Posts Tagged ‘Dear Leader’

Letter to the editor – Key suggests private providers for children in CYF services?!

4 September 2015 Leave a comment


Frank Macskasy - letters to the editor - Frankly Speaking


from: Frank Macskasy <>
to: Sunday Star Times <>
date: Mon, Aug 31, 2015
subject: Letter to the editor


The editor
Sunday Star Times


On 31 August, on Radio NZ’s ‘Morning Report’, our esteemed Prime Minister gave his strongest hint yet that parts of Child, Youth and Family could be contracted out to private providers. Key said,

“Child Youth and Family does outsource to the private sector already some contracts, and I think last year $81 million of business went to private sector contractors, so I can’t get up and say there is no involvement with the private sector, because there already is that. I don’t think we’re seriously talking about the private sector taking control of all the children, but if there is some small function they could do, maybe, I’d have to see what that is.”

The involvement of the private sector in government services, often resulting in poor outcomes and shockingly high cost over-runs, can be traced back as far as the mid 1980s with the failed INCIS police computer project contracted to IBM. Serco/Mt Eden, Talent 2/Novopay, and failed charter school Te Pumanawa o te Wairua are just some of the latest examples – that we know of.

John Key must be suffering another of his brain fades, if he has forgotten the Serco and Talent2 debacles already.

With regards to Child, Youth and Family, and the critical problems they have been facing, it defies understanding that our prime minister would contemplate, even for a micro-second, handing over aspects of support for our most vulnerable children to profit-driven corporations. If this is where New Zealand is heading, then as a nation we have truly lost the plot.

What possible benefit could a company like Serco have to offer children in State-care? Organising fight-clubs for 12 year olds?

The only solution is for the National government to cease under-funding critical social services such as Child, Youth and Family and ensure they are properly resourced; staffed; and work closely with other State agencies to achieve common goals.

Contracting out to private providers is not an answer. It is a cop-out. With vulnerable and damaged children paying the price of this lunatic idea.


-Frank Macskasy


[address & phone number supplied]





Radio NZ: Key – More CYF private sector involvement possible





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State propaganda on TVNZ – pssst, just don’t mention the war! Er, Election!

16 August 2014 2 comments




TVNZ’s Breakfast on 12 August, went from it’s scurrilous mis-reporting of the effigy burning, to sheer, naked propaganda. This time, Key put on a performance as a typical all-blokey cook-in-the-kitchen.

The programme host, Jeanette Thomas, opened with this statement – in-between eye-lash fluttering and schoolgirl giggling;

“We’re cooking with the Prime Minister, John Key. And this is alllll about getting to know yooou, and all the stuff that you do kinda behind the scenes, ’cause we’re not allowed to talk politics today…*giggle, giggle*”



TVNZ - Breakfast - cooking


Yeah, yeah, giggle, giggle, flirt…

However, one sharp-eyed viewer made this comment on his facebook page soon after the show was over;


TVNZ - Breakfast - cooking- facebook - hugh fletcher


Not quite the ordinary, blokey “man-of-the-people” after all, eh?

Question is, will TVNZ’s ‘apolitical’ Breakfast show allow equal time to Labour leader David Cunliffe? And will it be hosted by ‘impartial’ host, Rawdon Christie…?

Which brings us back to this slightly-more-serious-matter…

11 August – TVNZ Breakfast Show:

Note the  Breakfast host’s chatty “interview” between Rawdon Christie and Dear Leader John Key. Rawdon is all smiles and let’s Key speak without interuption;


TVNZ - Breakfast - kim dotcom - video - effigy - john key - burning - 2014 elections


12 August – TVNZ Breakfast Show:

The following day, TVNZ allowed Internet Party, Laila Harré, to respond. Note the combative/defensive stance  by host, Rawdon Christie;


TVNZ - Breakfast - laila harre


Laila’s “right of reply” included at least thirteen interruptions as Christie spoke over his guest within a five minute period.

It was left to the State broadcaster’s competitor, TV3, to publish a ‘retraction’ by John Key,


John Key admits effigy video not linked to Internet Mana


No apology from  Key, of course. Dear Leader does not ‘do’ apologies – unless it is “serious”.

It appears that media can broadcast or publish any old garbage with minimal recourse. Even when the target of a deliberate smear is given an opportunity to correct misinformation, the broadcaster’s representative will fight tooth and nail to justify their own misconduct.

We’ve seen it with the NZ Herald and the Donghua Liu Affair.

Interesting though that when Rawdon Christie first interviewed Key on this issue, on 11 August, he said,

“Another stunt, which may cause you slightly more concern, and that is on Cameron Slater’s WhaleOil site, recently…”

It should come as no surprise that Key and Christie were more than willing to take the blogger’s story at face value;


PM hints tip-off came from Cameron Slater


As Claire Trevett wrote in February this year,

[Key]...would not confirm it was Mr Slater, but said he did speak to Mr Slater “every so often,” and had called him earlier this week during which they briefly discussed Kim Dotcom. He said that did not mean he agreed with everything Mr Slater wrote on his blog. “I speak to lots of blogsters [sic].”

Such is the unholy relationship between the National Party and far-right, sleaze merchant, Cameron Slater – along with media connivance for an “easy story”.

Though this time I suspect Key and TVNZ may have ended up with some egg on their faces.

Anyone for some fried eggs’n’effigies?




TVNZ: Good Morning –  John Key in the kitchen

TV3: John Key admits effigy video not linked to Internet Mana

Facebook: Hugh Fletcher‎ – Good Morning

TVNZ: Internet-Mana denies involvement in PM burning effigy video

Fairfax media: Internet Mana anger over Key effigy claims

TVNZ: Good Morning – Laila Harre attacks PM for effigy video ‘slur’

NZ Herald: PM hints tip-off came from Cameron Slater

Previous related blogposts

The Donghua Liu Affair – Damn lies, dirty tricks, and a docile media

The Donghua Liu Affair threatens to unravel – PM and NZ Herald caught up in a dirty trick campaign?

The Donghua Liu Affair – the impending final act and curtain-fall in this smear-campaign

The Liu Affair: The first step to a complaint to the Press Council

The Donghua Liu Affair: responses from NZ Herald and Prime Minister’s Office – Is the PM’s office fudging?

The Mendacities of Mr Key #6: When apologising to a victim of violence is not considered “serious”

Other blogs

The Daily Blog: Just spoke to Electoral Commission – there’s been a complaint re the Planet Key satire song, they will declare if it’s banned this afternoon





john key is scared of your vote

Above image acknowledgment: Francis Owen/Lurch Left Memes

This blogpost was first published on The Daily Blog on 13 August 2014



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Letter to the Editor: What is the price of justice? (In dollar terms)

28 February 2014 2 comments




FROM: 	"f.macskasy" 
SUBJECT: Letter to the ed
DATE: 	 Fri, 28 Feb 2014 11:52:01 +1300
TO: 	"Dominion Post" <>

The Editor  
Dominion Post


Revelations that Peter Whittal's solicitor, Stuart Grieve,
made a $3.41 million payment to Crown Law in return for
dropping all charges in the Pike River Mine court case are
an incredible, jaw-dropping, new development for our
judicial system.

According to Mr Grieve's remarks on Radio NZ (27 Feb), it
would appear that the Solicitor General was involved in this
backroom deal making.

So for John Key to suggest, 

"My understanding is no, it was an unsolicited letter. They
looked at lots of different factors but in the end they
could have spent millions and millions and millions with the
lawyers and actually got nowhere - or practically make a
payment to the families, which made more sense."

- is a cynical attempt to trivialise a clearly dangerous
precedent that  undermines our justice system.

If justice can now be purchased in New Zealand, when will
John Key's government issue an Order in Council publishing a
tariff chart for payments to drop Court cases, calculated
according to the severity of charges? 

And will there be a bulk discount for multiple charges?

-Frank Macskasy
(address & phone number supplied)





Radio NZ:  Pike families convinced deal was done

Previous related blogposts

Purchasing “justice” on the New Zealand open market – did National sell Pike River victims out?



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A Tale of Two Prime Ministers…

What we once had…




And what we have now…






Government told there’s no excuse for child poverty

3:23 PM Saturday Jul 20, 2013
Photo / Getty Images  

Photo / Getty Images

The government’s being told there’s no excuse for its failure to act on the high number of children living in poverty.

The Child Poverty Action Group says latest figures show one quarter of all New Zealand children are living below the poverty line.

Its convener, Associate Professor Mike O’Brien, says that hasn’t changed from a year ago.

He says that may not be surprising, as the government hasn’t done anything to make any difference.”We’ve seen enough material from a whole range of sources to know the extent of child poverty and I guess I would have expected there would have been really concerted effort from the government to respond to some of those reports and the data that we now have.”

Dr O’Brien says New Zealand’s high rate of child poverty damages the country’s international reputation.

Source: NZ Herald – Government told there’s no excuse for child poverty


As the next election looms, it is time to mobilise and fight. We can have a decent society again. And by god, I’ll be doing my bit.




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“Moral mandates”, “mass medication”, and Mayors vs Ministers


“Moral mandates”


Nats look to 2014 governing options

Acknowledgement: Fairfax Media – Nats look to 2014 governing options


What was that about “moral mandate”, Dear Leader?

Key said the largest party had the “moral mandate” to govern.

“If National was to go out there and poll 46 per cent or 47 per cent – very similar to the result in 2011 – and not form the Government I think there would be outrage in NZ.”

So Key now believes in large numbers and percentages?


Because he certainly paid no heed to the Will of the Electorate when the majority (up to 75% in some polls)  opposed partial privatisation of   State assets.

Nor did Key pay any attention to  the finer points of the results of the  2011 election.  The majority of Party Votes  went to  parties opposing  asset sales,


National , ACT, United Future Party Votes Labour, Greens, NZ First, Maori Party, Mana, and Conservative Party votes

National – 1,058,636

Labour – 614,937

ACT – 23,889

Greens – 247,372

United Future – 13,443

NZ First – 147,544

Maori Party – 31,982

Mana – 24,168

Conservative Party* – 59,237

TOTAL – 1,095,968

Total – 1,125,240


So even though the Conservative gained no seats in Parliament (*because of the 5% threshold),  they gained over double the electoral-support for ACT. The Conservative Party, it should be noted, opposed asset sales.

It certainly did not matter to Dear Leader on the issue of public opposition to asset sales. He was more than willing to ignore the majority of New Zealanders who opposed his privatisation agenda.

Key’s claim that “morally” he should lead the next government post-2014 because National may be the largest Party  in Parliament – he should remember one thing;  size doesn’t always count.

Key’s assertion  on having a so-called “moral mandate” to govern post-2014, is  obviously a  message directed at  Winston Peters.

His message to Peters  is simple – ‘if we’re the biggest party, then we are the rightful government. And we will push this meme in the public consciousness which will make life difficult for you if you don’t co-operate’.

This is the kind of deviousness which National’s party strategist (taxpayer funded, no doubt) has come up with, to ensure a third term for John Key.

It now falls upon Peters to see if he’ll cave to pressure from the Nats.

Other Blogs

The Standard:  Moral mandates

The Pundit:   On coming first, yet losing



“Mass medication”


Radio NZ logo - Jim Mora's 4-5 Panel Edwards Boag


A curious event took place on Monday 1 July on Radio NZ’s Jim Mora’s panel…

His guests that afternon were left-wing, Labour supporter, Dr Brian Edwards and right wing, National supporter, Michelle Boag.

One of the topics of discussion was fluoridation of  urban water supplies. As is usual on issues like this, the debate became passionate.

But curiously, it was the position taken by each guest, Brian Edwards and Michelle Boag, that I found curious.

Usually, a left-winger will argue from a position of Collective action and responsibility. Like the issue of Food in Schools, the Lefts supports the stance that raising children, and ensuring their well-being, is a community responsibility.

The Right usually argues from a position of Individual choice  and responsibility. On the issue of Food in Schools, the Right reject any notion of collective responsibility and instead hold to  total parental responsibility as a default position.

I expected the same in the fluoridation debate between Brian and Michelle – only to find their positions reversed.

Brian was advocating from a Libertarian position of individual choice. He opposed flouridation.

Michelle was supporting the Collectivist position for a socialised benefit. She supported flouridation.

Their debate can be heard here:

Quicktime - Radio NZ - Jim Mora - 1 July 2013

Such complex creatures we humans are…


Mayors vs Ministers


Eqypt is not the only country wracked with coup d’états.

On  30th March 2010, National seized control of Environment Canterbury, postponing elections, and three weeks later appointing seven, un-elected Commissioners to run the body. The new Commissioners  were vested with new powers to  implement regional plans for Canterbury that could not appealed to the Environment Court (except to the High Court on points of law).

Roger Young, a trustee of the Water Rights Trust,  suggested one of the prime movers for central government seizing control of ECAN was the vexed problem of water rights in the Canterbury region,

After the commissioners’ own recommendations for a mixed member governance model at ECan post-2013 were ignored by the government, we see ECan now as simply a puppet to the bidding of a government which appears determined to increase irrigation and intensive farming in Canterbury despite the first order priorities in the Canterbury Water Management Strategy.

The slow pace of change behind the farm gate means that we will still have rising stocks of dirty water at a level that will haunt Cantabrians for decades.”

Acknowledgement: NBR – ECan ‘just a puppet to government bidding

The Canterbury Central Plains Water project is a half-billion dollar project, and National Ministers wanted to ensure that the money was spent according to their agenda. As we all know, farmers tend to vote National.

Three years later, and National has extended it’s power in the Canterbury region  “to oversee the Council’s consents department”. We are told that this was by invitation by the CCC.  I am reminded of puppet regimes that, once installed by a Super Power (former-USSR, US, China, etc) , duly “invited” their sponsor to send troops to help prop up the proxy government.

Was the Christchurch City Council “persuaded” by Gerry Brownlee to  “invite the Minister for Local Government, Chris Tremain, to put in place a Crown Manager to oversee the Council’s consents department“? Were there back-room dealings where Mayor Bob Parker was issued an ultimatum by Brownlee;

‘Invite us to take over; save face; and save your arse at the up-coming local body elections – or we’ll take over anyway; you have egg on your face; and Lianne Dalziel takes over as Mayor in October – Your call.’

Is that the discrete conversation that took place between Bob Parker and Gerry Brownlee?

I suspect so.

Central Government: 2

Local Government: nil

Another recent announcement had John Key confirming central government’s support for Auckland Council’s rail loop and other transport plans.

Len Brown was, understandably, ecstatic. Christmas has come early for the Auckland Mayor,

I am delighted the government has agreed to support this project

I want to acknowledge Aucklanders for being very clear in their support for this project.”

However, the Nats are not ones to offer something without expecting something else in return,


City's shares eyed for rail

Acknowledgement: NZ Herald – City’s shares eyed for rail


So central government will pay up a few billion bucks to upgrade Auckland’s transport system – but the Nats expect Auckland City to privatise their community owned assets?

Cheeky buggers.

Draw: 1 all

When it comes to Nanny State, National out-performs the previous Labour government in spades. Labour hardly ever engaged to this degree of interference in local government affairs.  Executive power under National is growing, and impacting more on our lives.

With National intending to increase the powers of the GCSB and force telecommunications companies to store and hand over data to police and the spy agencies, the state’s influence in our lives grows day by day.

By comparison, Labour was practically a hands-off, “libertarian” style government.

This blogpost was first published on The Daily Blog on 5 July 2013.



References  Environment Canterbury elections cancelled as commissioners appointed (30 Match 2010)

Fairfax Media: Environment Canterbury commissioners named (22 April 2010)

Ministry for Primary Industries:  Government funding for Central Plains Water Irrigation (18 Feb 2013)

NBR: ECan ‘just a puppet to government bidding’ (14 March 2013)  Auckland Mayor celebrates Government’s agreement to support rail loop (26 June 2013)

NZ Herald:  City’s shares eyed for rail (1 July 2013) PM Key says IANZ decision to strip Christchurch Council of consenting power is ‘unprecedented’ (1 July 2013)

Christchurch City Council:  Council to invite Crown Manager to oversee consenting  (3 July 2013)



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Facepalm #4: John Key (again)

From a speech John Key made in January 2008


"Well, I've got a challenge for the Prime Minister.  Before she asks for another three years, why doesn't she answer the questions Kiwis are really asking, like... [...]    Why are grocery and petrol prices going through the roof?"

“Well, I’ve got a challenge for the Prime Minister. Before she asks for another three years, why doesn’t she answer the questions Kiwis are really asking, like…
[…] Why are grocery and petrol prices going through the roof?”

Acknowledgement:  SPEECH: 2008: A Fresh Start for New Zealand


Five years of National government later,


NZ petrol prices reach record high

Acknowledgement:  NZ Herald – NZ petrol prices reach record high


Yes, Dear Leader – Why are grocery and petrol prices going through the roof ?”





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Beware of unstable government!

27 June 2013 3 comments


John Key - Peter Dunne - John Banks


In case anyone has missed it, Dear Leader and his Ministers have been consistantly spreading the message,  warning us about the potential perils of a Labour-Green-Mana(-NZ First?) coalition government.


Only National can provide a strong stable Government that keeps debt down and delivers on jobs. The alternative is big spending, big borrowing, and huge uncertainty.  Any way you look at it – a Labour-led Government would owe our future.” – Steven Joyce, 22 November 2011


If anyone thinks Labour and the Greens are going to deliver stable government, they’d better think again.” – John Key, 19 July 2012


The sharemarket value of Contact Energy, Trust Power and Infratil shares alone fell by more than NZ$300 million yesterday afternoon. That value was taken out of the pockets of hard-working KiwiSavers, the New Zealand Super Fund and small shareholders across New Zealand. If Labour and the Greens could do that in just a few hours, imagine what they would do if they ever got near being in government.” – Steven Joyce, 19 April 2013


There is not going to be a difference between centre left and centre right; it’s going to be a Labour government dominated by the Greens.

This would be the issue of 2014 and voters needed to be aware of the differences.

All of those differences between Labour and the Greens will need to be reconciled by Election Day.

If there is to be no Transmission Gully if a Labour/Green’s Government gets in then we need to understand that; they won’t be able to fudge that.” – John Key, May, 2013


Normally, elections are fought between the centre left and the centre right. That is not what’s going to take place next year. David Shearer has cut his cloth and it is wrapped around Russel Norman … that now becomes an election between the centre right and the far left.” – John Key, 28 May 2013


Well, we’ve seen “unstability” since November 2011.

One of National’s coalition Ministers was investigated by the Police for electoral fraud, and is now before the courts facing a private prosecution, charged with filing a false electoral return.

Another coalition Minister has just resigned his portfolios after allegations that he leaked document(s) to a journalist.

And National’s other coalition partner, the  Maori Party, seems unsure how many co-leaders it has;


Three co-leaders of the Maori Party


I think from now on, Key and his ministerial cronies may lie low a bit and keep comments of “unstable government” to themselves.

Instability? We’re seeing it now, in spades.

This blogger is picking an early general election – this year.

After that, this country can settle down to a coalition government of stability. One that doesn’t include Key, Banks, Dunne, et al.

About bloody time.


The Nationalmobile




References  Labour plus Greens equals billions more debt (22 November 2011 )

Dominion Post:  Key’s game is ripping into Greens (19 July 2012)  National’s Steven Joyce dismisses Labour-Greens power policy as ‘bumper sticker politics at its most destructive’ (19 April 2013)

FW:  Key fires warning shot over ‘green-dominated’ labour (May, 2013)

ODT: And so it begins (28 May 2013)



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Project Loon…

15 June 2013 3 comments


Balloons above Canterbury to beam down wireless internet

Acknowledgement: Radio NZ – Balloons above Canterbury to beam down wireless internet


John Key…

Project Loon


Talkback Radio, Public Radio, and related matters…
Radio NZ has an annual budget of $31,816,000. Which, by the way, has not changed since 2009 – See more at:



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Solid Energy – A solid drama of facts, fibs, and fall-guys


Cast of Charachters


Clayton Cosgrove, Labour Spokesperson on State Owned Enterprises


Don Elder, CEO, Solid Energy, May 2000 – February 2013


Bill English, MP, Deputy Prime Minister, Minister of Finance and Minister for Infrastructure, Ministerial Shareholder of Solid Energy


Mark Ford, current chairman of Solid Energy


John Palmer, CEO Solid Energy, 2006 -


Simon Power, former MP; former Minister for State-Owned Enterprises, 19 November 2008 – April 2011


Tony Ryall, MP, Minister for Health; current Minister for SOEs; Ministerial shareholder in Solid Energy


Dear Leader, Minister for Funny Hats, Minister for Truth


The story, thus far



30 June 2008

Nil dividend paid to government, for year ending 30 June 2008.

Source: 2008 Annual Report



8 November 2008

General Election

National-led government elected.  John Key becomes  New Zealand’s Prime Minister; Simon Power is Minister for State Owned Enterprises; Bill English becomes Minister for Finance.



May 2009

“The Government, in its first term, looked at SOE [state owned enterprise] balance sheets and decided many of them could carry more debt… it made a decision to allow Solid Energy to take on more debt,” Mr English said.

Mr English acknowledged that in 2009 he signed a letter to Solid Energy approving a higher debt level.

Source:  Solid Energy was allowed to increase debt

The letter, as follows,


letter from Simon Power to solid energy may 2009

Source: CCMAU & Treasury


Thus was set in motion a decision that would have serious consequences four years later; the near collapse of an efficient and highly profitable State Owned Enterprise.

Not only did Minister Power demand higher dividends from Solid Energy, and instructed the SOE to borrow heavily  to achieve that goal, Power also demanded that Solid Energy “release all surplus capital to the shareholder as special dividends“.

In case the reader is wondering that that means, in plain english, National Ministers wanted all spare cash to be handed over to the government.

They were looting SOEs.

Accordingly, Solid Energy’s gearing ratio rose from 13.8% cent in 2009 to 41.7% by 2012. National’s demands had been met (see: Ministers pressured Solid Energy, Parliament told ).

Mission accomplished – the pillaging of Solid Energy (and other SOEs)  had begun.

Note: On 26 February 2013, John Key would try to insist that Solid Energy was “out of control” and was borrowing wildly.

He would say, “the Government was worried about Solid Energy’s ambitious investment plans and rosy view of coal prices as far back as 2009 but was unable to order the company to steer a safer course.”

So not only did SOE Minister Simon Power direct Solid Energy to borrow more; pay higher dividends; and hand over all spare cash – but four years later, Key would blame the coal company for the consequences;  it’s inevitable financial melt-down,

The causes of the financial crisis at Solid Energy are the usual suspects in failing businesses – too much debt, unsuccessful investments and no reserves to weather a slump in coal prices.

Prime Minister John Key’s comments yesterday indicated these problems and pointed the finger at an imprudent amount of debt and investments that have not returned any cash yet.

Key said the debt had climbed to $389 million when “typically coal companies do not have a lot of debt on their balance sheets”.

Source: State miner to return to coalface

Powers’ letter also put the lie to National ministers claiming that they were powerless to intervene in Solid Energy’s activities. As Simon Powers’ letter clearly demonstrated, Ministers were  exhibiting a total hands-on control over SOE’s finances, borrowings, investments, and dividend payments.

As Key himself claimed (without evidence) on 25 February 2013,

The government blocked proposals in 2009 from its coal mining company Solid Energy for a billion dollar capital injection to allow it to become “the Petrobras of this country,” Prime Minister John Key says.

National ministers had control alright, no two ways about it.

Power might as well have been sitting in Solid Energy’s Christchurch head office, in the CEO’s chair, with  his fingers in the cash register till.



30 June 2009

$59.9 million dividend paid to government, for year ending 30 June 2009.

Source: 2009 Annual Report



30 June 2010

$54 million dividend paid to government, for year ending 30 June 2010.

Solid Energy paid a dividend of $24 million on 30 September 2009. In accordance with the company’s dividend policy, the Board is proposing a dividend of $30 million to be paid by the end of March 2010 bringing total cash dividends paid during the current financial year to $54 million.

Source: Small half year loss for Solid Energy

Source: 2010 Annual Report



27 August 2010

Treasury Report shoots down Solid Energy National Resource Company’s expansion  proposal

To: Bill English, Gerry Brownlee, Simon Power, Steven Joyce

5. In order for SEL to develop into a NRC, SEL has sought the following:


• indicative approval for total capital investment (including dividends and cash flow)
of $2-3 billion per annum with cumulative investment of $27 billion…

Source: Treasury Report: Solid Energy National Resource Company Response

Note the figure referred above: $27 billion.  Two and a half years later, Key would refer to that figure.

The question is, does the statement – “SEL [Solid Energy Ltd] has sought the following: indicative approval for total capital investment (including dividends and cash flow) of $2-3 billion per annum with cumulative investment of $27 billionactually state where the $27 billion would be sought from?

Answer: no.

And yet, by 15 March 2013, Key would insist that the Solid Energy chairman, John Palmer, sought $27 billion from the government.

See: Key says Solid Energy papers show $27b plan

John Key’s flexibility with truth is now legendary.



8 September 2010

Then-SOE Minister Simon Power writes to Solid Energy – states support for developing resources –


Office of Simon Power
MP for Rangitikei
Minister for Justice
Minister for State Owned Enterprises
Minister of Commerce
Minister Responsibilble for vthe Law Commission
Associate Minister of Finance
Deputy Leader of the House

08 SEP 2010

Mr John Palmer
Solid Energy New Zealand Ltd
PO Box 1303

Dear Mr Palmer

National Resource Company (NRC) Proposal

I would like to thank you and your Chief Executive, Don Elder, for meeting me
on 31 August 2010 to discuss the Government’s response to the Solid Energy
Ltd (Solid Energy) NRC proposal.

Ministers are encouraged by the vision of Solid Energy in developing the NRC
proposal. We also appreciate the efforts of the Solid Energy Board,
management and staff that have gone into preparing  the proposal.

Shareholding Ministers have carefully considered the proposal and at this stage
do not support the development of a single NRC to maximise the value of New
Zealand mineral resources.

Shareholding Mnisters are, however, supportive of Solid Energy developing its
current natural resources, including lignite and unconventional gas. As
discussed with you, we expect that Solid Energy will develop resources on a
project by project basis.

We also expect to be consulted on significant projects, and have the opportunity
to discuss the proposals with you. The proposals should be supported by a
business case and assessed against standard business case investment

Yours sincerely

Hon Simon Power
Minister for State Owned Enterprises

cc: Don Elder, Chief Executive Officer, Solid Energy

Source: Letter from Simon Power to John Palmer (NZ Herald website)

Interesting…  The Minister, Simon Power,  was;

A. Supportive of Solid Energy “developing its current natural resources, including lignite and unconventional gas. As discussed with you, we expect that Solid Energy will develop resources on a project by project basis”. No reference whatsoever of the Minister directing Solid Energy not to invest  “developing its current natural resources“.

B. Insisting that he be kept advised  “on significant projects“.  It would be interesting to know if Solid Energy advised National ministers of all projects? Including the ones that have been heavily criticised by Key, English, and Ryall.



3 June 2011

Key endorses Solid Energy expansion plans


Prime Minister John Key speaks at the opening of the WHK building in Invercargill.


“At the moment companies like Solid Energy are growth companies and we want them to expand in areas like lignite conversion,” Mr Key said.


“We know there is lots of resource there and we know they potentially have the capability [to convert lignite to urea or diesel] and so we will see how that progresses, but the briquette plant is a good starting point.”

Source: PM backs mining south’s lignite

Key is stating  with crystal clarity;  “we want them to expand in areas like lignite conversion” and “…so we will see how that progresses, but the briquette plant is a good starting point“.

Which would be in stark contrast to Key’s statements nearly two years later, when  on 23 February 2013, he condemns Solid Energy’s “… unsuccessful investments” and  ” and pointed the finger at an imprudent amount of debt and investments that have not returned any cash yet”.

Two days later, on 25 February 2013, Keywould again condemn Solid Energy – this time specifically distancing himself from the SOE’s expansion plans,

The government blocked proposals in 2009 from its coal mining company Solid Energy for a billion dollar capital injection to allow it to become “the Petrobras of this country,” Prime Minister John Key says.

It’s hard to keep up with a Prime Minister like John Key.

You have to wonder what his views will be in three, six, or twelve months time?

Key also said  at his  Invercargill speech,

However, Mr Key said companies were controlled by Government regulations and so there were always environmental obligations that needed to be met.

Which, again, totally contradicts what he said on 26 February 2013,

The Government was worried about Solid Energy’s ambitious investment plans and rosy view of coal prices as far back as 2009 but was unable to order the company to steer a safer course, Prime Minister John Key says.

Stories, eh? They’re so hard to keep straight sometimes.



30 June 2011

$20 million dividend paid to government, for year ending 30 June 2011.

Source: 2011 Annual Report



9 September 2011

Bill English – Don Elder – Opening new Mataura briquette plant


Solid Energy chief executive, Don Elder and Hon Bill English at MatauraThe first sod has been turned in the construction of Solid Energy’s demonstration briquette plant near Mataura in Southland. This was undertaken on Friday September 9 by local MP, Bill English who is also Deputy-Prime Minister and Minister of Finance. (source)


The Hon Bill English, MP for Clutha-Southland and Minister of Finance, today marked the official start of work at Solid Energy’s Mataura Briquette Plant, by “turning the first sod” at a small event on site with neighbours, local authorities, and other guests.The $25 million Mataura briquette plant is planned to start production by June 2012. It will produce up to 90,000 tonnes a year of low-moisture and higher-energy briquettes from about 150,000 tonnes of lignite mined from Solid Energy’s New Vale Opencast Mine and trucked to the Craig Road site. The plant will use technology developed in the USA by GTL Energy.

Source: Solid Energy starts work at Mataura Briquette Plant

Which demonstrated to anyone (if demonstration was needed) that National was in no doubt about Solid Energy’s expansionary plans.



4 November 2011

Treasury Scoping study reveals Solid Energy’s financial problems to Government Ministers

Ministers were  officially  made aware of Solid Energy’s severe financial problems. This would not become public knowledge until  two years later,  on  21 February 2013.

See: Treasury Report T2011/2373: Solid Energy New Zealand Scoping Study Report

The Scoping Study is noteworthy on these points,

  1. The considerable  number of redacted items which the reader has no way of knowing what they refer to. They could be sensitive commercial data. Or they could refer to political matters.
  2. In Paragraph 36, the Report states, “The scoping study also recommends that Solid Energy should have no debt at the time of IPO.”
  3. In Paragraph 46, fourth item, the Report states, “Indentified that the company’s free cash flow has been reinvested in the business, particularly the Renewable Energy and New Developments. As a result  dividend payments to the government have been funded by increasing debt.”

In two sentences, Treasury has just confirmed what all the evidence has pointed to; “dividend payments to the government have been funded by increasing debt“.

The very same increased debt demanded by SOE Minister Simon Powers in his letter in May 2009.



17 February 2012

Bill English – Asset Sales – Proceeds “just a guess”

Finance Minister Bill English is attracting political flak over suggestions that some figures in yesterday’s budget policy statement for the proceeds of share floats of state-owned enterprises were “a guess”.

The Government has long estimated that the sale of up to 49 per cent of five SOEs would collect between $5 billion and $7 billion.


Mr English said the Treasury “had to pick a number” so they picked the mid-point of the range.

“If we did get $6 billion, that would be a gain of sale [of $800 million] which is just a product of the accounting.

“I just want to emphasise that it is not our best guess; it’s just a guess. It’s just to put some numbers in that look like they might be roughly right for forecasting purposes.

Source: English admits his SOE figures just a guess

Well. Now we know why it was “just a guess”.

Because by now, the Treasury scoping study on Solid Energy had revealed to National Ministers that the SOE’s finances were a mess. There was no way English could’ve responded to journalist’s queries without either telling the truth – or outright lying (which they do anyway, but he would’ve been caught out on this particular ‘porky’).



18 May 2012

Subsidy on bio-diesel canned – Biodiesel New Zealand – Price increase for bio-diesel

National removed it’s subsidy on bio-diesel – which Solid Energy was producing through one of it’s subsidiaries, as part of it’s   expansion plans.

Biodiesel prices in Queenstown are likely to rise after a Government subsidy to develop production of the fuel was scrapped.

The subsidy, worth 42.5 cents a litre, was introduced by the National-led Government in 2008, but was not renewed in this year’s Budget.

The Queenstown Biodiesel Consortium has more than 20 companies running more than 70 commercial vehicles on the fuel.

The consortium’s provider, Allied Petroleum, is supplied by Biodiesel New Zealand, a Solid Energy subsidiary that makes the fuel out of canola seed and used cooking oil, in Christchurch.

Source: Biodiesel loses subsidy, prices to rise

This thoroughly  undermined Solid Energy’s business projections for income and profits, as they could no longer rely on the subsidy to produce bio-diesel on a viable basis.

So not only were National ministers stripping Solid Energy of it’s cash reserves and demanding higher and higher dividends – they were now tying it’s hands and undermining potentially profitable ventures.

A year later, on 22 February 2013, English (as well as Key and Ryall) would be blaming Solid Energy’s financial collapse on, “… a drop in world coal prices, and spen[ding] too much investigating other sources of energy”.

It would be safe to say that undermining a company’s commercial venture, by moving the goal posts half-way through, and changing rules,  is also not particularly helpful.


23 June 2012

Solid Energy Chairperson, John Palmer resigns

John Palmer is quitting as chairman of state-owned Solid Energy because at the age of 65 he is unwilling to stay on and see it through to partial privatisation.

Mr Palmer, who is also chairman of Air New Zealand, took up a strong public position in calling for the partial privatisation of state-owned companies and he welcomed the government’s plan to sell down stakes in electricity companies and Solid Energy.

Source:  Solid Energy chairman quits over asset sales

Palmer  resigned some 18 months before his contract was due to expire. The question, as always, is,

Was he pushed?

Or did he jump?

Writing on 16 March 2013, Tracey Watkins suggested a Great Big Shove helped Mr Palmer on his merry way,

There is, of course, nothing unusual about SOE chairmen and chief executives being subjected to a lengthy interrogation. But it is rare for committees to offer a platform to SOE bosses who have been manoeuvred out of their jobs by the Government.

See: Solid questions still remain unanswered

I tend to agree with her. This has all the makings of a politically-inspired, fall-quietly-on-your-sword, exit.


SOE Minister, Tony Ryall comments on Palmer’s resignation – Acknowledges company’s developments

State Owned Enterprises Minister Tony Ryall announced Mr Palmer’s departure from Solid Energy on Friday.

“While it is disappointing to lose such a senior director, I wish to recognise Mr Palmer’s commitment to the company since his appointment in 2006, and the developments the company has made under his leadership,” Mr Ryall said.

Source:  IBID

Two months later, Bill English would be announcing that Solid Energy had  “…some fairly substantial issues” and would not be saleable.

Another six months after that, and the sh*t would be hitting the Big Fan. “Fortuitously”, Palmer would have been long-gone by the time English announced that Solid Energy was insolvent and  $389 million in debt.

Palmer would return, however on 14 March 2013,  for an encore performance before the Commerce Select Committee, to answer some hard questions.



30 June 2012

$ 30 million dividend paid to government, for year ending 30 June 2012.

Source: 2012 Annual Report

Note that two months before English announced that  “Solid Energy faced “a number of commercial issues” and was “rethinking its business”, National ministers were  still taking dividends from Solid Energy.

Did English, Ryall, and Key not read the  2012 Annual Report which listed Solid Energy  posting a Net Profit after Taxation (NPAT) of  a  $40.2 million loss – on Page 2, under bold headlines, “FINANCIAL PERFORMANCE“???

Even though he maintains that “we wouldn’t be planning to float it any time soon”, they were still taking money out of what would prove to be a financially stricken company. This alone indicated that English and Ryall were being financially irresponsible in their role as Ministerial shareholders. As such,  Key was either ignorant of what was happening under his nose, or was irresponsible in not taking action.

Perhaps his adopted affectation as a “typical, non-political kiwi-bloke” who didn’t get his hands dirty with politics; grinned and shrugged off problems; and left matters to his sub-ordinates – had become a dangerous vulnerability for him? (See Tim Selwyn’s blogpost on John Key’s political/management style:  Rudderless Within The Great Game)

Either way, 30 June 2012 is an important date. This is when National Ministers should’ve known that something was seriously amiss.



21 August 2012

English announces “issues” with Solid Energy

In August 2012, Bill English announced that Solid Energy had  “…some fairly substantial issues” and was not ready for sale.

Solid Energy “certainly isn’t” in shape for a partial sell-down, Finance Minister Bill English says.

English today said Solid Energy faced “a number of commercial issues” and was “rethinking its business”.

“We would only take any of these companies to the market if they are in good shape for investment and Solid Energy right now certainly isn’t. It’s got some fairly substantial issues that they have signalled. Whether it ends up being able to be floated would depend on whether they can get in suitable shape for public investors,” English said.

“We wouldn’t be planning to float it any time soon.


English said Solid Energy needed to be in “considerably better shape than it is now” before it could be floated.”

Source: English: Solid Energy not ready for sale

Perhaps National Ministers should have keep their fingers out of  Solid Energy’s petty cash box?



9 September 2012

Coalminers redundancies – $200 million revenue shortfall – first mention of a ‘bailout’

Steven Joyce says Government capital for Solid Energy has not been ruled out.

The minister met with the company’s group manager of coal on Friday to discuss the situation. Mr Joyce says he has not promised a bailout, but if Solid Energy has a good business plan there may be funding options.

“Ministers get approached by state-owned enterprises to invest capital at different times. The thing that they would be interested in would be what’s the reason for doing it and what’s the opportunity.

“There’s a number of things that are up in the air with Solid Energy’s business plan at the moment that they need to work through with the new chair.”

Source: No decision on Spring Creek workers – Solid Energy

If National bailed out Solid Energy, they would  – in effect – simply be returning the dividends and spare cash that Simon Powers demanded way back in May 2009.

It would not be “new” money. It would be giving back what was looted from Solid Energy’s coffers, as National desperately tried to balance the government’s books, and return to surplus by 2014/15.

This entire sad, incompetant, wasteful,  exercise has provided no  benefit to anyone. National Ministers have ended up looking inept, manipulative, deceitful, and grasping. All for what?

The sole outcome has been to damage the reputations of businessmen who were hired for their business acumen (and who had been successful in their own fields), and destroy the name of Solid Energy.

In a bizarre twist, by sending Solid Energy into near-bankruptcy, National successfully delayed the partial privatisation of that SOE. Something that asset-sale opponants would welcome with delight.



21 February 2013

Solid Energy in crisis – debt revealed to the public

The depth of Solid Energy’s financial woes have been laid bare with the Government confirming the company is in talks with bankers over its debt levels.


State-owned Enterprises Minister Tony Ryall said a number of factors had weighed against the company, in particular world coal prices dropping by 40 per cent.

“It is facing very serious financial challenges,” Ryall said.

Ryall declined to say whether Don Elder received a payout on his departure as chief executive on February 4.

Solid Energy’s debt stands at $389 million and its interim result, which is due shortly, will show additional losses.

Earlier this week Prime Minister John Key said it was very unlikely Solid Energy would be sold in the near future.

Source: Solid Energy in debt crisis talks

Time to duck – the poo has hit the fan.

Watch Ministers scurry for cover; invent fictitious tales; and blame anyone/anything they can think of. John Key’s fingers will be moving at supersonic speeds, pointing at others, to apportion blame.



22 February 2013

English blames Solid Energy management, bonuses, coal price fall, and expansion projects

Mr English said Solid Energy’s woes have two primary causes: it failed to predict – and adjust to – a drop in world coal prices, and spent too much investigating other sources of energy.

“Four or five years ago they set out on a big programme of expenditure on alternative energy, including researching into lignite down south to coal gasification and other research-based speculation, and that hasn’t turned out the way they thought.”

Source:  No more bonuses at Solid Energy – English

And yet, English and former SOE Minister, Simon Power had actively encouraged Solid Energy to expand. (see comments 8 September 2010 and 3 June 2011)

But if there was a cause for Solid Energy’s financial woes, a $389 million debt most certainly accounted for most of it.

Even the most profitable, efficient, well-managed company will collapse if it is over-geared (borrowed too much) and too much capital is  extracted in dividends (as well as tax).

Therefore, when English blames Solid Energy’s problems on “world coal prices, and spen[ding] too much investigating other sources of energy”; and when Key and Ryall blame Labour; massive debt; bonuses; mis-management; etc – the facts  show otherwise.



23 February 2013

Key blames too much debt and unsuccessful investments

The causes of the financial crisis at Solid Energy are the usual suspects in failing businesses – too much debt, unsuccessful investments and no reserves to weather a slump in coal prices.

Prime Minister John Key’s comments yesterday indicated these problems and pointed the finger at an imprudent amount of debt and investments that have not returned any cash yet.

Key said the debt had climbed to $389 million when “typically coal companies do not have a lot of debt on their balance sheets”.

Which is  supreme irony – as nineteen days later, a letter will emerge showing that the former SOE minister, Simon Power,  instructed Solid Energy to borrow heavily and pay huge dividends to the National government. National was intent on using Solid Energy as a ‘cash cow’.

Source: State miner to return to coalface



25 February 2013

Prime Minister discloses Treasury scoping study of Solid Energy

The PM was asked when the government first became aware Solid Energy was accruing big debts, given that such businesses were not normally expected to take on large amounts of debt.

He replied that the government had undertaken a “scoping study” when they were preparing the formulation of the Mixed Ownership Model and that their examination of Solid Energy’s accounts at that time indicated a degree of poor investment, over-valuation of the expected price of coal–which neither the industry nor government agreed with—and related financial problems stemming from this.

Source: PM Press Conference Dominated by Solid Energy Debacle


Key claims Solid Energy wanted $1 billion cash injection

The government blocked proposals in 2009 from its coal mining company Solid Energy for a billion dollar capital injection to allow it to become “the Petrobras of this country,” Prime Minister John Key says.

Source: Govt blocked grandiose Solid Energy plans in 2009

Key’s claim is later rejected by ex-Chairman, John Palmer.

Documents released by Key – in an attempt to back up his claims – wound up shooting the Prime Minister in his foot. The documents do not show that Solid Energy (or it’s CEO or Board) asked National ministers for anything.  The documents show only that the government was informed that Solid Energy would have to borrow from somewhere.

As usual, Key had been bending facts to suit himself. (And he thought no one would notice?!?!)



26 February 2013

Ryall confirms Treasury  scoping study

Tony Ryall confirmed that the scoping study was carried out in “late 2011″,

Hon TONY RYALL: The member can repeat whatever he likes. The simple fact of the matter is when Ministers became aware of the issues raised in the scoping study at the end of 2011 we took the appropriate steps to address the issues that were raised. As the member knows, the company now has a new chair and new board, and we are currently dealing with the banks to resolve those issues.

Source: Parliament Hansards – State-owned Enterprises—Commercial Expertise

Despite that Treasury scoping study on 4 November 2011, National was still extracting dividends from Solid Energy, right up to 30 June 2012 ($ 30 million).


Key blames Labour

He said his support for the project in 2011 came four months before a scoping study revealed the true state of Solid Energy’s financial woes, and the former Labour government needed to take some responsibility for the situation.

“They can’t wash their hands that from 2003 on they were intimately involved when they purchased the land for lignite,” Key said.

Source: Govt forced to defend handling of Solid Energy


How far back does this man want to go in history as he tries to deflect responsibility for his government’s incompetance? It seems strange, but one gets the distinct feeling that John Key never learned how to take personal responsibility as a child.

Continually blaming others is not the mark of a mature individual. After a while, the public begins to notice.


Key blames Solid Energy’s expansion plans

Mr Key says his Government was cautious about Solid Energy’s expansion and said it could “take some baby steps”.

Really? Key’s government was “cautious”?

Funny, that’s not how it looked on 8 September 2010, when then-SOE Minister, Simon Power, endorsed Solid Energy’s expansion plans in a letter, stating,

Shareholding Mnisters are, however, supportive of Solid Energy developing its
current natural resources, including lignite and unconventional gas. As
discussed with you, we expect that Solid Energy will develop resources on a
project by project basis.

Or on 3 June 2011, when John Key supported Solid Energy’s expansion, when he gave a speech in Invercargill,

“At the moment companies like Solid Energy are growth companies and we want them to expand in areas like lignite conversion.

We know there is lots of resource there and we know they potentially have the capability [to convert lignite to urea or diesel] and so we will see how that progresses, but the briquette plant is a good starting point.”

Or on 9 September 2011, when,

The Hon Bill English, MP for Clutha-Southland and Minister of Finance, today marked the official start of work at Solid Energy’s Mataura Briquette Plant, by “turning the first sod” at a small event on site with neighbours, local authorities, and other guests.


Key blames inability to control Solid Energy

The Government was worried about Solid Energy’s ambitious investment plans and rosy view of coal prices as far back as 2009 but was unable to order the company to steer a safer course, Prime Minister John Key says.


But after getting advice on the company’s plan, Mr Key said his Government rejected it, “but of course under the SOE Act the company had the right to draw down debt and make investments and could do that without reference to the shareholder”.

Source: Govt worried about Solid Energy in 2009

Two things jump out about that statement,

A.  If  National ministers were so “worried about Solid Energy’s ambitious investment plans ” – why did they not change the Board of Directors? Or issue a new Ministerial Directive?

After all, Simon Power did just that in a letter dated 8 September 2010 (see above), when he issued an instruction to Solid Energy’s Chairman, John Palmer, not to proceed with a specific expansion plan,

Shareholding Ministers have carefully considered the proposal and at this stage
do not support the development of a single NRC to maximise the value of New
Zealand mineral resources.

B. Why did Tony Ryall acknowledge “Mr Palmer’s commitment to the company since his appointment in 2006, and the developments the company has made under his leadership” on 23 June 2012, when John Palmer stood down as Solid Energy’s chairperson – if  “Government was worried about Solid Energy’s ambitious investment plans and rosy view of coal prices as far back as 2009…“?

C.  How can Key state that “the Government was … unable to order the company to steer a safer course” – when legislation states otherwise? As the Crown Ownership Monitoring Unit (COMU) states,

Most SOEs are subject to ministerial direction in relation to the content of certain aspects of the company’s Statement of Corporate Intent and the level of dividend payable to the Crown. Shareholding Ministers may remove board members by shareholder resolution under the Companies Act 1993. Under the Companies Act 1993, an alternative process may be followed if allowed by the company’s constitution.

Source: COMU: State-Owned Enterprises

As stated above, then-SOE Minister Simon Power did just that: issued a Ministerial Directive.

Of course, “steering the company to a safer course” should have included reducing National Minister’s demands for hefty dividends.

That might have helped.

Either Key is grossly ignorant about SOEs and their ministerial oversight – or once again he’s deliberately misleading the public to suit himself.


Key Blames Solid Energy

At that point, the company approached his Government seeking a capital injection “in the order of about a billion dollars to turn this company into the [Brazilian state-owned energy company] Petrobras equivalent in New Zealand”, Mr Key said.

Source: IBID

As a 27 August 2010 Treasury report – released on 15 March 2013 – showed,  Key’s claim that Solid Energy approached the government for “a billion dollars to turn this company into the [Brazilian state-owned energy company] Petrobras ” would prove to be false.

As ex Chairman John Palmer was to tell the Select Committee on 14 March,

“Were we talking to the Government about the possibility of capital and receiving that from the Crown? The answer is no.”



14 March 2013

Former chairman John Palmer  and CEO, Don Elder appear before Commerce Select Committee

Now we start to hear the “other side” of the story – and much of it conflicts with what we’ve been hearing from English, Key, and Ryall.


National confirms big dividends paid out

For the first time it is publicly acknowledged – Solid Energy has been used as a cash cow by National, to extract big dividends from 2009 onward,

The government concedes the pressure it put on Solid Energy to increase its debt is partly to blame for the company’s financial failures.

The state-owned coal mining company owes $389 million in debt, and is negotiating a rescue package with Treasury and banks.

Government documents reveal that in May 2009, then-State Owned Enterprises Minister Simon Power wrote to Solid Energy’s then-chair, John Palmer, saying he was disappointed its profitability and dividends were forecast to drop over the next three years.

At the same time, the government wanted the company to increase its gearing (debt to equity) levels to 40 per cent and its dividends to 65 per cent of operating cash flow.

A ministerial briefing paper shows Solid Energy’s gearing level in March 2009 was 10 per cent, and was forecast to reach 27 per cent in June 2010, while its dividend was 50 per cent.

Parliamentary Library figures show Solid Energy’s gearing leapt from 9.4 per cent in June 2008 to 34.4 per cent in 2010, dropping back to 29.6 per cent in 2011 and jumping again to 41.7 per cent in 2012 as coal prices began to slump.

Finance Minister Bill English admits the government pressure was perhaps too strong.

Source:  Govt pressure on Solid Energy revealed

National had to come clean, as ex-CEO Don Elder appeared before the Commerce Select Committee to explain what went horribly wrong at Solid Energy. National’s ministers knew that the truth was coming out, and had to pre-empt any public disclosures of massive borrowings and payments of dividends,

Mr English says there was a pushback against the debt increase from Solid Energy, which he expected Mr Palmer and former chief executive Don Elder to explain when they fronted a select committee later on Thursday.

Labour leader David Shearer says the documents show ministers had a greater degree of involvement in Solid Energy’s failure than they were publicly letting on.

Source: IBID

Push back against debt“? By now we all understand that English is lying his arse off to Heaven and back. There was no push back.

The only “push” was to increase dividend payments and gearing up to 40%.

The only reason politicians tell such howling lies is because they do not expect people to remember all the facts; to connect the dots; or for an under-resourced media to tell the whole story as a continuous narrative. Politicians expect people to forget; not hear all the facts; or become confused with too much non-contextual facts and testimony from the main players.

That’s how they get away with it; we’re not paying close enough attention.


Don Elder appears before Commerce Select Committee – Confirmation of Govt wanting Solid Energy to increase debt – endorsed expansion

Firstly,  former Solid Energy chairman, John Palmer,  publicly confirmed that the National Government,

  • wanted Solid Energy to borrow more, and pay higher dividends to government coffers,
  • endorsed Solid Energy’s expansion plans

Labour’s finance spokesman David Parker asked whether the company was in any doubt that the Government wanted them to expand production, increase debt and dividends.

Palmer said it was “self evident” that increased gearing meant increased debt.

The Government was supportive of plans to expand, including into lignite.

Palmer’s comments contradicted Bill English’s comments on 22 February 2013 and John Key’s comments reported on 23 February, 2013, where both politicians lambasted Solid Energy for high debt and expansion plans.

According to Palmer, neither English nor Key were worried about Solid Energy’s expansion programme.


Palmer said that in late 2011 or early 2012, when it was clear what was going to happen, he spoke to minister Tony Ryall about a $200m revenue hole (twice the annual profits), which would have a dramatic effect on the balance sheet.

Which ties in with Bill English’s announcement on 21 August 2012, that Solid Energy had  “some fairly substantial issues… We wouldn’t be planning to float it any time soon”.

Now we know what he was referring to: Solid Energy was broke. He knew it then, but did not disclose the full nature of Solid Energy’s status until forced  by officials.


Ex-CEO rejects Key’s assertion of Solid Energy requesting a $1 billion cash injection

“Were we talking to the Government about the possibility of capital and receiving that from the Crown? The answer is no,” Mr Palmer said.

“A specific $1 billion capital injection, I’m reasonably sure we did not ask for it in exactly those terms.”

However he said the company did have discussions with the Crown about potential large investment in lignite processing but it was also talking to potential overseas partners, “because it made no sense to us to think that Crown as the sole shareholder should finance that”.

He also said the company discussed with the Crown a national resource strategy that would have required large investment.

“My recollection is there was no dollars attached to that proposal.”

Source: Solid Energy opposed Government’s debt plan


Curious case of politicians and executives receiving identical media-coaching

Meanwhile, National’s taxpayer funded media-staff had been busy coaching politicians and company executives;


Don Elder – Blame,  “Perfect Storm”

This was the perfect storm.”

Source: Palmer: Elder deserves applause

Tony Ryall –  “Perfect Storm” – blames downturn in coal prices – blames wrong investments

“State owned enterprises minister Tony Ryall blames the distressed financial state of Solid Energy on a “perfect storm” of events.

Mr Ryall says a wrong choice of investments, along with a worldwide collapse in coal prices, led to the coal mining company’s current state.”

“A wrong choice in investments, together with the most significant collapse in world coal prices in 2012 led to a perfect storm. The perfect storm has created the situation this company is currently in,” Mr Ryall says.

Source: Ryall blames ‘perfect storm’ for Solid Energy’s crisis

Bill English  – “Perfect Storm”

On TVNZ’s Q+A, on 17 March, English refers – not once, but twice! – to the “perfect storm”,

“That’s right. Look, in retrospect, they would have been better off with lower levels of debt, but as I think Don Elder and John Palmer said at the Select Committee, the board is there to make the decisions about what the actual levels of debt are. Bear in mind, in 2011 their debt had peaked and was declining, and then they got hit by the perfect storm in 2012.”

And a moment later, again,

“…And in 2011 their debt levels were actually declining from that, and then they got hit by the perfect storm…”

Source: TVNZ Q+A

Lotsa ‘stormy weather’ around? I thought we were experiencing a drought.



15 March 2013

Palmer says  Solid Energy did not want to take on high level of debt suggested by the Treasury

 Prime Minister John Key is facing claims he misled the public after former Solid Energy chairman John Palmer said the company resisted Government pressure to take on more debt – the very thing the Prime Minister said caused the company’s problems.


Appearing the day after Labour revealed former State-Owned Enterprises Minister Simon Power told the company to take on more debt and pay higher dividends, Mr Palmer said the company opposed that request.

The debt levels or gearing suggested by Mr Power and Treasury officials were higher than “we thought was an appropriate level of gearing given the nature of the industry we were involved in”, Mr Palmer said.

Source: Key under fire over Solid Energy claims


Key claims Solid Energy wanted $27 billion

Prime Minister John Key this morning released documents detailing Solid Energy’s ambitious expansion plans which would have required capital investment of $2-3 billion a year until 2021 or a total of up to $27 billion.

Key released the papers in response to Labour’s claims he misled the public about Solid Energy approaching his Government about a $1 billion investment to become the “Petrobras” of New Zealand, a request he says his Government turned down.


Key this morning said the documents showed the proposal “absolutely required, as Treasury pointed out, somewhere between two and three billion dollars of Government money”.

Source: Key says Solid Energy papers show $27b plan

Remember the Treasury report, dated 27 August 2010, referred above? Key is saying that the Solid Energy proposals would have required “between two and three billion dollars of Government money”.

Yet the 27 August 2010 Treasury report said nothing of the sort. Solid Energy could have obtained that money from the same commercial sources  it was already borrowing from.

And don’t forget, Solid Energy had already been borrowing significant amounts – pushing it’s ‘gearing‘ (debt to equity ratio) up:

Solid Energy’s gearing ratio [borrowings] was 13.8 per cent in 2009, but that rose to 34.4 per cent in 2010 and 41.7 per cent last year.

Source: Ministers pressured Solid Energy, Parliament told

To this day, Key continues to mis-represent the truth.


Key – Solid Energy wanted foreign investment and shareholders

“Key this morning said the documents showed the proposal “absolutely required, as Treasury pointed out, somewhere between two and three billion dollars of Government money”.

He said Palmer proposed selling a stake in Solid Energy to an offshore cornerstone investor “and that would involve taking more than 10 per cent of the company and not putting mums and dads first.”.

“I made it quite clear to him that we had campaigned on a mixed ownership model which didn’t involve someone having more than 10 per cent in the company”.

Solid Energy’s proposal “didn’t involve a situation where kiwi mums and dads would be first and so the only way to get that money was through the Government.”

Source: Key says Solid Energy papers show $27b plan

Now this is yet another contradiction from Key. First he tells us that Solid Energy executives wanted $1 billion (or was it $27 billion?) from Government.

But in the next breath – on the same day – he say Solid Energy wanted foreign investors/shareholders to buy 10% stakes in the SOE.

So which was it Dear Leader?! Government funding? Foreign investors/shareholders? Pixies at the bottom of the garden?

One can only conclude that former CEO, John Palmer, was correct, when he rejected any assertions that Solid Energy was looking to borrow money from government,

“I cannot recall that we have ever asked him explicitly for $1 billion dollars.”

Source: Key Must Front Up With $1 Billion Evidence

It was also interesting to note that Key derided Solid Energy’s plans for 10% foreign investors/shareholders blocks by stating that it contravened National’s policy of putting “kiwi mums and dads would be first“.

Which contradicts a statement that John Key made in a speech in 2005, on 4 March, where a private partner was something that National would welcome,

“In respect of Solid Energy, if an opportunity arose to introduce a private sector partner, we would consider that seriously.”

Source: John Key Speech: State Sector Under National

And how does Key reconcile that with other Public Private Partnerships (PPPs) such as Wiri Prison,

Corrections Minister Anne Tolley says a contract has been signed allowing the SecureFuture consortium to design, finance, build, operate and maintain the new 960-bed public-private partnership (PPP) prison at Wiri, South Auckland.

The new prison will deliver value for taxpayers and support the Government in reaching the target of a 25 per cent reduction in reoffending by 2017.

The 25 year contract is worth approximately $840 million, which is 17 per cent less than if the prison was procured through conventional means, representing a $170 million saving for taxpayers.

Fletcher Construction will build the new facility which will be operated by Serco and maintained by Spotless Facility Services. Construction will begin soon, with the prison set to open in 2015.

“The PPP will allow Corrections to draw on the experience and expertise of SecureFuture’s international partners,” says Mrs Tolley.

Source: Beehive – Contract signed for new PPP prison at Wiri

How many “mums and dads” invested in Wiri Prison?

There are many more PPPs of this nature where “mums and dads” have nil investments, and instead are the sole preserve of corporate investors – many from offshore.


Palmer denies Solid Energy wanted to borrow $1 billion from government

“Were we talking to the Government about the possibility of capital and receiving that from the Crown? The answer is no,” Mr Palmer said.

“A specific $1 billion capital injection, I’m reasonably sure we did not ask for it in exactly those terms.”

Source: IBID

Palmer is correct. According to the 27 August 2010 Treasury Report (referred to above),  Solid Energy did not ask Government for that money. The money could have been borrowed from any source – just as Solid Energy had already been doing.

This was also confirmed by a spokesperson for Bill English,

“We told them all to improve their performance and that, if they wanted to expand, they had to pay for it off their own balance sheet, rather than asking the cash-strapped taxpayers for money.”

Source: Ministers pressured Solid Energy, Parliament told

So it has becoming apparent that our Dear Leader Key is attempting to re-write recent history to suit his own agenda by shifting the blame elsewhere…


Key attempts to spin Assumption into “Fact”

“I think it is pretty self explanatory that when you come to the Government with such a very large proposal, we’re the 100% owner, that’s what’s required.”

Source: Details of Solid Energy’s expansion bid released

So let’s get this straight…

(i)  Solid Energy management presented  an expansion plan to National Ministers

(ii) The plan includes figures for said-expansion.

(iii) National Ministers had been encouraging of Solid Energy’s expansion plans (see comments 8 September 2010 and 3 June 2011)

(iv) There was no mention made of where borrowings would be made from – though up till now, Solid Energy had borrowed from private sources, and not the Crown. (See comments 27 August 2010)

(v) And from all that, the Prime Minister suggested that “ it is pretty self explanatory that when you come to the Government with such a very large proposal ” that Solid Energy expected finance from the  Crown?

I have one question: how on Earth did Key manage to amass a personal wealth of $50-$55 million when he  makes up  such fancifuul  “leaps of logic”?!?!


And the cover-up starts?

The head of the committee that grilled Solid Energy’s former bosses says he is unconvinced a full inquiry is needed.

Opposition MPs are pressuring for a full inquiry into the collapse of the state-owned coalminer, which is now reliant on government support to manage its $389 million debt pile.

Commerce select committee chairman Jonathan Young allowed yesterday’s appearance by former Solid Energy chairman John Palmer and former chief executive Don Elder to run for an hour longer than was originally expected.

Young, the National MP for New Plymouth, said this morning that he believed the committee now had “a very clear picture” of what had happened to Solid Energy, which was hit by falling coal prices, a strong New Zealand dollar and poor investment decisions.

In recent days it has emerged that the Government leaned on the company to take on more debt, after it warned it may pay less dividends.

Young said that “in hindsight we can look back and see if they didn’t have debt they would be in a better situation”.

Despite this, Young said he was yet to be convinced that a full select committee inquiry was needed into the collapse, saying there were “multiple levels of inquiry” already under way, with the company talking to its financiers, and the Government “looking at all of the issues”.

He told TV3′s Firstline: “I am personally yet to be convinced that we are going to uncover anything new or different that wouldn’t be uncovered” anyway.

Source: Solid Energy probe call rejected

“…the National MP for New Plymouth, said this morning that he believed the committee now had “a very clear picture” of what had happened to Solid Energy…”

That statement boggles the mind; drops the jaw to the ground; and is so, so, wrong on many levels. But wholly expected from a National member of Parliament; chairing a Select Committee; stacked with five National MPs out of nine committee members (see: Commerce Select Committee members); supposedly ‘investigating’ wrong-doing/ineptitude by National ministers.

Let’s see… what part of that is wrong? A government investigating itself and coming up with a verdict of nothing-to-see-here-folks-move-along-please? How is Young’s assertion that the Government was “looking at all of the issues” supposed to reassure us?! By what measure of common notions of justice is a  Government  “looking at all of the issues” supposed to be a non-partisan, transparent, and objective investigation into this issue?

It would be like directors of failed companies (many of whom are either in jail or waiting to be tried in Court or sentenced) investigating their own actions and coming up with the same comments as Young made,

“In hindsight we can look back and see if they didn’t have debt they would be in a better situation…”

Directors are “looking at all of the issues”.

“We are  personally yet to be convinced that we are going to uncover anything new or different that wouldn’t be uncovered”

Yeah, right, Mr Young. You can stop putting lipstick on that pig.

Listening to  the main players – especially John Key, Bill English, and Tony Ryall – there are too many conflicting statements to believe that an Inquiry is not needed. National ministers are simply unable to get their stories straight and have contradicted each other (and themselves) on numerous occassions.

Young asserts that the committee now had “a very clear picture” of what had happened.


The only thing even remotely “clear” about all this is that remains remain to be asked – and answered.

As Tracey Watkins wrote on 16 March 2013,

“But something clearly went seriously wrong if those talks were not enough to stop the collapse of an SOE on an unprecedented scale.

Beneath the flurry of claims and counter claims that is the question which has still not been properly answered.”

See: Solid questions still remain unanswered




17 March 2013

Bill English – TVNZ Q+A

The following is a transcript from  Corin Dann interviewing Finance Minister (and half shareholder in Solid Energy) on 17 March 2013,


All right, if we could move on to Solid Energy. Can you give us an update on where things are at with the banks? When will we know whether the government is going to have to bail out Solid Energy?


Well, that will be some months yet. There’s discussions going on with the banks now about stabilising Solid Energy. Some of the information around its cash flows is a bit more positive than we might have expected. But we will get a period of two to three months through to the end of June where we can look at all the options for recovering value for the taxpayer in the first place and, secondly, to decide whether there is an on-going viable business in the middle of this-


Are you saying it’s making a bit more money than you thought now and that it might be able to get itself out of trouble?


Well, I wouldn’t go that far. All I’m saying is the cash flow numbers are just a bit more positive than we expected. I mean, if you look back, Solid Energy made some very substantial investments in some of its mines. Some of those worked out, such as in Stockton; some of them didn’t, such as in Spring Creek. But where they have invested, they’ve got capacity for production and for value, and if coal prices are at some kind of reasonable level, then there is a business there.

“All I’m saying is the cash flow numbers are just a bit more positive than we expected. ” – In which case, Mr English, keep your sticky hands of that cash.

I sincerely hope that if National Ministers attempt to gouge SOEs again, that Board Directors resign on masse and publicly disclose political attempts at such interference.

The public is entitled to be reassured that politicians will not use SOEs as “cash cows” simply to balance their books.  Especially after two unaffordable tax cuts – a glorified ‘lolly scramble’ – left a gaping hole in government accounts.


Do you want the banks to take some of the heat on this?


Yes, I think that’s really important. They’ve lent money, and as lenders, they take risks. And if they lend to a company that’s affected by a very sharp downturn in coal prices and then loss of a quarter of their export sales, they’ve got the same risks as banks who leant to resource companies all around the world that have got in trouble.


You can see the irony in that, though, because you told them to borrow more.


Well, and you were talking about it as a revelation. We did a press conference back in 2009 about the need for our SOEs to take on-

And it took Labour to advise the public, Mr English. Bill English, Key, and Ryall were more than happy to keep that 2009 letter from Simon Power under wraps.

That was part of National’s ‘spin’ that the massive borrowings and  debt were a ‘creature’ of Don Elder’s and John Palmer’s making. But as Corin Dann pointed out;


But you know that timing is everything with these things, and that was a revelation coming at this time, given your government had tried to distance itself from this issue. You even blamed Labour for it, for what they said in 2007.


No, I don’t agree with that. In 2009, the government was facing a decade of deficits because of the Labour Party and the recession. And we quite reasonably said that our taxpayer-owned companies should contribute more cash to the coffers. That’s the point of owning them. And Solid Energy had paid barely- had paid almost no dividends for the previous five or six years, and they had very low levels of debt compared to their asset value. So, look, in retrospect-

Here we go again; more blame-gaming,

In 2009, the government was facing a decade of deficits because of the Labour Party and the recession.

English blames the recession?

In which case why did National Ministers extract 163.9 million in dividends from Solid Energy, during the worst recession since the 1920s/30s?

Is this what National calls “prudent fiscal management”?

Notice also that  English lied by  blaming “ a decade of deficits because of the Labour Party” – even though Cullen was posting surpluses from 2002-08 Labour-led period?! And paid down sovereign debt from 33.4% of  GDP to 17.4% GDP? (See previous blofpost:  Bill English – do you remember Colin Morrison?)

This is symptomatic of a National-led government that is desperate to avoid all responsibility.


But there was a good reason for that, wasn’t there? Because they were a coal company.


That’s right. Look, in retrospect, they would have been better off with lower levels of debt, but as I think Don Elder and John Palmer said at the Select Committee, the board is there to make the decisions about what the actual levels of debt are. Bear in mind, in 2011 their debt had peaked and was declining, and then they got hit by the perfect storm in 2012.

Look, in retrospect, they would have been better off with lower levels of debt“…   “In retrospect“?!?! Little wonder that Solid Energy’s board and management resisted National’s demands for higher and higher dividends (as English concedes in his next statement).

That statement – ”Look, in retrospect, they would have been better off with lower levels of debt“  – totally destroys the argument put forward by Key, English, and Ryall that Solid Energy’s debt and subsequent crisis was of it’s own making.

Quite simply, National was desperate for cash to pay for the 2009 and 2010 taxcuts, and were prepared to bleed SOEs dry to get it’s hand on their money. Even if those SOEs had to borrow to do it.

This is ministerial incompetance at best – or outright economic sabotage at worst. (No wonder ACT and Libertarians maintain that politicians can’t run businesses. Correction: National politicians can’t run businesses.)


But you were telling all SOEs to raise their debt to a 40% gearing, and Solid Energy told you they were not comfortable with that, and there was a good reason: because they were a volatile coal company. Surely that was too much pressure you were applying to them.


Well, clearly not, because their debt peaked at under 35%, which was the level the board set, which was lower than what the government was expecting. And in 2011 their debt levels were actually declining from that, and then they got hit by the perfect storm. So, yes, would they have been better off with no debt? Yes, just like lots of businesses and households would be better off with no debt. Then they got hit by these circumstances which may well have put the company into trouble even if it had no debt.

Yes Mr English, Solid Energy did get hit by “a perfect storm”. A storm largely made up of rapacious politicians.

It appears that by not gearing up to the full 40% demanded by National, that Don Elder and John Palmer may have done their best to prevent the collapse of Solid Energy.


The issue also, of course, has been around their investments. Now, your government must take some responsibility, surely, for the oversight of what they were investing in. You were the one down in Southland turning the first sod with the lignite plant. You knew what they were up to.


Well, and it’s yet to be seen just whether that particular investment has on-going potential or not. Clearly, some of them don’t. Some of them may do. That’s what’ll happen over the next two to three months. But what you’ve got to keep in mind here is that under the SOE model, politicians are not there to run the companies. We do not make the investment decisions. The boards make the investment decisions, and the weakness in the model is that there’s no market scrutiny of those board decisions, and that is why the partial sell-down of the electricity companies will help with the monitoring and the performance of those companies.

But what you’ve got to keep in mind here is that under the SOE model, politicians are not there to run the companies. We do not make the investment decisions. ” – Really, Mr English? And yet Simon Power felt he had the ministerial authority to write to Solid Energy demanding higher dividends.

In reality, under the State-Owned Enterprises Act 1986, shareholding Ministers can and do issue directives to SOE Boards. So English is being disingenuous when he tries to indicate that Ministers are powerless. They are not powerless,

13.  Powers of shareholding Ministers in respect of new State enterprises
  • (1) Notwithstanding any other provision of this Act or the rules of any company,—

    • (a) the shareholding Ministers may from time to time, by written notice to the board, direct the board of a company named in Schedule 2 to include in, or omit from, a statement of corporate intent for that company any provision or provisions of a kind referred to in paragraphs (a) to (h) of section 14(2); and

    • (b) the shareholding Ministers may, by written notice to the board, determine the amount of dividend payable by any company named in Schedule 2 in respect of any financial year or years,—

    and any board to whom such a notice is given shall comply with the notice.

    (2) Before giving any notice under this section, the shareholding Ministers shall—

    • (a) have regard to Part 1; and

    • (b) consult the board concerned as to the matters to be referred to in the notice.

    (3) Within 12 sitting days after a notice is given to a board pursuant to this section, the responsible Minister for the company concerned shall lay a copy of the notice before the House of Representatives.

Source: State-Owned Enterprises Act 1986 – Section 13

They have the power.

It’s the responsibility for their stuff-ups that seems to elude them.


And are you confident there will be much better decision-making, that these MOM companies, in general, are going to have better board making decisions?


I think mixed-ownership companies will, but there’s a real challenge for government with the lessons from Solid Energy. When you look ahead, the companies that the government will own all have their challenges – NZ Post with the shrinking postal market, TVNZ and the digital media environment, a coal company if there is still a coal company. And we are going to have to change the way we work with these companies to ensure that we don’t lose taxpayers’ money. Because the taxpayers’ money in these companies doesn’t come out of the sky; it comes from the PAYE and the GST paid by NZ households. And we have a strong responsibility for the stewardship of that money.

Source: TVNZ Q+A



22 March 2013

The NZ Herald reported that “seven years’ worth of documents about Solid Energy have been released by Treasury… It has been released after a number of Official Information Act request centred around how much the Government knew about the financial troubles the state owned coal miner was in“.

Source:  Big Solid Energy document dump from Treasury

[Note: This blogger has viewed only a fraction of documents. There’s no telling what other revelations and incriminating evidence is contained therein. Perhaps something to be re-visited on a quiet, wintry evening?]



25 March 2013

Papers confirm Govt pressure on Solid Energy

A week after English’s attempt to ‘spin’ the collapse of Solid Energy and blame everyone under the sun, Radio NZ reported,

Official papers confirm the Government put pressure on Solid Energy to increase its debt and then appeared later to criticise it for borrowing too heavily as it got into difficulty.

The state-owned coal company is in debt to the tune of $390 million.

The papers released on Friday also show that despite strongly disagreeing with the company’s business plan, the Government left it late to act.

In 2009 the then State-Owned Enterprises Minister, Simon Power, wrote to Solid Energy chair John Palmer recommending the company raise its gearing ratio – a measure of debt – to 40%.

By June 2012, when it was clear the company was in trouble, the ratio had risen to 37% and, according to the Treasury, Solid Energy had taken on significant debt.

It was only at that point, after arguing with the company for three to four years about its business plan, that the Government decided to make changes.

Source: Papers confirm Govt pressure on Solid Energy

By  this time, public attention and media focus had waned. There were other issues and problems to deal with, and National ministers could breath a sigh of relief. They were “off the hook”.

Let us recall that Treasury’s scoping report, released on 4 November 2011, confirmed everyone’s suspicions that National had cash-stripped Solid Energy;

 ”…dividend payments to the government have been funded by increasing debt“.

Source: Treasury Report T2011/2373: Solid Energy New Zealand Scoping Study Report

The ‘up-shot’ of all this?

  • A billion dollar state own enterprise had been milked as a “cash cow” and left to collapse.
  • English, Ryall, Key, et al – off the hook.
  • There would be no ministerial accountability; no resignations; no one held to account.

And for good measure,

  • Blame Labour for everything.



8 May 2013

Bill English preps public for Solid Energy’s write-off?

In a Radio NZ story (see: English questions viability of Solid Energy), Bill English contradicted his earlier assertion that Solid Energy would not be allowed into receivership,

“We’re not going to keep propping up businesses where we don’t think there’s a long term future. Where we think there there is, we put strong support in. So Kiwirail would be a good example.Where the government’s  already invested around a billion in them in the last 3 or 4 years and they will… all of their,um, surpluses will be reinvested in the business, probably for the next decade. So the taxpayer won’t take anything out of them. But there may be… it’s possible that there’s other businesses, as has been revealed say in the  Solid Energy case where their particular mix may not be viable so we have to look at  whether they can be restructured or whether in the long run there’s a viable proposition there. But at the moment Solid Energy is the only business where that’s in question.”

Listen RNZ interview: Bill English on Morning Report

By questioning the viability of Solid Energy, English is preparing the public for the day when National announces the demise of the company.

Having gutted it of cash and forced it to borrow millions for unsustainable dividends, National is now ready to administer the coup de grâce to finish it off. (If the Nats could eliminate all witnesses to their bare-faced thieving, I bet you they’d be considering it…)

Meanwhile, a week later…



14 May 2013

$1 billion for KiwiRail

Radio NZ revealed that KiwiRail was receiving government funding to keep operating,

Overall the Government has committed about $1 billion to the effort, and Finance Minister Bill English has said the Government is unlikely to take a dividend for the next decade so KiwiRail can reinvest any profits in the rail service.

Source:  Solid Energy problems pose risk for KiwiRail

See also: Next steps in KiwiRail’s Turnaround Plan

How is it that Solid Energy,  a once viable company – earning millions in revenue from overseas exports of coal (admittedly not a very environmentally-friendly product) – may be allowed to go into receivership?

Meanwhile, National is quite happy to keep investing in KiwiRail, which has never generated a profit in modern times. (Though admittedly, KiwiRail is  an environmentally-friendly transport enterprise with a positive future, as we pass the oil peak.)



A message to businesspeople:

National Ministers are attempting to sheet blame for Solid Energy’s financial crisis to it’s former Chairperson, John Palmer, and CEO, Don Elder.

Key, English, and Ryall  have  resorted to mis-presentation of facts; omission of facts;  exageration; and in some instances, outright lies.

This should serve as a clear warning to businesspeople. Think carefully before accepting managerial or Board positions during a National-led government.

Because if things go wrong – even if caused by political interference – then they will have no hesitation to smear your reputation.  They will hang you out to dry, whether you are at fault or not.

A message to Voters:

National has a reputation as “prudent fiscal managers”.

For the life of me, I cannot understand how they have earned that reputation.

To allow a billion dollar SOE to crash and burn; run into the ground; and now   facing bankruptcy suggests to me that Key, English, Ryall, Brownlee, Joyce, Collins could not run a corner Dairy without getting into financial trouble.

I don’t think these clowns could run a sausage sizzle without losing money by the end of the day.

Perhaps, as a test,  those voters who are disbelieving should keep voting National? Let’s see what other SOE will collapse on their watch, eh?

What the hell. After all, it’s only our property. And tax dollars.

This blogpost was first published on The Daily Blog on 17 May 2013.





Solid Energy: Annual Reports Index

Crown Ownership Monitoring Unit – SOE Disclosures

Treasury: SOE/Solid Energy Disclosures

Previous related blogposts

That was Then, This is Now #18 (24 Feb 2013)

National caught out over Solid Energy – changes story on coal prices, debt, and other matters (13 March 2013)

Additional links (to replace dead links)

Click to access solid-energy-annual-report-2008.pdf

Click to access solid-energy-annual-report-2009.pdf

Click to access solid-energy-annual-report-2010.pdf

Click to access solid-energy-annual-report-2011.pdf

Click to access solid-energy-annual-report-2012.pdf

Click to access solid-energy-annual-report-2013.pdf

Acknowledgement and appreciation to “BLiP”



= fs =

Brain fades and balls ups


John Banks - John Key - David Shearer


On 20 March, Key made this curious remark, regarding Shearer’s stuff-up over his undeclared New York bank account,

“You don’t get cut any slack from the Labour Party when you say (you’ve made) a mistake but when they make one they don’t want anyone to have a look at it.”

Acknowledgement: Radio NZ – IRD knew of Shearer account, but not Parliament

There are two points of interest regarding that remark,

1. “…but when they make one they don’t want anyone to have a look at it.”

Not true.

As Vernon Small wrote in the Dominion Post on 21 March,

He was right to front-foot it by doing the rounds of the press gallery to disclose his blunder and face the music. It would have played must worse if he had left it until the next register of pecuniary interests was published.

Acknowledgement:  Fairfax media – Shearer’s bank blunder threatens chances

Yet again this is another prime  example of Key willfully mis-representing facts to suit his own purpose. His ability to “bend the truth” is unparalled by any other Prime Minister, whether Labour or National.

Shearer actually fronted to journalists and made a candid admission of his stuff-up.

When is the last time Key or Banks did the same?

2. You don’t get cut any slack from the Labour Party when you say (you’ve made) a mistake…”

Why should Labour (or any other Party) cut any slack” for the National-led government?

Did National “cut any slack” for Labour when Helen Clark was Prime Minister? No, the Nats were relentless in their disparagement of Labour. In fact, they were often quite brutal,


Showers latest target of Labour’s nanny state

Acknowledgement: Scoop – Showers latest target of Labour’s nanny state


National launches its Food in Schools programme

Acknowledgement: Scoop – National launches its Food in Schools programme


(Note: National never proceeded with it’s “Food in Schools” programme, and the policy was quietly dropped soon after they were elected into power in November 2008. see:  Govt guarded on free school meals)

And this little ‘beauty’ in abusing Labour, in this January 2008 speech by John Key,

” Under Helen Clark and Labour, our country has become a story of lost opportunities. 

Despite inheriting the tail wind of a strong global economy, Helen Clark has failed to use that momentum to make significant improvement in areas of real importance to New Zealanders.  She has squandered your economic inheritance by failing to build stronger foundations for the future. 

Tomorrow, Helen Clark will tell us what she thinks about the state of our nation.  In all likelihood, she’ll remind us how good she thinks we’ve got it, how grateful she thinks we should be to Labour, and why we need her for another three years. 

Well, I’ve got a challenge for the Prime Minister.  Before she asks for another three years, why doesn’t she answer the questions Kiwis are really asking, like:

  • Why, after eight years of Labour, are we paying the second-highest interest rates in the developed world?
  • Why, under Labour, is the gap between our wages, and wages in Australia and other parts of the world, getting bigger and bigger?
  • Why, under Labour, do we only get a tax cut in election year, when we really needed it years ago?
  • Why are grocery and petrol prices going through the roof?
  • Why can’t our hardworking kids afford to buy their own house?
  • Why is one in five Kiwi kids leaving school with grossly inadequate literacy and numeracy skills?
  • Why, when Labour claim they aspire to be carbon-neutral, do our greenhouse gas emissions continue to rise at an alarming rate?
  • Why hasn’t the health system improved when billions of extra dollars have been poured into it?
  • Why is violent crime against innocent New Zealanders continuing to soar and why is Labour unable to do anything about it?

Those are the questions on which this election will be fought. 

Helen Clark thinks she can hoodwink Kiwi voters into giving her another three years to answer these questions.  Well, I say she’s had nine years, she’s had her chance and she’s wasted it. The truth is that as time has gone on, Labour has concentrated more and more on its own survival and less and less on the issues that matter to the people who put them there.”

Acknowledgement: National Party – 2008: A Fresh Start for New Zealand

So when Key whinges about the Labour Party not cutting him “any slack”, Key might consider that he gave as well as he got when he was in Opposition.

That is the role of Opposition – to criticise, challenge, and question. The alternative would be a quick trip down the road to join the club of authoritarian regimes.

By the way… how is John Key’s list of criticisms that he levelled against the Labour Government on 29 January 2008,

  • Why, after eight years of Labour, are we paying the second-highest interest rates in the developed world?
  • Why, under Labour, is the gap between our wages, and wages in Australia and other parts of the world, getting bigger and bigger?
  • Why, under Labour, do we only get a tax cut in election year, when we really needed it years ago?
  • Why are grocery and petrol prices going through the roof?
  • Why can’t our hardworking kids afford to buy their own house?
  • Why is one in five Kiwi kids leaving school with grossly inadequate literacy and numeracy skills?
  • Why, when Labour claim they aspire to be carbon-neutral, do our greenhouse gas emissions continue to rise at an alarming rate?
  • Why hasn’t the health system improved when billions of extra dollars have been poured into it?
  • Why is violent crime against innocent New Zealanders continuing to soar and why is Labour unable to do anything about it?

Except for interest rates (which is not controlled by governments – which Dear Leader should have known), none of John Key’s  list above has improved in any measurable manner.

He’s probably forgotten it by now.



This blogger is not a member of the Labour Party, nor has any preference in who leads that Party.

This blogpost was first published on The Daily Blog on 23 March 2013.



= fs =

John Key advocates theft by banks?


too big to fail to big to jail


Recent events in Cyprus have once again brought the global financial sector into sharp public consciousness. This time, as well as a bailout, there was a serious – and ominous –  demand from the EU that Cyprus make a “one off” levy (or tax) on the savings of Cypriots and others living in that country.


Hard EU bailout terms anger Cypriot savers

Acknowledgement: NZ Herald – Hard EU bailout terms anger Cypriot savers


Deposits up to and over   €100,000 ($158,000) would be levied with a  9.9% tax whilst below that threshold would be  pay a ‘lower’ portion of  6.75%.

Unsurprisingly, the proposed tax resulted in a run on cash withdrawals at ATMS (see:  Cypriots asked to surrender up to 10 percent of bank balances in return for EU bailout); banks closed their doors (see:  Fury as banks closed to avert run); global sharemarkets were affected (see:  Stock Markets Fall Amid Fears Of New Eurozone Crisis);  and the British government was forced to fly in one million euros to pay military personnel (see: One Million Euros Heading To Island For British Military Personnel ).

Pressure on the Cypriot government was such that in the last 48 hours, the Savings Tax was dumped (see:  Rejection of Deposit Tax Scuttles Deal on Bailout for Cyprus). The Cypriot Parliament voted  thirtysix against, with nineteen abstaining. It is noteworthy that not one politician risked his/her life by voting for the proposal.

Europeans. They know how to put pressure on their elected representatives.

Meanwhile, back home, in the Land of the Long White Cloud and several million sheep…


bank bailouts - bailout - new zealand banks - john ley

Acknowledgement: Radio NZ – NZ bank bailout scheme is last resort, says PM


Key’s statement here is chilling,

“At the end of the day we’re talking about emergency provisions. These banks are heavily regulated, they have significant oversight and lender of last resort facilities at the Reserve Bank.

This is really in the event that a bank got itself in such a terrible mess that it fell over and had to restart again.”

Acknowledgement: IBID

If that is supposed to be reassuring – it is not. In fact, if anything, this is a clear warning to every single New Zealander that if a bank gets into trouble – or if there is even a hint of trouble – to get in quickly and withdraw every cent that a depositor might have.

If a bank gets in trouble, and has a crippling run on deposits, it will be as a direct consequence  to Key’s plan to dip into people’s savings to bail out that institution,

The Reserve Bank’s Open Bank Resolution (OBR) plan, due to come into effect at the end of June, would mean a partial loss on all deposits if a bank failed in New Zealand, in order to fund the bank’s bailout.

Acknowledgement: Fairfax media – Reserve Bank scheme news knocks kiwi

Ironically, this is where Libertarians – who consider all taxation as theft – may have a point.

Taxation is one thing. We pay it so we can enjoy the benefits of a modern society and economy. Roads, bridges, schools, hospitals, police, etc, do not materialise out of thin air.

Dipping into people’s savings accounts – which has already been taxed one way or another – is not a tax. It is expropriation.

Expropriatiion – that dreaded word which National and it’s supporters levy against the Left when we talk about re-nationalising State assets. But which evidently is ok if a bank goes bust and has to be bailed out?

If this principal is to be applied across all sectors of society and the economy, then one could imagine that employees and sub-contractors of Mainzeal should have been taxed to bail out that company. Why should a bank be different to a construction company? Is there a difference?

If this expropriation of deposits was ever to happen, do the depositors gain any benefit? Do they gain shares in the Bank as compensation? Or, if not, does that mean that shareholders gain the benefit of other people’s money being used to prop up their investments?

One could imagine  an invalid on a WINZ benefit having his/her meagre savings “taxed” to bail out a bank – to preserve an investor’s shareholding that may be worth millions of dollars. This isn’t justice or common sense, this is nasty, medieval,   “robber Baron” stuff.

The biggest irony here is that, according to the principals of the free market, this is a kind of subsidy to a business – a subsidy enforced by the State, against the will of people who are not even shareholders in a particular bank.

Even marxists would balk at such extreme State power to seize people’s money. They’d simply nationalise the bank and be done with it. Depositors would still have their modest savings left intact and untouched.

Key’s proposal is not just crazy from almost every perspective – it is an insult to our intelligence. Especially when banks are doing very well with their profits,


bank profits headlines collage


When profits for New Zealand’s four largest banks are at a staggering   $3.5 billion (for 2011/12) – an increase of 22% – then that must raise serious questions why Dear Leader is even considering making depositors pay for any potential future bailout.

Shouldn’t the banks be looking at a deposit insurance scheme of some sort? You’d think so, wouldn’t you?

Perhaps, though, an event like this is what might be required to jolt New Zealanders out of their collective complacency. It’s only when the middle classes are hit hard in their wallets, that they stop being passive consumers and start to reassert themselves as active citizens.

Because, my fellow Kiwis, you can bet your last dollar (before the banks seize it) that John Key’s $50 million will be somewhere else – probably safe in some Swiss Bank account.

The people of Cyprus (and Iceland) have shown us the way.


Remember the so-called “Light Bulb” and “Shower Heads” affairs, in 2008, where National slammed the then-Labour Government as engaging in  “Nanny State” politics? (see: Showers latest target of Labour’s nanny state ) National’s Nick Smith said,

People should be free to use as much water as they like when showering, provided they don’t expect others to pay for their profligacy. User-pays is a far better approach than nanny state.”

So using eco lightbulbs and smaller shower flows, to conserve electricity and water is nasty  “Nanny Statism”.

But going into people’s savings accounts; stealing their money; and handing it over to banks – is all hunky dory? Well, I’m glad that’s settled.

(Cue theme music to ‘Monty Python’s Flying Circus’.)

This blogpost was first published on The Daily Blog on 22 March 2013.





Banking profits up 13.6 percent

ASB Bank cash profit rises 7pc

ANZ profits up 17pc to $1.26b

BNZ first-half profit jumps 36pc

$3.5b profits for big four banks

Westpac profit increases 22pc

Outcry at big banks’ mega-profits


Reserve Bank scheme news knocks kiwi



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National on Child Poverty?!


Poverty among Budget targets

Acknowledgment: Dominion Post – Poverty among Budget targets


At first glance, it appears that National has recognised that a crisis exists in our country; a crisis involving 275,000 children living in poverty.

Without doubt, this problem (I refuse to call it an “issue”) hit the public’s collective consciousness on 22 November 2011, when Bryan Bruce’s sobering documentary,”Inside Child Poverty” hit our television screens (see:  Strong reaction to damning TV child poverty doco).

Since then, the problem has become a major concern concern throughout the country.

More and more organisations, schools, political groups, etc, are adding their voice to a growing clamour for action. Most New Zealanders – those with eyes to see; ears to listen; and a mind to understand – want action. They want kids fed, so that they can attend their schools and learn and get a decent chance at life.

This is what Bryan Bruce, the documentary-maker of Inside Child Poverty wrote on his Facebook page;


OK, let’s get some things straight about providing free healthy meals in schools.

1. First of all let’s decide on the principle before arguing about the detail.

Let’s admit there is a significant problem of children turning up to school hungry and that a lot of kids are eating low cost foods that contain a lot of sugar and fat , causing obesity , diabetes and long term health problems.

And at least get the Feed The Kids Bill to Parliamentary Select Committee. You can argue all you want about how it should be funded or what’s going to be on the menu there.

If you don’t think we have a community responsibility to feed children and/or educate their palates to healthy eating habits – then read no further it will only make you angry.

2. It doesn’t fill a hungry kids tummy to point at their parents and shout “Your problem is you have bad parents”. This page takes the view that kids don’t get to choose their parents and we have a community responsibility to ALL our kids to make sure they grow up healthy. And if that means feeding them for free- then that’s what we do.

3. No one is going to force feed any child food they don’t want to eat or is culturally inappropriate. If you watch the video below which I filmed in Sweden for the documentary you will see children from multi -cultural backgrounds CHOOSING their food. And Yes children with allergies are catered for and Yes children can still bring their own lunch prepared by the parents .

4.Free healthy school meals can be paid for without raising taxes. We just choose to re-distribute the existing pool of tax payer money and give up on some other things. Here are some suggestions, I’m sure you can think of other ways we could spend smarter.

(a) We could fund school meals out of the Health vote rather than the Education vote. In a document released under the Official Information Act I revealed that children under 14 receive 10% of the money set aside for health care. But children under 14 represent 20% of our population. So we could fund some of it – if not all of it – by giving kids their fair share.

(b )It is a well accepted health statistic that for every $1 we spend on preventing disease we save $4 in expensive hospital cure. So within a few years the scheme will fund itself out of what we save. If we DON’T do it, taxpayers will be spending much more than they are now on the Health budget in the future.

(c) We could make children a spending priority. National plans to spend a billion a year on Roads of National Significance over the next 10 years. What about Children? – aren’t they of National Signifcance? I’d much rather feed our kids than be able to by – pass small towns while driving to Auckland .

(d) We could pay the pension to people when they actually stop working and not just because they reach 65.

(e) We could spend more energy making sure people paid their taxes . Last year the IRD detected about a Billion dollars worth of tax evasion mostly by businesses. It’s estimated that the real tax evasion in NZ is between 4 and 5 Billion.
If you pay PAYE you can’t cheat your taxes. So we could easily pay for free school meals if more adults played fair.

Let’s impose greater penalties for tax evasion, and let’s stop thinking of tax as a bad thing. Tax is a good thing – it’s giving to ourselves. That’s how we can have schools and hospitals and yes even Roads Of National significance. Tax is the price of civilisation. Get over it.

Now whether you agree with some of the above, all of the above or none of the above , let’s at least agree that The Feed The Kids Bill should at least go to Select Committee after its First Reading so the issue can be properly debated.

Please contact your local MP today and urge them to support the Feed The Kids Bill.

You can find their contact details here, just click on their name :

Thank you

Inside Child Poverty New Zealand


(Please give Brian support by going to his Page and “liking” it. The bigger the numbers, the more ‘clout’ he has.)

It’s fairly obvious to all by the most stubborn-minded that a malnourished child is not well pre-desposed to learning well. A child who cannot focus on his or her lessons and falls behind, eventually becomes alienated and disenchanted. The cycle of poverty, hopelessness, and anger perpetuates.

The Mana Party introduced a “Feed The Kids” Bill – aka the Education (Breakfast and Lunch Programmes in Schools) Amendment Bill – into Parliament last year, on 8 November 2012. The Bill is scheduled to come before Parliament for its first reading on 5 June this year.

With pressure coming hard and fast on Key and his increasingly shakey,  poll-driven,  ‘government’, their strategists are planning to end National’s destructive austerity Budgets and begin spending on essential social services that are critical to the well-being of our communities.

Part of this is Key’s stated intention;

Children who aren’t fed become victims and the Government has to deal with that, Prime Minister John Key says.

His comments come as action on child poverty is tipped to be the surprise package in Finance Minister Bill English’s fifth Budget on Thursday.

“The vast overwhelming bulk are [fed] in New Zealand, but if a child isn’t fed then actually they become a victim and whatever we think of that we need to try and deal with that issue.”

Acknowledgment: IBID

At his regular press conference,  Key was coy at whether National would  rule in or out a  food in schools programme – but was more candid in ruling out support for  Mana’s “Feed the Kids” member’s bill.

So. What we have is;

  1. A firm “no” by National to Mana’s initiative
  2. A firm “no” by Peter Dunne to Mana’s initiative  (Why Peter Dunne won’t “Feed the Kids”)
  3. A vague committment;  “The vast overwhelming bulk are [fed] in New Zealand, but if a child isn’t fed then actually they become a victim and whatever we think of that we need to try and deal with that issue.”

Now, call me a cynic if you like, but National has a fairly poor track record on dealing with social matters, whether it be unemployment, solo-mothers, worker’s rights and conditions, etc.

To give an example; our high unemployment.

Unemployment is high.

Jobs are scarce.

National’s ‘solution’; “reform” social welfare and make it harder for the unemployed to access welfare support, or to retain it. Additional ‘solution’; demonise the unemployed and infer that that are bludging. Ditto for solo-mothers.

That was National’s ‘solution’; force people off welfare and make the numbers look good. (see: Bennett trumpets 5000 fewer on DPB, see: 5000 beneficiaries quit dole rather than reapply, see: Welfare rules force people to struggle on without benefits)

I hope I’m wrong, but my gut feeling is that the Nats plan to pull a “swiftie”. We’re going to see something along these lines;

  1. A WINZ-based “targetted” approach where families that cannot afford to buy adequate food will have an increase in their food grants – but will probably have to re-pay it from their weekly welfare assistance.
  2. A reliance on some form of “PPP”-style programme, such as Fonterra’s milk-in-schools programme. There will be nothing concrete – just a “promise” to “investigate possible options”.
  3. A commision of enquiry of some description.
  4. An increase for school budgets to buy food, but which will be limited; capped; and money will be taken from elsewhere in Vote:Education to fund this.
  5. No increase in welfare assistance; no food in schools; but a form of food vouchers making up a portion of a beneficiaries overall entitlement.
  6. A limited “trial” food-in-schools programme – for a handful of schools only.

Far from addressing this crisis, National, ACT, and Peter Dunne will apply a band-aid “solution” and present it to the public of New Zealand as “Mission: Accomplished”.

It will be nothing of the sort.

Only one thing will begin to address this problem – a change of government.



NZ Herald: Strong reaction to damning TV child poverty doco (23 Nov 2011)

Feed The Kids website

Previous related blogpost

Why Peter Dunne won’t “Feed the Kids”

Can we afford to have “a chat on food in schools”?

Other blogs

The Daily Blog: Hungry Kids Annoy Frazzled Lobby Group Director



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John Key on Aaron Gilmore

From today’s Dominion Post…



Defiant Gilmore digs in

Acknowledgment: Defiant Gilmore digs in


John Key’s judgement on Aaron Gilmore,

In the end, to make a contribution, you have to have integrity, and to have integrity there has to be a directness and fullness in your answers.

*cough, cough*

Yes, Dear Leader, “you have to have integrity, and to have integrity there has to be a directness and fullness in your answers.




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Breakfasts, Brain-fades, and Bullshit

26 April 2013 2 comments


Key met spy candidate for breakfast


Acknowledgement: Dominion Post –  Key met spy candidate for breakfast


The best response amongst the comments posted was this one, in response to a right winger trying to deflect on to Shearer and Norman,


Key met spy candidate for breakfast - comment by Rodger Red

Acknowledgement: Dominion Post –  IBID


Brilliant reposte.

’nuff said.



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The Fletcher Affair – a warning for Labour

6 April 2013 8 comments


spy vs politician


The current mess surrounding the appointment of Ian Fletcher as the Government Communications Security Bureau’s (GCSB) Director should serve as a clear warning to any future Labour-Green government: Don’t Do It.

To be precise; don’t do what Key (and his ministerial cronies) has done. Circumventing the State Services Commission to “facilitate” appointments – even if done for decent motives – is simply;

(A) Not a good look

(B) Not worth the hassle when the media, bloggers, and Opposition get hold of it

(C) A slippery-slope toward cronyism and inevitable corruption.

The appointment of John Key’s Electorate Chairperson,  Stephen McElrea (who is also the National Party’s Regional Deputy Chair, National Party Northern Region) to the Board of NZ On Air raised numerous charges of cronyism and an agenda of political interference in public funding for television programming. (See:  Call for McElrea to resign from NZ On Air; See: PM has questions to answer over NZ on Air link )

Concerns over political appointees to highly sensitive positions, vulnerable to political interference, was quickly borne out when McElrea began to flex his “political muscles” even before being appointed to  NZ on Air’s Board,


National man eyes NZ On Air chair

Acknowledgement: NZ Herald – National man eyes NZ On Air chair


Key’s background in deal-making; cutting corners to achieve set goals; and getting results fatally blinds him to the realities that politics and government is a whole different kettle of fish to ‘high finance’. (Which would be a good thing, considering the almighty crash of  ‘high finance’ four years ago.)

The State Services Commission was set up precisely to keep politician’s greasy hands of appointments.  At the beginning of out nascent civil service, ministerial cronyism was rampant,

The departments that grew up over the next few decades operated under the direct control of their Ministers, in arrangements that were practical in pioneering times.  Ministers approved appointments, determined pay and conditions, and oversaw administration and financial management, with varying degrees of diligence.


Understandably, Ministers were inclined to see that the people appointed were sympathetic to their own political outlook and priorities – and inevitably, in a small population, these were sometimes friends or acquaintances.  The Public Service was run on somewhat ad hoc ‘frontier’ lines, and seems not to have been much different from its parent institution, the British civil service.  In their report on the British civil service Sir Stafford North and Sir Charles Trevelyan described a bureaucracy that was, in the 1850s, rife with patronage, fragmented and inefficient.

Acknowledgement: State Services Commission –  Origins of the Public Service and Office of State Services Commissioner

Accordingly, after 1912, reforms were enacted to clean up this unholy mess,

The Hunt Commission in due course recommended, as ‘the most important matter of all’, establishment of a Board of Management under Cabinet, to have ‘absolute and undisputed power’ in ‘all matters relating to the control and management of the Service – … appointments, salaries, promotion, suspensions, dismissals, and indeed everything affecting officers – ‘  It suggested the Board’s first duties should include blocking all ‘back doors’ of entrance to the Public Service, and arranging for all promotions be made from within the Service.

The outcome was the Public Service Act 1912 – based on Herdman’s Bill already before the house – which set up a non-political and unified career Public Service; non-political through powers of appointment, promotion and dismissal being entrusted to an independent body – the Public Service Commissioner.

Acknowledgement: IBID

It is abundantly clear that John Key doesn’t ‘get’ any of this, when he said,

I didn’t do anything wrong whatsoever. Labour have done very similar things.”

Again, blaming Labour.

Is everything he says or does predicated on what the previous government did?

Does Key not have standards of his own? (Rhetorical question. Don’t answer.)

Because Key’s memory lapses cannot be blamed on anyone but himself. Especially when, on 3 April he openly contradicted himself as to who-phoned-who, as Andrea Vance reported,

…he appears to be confused about who first suggested Fletcher for the job.

Asked why he didn’t tell the full story last week, Key said: “I’d forgotten that at that particular time.”

In Porirua this afternoon, Key was grilled about the sequence of events that saw Fletcher appointed as director of the GCSB in September 2011.

At first Key said: “Iain Rennie, state services commissioner recommended him to me… I rang [Fletcher] and said ‘look, you know, you might be interested.”

Asked again who first brought up Fletcher’s name, Key replied: “Iain Rennie put it to me.”

Later on, he was asked again who first mentioned Fletcher. “I would have mentioned it to him, I’m sure.”

When pressed to clarify if he first suggested the name to Rennie, he said: “I’m sure I probably would have.”

Acknowledgement: Fairfax Media – Fletcher’s appointment defended by SSC boss

Key lied. He was caught out lying.

On 4 April, Scoop Media wrote about the rationale behind Ian Fletcher’s appointment as GCSB director. Fletcher had no prior military of Intelligence experience. But he did have an extensive  background in intellectual property, commerce and “free” trade (see: The CV of a Spy Boss ) .

Fletcher’s appointment was announced  in September 2011, and was due to take up his new job in early 2012.

At the same time, police were planning their raid on Kim Dotcom’s mansion, scheduled to take place  on January 20 2012.

Scoop wrote,

Suppose Dotcom’s arrest and extradition was the clincher in the deal that secured Warner Bros’ agreement to produce The Hobbit in New Zealand. But any link to John Key, who led the negotiations with Warner Bros, would tend to confirm Dotcom’s claim, supported by the strong connection between Hollywood and US vice-president Joe Biden, of political persecution. So the prime minister had to be protected by having total deniability, leading to the completely implausible claim of not knowing about the most prominent resident in his own electorate until the day before the raid.

Acknowledgement: Kim Dotcom Part Two

Conspiracy fantasy?

Remember that Key has had several top level meetings with Warner Bros executives,

October 2010


No decision yet in Hobbit talks - Key

Acknowledgement: NZ Herald – No decision yet in Hobbit talks – Key


July 2011


PM's 'special' movie studio meeting

Acknowledgement: Fairfax – PM’s ‘special’ movie studio meeting


October 2012


Key - Dotcom won't be discussed during Hollywood visit

Acknowledgement: TV3 – Key: Dotcom won’t be discussed during Hollywood visit

Four days later,
Dotcom raised at PM's Hollywood dinner


And those are only the meetings which we, The Masses, are aware of.

It’s interesting to note Chris Dodd, the CEO of  the Motion Picture Assiciation of America (MPAA) referred to the Trans Pacific Partnership Aggreement (TPPA) in the 5 October NZ Herald article above.

The TPPA has more to do with intellectual property rights than with “free” trade. (See: “Global Research –  The “Trans-Pacific Partnership”: Obama’s Secret Trade Deal; See: MFAT -Trans-Pacific Partnership Negotiations – Intellectual Property Stakeholder Update)

It’s also worthwhile noting that Ian Fletcher’s appointment coincided to the month with the raid on Kim Dotcom’s mansion.

  • Raid on Kim Dotcom’s mansion:  20 January 2012.

And both men were involved in intellectual property rights – though from different angles,

  • Kim Dotcom – the man who Hollywood executives wanted brought down because of alleged copyright violations on his ‘megaupload’ website. (see: The MPAA on Dotcom)
  • Ian Fletcher – the man who had worked in the UK to protect oroporate interests in intellectual property rights. (see below)

When Ian Fletcher’s appointment was announced on 8 September 2011, Key himself proudly boasted of the new Director’s  career,

Announcing the appointment Prime Minister John Key said he has ” policy and operational experience particularly in relation to international economic and trade matters.”

Acknowledgement: New Zealand’s new top spy boss revealed

Fletcher’s ” policy and operational experience particularly in relation to international economic and trade matters” seemed to matter for John Key for some reason?

Kim Dotcom was very high on the list of issues relating to “international economic and trade matters“; namely intellectual property rights.  Indeed, in March 2007, Fletcher was appointed as Chief Executive of the UK Office of Intellectual Property.

On 20 March 2007, Ian Fletcher said,

“I am delighted to be joining the Patent Office. It already plays a vital role in the UK’s economic prosperity, its scientific excellence and its innovation system. As the Office moves on to tackle to challenges set out in Andrew Gowers’ review, the Office’s role will become even more central to the UK’s response to the challenges of globalisation.”

Acknowledgement: Intellectual Property Office – New Chief Executive for the Patent Office

(Hat-tip; Karol, on The Standard)

It has been widely commented that Ian Fletcher has no background in the military, nor Intelligence – yet was considered the one candidate who was eminently suitable for the role of Director of the GCSB.  Perhaps now we are starting to understand why Ian Fletcher’s appointment seemingly related to,

  • the Crown’s case against Kim Dotcom
  • Illegal downloads/Intellectual Property rights
  • MPAA concerns
  • Hollywood big business
  • Trans Pacific Partnership

And as Key himself admitted, the issue of Kim Dotcom had been raised by Hollywood executive. Just what does our Prime Minister have to discuss with said executives? Who knows – it’s all done in secret, behind closed doors. We’re just expected to pay our taxes and shut up.

Conspiracy theory?

Conspiracy theories remain the subjects of idle parlour chit-chat and somewhat kooky websites… well, until charges are laid. Then a conspiracy theory becomes a conspiracy case in a Court of Law.

This affair should serve as a warning for the next in-coming Labour-Green government. National’s administration is a text-book case of how not to do things.

Every minister in the next Labour-Green government should be appointed a “minder” to ensure that they do things By The Book, and not to cut one single corner. Or at the very least, periodically re-read press reports and blogposts detailing every f**k-up by National over the last four years.

New Zealand is a small country. Secrets are notoriously difficult to keep. And even if the whole story behind the Fletcher-Dotcom-GCSB-TPPA thing has not been fully revealed – I think we’ve had a glimpse into the murky shadows of political perfidity to smell something rotten.

The issue has not only further dented Key’s credibility, but is starting to wear down his public persona of  good natured, ‘blokeyness’,


John Key calls media 'Knuckleheads'

Acknowledgement:  NZ Herald – John Key calls media ‘Knuckleheads’


Abusing the media? Not a good look for Dear Leader. It appears that the stress of the job is getting to him. And he can’t handle it very well.

Key’s “blokeyness” morphes into bratty petulance when he further dictates the terms under which he will talk to the media and in Parliament,


PM John Key

‘What I should have done, and what I will be doing in the future, is saying, well, the member needs to put that down to me in writing, and I’ll be doing that to the journalists as well.
‘Cos if you want perfection of everything I have done, two, three, four, five years ago, I will get you all that information for you, but I’ll get you the whole lot and give it to you.”

Acknowledgement: Fairfax Media – John Key changes tack over questioning


This is “seige mentality” stuff.

Key’s teflon coating wore away over a year ago. With no defensive cloak, the media recognise a government and it’s leader who are in dire trouble and  on the defensive.

As Martyn ‘Bomber’ Bradbury wrote on “The Daily Blog”,

“John Key’s extraordinary appointment of his school-hood chum to be the new Director of our spy network could well be his ‘speeding in the Prime Ministerial Limo’ moment.”

Acknowledgement: The Daily Blog – John Key’s ‘speeding in the Prime Ministerial Limo’ moment

And as Bryce Edwards noted in the NZ Herald on 4 April,

“As a barometer of the political media, John Armstrong is always useful, and it appears that he too ‘smells blood’.”

Acknowledgement: NZ Herald – Political round-up: John Key’s precarious credibility

There are more headlines to come out of Key and National. It’s only a matter of time.




Related blogposts

Crony Watch!


Fairfax Media: New Zealand’s new top spy boss revealed (8 Sept 2011)

The Listener: Kim Dotcom and Megaupload: a timeline (20 March 2013)

Scoop: Kim Dotcom Illegal Surveillance And Response: Timeline (28 March 2013)

Fairfax Media:  Fletcher’s appointment defended by SSC boss (3 April 2013)

Radio NZ: State Services boss ‘surprised’ at PM’s phone call (4 April 2013)

NZ Herald: PM paints himself into another corner  (4 April 2013)

NBR: Honesty bigger issue than cronyism (4 April 2013)

NZ Herald: PM put mate’s case for job in 2009 (5 April 2013)

Radio NZ:  PM has no regrets about calling Fletcher (5 April 2013)

Fairfax Media: John Key changes tack over questioning (5 April 2013)

Scoop: Kim Dotcom Part Two (4 April 2013)

NZ Herald: PM put mate’s case for job in 2009 (5 April 2013)

Radiolive: Former GCSB boss intrigued by Ian Fletcher appointment – Audio  (5 April 2013)

NZ Herald: Ian Fletcher appointment a ‘totally ethical process’ (5 April 2013)

NZ Herald: John Key calls media ‘Knuckleheads’ (6 April 2013)

Other blogs

The Standard: The CV of a spy-boss

The Standard: Fletcher GCSB Change manager – and QLD

The Daily Blog: John Key’s ‘speeding in the Prime Ministerial Limo’ moment



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The unmitigated audacity of John Key and John Banks

19 March 2013 13 comments


This is how a politician  owns up to a mistake,


Shearer makes no excuse for forgetting bank account

Acknowledgement: Radio NZ


Then there are politicians who continually blames others or claim to “forget”, when it’s obvious they are lying.

John Key’s talent for blaming others for his own stuff-ups is fast becoming becoming legendary,



Key’s habitual finger-pointing currently extends to blaming Solid Energy’s debt crisis on it’s  Board; management; coal prices; global financial crisis, and uncle Tom Cobbly. He takes  no responsibility for his own Ministers demanding higher debt gearing levels  and dividend payouts which helped plunge Solid Energy into a financial hole,

He’s [John Key]  blaming the previous Labour Government, including former state owned enterprises minister Trevor Mallard who encouraged the company to expand in 2007, and citing a Cabinet paper supporting that stance.

“They can’t wash their hands of the fact that from 2003 on, they were intimately involved with the plans that that company had,” Mr Key said.

Acknowledgement: TV3

It was put to the PM that Solid Energy seemed to have been working with a “pretty high-risk” strategy. He responded by saying that all of these things were operational matters — he added that “if National’s to blame, then so’s Labour”. He said that the management and the board are responsible for the balance-sheet.


Board at fault for Solid Energy debt, not Govt – Key

Mr Key denied the Government was responsible for the company’s woes, despite encouraging the board to take on debt in 2009 and expecting it to pay a dividend.

Acknowledgement: TV3

They made some investments in core assets and those didn’t work out either, and the coal price collapsed.

Acknowledgement: MSN News

So everyone was to blame for Solid Energy’s collapse – except National which has been in power for four years and bled the company dry with demands for high dividends.

Then there are times in politics that politicians make utterances that are breath-taking in unmitigated audacity,


Shearer makes no excuse for forgetting bank account Banks comments

Acknowledgement: Radio NZ


This is one such instance – John Banks,  whose memory was so “bad” that he forgot his close relationship with a rather large German multi-millionaire; a helicopter flight to one of the biggest mansions in New Zealand; and who forgot $50,000  cheques for  donations for his electoral campaign.


John Banks says he never lied about internet billionaire Kim Dotcom’s $50,000 donation to his 2010 mayoral campaign but says he erred in not answering questions about the affair more openly.

But Mr Banks denied misleading the public about the donations and events around them, including a helicopter ride to Dotcom’s mansion which he has said he cannot remember.

“I didn’t lie. There’s no reason to believe that I lied. I simply couldn’t recall.”

Acknowledgement: NZ Herald


For someone with “nothing to hide” ACT leader and former Auckland mayor John Banks is doing an awfully good job of creating the impression there are some things he would rather keep to himself.

He has refused to confirm he solicited a donation from internet billionaire Kim Dotcom for his 2010 mayoral campaign and refused to confirm he asked that the $50,000 donation be split into two $25,000 payments.

He has also said he does not remember who donated money to his mayoral campaign, does not remember discussing money with Dotcom and his staff and, till yesterday, could not remember flying to Dotcom’s Coatesville mansion in Dotcom’s helicopter.

Either Mr Banks is suffering from the early onset of Alzheimer’s or he thinks honest answers to the questions raised by the revelation that Dotcom was an undisclosed donor to his campaign will reflect poorly on him.

Acknowledgement: Dominion Post – Editorial: Bad memory or poor judgment?

John Key and John Banks are now attempting to compare David Shearer’s omission for declaring his New York-based bank account.

Key said,

“People make mistakes. I make mistakes and when I do, I try and tell people I’ve made them. It’s just that you don’t get cut any slack from the Labour Party when you say you’ve made a mistake, but when they make one they don’t want anyone to have a look at it.”

Acknowledgement: NZ Herald – Key weighs in on Shearer’s $50,000 ‘oversight’

And John “I-can’t-recall” Banks added his own 2 cents worth,

“Shearer is on record as saying those who suffer from a memory lapse aren’t fit to hold office.  Shearer’s hypocrisy is staggering.”

Acknowledgement: IBID

Except for one thing – and here’s the rub:

David Shearer himself disclosed and admitted his own mistake,

“Frankly I was horrified that I’d overlooked it and I moved straight away to correct it. When I myself found that (bank account) error I made the move to correct it, I didn’t wait for anybody else to find it.”

Acknowledgement: IBID

It is one thing to stuff up; come clean; apologise; and not try to blame others.

It is entirely another matter when one continually blames others for his mistakes or has such problems recalling events that they become a laughing stock.

Perhaps Mr Key and Mr Banks should take a lesson from David Shearer’s book;  own your mistakes; don’t blame others; and don’t make facile excuses.

It’s not politicians who make mistakes, that the public loathes. It’s when they try to avoid responsibility for their errors.

Especially when Key and Banks demand responsibility from the rest of us,


Food parcel families made poor choices, says Key

Acknowledgement: NZ Herald – Food parcel families made poor choices, says Key




= fs =

Oh Dear Leader, stop teasing us…

26 February 2013 4 comments


Key not ruling out snap election over water rights



What can I, and a million New Zealanders say?  Bring it on!



= fs =

Dear Leader caught telling porkies (again)?! (part rua)

22 February 2013 10 comments


key's credibility takes a hit


Continued from: Dear Leader caught telling porkies (again)?!

From comments he made in Parliament, two day ago (20 February 2013),

20 February

John Key said:

It is pretty straightforward. Skycity, after it decided it would be prepared to enter an expression of interest process to have a larger convention centre, went off to its architects. Its architects designed such a thing, realised they needed more land, worked out who owned the land, and approached Television New Zealand…


I cannot speak for the Television New Zealand board, but I am finding it reasonably hard to believe that Television New Zealand entered a commercial agreement with Skycity to sell land that it owned, and it did so without its board knowing. If that happened, then maybe its board process needs to be improved, and maybe the mixed-ownership model would work for it…


Caught out fabricating facts over the Skycity and TVNZ non-land-deal, Dear Leader Key is backing away faster than an Aston Marton at top speed. The NZ Herald reports,

A spokesman for Mr Key said: The Prime Minister is happy to accept the assurances from TVNZ this morning that no approach has been made”.


A “spokesman”?

Key tells a fib in the House.

Then get a Party functionary to front when he is caught out?

Not a good look for Mr Key.

At least now the media – both msm and bloggers – will be  scrutinising Key’s comments, even closer than before,  for the slightest hint of distortion or outright lie.

Such as Key claiming that he had been “vindicated” by the Auditor-General’s report. That was a distortion of  the Auditor-General’s findings.

As Toby Manhire, writing for ‘the Listener‘ said, the Auditor-General’s report on  Key’s Skycity dealings was anything but a ‘vindication’,


1. “We found a range of deficiencies in the advice provided and steps taken leading up to [the] decision.”

2. “Although decisions were made on the merits of the different proposals, we do not consider that the evaluation process was transparent or even handed.”

3. “By the time it was expected that SkyCity would put a firm proposal to the Government for support, officials should have been working to understand and advise on the procedural obligations and principles that would need to govern the next steps. We found no evidence that officials were doing so at this stage.”

4. “The meetings and discussion between the Government representatives and SkyCity were materially different in quantity and kind from those between the Government and the other parties that responded.”

5. “SkyCity was treated very differently from the other parties that responded and the evaluation process effectively moved into a different phase with one party. In our view, the steps that were taken were not consistent with good practice principles of transparency and fairness.”

6. “Overall, we regard the EOI [expressions of interest] process in stage two as having been poorly planned and executed. Insufficient attention was given to planning and management of the process as a whole, so that risks were not adequately addressed and managed.”

7. “We did not see any evidence of formal discussions or decisions on the evaluation process and criteria, or mapping out of the basic options for what might happen next, or advice to Ministers on how the process would be managed and their involvement in it. We do not regard this as adequate for a project of this potential scale, complexity, and risk.”

8. “We have concluded that the preparation for the EOI process and the EOI document, fell short of good practice in a number of respects.”

9. “In our view, the result was that one potential submitter had a clearer understanding of the actual position on a critical issue – that the Government did not want to fund any capital costs – than any other potential submitters … We accept that it is unlikely that this flaw made a material difference to the outcome. However, we have spent some time discussing it because we regard it as symptomatic of the lack of attention to procedural risks, and therefore to the fairness and credibility of the process.”

10. “We are unable to comment on the value of any contribution the Government might make as part of any eventual agreement with SkyCity, because negotiations have not yet been concluded.”



Sprung, again.

He is on notice; keep telling porkies and he’ll be sprung each time. A few more incidents like this, and the wide-spread public perception of Dear Leader will be one of someone not to be trusted.

This is something the public already suspected in November 2011, just prior to the election,


John Key - Safe hands, forked tongue





* Note

Hansards can be “corrected” by MPs and Ministers. The comments quoted above were taken from Hansards at 5.20pm on 21 February, prior to any “amendments” being made. (see previous blogpost:  Dear Leader caught telling porkies (again)?!)

Previous related blogposts

Dear Leader caught telling porkies (again)?!

National under attack – defaults to Deflection #2


Fairfax media: John Key: Safe hands, forked tongue? (10 Nov 2011)

NZ Listener: The SkyCity convention centre deal: 10 quotes from the Auditor-General report (19 Feb 2013)

NZ Herald: Sky City report ‘deeply disturbing’ (20 Feb 2013)

NZ Herald: SkyCity: Key retreats from TVNZ land deal statements (21 Feb 2013)



= fs =

Dear Leader caught telling porkies (again)?!

21 February 2013 6 comments




Oh dear, it seems that Dear Leader has been caught out (again) being creative with facts. According to Hansards, on 20 February, Key told the House,


Hansard debates - john key - skycity 20 feb 2013



Slight problem though… None of it was true.

TVNZ has come out, effectively  rubbishing Key’s comments on any supposed land sale to Skycity,


PM forced to back down over TVNZ claim



To put this into a time-linear context,

20 February

John Key said:

“It is pretty straightforward. Skycity, after it decided it would be prepared to enter an expression of interest process to have a larger convention centre, went off to its architects. Its architects designed such a thing, realised they needed more land, worked out who owned the land, and approached Television New Zealand…


I cannot speak for the Television New Zealand board, but I am finding it reasonably hard to believe that Television New Zealand entered a commercial agreement with Skycity to sell land that it owned, and it did so without its board knowing. If that happened, then maybe its board process needs to be improved, and maybe the mixed-ownership model would work for it…”

21 February

TVNZ chief executive Kevin Kendrick said:

“I’ve only been involved since May of last year, but we’ve seen the speculation in the media same as everybody else and so we’ve acknowledged that is a topic that’s live. We’ve yet to have any approaches from SkyCity about the land.”

Which means that Dear Leader either made it up; or one of his Advisors has mis-led him; or he’s talking about some Skycity-TVNZ deal from a Parallel Universe Earth.

At any rate, it kind of reminds me of this incident,  from October 2011,


S&P contradicts Key downgrade claim




That’s quite a dodgy rep that Dear Leader is developing…

Continued at: Dear Leader caught telling porkies (again)?! (part rua)




* Note

Hansards can be “corrected” by MPs and Ministers. The screen capture above was taken at 5.20pm on 21 February, prior to any “amendments” being made.


NZ Herald: Sky City report ‘deeply disturbing’ (20 Feb 2013)



= fs =

Taking responsibility, National-style

5 February 2013 29 comments


"The National Party is built on age-tested principles that reflect what is best about New Zealand. We are a party of enterprise; a party of personal freedom and individual responsibility; a party of family; an inclusive party; a party of ambition." -John Key, 27 May 2007

“The National Party is built on age-tested principles that reflect what is best about New Zealand. We are a party of enterprise; a party of personal freedom and individual responsibility; a party of family; an inclusive party; a party of ambition.” – John Key, 27 May 2007


"We also need to remember the enduring principles on which the National Party is based – individual responsibility, support for families and communities, and a belief that the State can't and shouldn't do everything." - John Key, 30 January 2007

“We also need to remember the enduring principles on which the National Party is based – individual responsibility, support for families and communities, and a belief that the State can’t and shouldn’t
do everything.” – John Key, 30 January 2007


So let’s see how well Dear Leader and National  Does Responsibility…


John Key blames burglary on drug addicts



Blame: drug addicts


Key blames production firm for DVD music woes



Blame: music production company.


Worth blames media for Key 'ticking off'



Blame: the media (always a good flogging-post for polis in trouble)


Key blames Labour for his Govt's wage gap failings



Blame: previous Labour government, Recession


Key blames Hubbard for SCF collapse



Blame: Allan Hubbard. (Hubbard had not been convicted of any offense.)


Bill English blames Labour for bad economic management



Blame: previous Labour government (again).


Govt refuses responsibility for credit downgrades



Blame: previous Labour Government (yes, again),  Europe, and the United States.


Key blames Wall St, Minto blames Key



Blame: Wall Street (an industry sector in which Key used to work)


Key blames popularity dip on election campaign



Blame: election campaign (damned inconvenient, these “election” things)


Key blames edgy policy for poll drop



Blame: Polls, “edgy” things, state asset sales, and “lots of challenges out there”.


Key blames messenger in Beckham comments



Blame: “Somebody” (or anybody, whatever)


Pike River - Key blames company for disaster



Blame: Pike Rive mining company (which was following de-regulated safety laws enacted by National in 1991.)


Govt blames global economy for jobless woes



Blame: “global economic headwinds” (but not an excuse beneficiaries may use).


Govt blames election, rugby on DPS blowout



Blame: Rugby World Cup, the general election, and Diplomatic Protection Squad.

And when National has run out of people, institutions, countries, and things to blame – they can always refer to  the mystical realm,


Parata blames 'karma' after Ministry of Education staff miss pay day



Blame: Karma.


And of course, there are the none-too-subtle attempts to blame welfare beneficiaries for not having the jobs that existed prior to 2007/08,


Free birth control for beneficiaries


Beneficiary drug testing plans unveiled


Cost of beneficiaries $78b - report


Taking responsibility, National-style – means someone else copping the blame. Or sunspots.

Are we all clear on this?





Clayton’s Responsibility – The Responsibility You’re Taking, when You’re Not Really Taking Responsibility,


Kate Wilkinson resigns as Labour Minister

Full story


Wilkinson’s resignation was almost on top of the public release of the Pike River Royal Commission of Inquiry report. She was the “sacrificial lamb”, with the deliberate  objective to short-circuit media and public debate over National’s culpability in the de-regulation of the Mining Inspectorate in 1992.

Wilkinson’s “resignation” wasn’t taking responsibility – it was a carefully-crafted exercise in damage-control.

Note that Wilkinson retained her other portfolios (at the time), along with her $250,000-plus salary plus Ministerial perks and allowances  (see:  ‘What have I done wrong?‘).

Indeed, any attempt by National to  take responsibility was watered down when Key said,

Under successive governments, since 1992, the influence and reach of the mining inspectorate was eroded.”


Mr Key says the Government accepts there were systemic failures in the regulatory regime across successive governments.” – John Key, Govt responds to Pike River Royal Commission, 5 November 2012

So there you have it. Key’s comments attempts to spread responsibility as far as possible across twenty years of successive governments. Because, as we all know, if you spread responsibility – like margerine – as wide as possible, it becomes thinner and thinner until there’s bugger-all of it left.

The Nat’s spin doctors earned their tax-payer funded salaries that day.

Taking responsibility National style reminds me of that famous phrase from the 1970  movie, “Love Story“,

Love Means Never Having to Say Youre Sorry

For Dear Leader and his cronies, the sentiment is the same,


John Key Power Means Never Having to Say I'm Responsible

“Power Means Never Having to Say I’m Responsible.”


Previous related blogpost

It’s official: Key’s mind is someone elses’ responsibilty



= fs =

John Key’s State of the Nation speech – post mortem

25 January 2013 28 comments




John Key today delivered his State of the Nation speech. This is my appraisal of the contents of his address to the people of New Zealand…

Whether it’s welfare reform, law and order, education, the rebuild of Christchurch, or continuing our improvements in public services, it’s full steam ahead.

But no mention of jobs?

We’ve made a huge turnaround in the government’s books, we’ve brought in the biggest changes to the tax system in a generation, and we’re making significant changes to reform the welfare system and strengthen work obligations.”

Still no mention of jobs!

Among other things, we’ve introduced 90-day trials; set time limits for the consenting of large projects under the RMA; introduced a competitive new system for awarding oil and gas exploration permits; got ACC back into good financial shape; and kick-started a multi-billion dollar programme of infrastructure investment.”

Where are the jobs?

” …an economy that was left unbalanced, and in poor shape, by the previous government.

Bullshit. Aside from being National’s “Big Lie“, Labour posted several Budget Surpluses, and payed down debt.  How long can National keep blaming Labour for non-existant ‘mis-management’?

“…  the impact of the Global Financial Crisis

That was FOUR years ago – what has National been doing in the meantime – aside from banging on about welfare “reforms” and adding to unemployment by cutting back on the State sector and under-mining the export sector by not addressing the high Dollar?!

Since the bottom of the recession, in mid-2009, the economy has grown at an average of just under 2 per cent a year, and economists are expecting that to strengthen further.”

Yeah? Reallllly???

Which economists? These ones; Rodney Dickens finds economists consistently over-estimated growth?

And how can it be ‘strengthening’ when unemployment is rising; the export sector is being knackered by our high dollar; and government austerity is dampening growth?


Govt austerity slows growth, keeps rates low - RBNZ



Key is practicing more of his “vacant optimism”, and bugger all else.

Our employment rate is very high in comparison to other countries, with over three-quarters of all New Zealanders aged 20 to 64 in work. There are still too many people looking for work who can’t find it.  But forecasts show employment continuing to increase and unemployment falling.

Bullshit. Unemployment has risen in the last four Quarters,


New Zealand Unemployment Rate jan 2012 - dec 2012

Source: Trading Economics – Unemployment


By what stretch of his money-addled brain is he expecting it to fall? Especially when the 170,000 new jobs predicted in 2011 by a vacantly optimistic Key, have yet to materialise.

Interest rates are at 50-year lows.

Oh, puh-leeese.

Interest rates are not determined by government. They are set by the Reserve Bank. And current interest rates are low only because the economy is weak.

Reserve Bank Governor Alan Bollard said: “New Zealand’s economic outlook has weakened a little since the March Monetary Policy Statement.

“Political and economic stresses in Europe, along with a run of weaker-than-expected data, have seen New Zealand’s trading partner outlook worsen. Furthermore, there is a small but growing risk that conditions in the euro area deteriorate more markedly than is projected in the June Statement.

The Bank is monitoring euro-area developments carefully given the potential for rapid change.“Increased agricultural production and the weakened global outlook have driven New Zealand’s export commodity prices lower.

The resulting moderation in export incomes, although partially offset by depreciation in the exchange rate, will weigh on economic activity in New Zealand. Fiscal consolidation is also likely to constrain demand growth going forward.

See: Reserve Bank Monetary Policy Statement June  2012

Is Key taking credit for a weak economy?! Go on, Dear Leader, I dare you to do it!

Prices for primary exports are holding up, and our terms of trade remain high.

Say whut? Has Key been caught out fibbing – again?  Terms of  trade are not “remaining high”. Quite the opposite,

New Zealand’s terms of trade fell to a three-year low in the September quarter as the country’s strong currency ate into returns from an increasing volume of dairy exports.

The terms of trade, which measures how much imports can be bought with a fixed quantity of exports, fell 3.2 per cent in the three months ended September 30, according to Statistics New Zealand. That’s more than the 1.8 per cent forecast in a Reuters survey of economists. Export prices sank 6.3 per cent, ahead of the 3.6 per cent expected, while import prices declined 3.3 per cent versus an anticipated 2 per cent fall.

See: New Zealand Herald – Terms of trade hit three-year low

Primary export prices are not “holding up”. They are falling,

Dairy, which accounts for about a quarter of New Zealand’s exports, was the biggest contributor to the falling export prices and rising volumes, with volumes surging 32 per cent in the quarter, even as prices sank 13 per cent.


This isn’t a “State of the Nation” report – it’s a work of goddamn  fiction.

That will be centred, of course, on Christchurch, where the spend is now estimated to be around $30 billion. But construction is also expected to pick up in other areas, and manufacturers across the country will be gearing up to supply materials.”

Again, more vacant optimism from Key.

If two major earthquakes had not trashed Christchurch, where would the “growth”  come from? What would be driving economic growth and employment? Faith in the Free Market?!


Total manufacturing rose 2.6 percent.
Excluding meat and dairy product manufacturing, sales fell 1.4 percent.
Meat and dairy product manufacturing rose 13 percent.


Total manufacturing rose 1.6 percent.
Excluding meat and dairy product manufacturing, sales fell 1.1 percent.
Meat and dairy product manufacturing rose 9.3 percent.

See: Statistics NZ Economic Survey of Manufacturing: September 2012 quarter

In any three-month period in New Zealand, between 100,000 and 200,000 jobs disappear, and between 100,000 and 200,000 new jobs are created, as businesses start up, expand, contract and close altogether.”

Is Key suggesting that there are “100,000 to 200,000 new jobs” created within a three month period?!

The man is in la-la land.

Statistics NZ revealed that for the Setember 2012 Quarter,

The number of people unemployed increased by 13,000 people.
The employment rate fell 0.4 percentage points, to 63.4 percent.
The number of people employed decreased by 8,000.
The labour force participation rate remained unchanged, at 68.4 percent.

See: Household Labour Force Survey: September 2012 quarter

I see no evidence of 100,000 or 200,000 new jobs anywhere. Unemployment, however, rose from 6.8% in the June 2012 Quarter  to 7.3% in the September 2012 Quarter.

Key’s speech mentions none of this, and is as vacantly optimistic as he was last year, or 2011, or 2010, or 2009…

Because the truth is, you only get jobs and growth in the economy when people invest money, at their own risk, in setting up a business or expanding an existing business.


But the only way net new jobs can be created is by private investors putting their money into businesses in New Zealand.”

Which brings us to the matter of Market failure. We simply are not seeing the number of new jobs required to soak up any of the 175,000 unemployed.

Since 2009, a net total of 114,200 Kiwis left for Australia and elsewhere (see: Johnny’s Report Card – National Standards Assessment y/e 2012: migration ). One could only imagine the staggering level  of  unemployment if Australia  wasn’t an economic “safety-valve” just across the ditch.

” Governments can encourage investment but they can also discourage investment.

A government can load up big costs and uncertainties onto business.

It can make people unwelcome because they are considered to be the wrong nationality to invest here, or in the wrong industry.

And it can lock up the resources of the country.

That would certainly discourage investment.

But as I said, we have to be a magnet for investment.

That’s why my Government is working hard to reduce costs and uncertainties for business.

That’s why we welcome investment that benefits New Zealand.

That’s why we are keeping our own costs down.

That’s why we are ensuring people have the right skills to contribute to the workforce.

That’s why we are ensuring the country has the infrastructure it needs to grow.

And that’s why we’re focused on opportunities to use our natural resources productively and sustainably.”

Ok. So again – where are the jobs?!

After four years of National’s “working hard to reduce costs and uncertainties for business”, “welcoming investment that benefits New Zealand”, “keeping our own costs down”, “ensuring people have the right skills to contribute to the workforce”, “ensuring the country has the infrastructure it needs to grow”, and “focused on opportunities to use our natural resources productively and sustainably” – why are we not seeing this translated into more jobs?

Instead we are seeing unemployment GROWING – not reducing.

Something is terribly wrong here.

” This year we are launching five new vocational pathways that clearly signpost the subjects young people should take to prepare for vocational careers in construction, manufacturing, the primary sector, the service sector and social services.

This year there will be over 4000 places available in trades and services academies, allowing young people to explore vocational career opportunities while still at school.

And there will be around 8700 Youth Guarantee places for young people to study fees-free outside the school environment.”

Two years after the earthquakes that levelled Christchurch?! National has belatedly realised that Market failure is not delivering the number of skilled tradespeople required, and government intervention is needed?

Oh well, better late than never. At least they didn’t wait till after the 2014 elections… Or the turn of the next century… Or the Second Coming…

“Under Labour’s wasteful management, up to 100,000 people a year listed as being in industry training were in fact “phantom trainees” who achieved no credits and in some cases were no longer alive.”

Oh, how original – more Labour-blaming!!

I suspect that figure of  “100,000” is pure Key bullshit. But regardless, how long is National going to use Labour as a scapegoat?! Especially since, I suspect, that had National kept Labour’s apprenticeships scheme, we’d have the necessary numbers of tradespeople to help re-build Christchurch.

But I guess it’s easier for the Nats to do nothing; wait for the Market to deliver results – and then blame Labour when that nutty idea crashes and burns.

I hope Key realises that the finger-pointing of Labour-blaming is wearing rather thin? People are wondering when the Nats will start taking responsibility for their actions. Especially since National is the Party of personal responsibility,

We also need to remember the enduring principles on which the National Party is based – individual responsibility, support for families and communities, and a belief that the State can’t and shouldn’t do everything.” – John Key, 30 January 2007

Source: National Party

“That has freed up some very significant funding to re-invest in expanding apprenticeships.”

Oh? How much?

Is this “new” money?

Or money stolen from other budgets such as Vote  Health, eg;   for grommet operations for kids with glue ear? (see:   Grommet cuts fear )

One will excuse my cynicism, but with National’s current maniacal obsession with balancing their books, they are constantly robbing Peter to pay Pauline. The net result is that state services are being cut back and no  part of our community is safe from National’s cost-cutting slash-and-burn activities.

One thing is for sure – some other part of the community may find their services wound back to pay for National’s “expanding apprenticeships”.

” So today I am announcing a new initiative to expand and improve apprenticeship training.

This has a number of parts to it:

1. From 1 January next year, we are…”

“Next year”?!?!

Well, never let it be said that National moves with decisive speed when confronted with critical economic and social problems.

Initiating their “new” apprenticeships scheme will mean another year that Christchurch suffers a shortage of trained workers; another year we could have been training some of the 85,000 unemployed youth in this country. Another year – wasted.

This isn’t a government “on top of things”. This is procrastination by deliberate design. Perhaps Key is hoping that the Market will do the job in the next twelve months, giving National an excuse to quietly forget and drop this scheme?

“…we estimate that around 14,000 new apprentices will start training over the next five years, over and above the number previously forecast.”

This sounds remarkably familiar… Didn’t we get a similar promise in 2011,

Treasury say in the Budget, as a result of this platform on what we’ve delivered, 170,000 jobs created and 4% wage growth over the next three to four years.” – John Key, 19 May 2011

See: Budget 2011: Govt predicts 170,000 new jobs

Which was backed up on their 2011 election flyer,

“National’s Brighter Future Plan will help businesses create 170,000 new jobs over the next four years.”

Source: National Party

That one didn’t work out very well either.

Key went on to say,

“The whole idea is to kick-start new apprenticeship opportunities ahead of the curve, so that thousands of New Zealanders get to learn a new trade that will last them a lifetime.”

I have a simple question for our smile and wave Dear Leader; why didn’t they do this immediatly after the 2008 election? Why didn’t this come out of the Jobs Summit in 2009?

And why, as he’s said above, are they now leaving this critical problem to be addressed next year???

All in all – there is little here to create new jobs, now, when we need it the most. Even his comments regarding infrastructure are just so much ‘fluff’,

“Moving on to infrastructure, the Government will this year continue its significant programme of investment, which supports thousands of jobs across the country.”

Well that “support for thousands of jobs across the country” hasn’t worked out so well. Unemployment has risen four quarters in a row. Redundancies were happening across the board, up and down the country. 175,000 New Zealanders are now out of work. Three months prior, that number was 162,000.Before that, 160,000. (see previous blogpost: Johnny’s Report Card – National Standards Assessment y/e 2012: employment/unemployment ) The numbers are going the wrong way.

“In terms of housing, the Government is itself planning to build more than 2000 houses over the next two financial years…”

Two thousand?

That number is derisable and falls woefully short of the 20,000 new houses  required to be built each year to keep up with demand. As Warwick Quinn, from the Registered Master Builders Federation, said last October,

New Zealand had fallen way behind the required build rates of 20,000 homes a year, hit by the global financial downturn that began in 2008...”

See:  20,000 houses for Chch in next five years

Two thousand new houses over the next TWO years?

That doesn’t cut it, Mr Key. Not even close. In effect, what Dear Leader has done is acknowledge that a critical housing problem exists – but that National is unable/unwilling to address it in any meaningful way.  Their ideological attachment to free market dogma binds their actions at every turn.

Two thousand new houses over two years is a joke. Not a particularly funny one at that.

” We need more houses built in New Zealand, at a lower cost. That means we need more land available for building, more streamlined processes and less costly red tape.”

Now THAT comment worries me.

Didn’t we go through a de-regulation of the building industry in 1991? And didn’t we end up with billions of dollars of poorly built homes that leaked and rotted?

And wasn’t the end result of that disaster a situation where  liability ended up with local body councils paying 25% for repairs; central government 25%; and  home owners were lumped with 50%?! Oh indeed that IS the case!

Up to 89,000 home owners were affected by the “red tape” de-regulation of the early 1990s – and Key appears to be staggering drunkenly  down the same route. (see: Leaky home payouts start tomorrow )

Will this be a  repeat of the same errors of history all over again?!

Key went on,

” It’s ridiculous that we allow councils to demand almost anything as a condition for the consent.

And it’s ridiculous that we allow them to charge whatever fees they want.”

Why not? After all, National demands whatever taxes and government fees they want. Eg; rising petrol taxes; increased early childhood costs; increased ACC fees; raised GST, etc.

But when backed into a corner, default to Strategy #1 – blame Labour. As Key then said,

” Labour’s so-called ‘plan’ to build 100,000 houses doesn’t do anything to fix the actual cost of building – so will either fail miserably, deliver dwellings that people don’t want to live in, or require massive taxpayer subsidies. It’s dishonest and it doesn’t stack up.”

Well, Key would know about dishonesty: John Banks. Raising GST when promising not to. Mystery email regarding Standard & Poors. Clandestine meetings with Skycity executives. Pledging meals in schools, then recanting.

Key derides Labour’s plans to build 100,000 new houses, proclaiming it will “fail miserably”.

This from the smile and wave man who lives in a multi-million dollar mansion; has a holiday home in Hawaii; and god knows what other property – while young New Zealanders are desperate to buy their own homes. (See: Frustrated home buyers want investors to be discouraged)

This from the same smile and wave man who offers New Zealanders 2,000 new homes over TWO YEARS.

It beggars belief how anyone can take John Key seriously these days. The man is a joke.

Key then took the stick to local body councils,

“But if councils aren’t able to change their planning processes, then the Government would have to get a lot more proactive, because we are very serious about resolving this issue.”

Oh really? “Very serious”, eh? So serious that in four years National has done nothing about our housing shortage?

Moving from blaming Labour, Key now seems to be beating up on  local body councils.

Does National ever take responsibility for anything?!

On the environment…

” New Zealand is rich, for example, in minerals. The Greens and Labour oppose it, but we are going to continue to encourage development of our country’s oil, gas and mineral resources.

Looking across our resource base as a whole, what’s clear is that we need a much better system of planning and resource management – one that enables growth and provides strong environmental outcomes, and does so in a timely and cost-effective way.”

National’s ‘devotion’ to “strong environmental outcomes” is amply illustrated by their abandonment of the Kyoto Protocol; watering down the ETS,  and scrapping the five yearly State of the Environment Reports, despite John Key having endorsed it in September 2008 as one of National’s own policies. (See: National scraps crucial environmental report , Government shuns second Kyoto committment )

Anything Key, or one of his ministerial muppets, utters about environmental concerns can be safely dismissed as empty platitudes.

On the TPPA,

“The Greens and their fellow travellers say the TPP is anti-democratic. That is nonsense.”

Interestingly, Key does not say why claims that  the “TPP is anti-democratic” are “nonsense”.

Nor does he acknowledge that the TPPA negotiations are currently held in secret. The public and media are excluded from proceedings. Eventually, the TPPA presented to Parliament will  be a done deal, with no chance for media analysis and public oversight. If that’s not anti-democratic then I fear that Dear Leader has no concept of the principles of democractic participation.

Considering Key’s penchant for secretiveness when it comes to deals with corporates such as Mediaworks, Skycity, et al, It’s not clear to me why we should take him at his word.

On asset sales…

” Subject to the Supreme Court’s decision, this will start in the first half of the year with our offer of up to 49 per cent of the shares in Mighty River Power.

We also want to proceed with another IPO later this year.

The whole share offer programme will be a shot in the arm for New Zealand’s capital markets.”

Really? So National is flogging of half of Meridian, Genersis, Mighty River Power, Solid Energy, and further down-selling Air New Zealand… to satisfy “New Zealand’s capital markets”?!

Key’s background as a money-trader appears to have besotted him. The Big Sell-off has begun, and he’s positively salivating at the prospect.

Meanwhile, over 75% of New Zealanders don’t want a bar of state asset sales. But hey, so what? Anyone would think this was a democracy?

“At the same time, the Government will maintain majority ownership of the companies, and will use the proceeds to invest in other public assets, like schools and hospitals.”

Rubbish. National will use the proceeds to balance their books. Any other suggestion to the contrary is patent nonsense.

“That’s because overseas investment in New Zealand adds to what New Zealanders can invest on their own.”


That makes no sense… Typo? Brain-fade? A drunk speech writer?

“It creates jobs, boosts incomes, and helps the economy grow.”


So much bullshit…

Let’s remind ourselves  for the zillionth time that,

  • unemployment is up
  • the income gaps between New Zealand and Australia continues to widen
  • the economy is “growing” at a snail’s pace and as it does, our Current Account deficit grows. Why? Because increasing economic activity boosts profits for foreign owned companies, which means more  profits remitted overseas, which results in a worsening Current Account deficit. That, in turn, impacts on the interest rate we pay for our own capital (borrowings for mortgages, etc),

John Key knows all this – but he ain’t sayin, Billy-Bob boy.

And businesses aren’t so happy either,


The axe falls - Industry boss blames cuts on Govt


On Science & Innovation…

” Finally, despite tight times, the Government is continuing to put a real priority on science and innovation. Research funding will be greater this year than it ever has been, because new ideas are a key driver for a modern economy.”

Didn’t National remove the 15% R&D tax credit soon after winning the 2008 election? If that’s putting “a real priority on science and innovation” – I’d hate to see the Nats in full-flight when they positively hate something. (Oh yeah, kinda like beneficiary bashing.)

So back to default Strategy #1,

“But I can guarantee you one thing – Labour will oppose almost all of it.”

Yeah. Piss poor of Labour not to support National when Key demands absolute fealty. In fact, Labour, Greens, and NZ First should just bugger off and leave National to govern on it’s own… and we know what that’s called, don’t we?

dancing cossacks

Perhaps  New Zealand would be better served if – instead of constantly deriding and blaming Labour, the Greens, NZ First, local body councils, and Uncle Tom Cobbly – that National focused on the problems confronting our nation; our economy; and our society.  Fixating  on  Opposition Parties for eighteen  paragraphs is not a good look. Defensive, much, Mr Key?

John Key’s constant reference to Labour makes him look fearful – and perhaps so he should be.

By 2014, National will have been in office for six years, with very little to show for it. If Key goes to the election with nothing more except playing a bitter blame-game against Labour, voters will desert him in droves. Voters want results; something reassuring to make them feel better –  not excuses. Certainly not high unemployment, a stagnant economy, growing child poverty, lagging wages, more and more people taking flight to Australia, etc.

” As for the National-led Government, our plan will encourage investment, strengthen the economy and boost jobs.

People know what that plan is, we have stuck to it and we will continue to stick to it.”

Well, I’m happy-as-larry that National has a plan. Because most people haven’t got a clue what Dear Leader and his Nat mates are up to. Aside from cutting state and social services,  asset sales, and subsidising multi-billion dollar film companies, most New Zealanders are scratching their heads wondering precisely what this wonderful “Plan” is.

In 2011, business leaders were asking precisely the same thing,


Business NZ sees no economic plan

See: Business NZ sees no economic plan


Key’s speech can be summed up threefold;

1. Consisting mainly of wishful fantasy – with facts and the last four years disproving almost everything he claimed as a “success”,

2. Constantly blaming others for his own Party’s policy-failings. Grow a pair, Mr Key; man up and own your failings.

3. National’s faith in the ability of the Market to produce economic growth, jobs, and higher wages has been sadly misplaced. His announcement on 2,000 new homes over two years is an insult, and National’s new apprenticeship scheme is two years too late, and too little.

National’s neo-liberal policies are more faith-based dogma than anything rooted in Real Life – and the chooks are coming home to roost.

This wasn’t a State of the Nation speech – it was a Statement of  National failure. A Hekia Parata-style own-goal.

If this is National’s idea of a “bright new future”, they’ve just sent Labour and the Greens a very long concession speech for the next election.




NZ Herald: Full text: John Key’s state of the nation speech

Other blogs

Pundit: Mom, apple pie, apprenticeships & not much else

Idle thoughts of an Idle Fellow: The Ruminations of Robert Winter: The Negative Mr Key

The Dim Post: All part of the service


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Garrick Tremain sums it all up in one cartoon!

22 January 2013 4 comments


All my blogposts summed up in one, concise cartoon…


I want a job_we want a house_I want a safer community_I want us to catch up with Ozzie_they tell me they want our assets sold



Peter Martin

Related blogpost

Thieving Tories chomping at the bit to sell our state assets



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John Key: When propaganda photo-ops go wrong…

23 November 2012 16 comments



Desperate measures…


Desperate to seize power from Labour, and faced with strong, experienced leadership in the form of Helen Clark and Michael Cullen, National and it’s fresh,  new leader – John Key – launched a series of public-relations  media/propaganda initiatives. One of those propaganda exercises, a photo-op with a schoolgirl, would come back to haunt  Dear Leader and ridicule one of his major pledges…


Opening shots…


The campaign to mark out National’s “human face of neo-liberalism” was launched  on  30 January 2007, when Key made his speech  “The Kiwi Way: A Fair Go For All” at the Burnside Rugby Clubrooms, Christchurch.

See: The Kiwi Way: A Fair Go For All

It had all the nice, warm, fuzzy sound-bites; “good Kiwi upbringing“; “betterment of all New Zealanders“, “proud of our culture and society“; “opportunity and hope“; “giving people a fair go”; “egalitarian society“; “The Kiwi Way” (mentioned ten times); “born into a struggling household“, etc, etc, etc…

Whoever wrote that speech really mined the  handbook of the Kiwi Psyche.

But the real opening shots in the political battle for the hearts and minds of New Zealanders began in the opening months of 2007 – two full years leading up to the November 2008 general elections.

Reading many of Key’s speeches and policy announcements,  was almost like tapping into a Scandinavian model of a social democratic society. Michael Joseph Savage would have nodded in approval to many of Key’s utterances.

Especially when, on 3 February 2007, Key announced the launching of National’s “Food in Schools programme“. It was pure 1930s Labour stuff,


National Party Leader John Key has announced the first initiative in what will be a National Food in Schools programme.

“National is committed to providing practical solutions to the problems which Helen Clark says don’t exist,” says Mr Key.

During his State of the Nation speech on Tuesday, Mr Key indicated National would seek to introduce a food in schools programme at our poorest schools in partnership with the business community.

Mr Key has since received an approach from Auckland-based company Tasti foods.

“I approached Wesley Primary School yesterday, a decile 1 school near McGehan Close, a street that has had more than its fair share of problems in recent times. I am told Wesley Primary, like so many schools in New Zealand, has too many kids turning up hungry.”


See: National launches its Food in Schools programme

Of course once National came to power twentyone months later, on 8 November 2008,  Key’s  quasi-socialistic policy of  ”  providing practical solutions to the problems which Helen Clark says don’t exist “, quietly slipped beneath the waves and disappeared from public sight.

It had achieved it’s purpose.

In fact, National’s policy stance  on any suggestion of  Food in Schools programmes, is now somewhat more hostile,


Organisations working with the poor and opposition parties say Prime Minister John Key is in ”la la land” if he thinks fruit is enough to get a hungry child through a school day.

Labour yesterday unveiled a $10 million policy to provide free food to 650 of the country’s lowest decile primary and intermediate schools.

Key immediately rejected the idea, saying free fruit was already provided in the ”vast bulk” of low-decile schools and there was often a breakfast programme.

”Not every school wants every child to be provided a lunch,” he told reporters in Russia before leaving for Japan. ”There are many families that can provide those lunches’.”‘

See: Key in poverty ‘la la land’

And in case anyone missed the point that National was not about to follow the Scandinavian model of  helping  children living in poverty,

Prime Minister John Key says beneficiaries who resort to food banks do so out of their own “poor choices” rather than because they cannot afford food.

Mr Key made the comment when asked in Parliament yesterday about poverty levels.

When Labour’s social development spokeswoman Annette King asked about Salvation Army reports of high demand for food parcels, Mr Key responded by saying it was true that the global recession meant more people were on benefits.

“But it is also true that anyone on a benefit actually has a lifestyle choice. If one budgets properly, one can pay one’s bills.

“And that is true because the bulk of New Zealanders on a benefit do actually pay for food, their rent and other things. Now some make poor choices and they don’t have money left.”

See: Food parcel families made poor choices, says Key


Not only has National’s  “Food in Schools programme” vanished, and subsequently replaced with naked antipathy, but this blogger’s emails to the Prime Minister’s office on the issue have gone unanswered.

Too embarressing, no doubt.


Firing Photo ops missiles…


On 6 February 2007, National’s tax-payer funded spin-doctors organised this photo-op for Dear Leader,


Aroha Ireland, John Key, McGehan Close, Waitangi Day

Full story


Key was attempting to re-play  a much earlier scene on Waitangi Day in 1973, when then-Prime Minister, Norman Kirk walked onto the grounds on Waitangi, with then-ten year old, Moana Priest,



Acknowledgement:  Life and career of the late Prime Minister Norman Kirk, Herald Book


However, it can safely be stated that the  difference between Kirk and Key was/is monumental. It was a  distance between two men that can only be measured in interstellar terms.

Kirk believed deeply  in what he was doing.

Key simply exploited a naive young girl and her family for a photo-op –  which we all now by now is something he cannot pass by.

In the Herald, on 6 November 2007, Aroha and her family expressed delight at attending Waitangi Day celebrations with the leader of the Opposition (as he was then),

Yesterday morning, Mr Key picked Aroha up in a Crown limousine and took her to Waitangi with him, discussing, among other things, her favourite band, Panic at the Disco.

She described the trip – one of the few she’s made outside Auckland and which included her first stay in a hotel – as “exciting”.

She said her family were also rapt with the visit, and felt much more comfortable when they realised National list MP Jackie Blue, who accompanied Mr Key to McGehan Close, would be with her for the trip.

Dr Blue was Aroha’s grandmother’s doctor and also attended to her mother, Joan Nathan, so “Mum said I’d be in good hands”.

The pair spent part of the day with Mr Key but slipped away for lunch at the Copthorne Hotel, where Aroha described the chips as great but said she didn’t think the fish was fresh.

“Dad always says if it doesn’t fall apart it’s not fresh.”

Aroha said she knew little about events at Waitangi on Waitangi Day, but was looking forward to finding out.

See: A day out with friends in high places

It’s somewhat disturbing to note that National list MP Jackie Blue, who had a close personal  relationship with Aroha’s family, played along with the photo-op. That was despite reservations expressed by some,

Labour list MP Dover Samuels was the only one publicly labelling Mr Key’s invitation a stunt yesterday, but others quietly voiced similar concerns.

See: Ibid

The family, though, seemed blissfully unaware that they were little more than pawns in National’s pre-election grand strategy and expressed their comfort with events,

Mrs Nathan told Close Up last night that the invitation had given her daughter a good opportunity.

She continued to disagree with some of Mr Key’s views on McGehan Close, but she believed he was trying to push for positive changes.

See: Ibid

Three months later, on 27 May 2007, Key referred to Aroha Ireland in a speech strangely entitled, “Tough on Crime”. His reference to Aroha was fleeting (as was his brief intervention in her life), barely rating a mention,

For the past six months, I’ve had the privilege of travelling New Zealand from city to town talking to the people who make our country tick. I’ve been to places like McGehan Close and met people like Aroha Ireland, a young girl with big dreams for her future. I’ve milked cows in Horowhenua. I’ve visited primary schools in Canterbury. I’ve met with iwi in Ruatoria. “

See: John Key’s speech  – Tough on Crime

Cows weren’t the only thing he milked

In the same speech, Key ramped up the aspirational rhetoric,

The first ‘E’ is the economy. National will emphasise this theme because we are committed to delivering New Zealanders the fruits of a wealthier country. Make no mistake – Labour’s policies are seeing us fall further and further behind the rest of the world. The recent Budget did absolutely nothing to alleviate that slide.

Michael Cullen has given up on growing our economy, instead he’s preparing for retirement: Labour’s retirement.

Well, National is a lot more ambitious than that. We think Kiwis deserve higher wages and lower taxes during their working lives,as well as a good retirement. That’s why we will pursue economic policies and infrastructure development that will keep New Zealand competitive on the world stage. Make no mistake – Bill English’s first Budget will include tax cuts.

See: Ibid

The rest of Key’s speech was pure knee-jerk, tough-on-crime, BS – so beloved by National’s fearful aging middle classes.


Shots that re-bound and ricochet


Three Years later, and Key’s visit to McGehan Close had lost it’s gloss, as the NZ Herald reported on 10 February 2010,

The mother of the 12-year-old girl John Key took to Waitangi three years ago says she has been let down by the Prime Minister, and her daughter now wants nothing to do with him.

Joan Nathan said she and her family were worse off since National won the election.

She’d lost her job with National list MP Jackie Blue, arranged by Key, and a training allowance she received had been cut.

“They gave me the job to sweeten the deal, and then as soon as they got elected I got the sack,” she said.

“I’m pretty anti-Mr Key at the moment”..


“He’s just made everything worse for us and made it easier for ones that are higher up. I’m struggling every week.”

See: Family still on struggle street after Key leaves

The NZ Herald story went on to state,

A spokesman for Key said he had visited her home last year to try to help resolve the housing issue, and had spoken to her on the phone several times since the election. Key didn’t wish to make any further comment.

See: Ibid

Yeah. I’ll bet he didn’t want to comment.

Why should he? Aroha Ireland had served her purpose for the 2008 general election, and like some Bond Villain, Key was now disposing of his ‘puppets’ – they were no longer useful for his grand Master Plan for World New Zealand Domination.

And  Key’s crony, National MP Jackie Blue’s,  response was even more insightful,

Jackie Blue said Nathan worked 10 hours a week doing administration for Mt Roskill office up until the 2008 election.

She wasn’t re-employed because Blue merged her office with Lotu-Iiga, and didn’t need to rehire staff.

Blue said she had tried to keep in touch, but Nathan’s phone had been disconnected.

See: Ibid

Irony heaped upon grim irony… made redundant from a faux-job created specifically by the Nats as an enticing  “lolly” for Joan Nathan (Aroha’s mother)… phone disconnected as a sign of lowered income and encroaching poverty… Ms Nathan’s loss of employment symptomatic of National’s do-nothing approach to the country’s growing unemployment crisis…

Little wonder that Aroha Ireland no longer wanted to talk about Key’s visit three years ago. One cannot feel any measure of   pride in  being used.

John Key’s photo-op had gone full-circle, and was lining up to tear big chunks from Dear Leader’s arse.

If anything, Aroha’s situation was now a prime example of National’s policies (or lack thereof) – but not as the Nat’s politburo had intended.


Shot himself in the foot…


By November of last year, Key’s photo-op with Aroha Ireland had jumped from expressions of disgust, by her family at being exploited, to one of high farce for the Nats – and a measure of  hope for Aroha.

Ms Ireland was joining the flood of New Zealanders escaping over the Berlin Wall Tasman Sea to a Brighter Futurein Australia,

National leader John Key says the teenager he took to Waitangi Day three years ago is not leaving for Australia because life is better there.

Aroha Ireland, 16, became the face of National’s campaign to close the gap with Australia and help struggling families during the last election campaign.

Now it has been reported that Miss Ireland is headed across the Tasman.

See: PM denies teen leaving for good life

Dear Leader sez  “the teenager he took to Waitangi Day three years ago is not leaving for Australia because life is better there ” ?!

Oh yeah, spin it, John Boy, spin it!

Key went on to state (with a straight face, I hope) that  he did not think she was going because of the yawning wage gap, between our two countries,

I’m proud of the Government’s record – in difficult times, we’ve closed that wage gap with Australia. We’ve grown after-tax wages by 10 per cent in the last three years, Australia by six.”

Except… well… Yeah, nah. John Key is now piling the BS on top of his previous outrageous spin. The facts speak otherwise – the wage gap is growing, not reducing, despite what Key and his spinmeisters might want us to believe.

In fact, Key should be fully aware that he was being less than truthful by suggesting that the wages gap was closing. As right wing politician, and  ex-Reserve bank governor, Don Brash stated only two weeks earlier,

In 2008 we estimated the gap was 35% currently it’s nearer 40%.”

See: Aussie wage gap now 40% – Brash

(Unfortunately, Brash’s brief moment of lucidity was short-lived, and he thereafter  descended into right wing nuttery to solve the growing wage gap. In essence, more of the same of the last thirty years. What’s that definition of craziness; doing the same thing over and over again and expecting a different outcome?)

It was little wonder that Key claimed he had “no idea” why Aroha was escaping to Australia,

Lots of young people decide to go for an OE – I don’t know how long she’ll last. I’m not in a position to go into too much; hope she comes back.

I’m disappointed she’s going for her, because I think New Zealand has got a great future in front of it and I’d like her to be part of it.

See: PM denies teen leaving for good life

Of course Dear Leader knows why Aroha left New Zealand. But to admit it would be a colossal admission of National’s failure to address critical economic and social problems in our country.

Key’s comments are lame by any standards. We simply laugh harder and louder at his moronic utterances.

A year later, all doubt was removed why Aroha Ireland – like thousands of other New Zealanders, before and since, her voting with her feet – had moved to Australia…


And the photo-op blows up in Key’s face…


According to a NZ Herald report this year, Aroha’s move to Australia held no great mystery,

… Aroha Ireland has given up on New Zealand, is engaged to be married and earning good money with no plans to return to her homeland.

The 17-year-old bailed for the lucky country last year, disillusioned with her prospects in Auckland.

Miss Ireland, who is engaged to Stuart Spashett also of Auckland, did not return the Herald’s calls.

She has told family members and friends she is embarrassed by the publicity that followed her since her visit to Waitangi in 2008.

Lisa Spashett, who calls herself Aroha’s second mum, said the Government had failed people like her future daughter-in-law.

She said there was nothing for them in New Zealand to look forward to or return to.

See: Key’s poster girl finds life much better in Australia

Ms Spashett went on to say, with drilling, laser-beam, accuracy,

As far as they are concerned, no, they [the National Government] hadn’t done anything for them. I can tell you that straight up and that’s why they are in Australia.”

See: Ibid

From 6 February 2007,


Aroha Ireland, John Key, McGehan Close, Waitangi Day

Full story


… to 13 November 2012,


Full story


From self-serving exploitation by a cynical multi-millionaire-cum-politician – to an embarressing example of  National’s failure.

And the best thing about this? National has shot itself in it’s own foot, with no help from it’s political opponants whatsoever.

They did it to themselves.






National Party Speech – The Kiwi Way: A Fair Go For All (30 Jan 2007)

National Press Release – National launches its Food in Schools programme (4 Feb 2007)

A day out with friends in high places (6 Feb 2007)

Aroha is missing her Key friend (10 Feb 2007)

National Party Speech  – Tough on Crime (27 May 2007)

Family still on struggle street after Key leaves (7 Feb 2010)

Aussie wage gap now 40% – Brash (7 Nov 2011)

PM denies teen leaving for good life (21 Nov 2011)

Key’s poster girl finds life much better in Australia (13 Nov 2012)



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Dear Leader, GCSB, and Kiwis in Wonderland…

1 October 2012 12 comments




As the Dotcom-GCSB Affair drifts further into ‘The Twilight Zone‘ (or Wonderland),  we learn the latest anouncement that Secretary of Cabinet, Rebecca Kitteridge, will be seconded to the GCSB to oversee a review of the Bureau.

The NZ Herald reports,


Full story


The Herald lists Ms Kitteridge’s responsibilities to include:

  • Review the systems, processes and capabilities underpinning the GCSB’s collection and reporting,
  • Build capability and provide assurance to the GCSB director that the compliance framework has been reviewed, improved and is fit for purpose.
  • She will establish new, specific approval processes for activity in support of police and other law enforcement agencies.




Meanwhile, NZ First Leader, Winston Peters, managed to extract this gem from Dear Leader during Question Time in Parliament,

Government Communications Security Bureau—Briefings Since November 2008

3. Rt Hon WINSTON PETERS (Leader—NZ First) to the Prime Minister: How many times has he been formally briefed by the Government Communications Security Bureau, by year, since November 2008?

Rt Hon JOHN KEY (Prime Minister) : My diary indicates that I have been formally briefed by the Government Communications Security Bureau the following number of times, by year, since 2008: twice in 2008, 15 times in 2009, 11 times in 2010, 10 times in 2011, and 15 times in 2012.

Source: Parliamentary Hansards, 25 September 2012

Key’s response is extraordinary for two reasons,

  1. He gave a serious answer and not the flippant, juvenile wise-cracks he normally indulges in (which, we, the taxpayer, have to pay for as he wastes Parliamentary time)
  2. The answer he gave revealed that Key had met with the Government Communications Security Bureau (GCSB) fifteen times this year alone – and the subject of GCSB surveillance on Kim Dotcom – possibly one of the most colourful, controversial, and contentious people in the country – was never raised once?!?!

John Key. Met. With. The. GCSB. Fifteen. times.




It is worthy to note that Ms Kitteridge’s  three areas of responsibilities,

  • Review the systems, processes and capabilities underpinning the GCSB’s collection and reporting,
  • Build capability and provide assurance to the GCSB director that the compliance framework has been reviewed, improved and is fit for purpose.
  • She will establish new, specific approval processes for activity in support of police and other law enforcement agencies.

… and nowhere is it written that she should ask the question on all our minds: how can the Prime Minister – the one man who has oversight  over the SIS and GCSB – not have discussed Kim Dotcom with either of the Security Agencies?

There can be only two possibilities;


Key lied – and the matter of Dotcom was discussed.


The GCSB deliberately witheld this matter from the Minister in charge of the GCSB.

Either way,

Why are there no resignations/sackings?

Why is Ms Kitteridge not charged with finding out the truth of this issue?

Why is John Key refusing a full inquiry on this issue?

Why did Bill English sign off on a warrant to suppress the GCSB’s wrongdoing?

Who lied?





Parliamentary Hansards, 25 September 2012 (25 Sept 2012)

Inspector-General’s report released by PM (27 Sept 2012)

Dotcom case: GCSB review ordered (1 Oct 2012)

Cabinet Secretary to head review of spy agency (1 Oct 2012)

Other Blogs

5AA Australia: Across The Ditch With Sean Perry & Selwyn Manning – The Illegal GCSB Spying Scandal



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John Key: Man of Many Principles

28 September 2012 29 comments



In case anyone has been holidaying on Planet Key lately, and missed the latest shenanigans from the Ninth Floor of the Beehive,  John Key has apparently  abandoned his earlier principles rejecting  possible coalition deals with Winston Peters. He  has found new principles of  “wait and see”.

In 2008 and 2011, Dear Leader Key was fairly adamant and all but promised to poke himself in both eyes with red-hot pokers, rather than go into any coalition with Peters,








But this blogpost is not about Key’s ‘principles’ which, as we all know by now, are so bendy-twisty ‘flexible’ as to be positively plasticine.  When Key assures us that the sun will rise tomorrow morning, we still want to see it for ourselves. Just to make sure.

Indeed, another blogger – NZ Pundit – scarily predicted back  in August 2008  that Key’s “read-my-lips’ rejection of Winston Peters, as a possible coalition partner, was little more than a “hollow promise“, and would change overnight if National found itself desperate for a coalition partner.

See: NZ Pundit – Key’s Hollow Promise On Winston

Fast forward to 2012 – National finds itself desperate for a coalition partner.

With ACT now a Dead-Party-Walking after one scandal too many and Peter Dunne effectively a One-Man-Party, that leaves the Nats with two options;

  • The Maori Party. Does National really want to be beholden to a Maori nationalist party? Even if it is a paler-version of Hone Harawira’s Mana Party? Will the Maori Party make it back in 2014 anyway?
  • The Conservative Party. Notwithstanding it’s quasi-religious flakiness, Colin Craig has managed to alienate about 60% of the population (women and gays) plus probably everyone else with two interconnected braincells. Even if National drops the MMP Party threshold from 5% to 4%, there is no likelihood Craig will increase his electoral support.

In reality, with John Key showing the amorality of a  political  serial-adulterer, he will take whatever option is on offer. Whether his coalition bedmate is  the Maori Party  or CCCP (Colin Craig’s Conservative Party) or a menage a trois of both, concerns him nought.

As long as he can cross that magic 61 or 62 seat majority (depending on over-hangs) is his sole concern.

To achieve that end, National’s back-room strategists have been working over-time and have fixed their laser-sights on Winston Peter’s New Zealand First.

Said strategists have taken a single  approach to dealing with NZ First – with two planned outcomes.

In both scenarios, National makes overtures to NZ First and make it clear to the voting public that this time, Key will not resile from a  National-NZ First Coalition . Key will make the age of super entitlement and promise of abandonment of asset sales two prime factors that Peters will  find hard to reject. ( Peters is not as hard-line in his opposition to asset sales as he makes out.  See “Peters switch on Asset Sales“)

A third common ground between the Nats and NZ First;  if water rights is still a burning political  issue, this will move NZ First to the right, into National’s camp, as both parties have stated positions firmly rejecting Maori aspirations on this issue.

1. Yay

First scenario; Despite been seen as “cosying up” to National, NZ First retains electoral support, and makes it over the 4%/5% threshold. With Peter Dunne, John Key leads a third term of a National-led coalition government.

Outcome: win for National and John Key.

2. Nay

Second scenario;  As National electoral support drops and public hostility to John Key increases, any perceived “cosying up” between the Nats and NZ First is viewed with displeasure by Peters’ supporters.

NZ First’s supporters – traditionally seen as the “grumpy vote” – either do not bother to cast a vote on Election Day (as many of Labour’s supporters stayed away last November), or cast their vote for the Conservative Party or possibly  Labour.

NZ First fails to cross the 4%/5% threshold, and loses their seats in Parliament. In effect, National has been toxic to NZ First. Why would voters support NZ First if appears they will  be getting a National-led government? Those who vote NZ First traditionally do so as a protest vote against the incumbent government (whether Labour-led or National-led).

Outcome: win for National and John Key.

Both scenarios are a No Lose situation for National. Except that in Option #2, any perception of a “cosying up” by National to NZ First may mean the “kiss of electoral defeat” (again) for Peters. If National’s support drops further in the polls; if Key’s status of Preferred Prime Minister  wanes; and if the Nats are seen as ineffectual in a stagnating economy – does Peters want to be “tarred by association” by a Party on the way out?

Many New Zealanders – especially those in the late 30s and older – will remember the events of December 1996.

Many voters viewed NZ First’s decision to coalesce with Bolger’s National Party as an electoral betrayal – especially when Peters had made several Key-like statements during the 1996 election campaign. These statements were  unequivocal in denouncing National as a a potential coalition partner, and sent a clear message to the voting public,


Jim Anderton: Is the member going into a coalition with National?

Winston Peters: Oh no we are not. – Parliamentary Hansards, P14147, 20 August 1996


There is only one party that can beat National in this election that that is New Zealand First. – Winston Peters, 69 & 85 minutes into First Holmes Leaders Debate, TVNZ, 10 September 1996


Of course I am not keen on National. Who is?

… This is a government bereft of economic and social performance  [so] that they are now arguing for stability. – Winston Peters, Evening Post, 25 June 1996


The prospects are that National will not win this election, that they will not form part of any post-election coalition. – Winston Peters, The Dominion, 5 October 1996


It is clear that this National government will use every means at its disposal to secure power… Come October 12…  Two months ago I warned that the National Party would use every trick and device at their command to to retain their Treasury seats. – Winston Peters speech to Invercargill Grey Power, 26 August 1996


The Prime Minister [Jim Bolger] is not fit for the job and come 12 October he will be out. He should not get on his phone and call me like he did last time, because we are not interested in political, quisling  behaviour. We are not into State treachery. – Winston Peters, Parliamentary Hansards, P14146, 20 August 1996


We believe the kind of politician depicted by Bolger, Birch, and Shipley is not to be promoted into Cabinet. As a consequence we will not have any truck with these three people. – Winston Peters, NZ Herald, 22 July 1996


We are a party that says what we mean and mean what we say, regardless of the political consequences. – Winston Peters, Speech to public meeting, 9 October 1996


Despite Peters’ assurances,  on  11 December 1996  the public woke up to this announcement,


Front page, Otago Daily Times, 11 December 1996


The following three years were harsh for NZ First, culminating in it’s tearing apart in late 1998.The party split in two, with the ‘rump’ NZ First, and breakaway ‘Mauri Pacific‘, led by Tau Henare (now a National MP).

NZ First was nearly annihilated in the following year’s General Election, with Peters barely retaining his seat of Tauranga,

1996 – NZ First Party Vote: 276,603 (source) – Peters’ Electorate Vote: 18,997 (source)

1999 – NZ First Party Vote: 87,926 (source) – Peters’ Electorate Vote: 63 (source)

The message from voters was crystal clear for Peters; supporting an incumbent Party to retain power was a ‘no-go’ . People voted for NZ First to get rid of the incumbent government – not prop it up.

Cosying up with the Nats will not serve Peter’s  interests one iota. It will remind the electorate of the events of the late 1990s, and will harm popular support for NZ First.

Peters should consider; as opposition to National grows, why would people who oppose National vote for a small Party that may end up propping it up? The answer is; people will not vote for such a small Party.

This should serve as a warning to Peters and his Party: coalesce with National at your peril. History can repeat.


Peters ‘sorry’ about coalition – NZPA – 14 September 1998




Previous Related Blogposts

Ministers, Mad Moralists, and Minor Parties


Otago Daily Times – NZ First leads in ‘most loathed’ poll  (8 October 1999)

Dominion Post – Key rules Peters out of National’s future (27 August 2008)

Sean Plunket – PM should ponder the Orwellian switch to the farmhouse (22 Sept 2012)

TV3 – Duncan Garner: John Key refuses to rule out Winston Peters (24 Sept  2012)

TV3 – Peters welcomes National coalition (25 Sept 2012)

TV3 – Video:  Peters welcomes National coalition (25 Sept 2012)



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