;
A full analysis of the links between Oravida, Crafar Farm purchase, and the National Party was reported in a previous blogpost here; Doing ‘the business’ with John Key – Here’s How (Part # Rua).
Whilst details are hard to confirm by the very nature of these highly secretive deals – many made informally – the questions arising from these (and other) murky ‘arrangements’ is sufficient to underscore a recent downgrading of our Transparency International Corruption Perception Index;
We have had sufficient number of glimpses into dubious activities that hint at corrupt practices. Even fourth place on the Transparency International Corruption Perception Index may be wildly optimistic.
As the Saudi farm-bribe and use of GCSB to spy on behalf of Tim Groser has shown, National is not averse to employing dodgy practices and dirty deals to enrich itself or what it perceives may “benefit” the country (and consequently it’s re-election chances).
There are simply too many coincidences to ignore the inescapable conclusion: it is my considered opinion that National has benefitted financially from several commercial/government transactions.
Our political system has been tainted with corruption.
As at 21 April, the so-called “Taxpayers Union” – a self-appointed group of “watchdogs” to protect public interest from political corruption and waste of taxpayers’ money, had made no comment on the Niue Scandal;
The “Taxpayers Union” had condemned the Universal Basic Income; had a ‘go’ at Maori Iwi; lambasted Labour; criticised MoBIE; and several other attacks on perceived “wrong-doing”.
But not a peep on the Niue scandal.
But considering that the “Taxpayers Union” is made up of National Party apparatchiks and supporters, that is hardly surprising.
Radio NZ: PM not worried about Niue resort deal
Fairfax media: Ministers knew of BMW buy-up last year
Fairfax media: PM signed papers relating to BMWs
NZ Herald: Dealer denies donation link
Transparency International (NZ): Corruption Free? NZ drops again
Fairfax media: Auditor-General had doubts Saudi sheep deal was legal
Scoop media: BSA decision – One News on Sale of BMWs
Previous related blogposts
This blogpost was first published on The Daily Blog on 22 April 2016.
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Previous related blogposts
This blogpost was first published on The Daily Blog on 17 April 2016.
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In a recent Radio NZ “Morning Report” interview, National MP, Mark Mitchell, revealed the government’s true objective with the so-called “TPPA Roadshow” and Parliamentary Select Committee hearings. Behaviour by other Select Committee members has also drawn harsh criticism by some members of the public who attended the sessions.
The Roadshow and Select Committee hearings are being held by the Ministry of Foreign Affairs (MFAT) and Foreign Affairs, Defence and Trade Select Committee (respectively) to seek public submissions on the Trans Pacific Partnership Agreement, aka, the TPPA;
More than 330 people have asked to give their views on the controversial trade treaty to the Foreign Affairs, Defence and Committee in person.
The committee will hold hearings in Christchurch on 31 March and 1 April, and in Auckland the following week, before returning to Wellington, where it has already heard some submissions.
Committee chair Mark Mitchell said there would be more than enough time for the hearings.
“I’ve made sure that we allow plenty of time, so that’s going to allow us enough time to be able to hear everyone that wants to make an oral submission to the committee.”
Mitchell, the Chairperson of the Select Committee, was defending the shortened reporting time of the Select Committee back to Parliament. As Mei Heron reported for Radio NZ;
MPs have been given just five days to consider hundreds of submissions on the controversial TPP trade deal after the timeframe was drastically cut from four weeks.
The select committee was originally give a month to write its report and present it back to Parliament.
Opposition MPs were furious at the sudden change and they called it an attack on democracy.
The trade deal has already been roundly criticised by its opponents for being too secretive and lacking consultation.
The Foreign Affairs, Defence and Trade Select Committee had been hearing submissions on the TPP from hundreds of people across the country and that will continue until the end of the month.
But opposition members on the committee say they were told yesterday the government wanted to cut down the time they had to analyse the submissions, so the legislation could get through by the end of the year.
Predictably, Opposition members of the Select Committee expressed dismay and anger at National’s unilateral change of the Committee’s timetable, with Green MP, Kennedy Graham, roundly condemning the move;
“It’s just a slap of indifference and dismissal of some very sincere, very capable and hard-working New Zealand people. It shows it up for what it is – which is essentially a ‘roadshow’ with a predetermined end.”
Graham’s assertion that the public submission process “ is essentially a ‘roadshow’ with a predetermined end”, is confirmed after a startling admission by the Committee’s chairperson, Mark Mitchell. On “Morning Report” on 8 April, Mitchell vented his obvious frustration with the New Zealand public;
“I think, I think some people are very set in their views. And to be honest with you my feeling is that it doesn’t matter what evidence we provide or how we try to balance the information that could allay those fears, they’re already set in their minds. They’ve decided what position they going to take and it’s going to be very hard to probably move them of that position. But there’s other people that are just genuinely worried about it because there has been some misinformation put into the public debate. And often when they get the full story, and of course the Minister’s done a very comprehensive, um, series, at which he’s continuing to do public meetings throughout the country. I think he’s in excess of about 30 or 35 now. Is that people actually just wanted to have some proper information around the TPP.”
Mitchell complained that “it doesn’t matter what evidence we provide or how we try to balance the information that could allay those fears, they’re already set in their minds” and “they’ve decided what position they going to take and it’s going to be very hard to probably move them of that position”.
For perhaps the first time in the history of the Westminster Parliamentary process, a member of Parliament has suggested that the Select Committee process is no longer a forum where the public offer submissions for their elected representatives to listen and consider. Instead, Mitchell’s comments indicate that Select Committees are now viewed as useful tools for dissemination of “proper information around the TPP” for the public and businesses.
A Ministry of Foreign Affairs and Trade website page appears to echo Mitchell’s views on the purpose of MFAT’s travelling “Road Shows”;
The Government will run a number of events on key TPP outcomes. These will be aimed at ensuring businesses are able to prepare to take advantage of new opportunities presented by TPP’s entry into force, and to provide information of interest to the wider public and other stakeholders. These events follow the extensive public consultations carried out during TPP negotiations.
The Government is running TPP roadshows on the outcomes of TPP for New Zealand. Members of the public are welcome. The roadshows will also help businesses prepare to take advantage of new opportunities presented by TPP’s entry into force.
However, the agendas of both the Foreign Affairs, Defence and Trade Committee’s submission process and MFAT’s “Road Shows” is not shared with the Parliamentary Office of the Clerk;
The Foreign Affairs, Defence and Trade Committee is now calling for public submissions on the TPPA and the four related intellectual property treaties. Each treaty has a national interest analysis which sets out the advantages and disadvantages for New Zealand of becoming a party to it.
You have until Friday 11 March 2016 to share your views about these documents with the parliamentary select committee by making a submission.
The committee will consider the written submissions it receives and they will be posted on the Parliament website when released by the committee.
The committee is also expecting to hear from submitters who wish to speak to their submission. Committee staff will contact those submitters to organise a time for them to speak to the committee. Hearings may take place outside of Wellington depending on the number of submitters from each region.
Mark Mitchell seems not to have received the emailed memo from the House Clerk.
The “Road Shows” have also drawn criticism from the way they have been carefully orchestrated. From a Radio NZ story;
Albert-Eden Local Board member Graeme Easte said the event was more of a show and tell, in which Trade Minister Todd McClay and the senior negotiator described what they were doing.
“It was very much pro the agreement,” Mr Easte said.
“Even though half the questioners were clearly sceptical or anti, there wasn’t really an opportunity for a discussion or a debate.”
A member of the public complained that the “Road Show” was being held at a time guaranteed to minimise public attendance;
One placard holder, a teacher, has slipped away from school and down the road to make that point: “Let’s consult widely with the public. How about on a Monday morning when everyone is at work? Yeah right!”
Blogger, ‘SkepticNZ’, related his experience at the Dunedin Roadshow event;
Now attending a Roadshow is not as simple as popping along. In fact in order to attend you have to first register via the MFAT website.The good people at MFAT no doubt in the interest of open debate and inclusion have the following requirement upon interested citizens to gain entry.
You will need to bring photo ID (e.g. passport or drivers licence) in order to collect your name badge when you attend the roadshow. You may not be permitted entry to the roadshow unless you present photo ID.Entry to the roadshow on the day is entirely at the discretion of the event organizers. Disruptive, threatening or offensive behavior will not be tolerated and may result in you being required to leave the venue.
You must comply with the instructions and directions of the event organizers. You may be required to leave the roadshow if you do not do so.Right, have you got that? before you can enter Mr McClay’s ‘open debate, informed discussion’ you first have to agree to doing what you are told.Being a curious and dutiful citizen I prepared my identification, completed my registration, and printed off my MFAT confirmation including individual Bar Code, and off I went to the show.On arriving at the Venue in Harrop street, I was greeted by some very friendly people keen to hear my views about the TPPA, and happy to give me information sheets. But enough about the protesters, onto the front door.The front door itself was guarded by a heavy police presence supported by private security contractors from Amourguard. A young man from Armourguard asked for my photo ID and then told me I wasn’t on the list and asked me to stand to one side while they check if I could enter. Which under a watchful Police eye I did.I didn’t have long to wait before another slightly older young man from Armourguard came to speak to me and ask if I had my registration form, which of course I did. After a moment of reading my licence, checking my registration , and checking my licence again I was allowed in the door.Hallelujah I haven’t had so much scrutiny to enter a door ever in my life. Not even as an under age drinker in the last century, nor at Passport control at Heathrow, have I ever faced such close observation and suspicion. Crikey there must be something really really important inside.Inside the door was more police, and more security, and a desk to register to attend the day. I must say the folks from Orbit (Event Staff) were genuinely friendly and helpful. In a very short time I was given my ID Card and lanyard and direct to the stair well. Apparently the Lift was out of order. This was when yet another Security Officer asked to search my bag. Being a good citizen I handed my bag over. Apparently my pen and paper and Banana for morning tea did not constitute dangerous items and I was allow to begin my long climb up the stairs.The climb itself was uneventful except for the presence of Security Personnel on every landing carefully watching our every move to ensure we went were we where supposed to.Upon reaching the top floor I was greeted by even more security staff and a lobby to wait in. The lobby contained some MFAT TPPA Fact Sheets and that is about it.After about 10 minutes of standing and being watched we were all allowed to enter the conference room itself.I must admit by now my expectations where very high. After all why have a small army of security guards if there wasn’t something spectacular inside?
SkepticNZ’s experience is worth reading in it’s entirety.
Another member of the public, Tim O’Shea, who was presenting a submission to the Foreign Affairs, Defence and Trade Select Committee on 8 April in Auckland, became upset when he realised that “thirty minutes in, and two National MP’s are missing“;
Acknowledgement: Image courtesy of Tim O’Shea
Tim also complained that “of the three who are here, [National MP] David Bennett… spent more time looking at his smart phone than he has spent listening to oral submissions.” [See image above]
Tim has lodged a formal complaint with the Foreign Affairs Defence Trade Committee chairperson;
“On Thursday I observed that the hearing was well attended by those on the Select Committee, and that all submitters (whether pro or anti the TPPA) were dealt with in a predominantly fair and courteous way. All attending members showed respect for those submitters by making a clear effort to listen to, and look at, the various submitters. The day was a long and busy one – i.e. there were many submissions, and very few unplanned interludes and gaps between the submissions.
On Friday, several submitters expressed their dissatisfaction and disappointment at how few government committee members were in attendance compared to the previous day. I counted just three (including the chairman), compared to five who attended on the Thursday.
That in itself, however, was of less concern to me than the rude, discourteous and totally disrespectful behaviour shown by one of the attending committee members, namely National MP David Barnett.
Despite the fact that the hearing didn’t start until the relatively leisurely time of 10:00am, Mr Barnett clearly felt, as the attached photo that I took at 10:22 shows, that looking at his cell phone was far more important than listening to, or looking at, the first THREE submitters !
It wasn’t until part the way through the third submission that Mr Barnett eventually put his phone down.”
When Tim asked David Barnett “to put his cell phone down for ten minutes to show some courtesy and respect“;
“The chairman, Mark Mitchell told me that I should not address committee members directly in that way, and that the members had other important work to do during the hearing – I responded that I also had work to do, and that the least he could do is listen to me and show some respect.”
“As I continued to the end of my submission, David Barnett showed complete and utter contempt by looking at his cell phone for the whole time that I presented, showing no interest at all, and not even looking up at me. Chairman Mark Mitchell said nothing about it whatsoever.’
The complainant claims that Committee Chairperson, Mark Mitchell then criticised Tim for his “bad behaviour”. According to Tim O’Shea;
“Mr Mitchell then told me that he didn’t like the fact that I stood up to do my submission.”
In an obviously increasingly tense atmosphere, another Select Committee member, Labour’s David Shearer, was allegedly over-heard referring to Tim as an “arrogant twat” to fellow-committee member, Green MP Kennedy Graham.
The complaint is on-going.
Whatever purpose the “Road Show” has, it clearly has upset members of the public. According to comments made by Mark Mitchell, and repeated on an MFAT website, Green MP, Kennedy Graham was correct when he condemned the exercise as;
“…essentially a roadshow with a predetermined end.”
Certain MPs seem to hold the attitude that they are not so much highly-paid civil-servants, elected to represent us in Parliament – but instead “members [who] had other important work to do”. These MPs forget that they hold office at our pleasure.
The clear perception is that public participation is not welcome at the “TPPA Roadshow” or Select Committee.
The farce surrounding the TPPA continues.
|Foreign Affairs, Defence and Trade Select Committee||Role||MP Name||Party, Electorate|
|Foreign Affairs, Defence and Trade||Chairperson||Mitchell, Mark||National Party, Rodney|
|Foreign Affairs, Defence and Trade||Deputy-Chairperson||Reti, Shane||National Party, Whangarei|
|Foreign Affairs, Defence and Trade||Member||Bennett, David||National Party, Hamilton East|
|Foreign Affairs, Defence and Trade||Member||Graham, Kennedy||Green Party, List|
|Foreign Affairs, Defence and Trade||Member||Muller, Todd||National Party, Bay of Plenty|
|Foreign Affairs, Defence and Trade||Member||Ross, Jami-Lee||National Party, Botany|
|Foreign Affairs, Defence and Trade||Member||Shearer, David||Labour Party, Mt Albert|
|Foreign Affairs, Defence and Trade||Member||Tabuteau , Fletcher||NZ First, List|
|Foreign Affairs, Defence and Trade||Member||Tisch, Lindsay||National Party, Waikato|
|Foreign Affairs, Defence and Trade||Member||Woods, Megan||Labour Party, Wigram|
Trade Minister Todd McClay appears to be labouring under an illusion when said;
“But you’ve got to remember it’s been over seven years or more of negotiation, so not all of that consultation or engagement will be remembered.”
MFAT repeated the fantasy;
These events follow the extensive public consultations carried out during TPP negotiations.
One of the most trenchant criticisms of the TPPA is that there was no public consultation carried out during the negotiations. It was all done in secret.
In fact, Professor Jane Kelsey won a court case on this very issue.
So one has to wonder how Todd McClay and MFAT can make the startling assertions that there was “extensive public consultations carried out during TPP negotiations“.
Too soon to be re-writing recent history, yes?
National MP, Mark Mitchell, is closely connected with far-right activist,Simon Lusk, who runs (ran?) a private, self-styled “candidates school” for potential National Party candidates. Amongst those National MPs linked to Lusk are Taupo MP Louise Upston, Maungakiekie MP Sam Lotu-Iiga, Napier MP Chris Tremain, disgraced former list MP, Aaron Gilmore, and Minister Judith Collins. (Lusk, in turn, is associated with “Whaleoil’s” Cameron Slater; “Kiwiblog’s” David Farrar; and “Taxpayer Union’s” Jordan Williams.)
To Tim O’Shea, for kind permission to use his material (images, quotes, etc) and for proof-reading my story to ensure accuracy.
Radio NZ: Over 330 ask to have say on TPP
Parliament: Select committee begins examination of TPPA
Ministry of Foreign Affairs & Trade: Trans-Pacific Partnership – Events
Scoop Media: Select committee begins examination of TPPA
SkepticNZ: Inside the #TPPA Roadshow Experience
Facebook: Tim O’shea – Submission
Facebook: Tim O’Shea – Facebook Post
Radio NZ: TPP requests – Groser acted unlawfully
Fairfax media: Seriously happy to upset the status quo
Bryce Edwards: Invite to Selection Training Weekend
Bowalley Road: Protecting The TPP
No Right Turn: Government propaganda on the TPPA
The Daily Blog: Josie Butler – Why I attacked the TPPA roadshow
The Standard: TPPA review time slashed
Wheeler’s Corner: TPPA’s Road-show SEAN PLUNKET tongue flaps
Previous related blogposts
This blogpost was first published on The Daily Blog on 13 April 2016.
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National Makes Good on 2008 Threat to Sell Kiwibank
NZ Post’s, announcement on 6 April that it intends to sell-down 45% of it’s subsidiary, Kiwibank, appears to make good on Bill English’s inadvertent threat in August 2008 that Kiwibank would “eventually be sold”.
English was secretly recorded by an un-named person during a 2008 National Party Conference, and encouraged to talk freely on the prospect of selling Kiwibank;
English subsequently complained; “I did not choose my words well“.
However, it now appears that English expressed his words honestly, disclosing a secret agenda to sell Kiwibank to someone he believed was a loyal National Party apparatchik.
Another secret recording, this time from National MP Lockwood Smith, also hinted at a secret agenda held by National;
“There’s some bloody dead fish you have to swallow, to get into government to do the kinds of things you want to do. Once we have gained the confidence of the people, we’ve got more chance of doing more things.
We may be able to do some things we believe we need to do, perhaps go through a discussion document process. You wouldn’t be able to do them straight off.”
Both English and Key issued public statements resiling from any intention to sell Kiwibank;
“It’s not my view. It’s not my private view. I simply used loose language – I made a statement I shouldn’t have.” – Bill English
“We would never make a change to that decision without a mandate.” – John Key
Again in 2008, Key resiled from any sale of Kiwibank;
“I’m ruling out selling Kiwibank at any point in the future.”
And again in 2010,
“National would not sell Kiwibank at any stage, ever. We have ruled it out.”
Making a Promise
On 25 February 2014, our esteemed Dear Leader, John Key, announced to the nation that National’s asset sales programme was over;
Two years and nearly two months later, and Key’s promise- like so many other committments he has made – appears to have been watered-down to permit a de-facto partial-sale.
The intended purchasers would be two other SOEs, NZ Superannuation Funds (25%) and ACC Funds (20%);
Breaking the Promise
Even as NZ Post’s Directors were announcing the partial sale of their subsidiary, Kiwibank, Finance Minister Bill English was engaged in some well-rehearsed damage-control.
No doubt with considerable prompting by Party strategists and media-minders, English reassured the public that National would not allow the people’s bank to end up in private ownership, as the former Postbank did February 1989 when it was sold to the ANZ Bank.
To be blunt, National cannot be trusted to keep it’s word.
Key knew in advance!
Despite Key’s committment to end asset sales on 25 February 2014, it appears from Michael Cullen’s own statements that our esteemed Dear Leader was already aware at around the same time, that a partial asset-sale was being planned by NZ Post.
During a video-taped press-briefing by Fairfax media, Cullen admitted that he and Key had discussed the partial-sale of Kiwibank that year (2013/14).
“So Brian [Roche] and I after discussion, and [I] think I remember correctly, I had a brief discussion with the Post Board, went to see the Prime Minister, to see whether there would be a kind of visceral reaction from the government, as our ultimate share holder, to that happening. That was not the case. Mr Key indicated he was very comfortable with that prospect and on that basis therefore we began to proceed...”
So when Key made his public promise on 25 February, 2014, that National’s asset sales programme was over – he was making that committment whilst knowing full well that the partial sale of Kiwibank was already underway.
Broken promises and secret agendas – this story has it all.
Who Pays? Loyal Kiwibank customers do!
There is a hidden cost to the partial-sale of Kiwibank.
As David Hargreaves from Interest.co.nz reported;
The move could see Kiwibank’s credit rating slip by one notch from the current A+ to A as NZ Post will likely not guarantee Kiwibank’s future obligations once the deal proceeds.
When a financial institution’s credit rating is reduced, it means (generally) that they become a greater risk of lending money to them. According to Investpedia;
“…While a borrower will strive to have the highest possible credit rating since it has a major impact on interest rates charged by lenders, the rating agencies must take a balanced and objective view of the borrower’s financial situation and capacity to service/repay the debt.
A credit rating not only determines whether or not a borrower will be approved for a loan, but also the interest rate at which the loan will need to be repaid.
… and a high interest rate is much more difficult to pay back.”
It is entirely likely that when a credit down-grade occurs (as happened to New Zealand under National in September 2011), the cost of borrowing funds will increase for the bank.
Which is precisely what Hargreaves reported;
Standard & Poor’s has indicated that following the announcement of the proposed transaction, Kiwibank’s long term issuer credit rating (A+) will be placed on credit watch negative pending the proposed termination of the standing guarantee provided by NZ Post. Should the guarantee be terminated, Standard & Poor’s has indicated it will result in a one notch downgrade to Kiwibank’s long term issuer credit rating (from A+ to A).
That cost will either have to be absorbed, reducing their profit margins and making it easier for Key and English to justify full privatisation – or will be passed on to the banks customers.
English will most likely not permit Kiwibank’s profit to fall as that would mean lower dividends paid into government coffers.
Which leaves Kiwibank’s Mum & Dad customers to foot the bill for the partial-sale.
The Agenda #1
The sale to ACC and NZ Super Fund is a clever ploy. On the face of it, Kiwibank remains in wholly State ownership, albeit shifting it’s shareholders around, from one SOE (NZ Post) to three (NZ Post, ACC, NZ Super Fund).A kind of multi-million dollar Musical Chairs.
At the same time, this would allow a healthy dividend payment (an amount yet to be disclosed) to be paid to the government. As Cullen said on 6 April;
“The proceeds would allow New Zealand Post to invest in its core parcels, packages and letters business and pay down debt. It is anticipated that a special dividend would also be paid to the Crown…”
This was confirmed a day later by Bill English speaking with Guyon Espiner, on Radio NZ’s Morning Report;
Guyon Espiner: “Ok, let’s look at what happens to the $495 million that NZ Post gets from this sale. I understand it doesn’t go to generate any extra capital for Kiwibank, it goes to NZpost to pay down debt and invest in it’s parcel and mail business, right?”
Bill English: “That’s right, and then if there’s, subject to negotiations there may be special dividend passed back to this [inaudible] government.”
English said any dividend payable to the government would “likely be several hundred million“. This would prove a godsend to English who otherwise would be struggling to create another Budget surplus in his May budget.
The Agenda #2
National has not only increased it’s revenue, thereby alleviating a major headache for Bill English, but they have pulled the rug out from under the Greens who, three days earlier, had been calling for increased $100 million investment in Kiwibank. As Greens co-leader James Shaw stated in a recent policy announcement;
“Our plan will help Kiwibank lead a change in New Zealand banking, by giving it a clear public purpose that requires it to drive competition to generate better interest rates for New Zealanders.
We’ll help Kiwibank to grow faster by injecting $100 million of capital into the bank and let it retain more of its profits.
Strengthening Kiwibank so it can create competition in the banking sector is the smartest way to ensure all banks pass on the best interest rates to Kiwis.”
A deeply cynical person might suspect that after the defeat of John Key’s pet vanity-project (the recent flag referendum debacle) that National has decided to exact revenge against the many Labour and Green voters who voted to retain the current flag, by partial privatisation of a favourite state owned enterprise.
Does such cynicism border on paranoia? In an era of Dirty Politics; tax-havens with trillions hidden away; and increasingly corruption of state leaders, officials, organisations, and institutions – the demarcation between healthy scepticism and paranoid fantasies blur, merge, and are tomorrow’s headlines waiting to be made public.
Labour and the Green Party both responded to Cullen’s announcement. As Stacy Kirk wrote for Fairfax Media on 6 April;
The response of opposition parties has been mixed, with the Greens calling it a step down the path of privatisation.
Labour leader Andrew Little said it was important Kiwibank stayed in public ownership.
“And this does that, there are some good conditions around it,” he said.
“This provides a way to get extra capital from these sovereign wealth funds, and hopefully for NZ Post to use the funds that they raise from the sale, to put more capital into Kiwibank.
Meanwhile, Labour Party state-owned enterprise spokesman David Parker said Cullen should be congratulated on the idea.
“Michael Cullen should be congratulated for securing a route to expand KiwiBank and keep it in public ownership, given the refusal of National to provide more capital for NZ Post or KiwiBank.
“Michael Cullen’s solution only works to ensure the bank will remain in public ownership if National promises that if ACC or the Super Fund sells its shares, then the government of the day would exercise its first right of refusal and buy them back.”
Labour’s response has not only been weak and naive – but it also appears that David Parker is not “up to speed” with the terms of the sale. It is extraordinary that both Labour’s SOE Spokesperson, David Parker, and Labour’s Leader, Andrew Little, believe that;
“This provides a way to get extra capital from these sovereign wealth funds… to put more capital into Kiwibank” and that “Michael Cullen should be congratulated for securing a route to expand KiwiBank”.
Nothing of the sort will happen.
Both Cullen and Bill English have been crystal-clear and surprisingly honest in stating that;
- “The proceeds would allow New Zealand Post to invest in its core parcels, packages and letters business and pay down debt.” “
- “It is anticipated that a special dividend would also be paid to the Crown.”
- Kiwibank will get nothing.
So where Parker and Little get their cozy ideas about “putting more capital into Kiwibank” is unclear.
Instead, Green Party co-leader, James Shaw, seemed more cognisant to National’s real agenda;
“The fact is the Government forced Kiwibank’s hand and today’s announcement will make it easier than it was before to move Kiwibank into private ownership.”
Labour needs to get it’s act together on this issue.
The future of the people’s bank depends on it.
As for the mainstream media, it is high time they became aware of the many promises made by both Key and English – and their subsequent breaking. Otherwise, they too are failing the public.
National, in the meantime, has carried out the perfect bank “heist”.
It only took eight years to accomplish.
NZ Herald: English – I didn’t choose my words well
TV3 News: National hit by more secret recordings
NZ Herald: PM pledges not to sell Kiwibank after all
Faifax Media: Key – Why I should be the PM
Otago Daily Times: Key not ruling out Kiwibank sale in future
NZ Herald: PM – no more SOEs to sell after Genesis
Fairfax Media: Key ‘no GST rise’ video emerges
NZ Treasury: Income from State Asset Sales as at May 2014
Investopedia: Credit Rating
NZ Herald: S&P cuts NZ credit rating
Fairfax media: Kiwibank tape catches English
Scoop Media: Bill English Talks On KiwiBank Being Sold (audio)
No Right Turn: Plunder
The Dim Post: A fascinating precedent
The Standard: Kiwibank sale to NZ Super, ACC privatisation by stealth
Previous related blogposts
This blogpost was first published on The Daily Blog on 11 April 2016.
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Due to personal circumstances (and a tussle with a ‘bug’ that seemed to take a fancy to my body), this blogpost is a couple of weeks late. Therefore, it is worth more as a “retrospective” than anything else. Apologies for the delay.
PS: The bug lost.
Flag thoughts and settling dust – Dedicated to our esteemed Dear Leader and Audrey Young
The People’s Verdict
The verdict is in; the people have spoken; ‘Old Blue‘ has been retained as our current flag.
By now most will be aware of the voting results;
Just over 1.2 million voters cast their ballot to retain the existing flag. That is 68,502 votes more than National party vote share (1,131,501) in the last election. If ‘Old Blue‘ was a political party, it could probably govern in it’s own right, without the second-rate hangers-on that National relies on to remain in power.
So, 1,200,003 people were not inclined to change our flag. There was no one particular reason – there were several;
- War veterans fought, and many perished, under that flag (or, at least, commemorate ANZAC Day under it)
- There was no popular movement for change – the two referenda were handed down from On High, and foisted upon the public
- Some did not like the process of deciding the candidate-designs in both referenda
- Some did not like the fact that three out of four (later, with the addition on Red Peak, five) options were eerily similar, bearing the silver fern
- Some thought that $26 million could be better spent on health, education, housing, increasing Pharmac’s budget to buy new cancer medicines, and other more worthwhile and pressing causes
- Some viewed it as a deliberate ploy by National to distract public attention from growing social and economic problems confronting us
- Some did not like the Kyle Lockwood design
- Some viewed the government’s decision to reinstate Knighthoods as contradictory to changing our flag
- Some remembered Key’s rejection and denigration of the 2012 anti-asset sale referendum and wondered why they should support our esteemed Dear Leader’s initiative, when he so casually derided a popular, grass-roots movement to voice opposition to asset sales
- A fair few voted against change as they saw it as a de facto referendum on John Key’s government (much like the September 1997 Compulsory Retirement Savings Scheme referenda, which many treated as a vote of No Confidence in the National-NZ First Coalition government at the time)
- Some were not convinced of the need for change
- Others viewed the alternatives as a “branding” exercise rather than advancing our national identity
- And a fair few simply liked the current ‘Old Blue‘, full stop.
The only real surprise was that the numbers voting to retain the current flag was only 56.6%. Previous public opinion polling had indicated that between 61% and 65% opposed change. Even as recently as a few weeks ago, a UMR Poll showed 59% opting to support the status quo.
A matter of National identity
One of the most trenchant criticisms of the flag referendum process is the contradiction of Key’s government returning New Zealand to British Knighthoods.
Discussion of wider aspects of nationhood such as becoming a republic and electing our own Head of State were also muted.
On 29 October, 2014, Key maintained the aspirations of a new flag expressing our own modern, independent identity;
“Our flag is the most important symbol of our national identity and I believe that this is the right time for New Zealanders to consider changing the design to one that better reflects our status as a modern, independent nation.”
In another example of Key’s multiplicity of opinions, his comments were contradicted two years later on 2 April this year when he uttered this eyebrow-raising assertion;
“We are at the core … a British colony and I thought there was an argument that New Zealanders could be treated in a way which reflected that.”
So much for “independent national identity”.
Key’s restrained/rehearsed response
On TV3’s The Nation, on 26 March, Lisa Owen interviewed our esteemed Dear Leader, John Key. His face was studiously calm and seemingly unperturbed by what was obviously a rejection of his beloved silver fern flag reform. Key’s tax-payer funded media minders had earned their salaries and trained him well.
Key’s composure was perhaps a little too perfect;
During the interview, Key blamed voters for voting along “party lines”;
“Well, that was because what we saw was some really big numbers that looked like they were along party lines. Seventy percent of Labour voters for instance in the polling indicated they would vote for the current New Zealand flag when it was Labour policy to change the flag via a referendum.”
Astoundingly, Key cheekily tried to re-write recent history by denying any favouritism in the flag debate;
“Well, in the end, you gotta remember I didn’t back the horse. What I did was open up a process which allowed ten and a half thousand to put in a submission…”
Oh, of course, not Dear Leader. You had no preference at all, right? These images below – they are images of your evil duplicate, from a Parallel Universe, right?
It was noticeable that Key had no lapel pin on his jacket-breast in the interview with Lisa Owen (nor on TVNZ’s Q+A, the following Sunday). Even after the people had spoken in a referendum promoted by him and his government, he could not bring himself to wear the mandated flag of our nation.
It will be interesting to see what pin he will be wearing in future, if any. After all, as Key himself pointed out;
“..and actually now, as a country, let’s get behind our flag.”
Indeed, Dear Leader; let’s get behind our flag. And you can start by wearing it on your lapel.
Audrey Young’s response
In examples of childish foot-stomping, petulance, Audrey Young’s piece on 25 March in the NZ Herald was hard to beat;
“It is not even a failure to persuade because Key did not campaign heavily for change.
If anything, he failed to campaign strongly enough.
He always answered questions about changing the flag but he did not lead a campaign to change it in the way the late Lloyd Morrison might have done.”
Young’s assertion that “Key did not campaign heavily for change” beggars belief. As the two images above show – along with other evidence easily available on the ‘net – Key was one of the prime movers to replace the current flag.
Young would have to have been living in a snow-cave in Antarctica; in a bathysphere at the bottom of the Marianas Trench; or a moonbase on the Dark Side of the Moon, not to have noticed Key’s cheerleading for the Kyle Lockwood flag.
“He wrongly counted on the Greens and Labour actually following their own policy and embracing the referendum rather than politicizing the process.”
Which illustrates Young’s lack of knowledge on the referendum voting patterns (as well as over-looking the fact the entire process had been politicised when Key took a personal position on which flag he supported).
In fact, many of the electorates which voted to retain the current flag are held by National MPs;
Auckland Central (56.5% current flag, 43.2% alternative flag)
Botany (51.5%, 48.3%)
Christchurch Central (56.4%, 43.4%)
Coromandel (54.5%, 45.3%)
East Coast (57.5%, 42.3%)
Hamilton East (51.9%, 47.9%)
Hamilton West (55.2%, 44.6%)
Hunua (53.4%, 46.5%)
Invercargill (60.0%, 39.9%)
Kaikōura (53.0%, 46.8%)
Maungakiekie (59.0%, 40.8%)
Nelson (51.9%, 47.8%)
New Plymouth (50.7%, 49.1%)
North Shore (50.4%, 49.4%)
Northcote (56.1%, 43.6%)
Ōtaki (57.4%, 42.4%)
Pakuranga (53.2%, 46.7%)
Papakura (59.0%, 40.9%)
Rangitata (51.6%, 48.2%)
Rangitῑkei (56.0%, 43.9%)
Rodney (52.4%, 47.3%)
Rotorua (56.2%, 43.6%)
Taupō (53.0%, 46.8%)
Tauranga (50.1%, 49.7%)
Tukituki (56.5%, 43.3%)
Upper Harbour (55.8%, 44.0%)
Waikato (52.2%, 47.6%)
Waimakariri (51.0%, 48.9%)
Wairarapa (56.8%, 43.0%)
Waitaki (50.4%, 49.4%)
Whanganui (59% – 40.8%)
Whangarei (58.5%, 41.3%)
Even our esteemed Dear Leader’s own electorate turned against him;
Helensville (56.6%, 43.3%)
In the last election, National scored 58.39% of the Party Vote and 65.17% Electorate Vote.
So For Audrey Young to whine about Labour and the Greens not towing the official Government Party Line on this issue is childish finger-pointing and blame-gaming. Perhaps she should take it up with National’s own supporters.
After all, in National-held Invercargill, the vote was a staggering 60% to retain ‘Old Blue’. I doubt if that far-south electorate is a secret Labour and Green stronghold and hotbed of left-wing, anti-government activity.
And where did Key’s support go in his own electorate?
Audrey Young’s whinging continued;
“To those who didn’t like the design of the silver fern alternative, it was the public’s choice.
To those who didn’t like any of the five finalists in the first referendum, they were the Flag Consideration’s Panel’s Choice.
To those who wanted Red Peak among the finalists, Key and the Green Party got it added and shut them up.
To those in Labour who say a new flag should not have been considered until New Zealand becomes a republic, he can say “hypocrite.”
That’s not they were saying in 2014 when Trevor Mallard released its policy saying “We believe that the time has come for a change and it is right for the issue to be put to the public.”
To those who did not want a referendum at all, did they want a choose imposed on them?
To those who thought it was a waste of money, it is not what they were saying in 2013 on the referendum for state asset sales for which the Government had received a clear mandate at the 2011 election.
To those say who say people should have been asked first if they wanted change, it was a question biased towards no change.”
It seems fairly obvious where Young stands on the flag referendum. She brooks no dissent; no contrary opinion; and certainly does not respect the will of the people.
For example, her ridiculous notion that “to those who didn’t like the design of the silver fern alternative, it was the public’s choice” – is arrant rubbish. The Kyle Lockwood option on the ballot paper was one of four decided by the Flag Selection committee.
Of the four, three had the silver fern and could be considered nearly identical. (The fourth option – Andrew Fyfe’s Koru flag design – was so abysmal as to be a sure bet to be relegated to last position in voting preferences. No personal offense intended Mr Fyfe.)
Of the four options, a silver fern was bound to win. The public had few real choices in the matter.
Audrey Young left out one “To Those“, which I will offer in the form of one of her own statements, slightly amended;
To those who fume at the referendum result, get over it!
Key got his referendum. He simply did not get the result he wanted. Audrey Young insults voters with her whiney little tanty.
This time – unlike the referendum on State Assets which he thumbed his nose at – he cannot ignore the Will of the People. Not unless he wants to lose the 2017 election, and probably the next one or two after that.
Other matters to consider: 1 – Similarity
Perhaps the Number One argument in favour of changing our flag was “Old Blues” similarity to Australia’s flag;
Which is not a unique situation, as Hungary and Italy also have similar flags;
As do France and Russia
And try remembering which is which when it comes to Indonesia and Poland!
Changing a flag because it bears a similarity to another nation’s emblem does not – on the face of it – seem a necessity when so many others are striking in their sameness.
Quite the contrary, if any two nations on the face of this little planet have a reason to share a similar design – it is Australia and New Zealand.
After all, we have a similar pattern of colonisation; shared history, language, culture, values, economy, and we laud our ANZAC tradition. To an outsider, there is little appreciable difference between Australians and New Zealanders (except we don’t have an accent).
Why shouldn’t our flags be similar as well?
Other matters to consider: 2 – Stubborness
By now, our elected representatives should know that New Zealanders don’t like being told what to do. Our stubborn streak of “sticking it to the man” was epitomised in that 1981 cult classic, “Goodbye Pork Pie“. The entire movie (in case the title wasn’t sufficient to give it away) was a middle finger raised at the increasingly autocratic National government of the day. (What is it about National governments that tend toward authoritarianism?)
The flag referendum, unlike it’s more successful predecessor, the firefighters’ referendum in 1995, and the anti-asset sales referendum in 2012, was not a grass-roots movement by the people.
It was handed down, from on-high, and by golly the government would demand that we vote on this matter.
People did not want the referendum, and the cost – at a time of cuts to many social services and lack of funding for new anti-cancer drugs – rankled with many.
But vote we did. Over two million New Zealanders.
Not because we wanted to.
But so that a flag change would not be carried by a minority who were either Key-sycophants, or disliked our current flag sufficiently to vote for change, regardless of dirty political manipulations at play.
So, vote we did.
And we sent a clear message to the National government as clearly as a certain little yellow mini did, thirtyfive years ago. The message, in case anyone missed it: stop fart-arsing around!
Bolshie lot, aren’t we?
Other matters to consider: 3 – Real Change
If New Zealand is going to embrace change and adopt a new flag, it must actually mean something. It must mean a new start to building our own nationhood.
Otherwise, any flag-change – without meaningful change to back it – simply becomes a re-branding exercise. Which is precisely what our esteemed Dear Leader seems to have had in mind; a re-brand rather than a republic.
It was no coincidence that Key’s own preference was for the Silver Fern – a commercialised brand symbol on everything from the All Blacks to Air New Zealand.
This was a re-branding exercise for NZ Inc, and many (if not most) people saw through it. John Key’s seeming lack of understanding the meaning of real nation-building (see: “A matter of National identity” above) doomed his pet project from the start.
John Key is not the right person to effect this kind of sea-change in our country’s destiny. He never was.
Other matters to consider: 4 – Where were Maori, our Treaty partners?
During this entire exercise, very little – if any – inclusion of Maori culture made it to the final five designs. It is like they never existed.
And yet, there were many offerings that the Flag Selection panel could have chosen from;
Instead, the final offerings to the public were Pakeha notions of flag-design.
Perhaps it explains why the Maori electorates voted to retain ‘Old Blue‘. For them, it would be “change” that was no change at all. Sticking with the current flag, albeit with elements of musket-enforced British colonialism, was little different to alternatives on offer.
In this matter, the Flag Consideration panel was an abject failure, tainted with mono-culturalism.
Key “get’s Behind our flag” – by ignoring it!
Remember how our esteemed Dear Leader said on TV3’s The Nation, on 26 March,
“…and actually now, as a country, let’s get behind our flag.”
This is how he backed up his words on 5 April, during a press meeting;
What is on his lapel? Nothing.
That is how Key “gets behind our flag”.
The final word on this saga has to go to out-going Governor-General, Jerry Mateparae, who, on 28 March opined on Radio NZ;
“Sometimes we’ve got distracted, and that’s the nature of politics, and that’s also possibly the nature of such an important emblem of who we are – this represents us…”
Rich irony indeed; the Establishment’s figurehead complains that people were distracted from a referendum that many considered a distraction in the first place.
Electoral Commission: Second Referendum on the New Zealand Flag – Preliminary Result
Electoral Commission: 2014 General Election Official Count Results – Overall Status
Good Returns: Do not file New Zealand Superannuation just yet
TVNZ News: Two-thirds against changing flag, poll shows
NZ Herald: Poll indicates flag unlikely to change
Radio NZ: Current flag the favourite – poll
NZ Herald: How did New Zealand vote?
Wikipedia: Helensville – 2014 Election
Fairfax media: Andrew Fyfe’s Koru flag design
NZ Herald: UK forgets NZ ties, Key tells Cameron
Otago Daily Times: Asset sales referendum ‘waste of money’
Bowalley Road: Whoops And Cheers For Democracy’s Flag
No Right Turn: A referendum on John Key
The Daily Blog: Not a bad result for opponents of the colonial flag
The Daily Blog: Battle Lines: Occasional Dispatches From the Class War
The Daily Blog: Key’s Colonial Daze
The Standard: Flag distraction result today
The Standard: What the flag vote means
Previous related blogposts
This blogpost was first published on The Daily Blog on 6 April 2016.
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Truth is stranger than fiction, they say. This has been proven time and again, and perhaps none so aptly as the 2016 US Election primaries, where a billionaire has risen to political prominence;
Ooops, wrong billionaire.
I meant this one;
After all, one is supposedly “real” and the other is supposedly “fiction”. Sometimes, it’s just so damned difficult to tell which is which.
The only thing missing?
After all, if the Universe is going to foist super-villains on us, is it too much to expect a counter-balance?
This blogpost was first published on The Daily Blog on 4 April 2016.
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