New Zealand First will use its influence on the next coalition Government to buy back our state-owned power companies which are being flogged off by National.
Rt Hon Winston Peters says New Zealand First is committed to buying back the shares at no greater price than paid by the first purchaser.
“State-owned assets rightfully belong to all New Zealanders but National is intent on handing them over to rich foreign investors.
“It is simply lining the pockets of the wealthy by selling off well-performing assets that already provide the Government with extremely healthy dividends.”
Mr Peters says it is only fair to alert potential investors that New Zealand First’s intention to buy back the shares will be part of any coalition negotiations.
“As things stand now, the assets will end up in foreign ownership which is an outright attack on our sovereignty. We are committed to repelling that attack.”
Archive
The Mendacities of Mr Key # 12: No More Asset Sales (Kind of)
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On 25 February 2014, Dear Leader John Key announced to the nation that his government’s asset sales programme was over;
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“Just as we did before the last election we’re making our position on share sales clear to New Zealanders before we go to the polls later this year. We’ve achieved what we wanted with the share offers in energy companies and Air NZ. We’re now returning to a business-as-usual approach when it comes to [state-owned enterprises]. The truth is there aren’t a lot of other assets that would fit in the category where they would be either appealing to take to the market or of a size that would warrant a further programme, or they sit in the category that they are very large like Transpower but are monopoly assets so aren’t suited.”
Like so many of the Prime Minister’s promises, that “Key Committment” did not last long. Not even a year.
As Fonterra’s payout to farmers collapsed and weakening exports to China’s slowing economy began to impact on the government’s tax-take, Bill English’s much-heralded promise of a Budget surplus sank deeper than the m.v. Rena in 2011. English promised almost exactly a year ago on 16 May 2014;
“It’s a real surplus and it follows a string of improvements in deficits starting at $18 billion four years ago, this year about $2.5b and next year a surplus of $370 [million], and then bigger surpluses after that.”
Barely three months after the 2014 elections, Treasury had bad news for English and the National government;
Treasury this morning delivered a body blow to the Government’s hopes of returning to surplus, saying it now expects a deficit of over half a billion dollars for the June financial year.
At this morning’s Half Year Economic and Fiscal Update, Acting Treasury Secretary Vicky Robertson said despite solid growth in the economy, the Crown’s finances would take a hit from lower than previously forecast tax take.
That had seen Treasury change its forecast operating balance before gains and losses (Obegal) for the 2014-15 year from a slim surplus of $297 million to a deficit of $572 million.
Treasury said softer outlook for economic drivers of the tax such as lower dairy prices and interest rates had seen the expected tax take for the year fall by $600 million.
In the same Herald report, English and Key were both frantically doing their best King Canute impersonations since King Canute took a day to go to the beach;
But Finance Minister Bill English was this morning still clinging to the hope Treasury is wrong and the books will indeed be back in black this year as he and Mr Key have promised for some years.
“I’m hopeful we will,” Mr Key told reporters this afternoon.
“The view of the Minister of Finance is that we can still achieve that surplus. There’s a lot of different factors moving around here at the moment.”
By 2 May of this year, even National’s spin-meisters had run out of steam, and on TV3’s ‘The Nation‘, English was forced to admit that the world was indeed round and not flat; money-printing pixies did not exist; and dreams of a budget surplus were a Tory fantasy;
“No, I don’t call it a failure. It is what it is, and that is for the 14/15 year, we budgeted $370 million surplus. It looks like it will be a $500 or $600 million deficit, and the surplus will be the next year. So we’re on track.”
So “the surplus will be the next year“?
The Minister had better be hoping that the Christchurch re-build; the Auckland housing boom; and renewed growth in China’s economy, will continue to stimulate the economy. Otherwise, that “500 or $600 million deficit” will balloon into $1 billion or $2 billion or…
National’s expensive, multi-billion dollar 2009 and 2010 tax cuts may not have been such a clever move after all.
English, though, is not about to surrender. His government’s policies may be predicated on tax revenue from re-building a semi-destroyed city; an unsustainable housing boom in Auckland; and waning dairy exports – but National’s Finance Minister has other ideas up his sleeve.
In his 2 May interview on ‘The Nation‘, English committed the government not to cut spending;
Lisa Owen: “Okay. Well, before on The Nation, you said that the Government would not make any cuts to reach surplus. Is that still your plan?”
Bill English: “That’s right. We’re not going to make any specific extra decisions now just because our tax revenue’s a percentage point – 1 percent down.”
English has committed the government not to “make any specific extra decisions now just because our tax revenue’s a percentage point – 1 percent down”.
It’s just a shame we can’t believe a word of what he says. The cuts had begun long before English uttered his lies to Lisa Owen.
The story unfolds…
16 May 2014…
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National’s “economic whizz-kid” had promised the country a “$372 million surplus” – as well as “an increase to paid parental leave from 14 weeks to 18, free doctors’ visits and prescriptions for children under 13, extra money to ease the cost of early-childhood education, eligibility for paid parental leave extended, and the existing parental tax credit to rise“.
Labour’s social policies had been nicked by National. English basked in political glory. Sceptics were ignored. The country went to the polls four months later.
20 September 2014…
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And then reality began to reassert itself.
16 December 2014…
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National’s core policy; it’s raison d’être; it’s reputation amongst New Zealanders who are only vaguely politically conscious – is it’s so-called “reputation for fiscal prudence and responsible economic manager”, and it was rapidly being sucked down a flushing toilet of indebtedness. If it couldn’t deliver on it’s promise of returning the books to surplus – as Labour’s Finance Minister, Michael Cullen, had done between 2000 and 2008 – then what good was it?
English looked at his options to cut spending, and to raise money without creating headlines that shrieked “panic” or “broken promises”.
28 January 2015…
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So much for Key’s assertion that “the truth is there aren’t a lot of other assets that would fit in the category where they would be either appealing to take to the market or of a size that would warrant a further programme”.
Truth and John Key parted company a long time ago. Key’s announcement that up to 8,000 State houses could be sold came only eleven months after his earlier committment to New Zealanders that no further state assets would be sold.
13 April 2015…
John Key denies there is a housing crisis in New Zealand;
“No, I don’t think you can call it a crisis. What you can say though is that Auckland house prices have been rising, and rising too quickly actually.”
21 April 2015…
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National’s broken promise flew in the face of committments made prior to last year’s general election, as then-Health Minister, Tony Ryall said;
Free doctors’ visits and prescriptions for children aged under six will be extended to all children aged under 13 from July next year, Health Minister Tony Ryall says.
“Budget 2014 is investing $90 million over three years from 1 July 2015 so primary school-aged children can go to a doctor for free, any time of the day or night, and get their prescriptions free as well,” he says.
“National brought in the policy of free GP visits and prescriptions for children under six, including free after-hours visits. Thanks to our prudent management of the health budget, we are extending this policy to all children under 13.
“This is what careful financial management can deliver to Kiwi families.
Interestingly, there was a very minor – but all-important word missing between two otherwise identical Facebook postings by John Key and the National Party;
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Note the one missing word – “all” – from Key’s Facebook statement. Otherwise, the statement is identical to the National Party Facebook page. Someone in the National Party’s politburo obviously wasn’t keeping track of re-writing their election promises.
Green Party Health and ACC spokesperson, Kevin Hague, hit the nail on the head when he demanded;
“If one in ten kids have to pay up to $38 to go to the doctor when they have an accident, then that visit is not free and that’s a broken promise. It begs the question: what other promises are the Government going to renege on this year in a bid to save a bit more money? This shows how desperate the Government is to reach a surplus that it’s trying to pinch pennies from injured children.”
30 April 2015…
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Attempting to justify the transfer, English announced;
“Over half of the new houses will be sold to help offset construction costs, and the remainder will be retained as social housing. Our bottom line is that there will be at least as many social houses in Tāmaki as the 2800 there now.”
As with previous promises, National’s assurances cannot be relied upon. Ministers will utter soothing reassurances one day – and weeks, months, or years later will find justification why they had to retract.
National ministers simply cannot be trusted to keep their word. Even if 7,500 new homes are built, there is no guarantee that “half of the new houses will be … retained as social housing“. National will find a reason to sell them.
English further stated;
“The Government owns one in 16 houses in Auckland and we need to do a better job with them for the sake of tenants and aspiring homeowners, as well as for the neighbourhoods they live in and the wider city…
…This transfer of ownership of HNZC properties and the responsibility for tenancy management to TRC will enable faster construction of warm, dry and safe houses that better meet people’s needs.”
His comments are a repetition of National’s spin that NZ Housing properties are ‘badly run down and in dire need of maintenance’;
Finance Minister Bill English has confirmed the Government will need to spend $1.5 billion upgrading state houses as they are sold to social housing providers.
Mr English conceded many state houses were not up to standard and had not been properly maintained.
He said the cost of deferred maintenance had risen to $1.5 billion and that the matter had been raised during discussions with social agencies considering buying state houses.
“They’ve highlighted that. So part of the benefit of the process we’re going through is that these agencies are going to apply a very tight scrutiny to the state of the houses that maybe they might be looking at buying.”
Mr English blamed the former Labour-led Government, saying it had focused more on building new state houses than on maintaining existing homes.
English’s apportioning of blame to the previous Labour government is disingenuous.
The sole reason why Housing NZ has not been able to maintain it’s properties is that it has had to pay dividends from income (rent paid by low-income/beneficiary tenants) to successive governments. According to National’s Building and Housing Minister, Dr Nick Smith;
“The average dividend under the 5 years so far of this Government has been $88 million. The dividend this year [2014] is $90 million…”
Fairfax reported Nick Smith as stating;
Smith said the dividend had been been fairly consistent in the past several years – $71m in 2010, $68m in 2011, $77m in 2012 and $90m in 2013.
Four years worth of dividends – $306 million – were paid to the government’s Consolidated Fund. No wonder Housing NZ is unable to maintain it’s properties.
National was brutal in it’s expectations of huge windfalls from Housing NZ;
The letters reveal that on six occasions ministers asked for dividends to be hiked, or paid faster. In March 2010, Maurice Williamson wrote: “I expect . . . a significantly higher annual return to the Crown.”
Phil Heatley, when he was housing minister, asked that in 2011-12 and 2012-13 the dividend be $45m higher than that forecast in the 2011 Budget. Later he revised expectations upwards, to $251m over three years.
In July last year, Smith said “dividend levels should be significant enough to represent a challenge”.
These demands from National ministers were placed on a government department charged with housing the poorest and most vulnerable in our society. Williamson, Heatley, and Smith were content to bleed Housing NZ and let tenants live in cold, damp, miserable conditions.
Williamson, Heatley, and Smith – National’s 21st century slumlords.
As with Solid Energy, National exploited government departments and SOEs such as ACC, as “cash cows”, with which to balance their books to return to Budget surplus. (see: Solid Energy – A solid drama of facts, fibs, and fall-guys )
It is also worthy to note that National Ministers are employing spin when it comes to state house sales. English and other ministers use the term “transfer” and not sale.
On 6 May, Bill English stated that houses would not be sold “unless tenants get better services and taxpayers get fair and reasonable value“.
On TVNZ’s Q+A on 10 May, Minister for Social Housing, Paula Bennett, admitted that her government was selling state housing;
@ 2.13
Corin Dann: “But the point is, they are going to get these houses, they’re going to be sold these houses, aren’t they? You say transfer but it’s a sale of houses at a discount, right?”
Paula Bennett: “Well, I’m sure it’ll be less than the market value, yes.”
These are sales, not a transfer. “Transfer” implies a change of ownership without cost or exchange of money. There is Big Money involved in state house sales.
[Incorrect information deleted. – FM]
6 May 2015…
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The Great Sell-off of Housing continues under National – with the government disposing of all state housing in Tauranga and Invercargill. Radio NZ reported;
The Government has announced it will begin selling off up to 1600 state houses in Tauranga and Invercargill to social housing groups.
There are 370 state houses in Invercargill and 1250 in Tauranga and it’s understood all of them could be sold if buyers come forward.
Only vetted and registered community housing providers will be able to buy them and, depending on their negotiations with the Government, they may not have to pay the market price.
There is nothing to stop private developers from acquiring state houses through back-door means, as this report on a landlords website explained;
The state houses will only be available for sale to registered Community Housing Providers (CHPs).
However, Housing NZ Minister Bill English said that registered CHPs can partner with other organisations to acquire and develop social housing.
“Any transfer of houses will not affect the rent tenants pay or their eligibility for subsidised housing, and properties transferred as social houses will also have to stay as social housing unless the Government agrees otherwise. In both Tauranga and Invercargill, Housing New Zealand owns a significant number of houses so there is potential for more than one organisation to acquire houses for community ownership.”
This means there could be scope for private investors to get involved in the provision of social housing – either by becoming a registered CHP or by partnering with a registered CHP.
Speaking on TVNZ’s Q+A on 10 May, Minister for Social Housing, Paula Bennett confirmed that private investors could “partner” with Community Housing Providers to purchase state houses; re-develop the properties; and sell new residences at a profit.
On 6 May, English assured the public;
“Any transfer of houses will not affect the rent tenants pay or their eligibility for subsidised housing, and properties transferred as social houses will also have to stay as social housing unless the Government agrees otherwise.”
Of course National will agree. This is a wholesale sell-off of state housing. Why wouldn’t they agree to new owners on-selling these properties for a profit? Otherwise new owners would be stuck with old, dilapidated properties, requiring expensive repairs, and soon getting into deep debt.
This is privatisation, by stealth, through the back-door, using intermediaries. This is a whole new level of government subterfuge.
It also exposes John Key’s assurance – that state assert sales have ended – as a lie.
Conclusion
Finance Minister Bill English is desperately scrabbling for every dollar he can claw back. Miserly does not even begin to aptly describe this government’s actions.
It seems that the tax cuts of 2009 and 2010 are being paid for by paperboys and girls; sick children; welfare beneficiaries; and Housing NZ tenants.
It remains to be seen what further cuts in social spending Bill English has planned. His reassurances on 2 May 2015 – that there would be no cuts to social spending – are to be treated with the same contempt as other promises, assurances, and committments that have been made, and broken, by John Key, Bill English, et al.
Governments are at their worst and most dangerous, when desperate. And this is a desperate government.
Addendum1
Karol, writing for The Standard, has more on this issue. See: “Key Govt asset stripping state housing‘.
Addendum2
Registered community housing provider, Habitat for Humanity Invercargill-branch chairman, Stephen Falconer, is an enthusiastic cheerleader for National’s covert privatisation programme. He told the Otago Daily Times on 7 May;
“We’re a private organisation, essentially, and we think that private enterprise can actually do a better job than Government on most things.”
Because private enterprise has done such a stirling job thus far in meeting demand for housing in Auckland, Christchurch, and elsewhere?
It is disappointing that an ostensibly community organisation like Habitat for Humanity has bought into the government narrative, complete with parroting neo-liberal cliches that “private enterprise can actually do a better job than Government“.
If it were true that “private enterprise can actually do a better job than Government“, then why does Habitat for Humanity exist?
Addendum3
Social Housing Minister Paula Bennett is interviewed by Corin Dann on TVNZ’s Q+A. Along with Bill English’s admissions, her comments are a disturbing indication where National is going with state housing. See: Govt social housing target 3000 homes
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References
NZ Herald: PM – no more SOEs to sell after Genesis
John Key: My key commitments to you
NBR: Weak dairy prices prompt analysts to pull back Fonterra forecast payout for next season
The Independent: How China’s slowing GDP growth could drag down the global economy
TV3 News: National Party wins third term
NZ Herald: No surplus this year – Treasury
Fairfax media: Budget 2014 – Surplus real, says English
TV3: The Nation – Bill English
Fairfax media: Budget 2014 – Surplus real, says English
TV1 News: Up to 8,000 state houses could be sold under John Key’s radical plan
Radio NZ: Key denies Auckland housing crisis
NZ Herald: No free GP visits for all children – Government
National Party: Free doctors’ visits, prescriptions for under 13s
Facebook: John Key
Facebook: National Party
Scoop media: Govt breaks free doctors visit promise to kids
Fairfax media: Government offloads 2800 state houses to Auckland development company
Radio NZ: Govt to spend $1.5b fixing up state houses
Parliament: Hansards – Questions for Oral Answer — Questions to Ministers – 8 May 2014
Fairfax media: Nats milking Housing NZ – Labour
Fairfax media: Not much in the cupboard for English to dine on
NZ Herald: State houses in Tauranga and Invercargill to go on the market
TVNZ Q+A: Govt social housing target 3000 homes
Landlords – For Kiwi Property Investors: State houses to go on sale in Tauranga & Invercargill
NZ Herald: Budget 2012 – ‘Paper boy tax’ on small earnings stuns Labour
Fairfax media: Invercargill and Tauranga chosen for first state house sales
Radio NZ: Tauranga, Invercargill state houses to be sold
Otago Daily Times: Invercargill among first state house transfer sites
Previous Related Blogposts
Can we do it? Bloody oath we can!
Budget 2013: State Housing and the War on Poor
Budget 2013: State Housing and the War on Poor
National recycles Housing Policy and produces good manure!
National Housing propaganda – McGehan Close Revisited
Housing; broken promises, families in cars, and ideological idiocy (Part Tahi)
Housing; broken promises, families in cars, and ideological idiocy (Part Rua)
Housing; broken promises, families in cars, and ideological idiocy (Part Toru)
“It’s fundamentally a fairness issue”- Peter Dunne
Solid Energy – A solid drama of facts, fibs, and fall-guys
The Mendacities of Mr Key #11: Sorry, Prime Minister, what ‘mandate’ were you referring to?!
Other blogs
Polity: Housing horrors
The Jackal: Nationals housing failure
The Standard: Key Govt asset stripping state housing
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This blogpost was first published on The Daily Blog on 10 May 2015.
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Winston Peters recycles pledge to “buy back state assets” – where have we heard that before?
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Over the last two years (give or take), NZ First leader, Winston Peters, has stated on numerous occassions that buying back shares in the three energy SOEs (Meridian, Genesis, and Mighty River Power) will be a “bottom line” in any post-election coalition deal.
On 20 June 2012, NZ First posted this statement on their website,
The pledge was repeated on 29 November 2013;
“New Zealand First is the only political party that has said since the beginning that if the Government did go ahead with this idiotic decision, then when we are in a position to influence the next Government, we would buy back the shares at a price no more than that initially paid for them.”
On ‘The Nation‘, on 15/16 March, interviewed by Patrick Gower, Peters repeated NZ First policy that a share buy-back, at a cost no greater than the original purchase-price, was a bottom line policy for his Party;
Gower: So that means buying Genesis back?
Peters: That’s right. At no greater price than they paid for it.
Gower: And does that mean buying back the other power companies as well?
Peters: It means exactly that. That’s what our position has been for some time.
Gower: So that’s a priority for you in any negotiations?
Peters: It is a priority, and it also has the blessings in terms of economic calculations from Treasury.
Taken at face value, Peters’ committment to buy back shares in the powercos seems more comprehensive and radical than either the Greens or Labour. Neither have committed to buying back shares in Meridian, Genesis, and Mighty River Power until the government books allow it.
But, can Peters’ pledge be taken at face value?
Can he be trusted to make good on his word to (a) make a share buy-back a bottom-line in any coalition deal and (b) actually follow through?
His track record on such matters is not good.
On 27 September 1996, the then-Bolger-led National government sold the Forestry Corporation of New Zealand Ltd cutting rights to a private consortium (Fletcher Challenge Forests, 37.5%, Brierley Investments Ltd, 25%, and Chinese state-owned company, Citifor Inc, 37.5%)
This became a major election issue in the lead-up to the first MMP election in 1996, with the Alliance organising a CIR petition to halt the sale.
NZ First leader, Winston Peters, pledged to buy back the cutting rights, stating on several occasions that any government he was part of would “hand back the cheque“;
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During the election campaign, Peters stated unequivocally his intentions that the privatisation of Forestry Corp would not stand under any government he was part of;
“I want to tell the Chinese buyers and I want to tell Brierleys that they had better not make any long-range plans because the day after the election is over we will be sending them an emissary to them them exactly what is going to happen, that is, that we are going to keep out promise, they can give back the asset and we will give the money back.” – Winston Peters, Otago Daily Times, 1 Feb 1997 (on pre-election statement/promise)
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On 11 December 1996, Peters announced that he would be entering into a formal coalition arrangement with the National Party, to form the first MMP coalition government.
Subsequently, Peters’ pledge to “hand back the cheque” and buy back the forestry cutting rights, was ‘quietly’ dropped;
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“… NZ First did not make any attempt to include in the [Coalition] agreement its policy of placing a 24.9% limit on foreign ownership of strategic assets.
Neither did they raise the NZ First promise to buy-back Forestry Corp, which was sold earlier this year to a consortium including Fletcher Challenge.” – Otago Daily Times, 16 Dec 1996
As Treasurer and Deputy Prime Minister in the National-NZ First government, Peters had ample opportunity to implement his Party’s buy-back policy. It was a promise he could have kept. And should have kept.
Instead, NZ First opted to implement National’s policy of tax cuts on 1 July 1998. With even more tax cuts promised by then-Finance Minister, Bill Birch.
This was money that Peters could have allocated and spent of re-nationalising our forests – but was instead wasted on cutting taxes, thereby reducing the ability of the coalition government to implement a buy-back, as Winston Peters had promised.
If Peters holds the balance of power after 20 September, and if he forms a coalition with either bloc, he may well carry out his promise to buy back shares in our energy utilities.
Or then again, he might not.
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References
NZ First: NZ First Committed To Buying Back State-Owned Assets
NZ First: Our asset sales buyback promise – Radio Live Column
TV3: Winston Peters: Asset buy-back ‘a priority’
FAO.org: Devolving Forest Ownership in New Zealand: Processes, Issues and Outcomes
Treasury: Income from State Asset Sales as at 30 September 1999
Wikipedia: CITIC Group [Citifor]
Wikipedia: Referendums in New Zealand
Otago Daily Times: Alliance quits quest for forestry petition
Otago Daily Times: NZ First ignored chance to implement own policy
Otago Daily Times: NZ First opts for National
Otago Daily Times: Further tax cuts unlikely before next century
NZPA: Birch pledges more tax cuts
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Above image acknowledgment: Francis Owen
This blogpost was first published on The Daily Blog on 16 March 2014.
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Letter to the Editor: Why should I believe John Key?
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FROM: "f.macskasy" <f.macskasy@clear.net.nz> SUBJECT: Letters to the editor DATE: Tue, 25 Feb 2014 08:33:27 +1300 TO: "Sunday Star Times" <letters@star-times.co.nz>.
The Editor Sunday Star Times . John Key's promise not to sell any other state assets should National be re-elected should be treated with suspicion and caution. Key's track record in breaking promises and "bending the truth" is now legendary, whether it be his promise not to raise GST (which he did) or to strengthen the Emissions Trading Scheme (which he watered down) or, in 2008, when he campaigned on implementing food in schools - only to resist introducing the programme later on. Plus he has been less than honest in describing the GCSB Bill as "not fit for purpose" and "vague" - when it was crystal clear in stating that the Bureau could not spy on New Zealanders and permanent residents. Key habitually makes promises or statements of fact which he breaks with flimsy excuses to justify his actions. This is not a Prime Minister who can easily be taken at his word. -Frank Macskasy (address and phone number supplied)
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FROM: "f.macskasy" SUBJECT: Letters to the editor DATE: Tue, 25 Feb 2014 08:18:31 +1300 TO: "NZ Herald" <letters@herald.co.nz>.
The Editor NZ Herald . John Key's "reassurance" that his government has no further plans to sell other state assets is simply not credible. His reputation for "bending the truth" and broken promises is now widespread. Who can forget his promise not to raise GST - which he broke with flippant excuses. Or his assertions that the GCSB Act was "vague and unclear" - when in fact it was crystal clear in stating that the Bureau could not spy on New Zealand citizens and permanent residents? Or his reference in October 2011, to a mysterious Standard & Poors email, claiming that the ratings agency would have downgraded NZ if Labour had been in office? Standard and Poors immediatly rejected they made any such statement. I have no reason to take Mr Key at his word. His reputation precedes him. -Frank Macskasy (address and phone number supplied)
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FROM: "f.macskasy" SUBJECT: Letters to the editor DATE: Tue, 25 Feb 2014 07:58:42 +1300 TO: "Dominion Post" <letters@dompost.co.nz> . The Editor Dominion Post . John Key has announced that his government will not sell any other state assets should National be re-elected later this year. It is hard to believe a Prime Minister who has made so many promises and statements which have either turned out not to be true; a distortion of the truth; or outright mistruths. His broken promises such as not raising GST and raising wages to parity with Australia have all been broken. There is an old saying, "Fool me once, shame on you. Fool me twice, shame on me". I prefer not to be fooled a second time. I simply don't believe him. -Frank Macskasy (address and phone number supplied)
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References
NZ Herald: PM: no more SOEs to sell after Genesis
Radio NZ: No more asset sales? Cunliffe doesn’t believe it
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Above image acknowledgment: Francis Owen
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“Moral mandates”, “mass medication”, and Mayors vs Ministers
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“Moral mandates”
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Acknowledgement: Fairfax Media – Nats look to 2014 governing options
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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?
Interesting.
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,
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| National , ACT, United Future Party Votes | Labour, Greens, NZ First, Maori Party, Mana, and Conservative Party votes |
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National – 1,058,636
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Labour – 614,937 |
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ACT – 23,889
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Greens – 247,372 |
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United Future – 13,443
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NZ First – 147,544 |
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Maori Party – 31,982
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Mana – 24,168
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Conservative Party* – 59,237
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TOTAL – 1,095,968 |
Total – 1,125,240 |
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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
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“Mass medication”
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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:
Such complex creatures we humans are…
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Mayors vs Ministers
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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,
.
Acknowledgement: NZ Herald – City’s shares eyed for rail
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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
Sharechat.co.nz: 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)
Interest.co.nz: Auckland Mayor celebrates Government’s agreement to support rail loop (26 June 2013)
NZ Herald: City’s shares eyed for rail (1 July 2013)
Interest.co.nz: 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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= fs =
The Politics of Power and a Very Clear Choice – Part Wha
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Continued from: The Politics of Power and a Very Clear Choice – Part Toru
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First NZ
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As Chris Trotter pointed out in his excellent blogpost just recently,
“ONLY STEVEN JOYCE could offer up JB Were, Woodward Partners, Milford Asset Management, First NZ Capital, and Forsyth Barr as credible critics of the Labour-Greens’ energy policy. As if these six financial institutions were ever likely to offer the Opposition parties their fulsome support!.”
Acknowledgement: The Daily Blog – No Dog In The Fight: Whatever happened To Academic Expertise?
We can add to the above list; AMP Capital, Morningstar Research, BusinessNZ, and Federated Farmers – all of which appear to be the front-line foot-mercenary-soldiers in National’s counter-attack to the Labour-Green’s NZ Power.
Minister of the Known Universe, Steven Joyce’s actual comment was,
“Financial analysts including JB Were, Woodward Partners, Milford Asset Management, First NZ Capital, Devon Funds Management and Forsyth Barr are unanimous in their condemnation. One has labelled it a ‘hand grenade’ to the New Zealand economy, while others have said it will cut the value of every New Zealanders’ KiwiSaver account and lead to rolling blackouts. ”
Acknowledgement: Scoop – Labour-Greens Power ‘Plan’ Economic Sabotage
“Rolling blackouts“?!
He left out a plague of locusts and rivers turning into blood (though with farm run-offs, these days it’s more like Rivers of Excrement).
We’ve had power black-outs in the past, due to dry weather; equipment failure; shut-downs for maintenance; human error; etc. And we will continue to have unavoidable power cuts, in the future;
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Acknowledgement: NZ Radio – Damaging gales forecast for north
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Joyce added,
“Kiwis are deeply suspicious about the Labour-Greens announcement and its timing. It’s simply economic sabotage. ”
Hmmm, considering the high value of the New Zealand dollar’s destructive effects on our manufacturing/export sector and the 40,000 jobs that’s been lost in the last four years – if I were Joyce, I would not be too keen to bandy about charges of “economic sabotage”. National’s policies in the last few years have been more than effective in that regard,
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Acknowledgement: Radio NZ – Exporters tell inquiry of threat from high dollar
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It’s hardly surprising that most of the negative response has been from the financial markets and commercial firms. They are the ones with the naked vested interests.
To date, the following fear-threats have been thrown at the New Zealand public – because make no mistake, these doomsday scenarios are directed at voters, and not Labour or the Greens.
Acknowledgement: First NZ – Contact Energy – If it ain’t broke don’t fix it
Hold on.
Is First NZ is really telling the public that power prices have only risen 2.6% since 2000?!?! Well, they do qualify that with “net of line charges and after allowing for inflation”. Though why they would omit line charges seems pointless; the public are still paying at the end. “Clipping the ticket” seems the norm and impacts on the end-consumer regardless of how it is done.
Which also raises a question in my mind; why is First NZ making this assertion only now? Why did they not make the effort to rebut National’s claims when Dear Leader issued public statements like this, on 27 January, 2011,
“In the nine years Labour was in government, power prices went up 72 per cent and the Government owned 100 per cent of the assets.”
Acknowledgement: NZ Herald – Power price fears if Govt stakes go
Why did First NZ not issue public statements ‘correcting’ National’s “misrepresentations” at the time?
Why have they left it only till now, to counter the assertion that “power prices went up 72%”?
Why is a single-buyer desk for electricity sending brokerage firms into a panic? Especially, considering, that we already have single buyer-desk’s in the form of Fonterra, Zespri, PHARMAC, etc.
The answer, I submit, is fairly obvious. First NZ’s fanciful statements and assertions are part of an orchestrated litany of bullshit to scare Joe & Jane Public to run back into the cold, dead arms of Nanny Neoliberal.
The Financial Money Men, with their Federated Farmers allies, are propping up their neo-liberal stooges in Parliament. The rats are out of the woodwork, and we can see who is lined up against the best interests of the public.
Because, in the final analysis, this all boils down to money – who makes it and who gets to keep it. And because so much money is at stake, we are told that rising power bills is the price for living in a “free” market.
We’re also promised that power prices will drop. Sometime. In the future.
We just have to be patient.
Maybe another thirty years?
It will be interesting if people buy into this propaganda BS. Will voters believe the fear-mongering campaign from the money-pushers?
Or will they realise that share brokers and merchant bankers are interested only in seeing that power prices remain at stratospheric levels, to provide maximum returns for their shareholders?
Because one thing is as certain as the sun rising tomorrow; these firms are not remotely interested in our welfare. Nor in the welfare of Kiwi families being gouged with higher and higher power bills.
I’m struck senseless that so many National supporters believe that siding with the likes of JB Were, Woodward Partners, Milford Asset Management, First NZ Capital, Devon Funds Management, Forsyth Barr, Business NZ, Federated Farmers, et al, will somehow gain them some kind of ‘benefit’. Are National supporters so masochistic and blinded by their faith in the “free market” that they are willing to tolerate paying higher and higher prices for electricity?
I hope they realise that JB Were, Woodward Partners, Milford Asset Management, First NZ Capital, Devon Funds Management, Forsyth Barr, Business NZ, Federated Farmers, et al, will not pay the power bills for National supporters.
Good luck with that!
The Labour-Green coalition should welcome these attacks as an opportunity. Every time one of these money-pushing firms launches a critical attack on NZ Power – the Labour-Greens should counter with press conferences where facts, stats, and more details are presented for the public and nice, big, colourful graphic-charts presented.
Like this one, from the Ministry of Economic Development/Business, Innovation, and Employment;
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Acknowledgement: Ministry of Economic Development/Business, Innovation, and Employment – Power Prices
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(Note price drop around 1999. Whilst Industrial and Commercial prices fell, residential prices continued to rise. There is more to explain the 1998/99 price fall here; Statistic NZ – Electricity consumption. It had little to do with Bradford’s reforms, and more to do with competing retailers changing their methods of calculation for the CPI electricity price index and building extra generation capacity. The cost of the latter had shifted from the State and onto domestic consumers.)
Where possible, David Parker and Russell Norman should speak at engagements around the country at public meetings. (Community newspapers and other local media should be engaged, as they love anything that happens within their community.)
Invite others such as the Salvation Army, and experts such as energy-sector expert, Molly Melhuish, and Victoria University researcher Geoff Bertram, should be invited to address media events.
Invite members of the public; families, etc, to present their power bills as evidence of skyrocketing prices.
Build a Broad Front of support. Show the country that there is support for NZ Power.
People want reassurance. We need to give it to them. And we need to show them why the National and the finance sector are working in cahoots.
Because ain’t it funny that no community organisation has come out, demanding that the electricity sector remain unregulated and welcoming higher and higher prices?
And if the media aren’t presenting the full story, use progressive blogs to publish the information. We, too, can be “foot soldiers” in this struggle. (Because surprise, surprise, we too, use electricity.)
This is a war between the Neo Liberal Establishment and Progressive forces fighting to roll back thirty years of a failed experiment.
That war began on 18 April.
There is no reason on Earth why we should not win.
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NZ First
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I find it hard to trust NZ First. Or, to be more precise; I find it hard to trust it’s leader, Winston Peters.
His parliamentary colleagues; party members; and supporters – I have no problem with. They are people who, generally, want the best for this country and dislike the false religion of neo-liberalism as deeply as those on the Left do.
But Peters…
Peters has ‘form’. He has changed direction on numerous occassions, and I find it hard to take him at his word.
Some examples…
1.
In 1996, Winston Peters campaigned to defeat the National Government and remove it from power. His campaign statements at that time seemed unequivocal;
“Jim Anderton: Is the member going into a coalition with National?
Winston Peters: Oh no we are not.” – Parliamentary Hansards, P14147, 20 August 1996
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“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
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“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
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“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
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“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
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“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
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“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
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“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 nightmare,
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2.
In 1996, one of the biggest election issues was the sale of Forestry Corporation of New Zealand Ltd (cutting rights only, not the land). In 1996, the then Bolger-led National government had announced it’s intention to privatise the SOE,
In 1996, the Minister of Finance announced the government’s intention to sell its shares in the Forestry Corporation of New Zealand (formerly Timberlands Bay of Plenty). The corporation’s assets were Crown Forestry Licences to planted forests, which had expanded to 188 000 ha in the central region of North Island, processing plants in various locations, a nursery and a seed orchard.
A handful of large forestry companies and consortia submitted bids. The sole criterion was price. However, as the strength of the bids was not as great as hoped, bidders were asked to resubmit their bids. In August 1996, it was announced that the Forestry Corporation of New Zealand had been sold to a consortium led by Fletcher Challenge in a deal that valued the assets at $NZ 2 026 million.
Acknowledgement: Devolving forest ownership through privatization in New Zealand
The sale went ahead and the final sale-price was $1,600,000, to a consortium made up of Fletcher Challenge Forests (37.5%), Brierley Investments Ltd (25%) and Citifor Inc (37.5%).
Acknowledgement: Treasury – Income from State Asset Sales as at 30 September 1999
Throughout 1996, Winston Peters engaged in an election campaign to “hand back the cheque” should he and his Party be elected into a position of power,
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Acknowledgement: (hard copy only): Evening Post, 13 August 1996
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Acknowledgement: (hard copy only): Evening Post, 2 October 1996
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To quote Peters, who said on 13 August 1996,
“I ask both the Labour and Alliance parties – putting politics aside for this one day – to join New Zealand First in it’s post-election pledge to reverse the sales process“.
As many who lived through the times will recall, Peters pledged to “hand back the cheque”. It was a powerful message.
But it never happened.
Peters joined in coalition with National (consigning Labour and The Alliance into Opposition) and the pledge to buy back the forests was dropped – much to the disgust of people at the time..
Sixteen years later, and Peters has made the same promise all over again. On TV3′s The Nation, on 24 June 2012, Winston Peters stated,
“The market needs to know that Winston Peters and a future government is going to take back those assets. By that I mean pay no greater price than their first offering price. This is, if they transfer to seven or eight people, it doesn’t matter, we’ll pay the first price or less. ”
Acknowledgement: TV 3 – The Nation
On 4 March this year (2013), Peters announced,
“New Zealand First will use its influence on the next coalition Government to buy back our state-owned power companies which are being flogged off by National and we are committed to buying back the shares at no greater price than paid by the first purchaser.”
Acknowledgement: Scoop – One More Quisling Moment from Key
Another quote from Winston Peters, who said in a speech to the NZ First Conference, in 1999,
“All the policies and manifestos in the world are meaningless when you cannot trust the leadership. That is what leadership is about – trust. Nobody expects leadership to be infallible. But you have a right to expect it to be trustworthy.”
Acknowledgement: (hard copy only): Speech by Rt Hon Winston Peters to the New Zealand First Conference, 18 July 1999, at the Eden Park Conference Centre
Indeed; “All the policies and manifestos in the world are meaningless when you cannot trust the leadership.”
If Peters and NZ First hold the balance of power in 2014 and choose to enter into a coalition arrangement with National – will he carry out his pledge this time?
Or will that promise be dropped and buried for political expediency and some babbled, weak excuse?
It’s happened once, before. And not too long ago.
Can he be trusted for a second time?
I am of the belief that folks can learn from their mistakes. God knows I’m made a few in my early adulthood.
Has Winston Peters learned to honour his electoral pledges and not to treat the voting public as fools? Has he learned that he betrays voters at his peril? I hope so.
Because the public exacted a fitting response to his behaviour in 2008, as he and his Party were punished and spent three years in the political wilderness (see; New Zealand general election, 2008).
More than ever, the future of this country – and the power – is in our hands,
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Don’t screw up this time, Mr Peters.
This blogpost was first published on The Daily Blog on 6 May 2013.
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*
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Previous Related Blogposts
History Lesson – Tahi – Electricity Sector “reforms” (4 March 2012)
John Key: Man of Many Principles (28 Sept 2012)
Labour, Greens, NZ First, & Mana – A Bright Idea with electricity! (10 March 2013)
Additional Sources
Statistics New Zealand: The history of electricity reform
Ministry of Economic Development: Electricity Prices
NZ History Online: Dancing Cossacks political TV ad
The Treasury: Income from State Asset Sales as at 30 September 1999
References
NZPA: Splitting up ECNZ expected to cut wholesale power price (16 Dec 1998)
NZPA: Reforms aimed at business – Luxton (21 April 1999)
Otago Daily Times: Power Prices Set To Soar (12 May 1999)
Otago Daily Times: No case for regulation (24 May 1999)
Otago Daily Times: Lower power prices coming says Bradford (3 June 1999)
Otago Daily Times: Power prices to rise by up to 15.1% (29 June 1999)
Otago Daily Times: Reforms blamed for hike (13 July 1999)
Scoop: Alliance to hold Winston Peters accountable (8 Oct 1999)
NZ Herald: Peters ‘forgets’ NZ First support for power reforms (13 Aug 2008)
Fairfax: Government to seek inquiry into power price rise (30 September 2008)
NZ Herald: Put prices on hold, Brownlee tells power companies (21 May 2009)
NZ Herald: Mighty River directors’ 73pc pay rise realistic – Key (5 April 2013)
Scoop: Labour-Greens to rip up the book on electricity pricing (18 April 2013)
NZ Herald: Labour-Greens plan could work, says Vector CEO (19 April 2013)
NZ Herald: National gobsmacked at Labour idea (19 April 2013)
NZ Herald: Power plan likened to Soviet era (19 April 2013)
NZ Herald: MRP chief slams socialist’ plan (21 April 2013)
TVNZ: Q+A – Transcript of Steven Joyce interview (21 April 2013)
NZ Herald: Bernard Hickey: Power barons fail to fool the public this time around (21 April 2013)
Radio NZ: Power prices nearly double since 2000 (21 April 2013)
Other blogs
Kiwiblog: Electricity Prices
Tumeke: MANA threaten overseas investors not to buy assets – Bloomberg pick up on the story
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= fs =
The Politics of Power and a Very Clear Choice – Part Toru
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Continued from: The Politics of Power and a Very Clear Choice – Part Rua
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On a more Positive Note
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With all the scare-mongering from some quarters (National, right wing blogs, conservative media commentators), and naked threats of economic sabotage (JB Weir, Brian Gaynor, etc), there have been commentators with a more positive, up-beat assessment of the Green-Labour proposal for NZ Power.
Bernard Hickey wrote,
“But sometimes the sheer size of the profits becomes so obvious that it invites a backlash. The National Government realised the power-consuming public was nearing the end of its tether in 2008, so it acted to force more competition with its 2009 sector review and the very successful “Whatsmynumber”. It helped increase the switching rate over the past couple of years towards 20 per cent. Annual residential power price inflation halved from 8 per cent in the decade from 1998 to 2008 to 4 per cent since then.
But it is still running at quadruple the general inflation rate and it’s clear that “competition” hasn’t worked to reduce or even restrain power prices for voters, as opposed to businesses.
[…]
The SOE sales programme changed all that. It proposed handing those super profits to the richest New Zealanders in the form of shares and dividends.
That was the moment the Government and the industry crossed that red line and triggered the regulatory backlash promised this week by Labour and the Greens.”
Acknowledgement: NZ Herald – Bernard Hickey: Power barons fail to fool the public this time around
Vector chief executive, Simon Mackenzie, seemed to agree,
The electricity policy announced by the Labour and Green parties could be made to work and the current debate is overly emotive, says the chief executive of the regulated monopoly electricity and gas network owner, Vector.
Simon Mackenzie told BusinessDesk he was encouraged by the fact the proposed central purchaser system would incentivise commercially rational investment in energy efficiency, and that the Opposition parties were not pursuing direct subsidies.
He also welcomed the fact Labour was proposing to simplify regulation of lines companies, which has become enmeshed in the courts after policies Labour implemented was “not tracking as was intended,” Mackenzie said.
There was “no perfect model” for electricity systems, and other countries used similar methods to set prices and to procure investment in new power plants as demand rises. At present, new generation is procured by competing generators identifying the “next least-cost” of new generation and deciding to build it.
[…]
“The model is used in other jurisdictions. It has its pros and cons. It’s made to work.”
Acknowledgement: NZ Herald – Labour-Greens plan could work, says Vector CEO
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Inevitable Conclusions
.
1. The term “Government-in-Waiting” is well known.
But there is a corollary to this concept.
The Green-Labour policy has not only put National on the “back foot” with the audacious nature of the plan – but has placed National Ministers – from John Key up – into a ‘No Man’s Land’ of a Government-in-Opposition role.
National finds itself faced with a policy that is so novel; so unforeseen; that their initial reactions were indignant splutterings of “North Korean school of politics”; candles; brown-outs; “United Soviet Socialist Republic of New Zealand” [sic]; threats of economic collapse; economic “sabotage”, and other doomsday scenarios.
The responses could be likened to the indignant temper-tantrums of a teenager who has been used to getting things all his/her life – and was suddenly being brought to heel by exasperated parents.
Key has said he never wants to be in Opposition again,
“I don’t think it suits me as a person. I’m not a negative person and a lot of Opposition is negative.”
Acknowledgement: NZ Herald – Key says he’ll quit politics if National loses election
Well, that is precisely where he now finds himself: the new quasi-Opposition in Parliament. The Green-Labour coalition is setting the agenda, and National can only react,
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Acknowledgement: Sharechat – Labour-Greens plan forces government to suspend MightyRiverPower offer, amend documents
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2. On 20 April, Labour finance spokesperson, David Parker, told TV3′s The Nation,
“It’s not like the money disappears from the economy, just that people have more money in their pockets. Instead of spending it on inflated power prices, they’re spending it somewhere else in the economy.”
Which is pretty much the rationale that National used to justify it’s fiscally irresponsible tax cuts in 2009 and 2010,
“In the short term, National’s tax package will give households confidence and some cash in their back pockets to keep the economy going and to pay down debt.”
Acknowledgement: National – Economy/Tax Policy
3. If New Zealanders could tick National in 2008 for their promised tax cuts (in 2009 and 2010, despite being unaffordable and demanding massive borrowings to fund) – then I’m sure as hell confident they’ll be ticking Labour and/or Green in 2014 (if not earlier) for cheaper electricity.
There is nothing as easy to sell to voters than giving them what was theirs in the first place. That applies equally, whether tax dollars or electricity.
Unlike the academic nature of who owns our State Assets – which for the poor underclasses means very little – everyone can understand a very simple concept of cheaper power.
Consider if those 800,000 missing-in-action, non-voters were asked the simple question; do you want cheaper electricity?
If the answer is “yes” – they need only tick the box for Labour and/or Greens.
For the Nats: game over.
Continued at: The Politics of Power and a Very Clear Choice – Part Wha
This blogpost was first published on The Daily Blog on 26 April 2013.
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*
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Previous Related Blogposts
History Lesson – Tahi – Electricity Sector “reforms” (4 March 2012)
John Key: Man of Many Principles (28 Sept 2012)
Labour, Greens, NZ First, & Mana – A Bright Idea with electricity! (10 March 2013)
References
NZ History Online: Dancing Cossacks political TV ad
NZPA: Splitting up ECNZ expected to cut wholesale power price (16 Dec 1998)
NZPA: Reforms aimed at business – Luxton (21 April 1999)
Otago Daily Times: Power Prices Set To Soar (12 May 1999)
Otago Daily Times: No case for regulation (24 May 1999)
Otago Daily Times: Lower power prices coming says Bradford (3 June 1999)
Otago Daily Times: Power prices to rise by up to 15.1% (29 June 1999)
Otago Daily Times: Reforms blamed for hike (13 July 1999)
Scoop: Alliance to hold Winston Peters accountable (8 Oct 1999)
NZ Herald: Peters ‘forgets’ NZ First support for power reforms (13 Aug 2008)
Fairfax: Government to seek inquiry into power price rise (30 September 2008)
NZ Herald: Put prices on hold, Brownlee tells power companies (21 May 2009)
NZ Herald: Mighty River directors’ 73pc pay rise realistic – Key (5 April 2013)
Scoop: Labour-Greens to rip up the book on electricity pricing (18 April 2013)
NZ Herald: Labour-Greens plan could work, says Vector CEO (19 April 2013)
NZ Herald: National gobsmacked at Labour idea (19 April 2013)
NZ Herald: Power plan likened to Soviet era (19 April 2013)
NZ Herald: MRP chief slams socialist’ plan (21 April 2013)
TVNZ: Q+A – Transcript of Steven Joyce interview (21 April 2013)
NZ Herald: Bernard Hickey: Power barons fail to fool the public this time around (21 April 2013)
Radio NZ: Power prices nearly double since 2000 (21 April 2013)
Other blogs
Robert Guyton: Murray Kerr on MRP
Kiwiblog: Electricity Prices
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= fs=
The Politics of Power and a Very Clear Choice – Part Rua
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Continued from: The Politics of Power and a Very Clear Choice – Part Tahi
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Evidently, the sky will fall if New Zealand proceeds with Labour-Green’s NZ Power proposal…
The four Donkeys of the Fiscal Apocalypse
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- Lack of New Infra-structure – The argument goes that without massive profits, state owned powercos will not have sufficient funds to pay for new power production or to maintain transmission lines. Really?! In which case, how on earth did we ever build up this country’s energy infra-struction in the first place???
- Brown Outs – We’ve been told we’ll have brown outs (see Collin’s Tweet above). Really?! It beggars belief how we ever got out of bed in the mornings and tied our shoelaces, prior to to introduction of neo-liberalism. What a hopeless lot we must’ve been.
- Share Falls – Yes, the sharemarket will fall if the NZ Power propopsal goes ahead. In fact, they’ve already dropped (see: Power shares keep falling). So what people like Nick Lewis, an analyst at Wellington-based brokers Woodward Partners, is telling us is that the sharemarket is dependent on the New Zealand public held to ransom by way of exorbitant power pricing? We’re subsiding the sharemarket? I wonder what reaction the share market might have if competition really worked, and drove down power prices???
- Investors abandoning NZ – Yes, for a while, the jittery bastards at Boston, Beijing, or Berlin might panic and withdraw investment funds. For about half-a-f*****g second. Then they will get over themselves and return to invest elsewhere in our economy. Such as green technology in power production – technology which can be exported overseas for a tidy profit.
The fear-mongering from National, business, conservative media commentators, and other assorted right-wing nutjobs, assumes that New Zealanders are little children who are easily frightened by shadows.
We are not (much).
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Max Bradford and That ‘Dip’
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After Bradford’s reforms, power prices went north, skyrocketing by a jaw-dropping 87% since 2000. If food had increased that much since 2000, there’d be wide-spread starvation in this country. And wide-spread rioting that would make the 2010 London riots pale by comparison.
Bradford, though, has insisted that his “reforms” would have worked, had the new Labour government not ‘tinkered’ with them in the early 2000s. On TV3′s “The Nation“, on 21 April, Bradford stated,
“When the competive market was allowed to work, prices fell. And, ah, between 1998 and 2002, before Labour started fiddling with the market, prices did fall. So if you let the competitive market work, then prices will either rise more slowly than otherise they would, or they fall. ”
Acknowledgement: TV3 – The Nation
On Kiwiblog, David Farrar kindly provided a graph, attempting to support Bradford’s claims,
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Acknowledgement: Kiwiblog/Stats NZ
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The graph is even helpfully marked with a black line and labelled “Bradford Reforms”, between 1997 and 1998.
Unfortunately, this in itself is not quite correct. Despite Bradford’s Electricity Industry Reform Act 1998 taking effect in mid-1998, the electricity sector reforms did not fully take effect until April 1999, when Contact Energy was privatised and ECNZ was split in three; Mighty River Power, Meridian, and Genesis.
In the same year – 1999 – power prices surged (see: Power prices to rise by up to 15.1%, see; Reforms blamed for hike), as Farrar’s own graph shows with crystal clarity.
But then, curiously, there is a considerable dip in 2000 and 2001, followed by a sharp, massive series of rises thereafter.
So, what happened in 2000 and 2001?
The Asian Crisis is what happened, folks.
As then-governor of the RBNZ, Don Brash reported,
“In July 1997 the Thai baht fell sharply, triggering a period of turbulence in the financial markets of East Asia. Many currencies declined p re c i p i t o u s l y, along with share markets and real estate prices.
The banking sectors of the countries most affected were severely damaged, and real economic activity fell, in some cases sharply, for the first time in decades. The direct effect on the New Zealand economy was adverse and substantial, and looks likely to continue for some time. The indirect effect, through business and household sector confidence, was also significant. The impact of the Asian situation reduced inflationary p re s s u res in New Zealand markedly.
[…]
Inflationary pressures had been slowing for some time previously, so that as far back as December 1996 monetary policy began to ease in response. Then late in 1997 and into 1998 the Asian financial crisis added to the slow-down, as growth prospects in many Asian economies, including Japan, deteriorated (see box 2). In December 1997, when easing monetary policy further, the Bank cited the likely impact of the Asian crisis on the New Zealand economy, and noted that the disinflationary impact of that crisis could become markedly worse. During 1998, this happened, and in response monetary policy was eased more aggressively still.
[…]
For New Zealand, reduced exports to the region, which previously accounted for 36% of our merchandise exports, had a negative impact on economic activity. The likely effects of the crisis were a particular focus in each of the Bank’s quarterly Monetary Policy Statements from December 1997 onwards. In the Reserve Bank’s March 1998 projections, we judged that the severity of the crisis was being underestimated by many observers. As a result the Reserve Bank eased monetary policy by more than New Zealand markets had expected.”
Acknowledgement: – Don Brash, Reserve Bank of New Zealand Annual Report 1997-1998
Here is the NZ Reserve Bank chart of economic growth, measuring Real Gross Domestic Product (GDP), from 1990 to 2012,
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Reserve Bank of New Zealand – Real Gross Domestic Product, 8 January 2013
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Note the RBNZ statement, from the above January 2013 report,
Following the 1998 “Asian crisis” New Zealand’s Gross Domestic Product (“GDP”) recovered strongly. Annual GDP growth from 2001 through to 2004 (on average) exceeded that of its major trading partners, partly as a result of strong net inward migration and associated population growth.
Acknowledgement: IBID
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Now let’s compare the period from 1997 to 2002, on both graphs,
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A closer look at the 1997 – 2002 period,
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Acknowledgement: Trading Economics/Stats NZ – New Zealand GDP Growth Rate
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Aside from a “dead cat” bounce in the Third Quarter of 1999, the correlation between economic activity and power prices is self-evident. The drop in electricity prices in 2000 and 2001 followed a slump in economic activity in Asia, and it’s subsequent global flow-on effects.
As PBS Frontline reported,
The Asian financial crisis that was triggered in July 1997 was a shocker. Even two years after it ended, anxiety still loomed over global financial markets. What was at the time perceived to be a localized currency and financial crisis in Thailand, soon spread to other Southeast Asian countries–including Malaysia, Indonesia and the Philippines.
By the fall of 1997, the contagion extended its reach to South Korea, Hong Kong and China. A global financial meltdown had been ignited. In 1998, Russia and Brazil saw their economies enter a free-fall, and international stock markets, from New York to Tokyo, hit record lows as investors’ confidence was shaken by the volatility and unpredictability in the world’s financial markets.
Acknowledgement: PBS – Timeline of the Crash
As the Reserve Bank stated above, “annual GDP growth from 2001 through to 2004 (on average) exceeded that of its major trading partners” – and 2001 is when power prices started to rise again.
Also worthy of attention is that the electricity CPI also drops in 2009 and 2011, during the latest Global Financial Crisis and resulting Great Recession.
Unfortunately, for reasons of their own (but which we can guess at), Mr Farrar and his National Party friends fail to point out this salient fact. The Right will mis-represent facts and re-write history to suit their own narrowly-defined ideological agenda.
Labour-Green’s NZ Power is a threat to that ideologically-based agenda.
Continued at: The Politics of Power and a Very Clear Choice – Part Toru
This blogpost was first published on The Daily Blog on 25 April 2013.
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*
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Previous Related Blogposts
History Lesson – Tahi – Electricity Sector “reforms” (4 March 2012)
John Key: Man of Many Principles (28 Sept 2012)
Labour, Greens, NZ First, & Mana – A Bright Idea with electricity! (10 March 2013)
References
NZ History Online: Dancing Cossacks political TV ad
NZPA: Splitting up ECNZ expected to cut wholesale power price (16 Dec 1998)
NZPA: Reforms aimed at business – Luxton (21 April 1999)
Otago Daily Times: Power Prices Set To Soar (12 May 1999)
Otago Daily Times: No case for regulation (24 May 1999)
Otago Daily Times: Lower power prices coming says Bradford (3 June 1999)
Otago Daily Times: Power prices to rise by up to 15.1% (29 June 1999)
Otago Daily Times: Reforms blamed for hike (13 July 1999)
Scoop: Alliance to hold Winston Peters accountable (8 Oct 1999)
NZ Herald: Peters ‘forgets’ NZ First support for power reforms (13 Aug 2008)
Fairfax: Government to seek inquiry into power price rise (30 September 2008)
NZ Herald: Put prices on hold, Brownlee tells power companies (21 May 2009)
NZ Herald: Mighty River directors’ 73pc pay rise realistic – Key (5 April 2013)
Scoop: Labour-Greens to rip up the book on electricity pricing (18 April 2013)
NZ Herald: Labour-Greens plan could work, says Vector CEO (19 April 2013)
NZ Herald: National gobsmacked at Labour idea (19 April 2013)
NZ Herald: Power plan likened to Soviet era (19 April 2013)
NZ Herald: MRP chief slams socialist’ plan (21 April 2013)
TVNZ: Q+A – Transcript of Steven Joyce interview (21 April 2013)
NZ Herald: Bernard Hickey: Power barons fail to fool the public this time around (21 April 2013)
Radio NZ: Power prices nearly double since 2000 (21 April 2013)
Other blogs
Kiwiblog: Electricity Prices
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The Politics of Power and a Very Clear Choice – Part Tahi
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Historical Background
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New Zealanders, by and large, are not stupid.
We can recognise a rort when we see it. And in the case of electricity prices, we see it on a regular basis in our power bills and media headlines,
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2008
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Acknowledgement: Fairfax: Government to seek inquiry into power price rise
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2009
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Acknowledgement: NBR – More profit than power for state-owned energy companies
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2010
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Acknowledgement: Fairfax Media – High spot prices hint at power price rise
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2011
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Acknowledgement: NZ Herald- Power bills set to rise up to 8pc from March
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2012
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Acknowledgement: Fairfax Media – Electricity prices tipped to rise steeply
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2013
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Acknowledgement: TVNZ – Power prices rise by average $120 nationwide
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We all know the facts and figures by now,
- National Minister Max Bradford “reformed” the electricity sector in 1999 (see: Splitting up ECNZ expected to cut wholesale power price)
- We were promised cheaper power due to Bradford’s reforms (see: Lower power prices coming says Bradford)
- Power prices have continued to rise, increasing by 87% since 2000 (see: Power prices nearly double since 2000)
- Consumer power prices rose by 72%between 2000 and 2008 whilst inflation went up only 29% (Put prices on hold, Brownlee tells power companies)
None of Bradford’s promises came to fruition and on 27 November 1999, Bradford lost his Rotorua seat to Labour’s Stephanie Chadwick (see: Rotorua – New Zealand electorate).
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A Bold New Plan
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On 18 April, Labour and the Greens announced a bold new policy initiative to reign in escalating power price rises. Called NZ Power, the reform would work thusly,
Key to the proposals is the creation of a central buying and electricity system planning agency, dubbed NZ Power, which would drive down power prices because of its market power and would not be required to make a profit.
It would also be the market regulator.
“It will not just supervise the market, it will be actively involved,” said Labour’s finance spokesman David Parker, a Minister of Energy in the 1999 to 2008 Labour-led administration.
It would tender for new electricity generation, or potentially energy efficiency measures, rather than the current crop of generators competing to identify the next least costly unit of new generation when demand rises.
In some cases, industrial users would be able to contract directly with NZ Power.
Power prices would be set not by reference to the cost of the next new unit of generation, but by average costs that include the anticipated price of new generation. However, there would still be a traded market in wholesale electricity, which could reflect regional variations.
Acknowledgement: Scoop – Labour-Greens to rip up the book on electricity pricing
This new plan was the confirmation (if any was needed) that National’s grand experiment in privatisation and “competition” in the electricity sector was not working. Only fools (mostly those posting on right-wing, pro-National Kiwiblog) could possibly argue that the current system was “succeeding”.
In fact, even as far back as May 2009, National Minister Gerry Brownlee demanded that power generators put price rises on hold. He stated,
“There is something fundamentally wrong in the way in which we’re marketing electricity in New Zealand.“
Acknowledgement: NZ Herald – Put prices on hold, Brownlee tells power companies
And even the architect of this ill-conceived “reform”, Max Bradford, was reported in May 1999 in the media as planning to regulate electricity line charges,
Enterprise and Commerce minister Max Bradford is to press ahead with regulations to control electricity line charges, but sees no reason to implement regulation in the competitive end of the market.
Acknowledgement: Otago Daily Times – No case for regulation
So even National ministers reluctantly concede that the electricity sector cannot work in an unregulated “freemarket” model, and is unable to deliver the ‘golden fruits’ of de-regulation and so-called competition.
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Carping & Criticisms
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After the press conference on 18 April, criticism flew thick and fast from National ministers; right wing bloggers; pro-National sycophantic elements of the media, and their ideologically-wedded fellow-travellers.
On Steven Joyce’s twitter account,
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Source: Twitter/Steven Joyce
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Judith “Crusher” Collins added this bit of gratuitous fantasy-fear mongering,
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Source: Twitter/IBID
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From Simon Bridges, this little bit of muppetry,
“They may want to return to sort of United Soviet Socialist Republic of New Zealand days but National certainly doesn’t.”
Acknowledgement: NZ Herald – Power plan likened to Soviet era
It was actually the Union of Soviet Socialist Republics, Mr Bridges, not “United” Soviet Socialist Republic. Get your Evil Empires right, mate.
And anyway, most of New Zealand’s centralised planning occurred during National’s administration, from 1975 to 1984, under the late Robert Muldoon. Remember the price/wage freeze?
Mighty River Power chief executive Doug Heffernan, also called the plan “socialist” (by the way, is that a bad thing?) He declared,
“What you’ve just described is a socialist consumer model.”
Acknowledgement: NZ Herald – MRP chief slams socialist’ plan
To which I would point out to the reader,
- Heffernan benefits from a $1.49 million p.a. salary – whilst Mighty River Power keeps raising it’s power prices. So the gentleman has a vested interest in this issue.
- In February this year, Heffernan announced that Mighty River Power’s half-yearly profit has quadrupled; prices had risen by 2%; despite demand “being flat”. (see: Mighty River Power profit quadruples )
- Saying that “Mighty River Power would not have made the $1billion investment into geothermal energy that we’ve made in the last five years … The risks would have been too high” – insults our intelligence. Mighty River Power was built up by the State, with taxpayers’ money. Heffernan forgets himself; MRP is not a private company.
- And anyway, is it the role of SOE chief executives to be promoting privatisation?
Steven Joyce added to the “red menace scare”on TVNZ’s Q+A on 21 April,
“By definition, it’s socialism.
“They are not just talking about the price, they’re talking about telling the generators when they can generate, which generating assets they can use, which ones they can introduce to the markets.”
The Minister said the proposed plan would also scare off investors, with evidence of this seen late last week when the market dropped.
“On Thursday and Friday, the market dropped nearly $600 million across three companies because they said, ‘Jeez, we’re not interested in this’.”
Which is rather strange… Joyce, Bridges, Collins, Key, et al, are likening Labour-Green’s plans to “North Korean economics” or “Soviet style socialism”.
But when did the former USSR or the current North Korea ever have a share market or multi-party Parliamentaty democracy?!?!
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Could it possibly be that National ministers have no intellectual, rational response to the proposed NZ Power scheme?
Could it be that they must rely on fear-mongering? Which reminds me of this,
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Acknowledgement: NZ History Online: Dancing Cossacks political TV ad
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Could it possibly be that National ministers are placing their faith in free market economics – vis-a-vis the partial sale of state powercos – to get prices to drop? (Which, after 14 years is yet to happen for the domestic consumer.)
Could it be that National ministers are… panicking?!
Because as NZ Herald columnist, John Armstrong wrote on 19 April,
“There may be good reasons for the seemingly constant above-inflation hikes in retail prices. But politicians have given up explaining because consumers long ago stopped listening.
All this would suggest there is fertile ground for Labour and the Greens, who yesterday foreshadowed plans to slash power prices by setting up a new agency, NZ Power, to act as a single buyer of wholesale electricity.
National was truly gobsmacked. It accused Labour of “Muldoonism”, “loony tunes” policy making and “North Korean economics”.
National accepts that at the outset there might be lower prices. But it argues the policy would distort price signals that are so vital to matching supply and demand. That could lead to power shortages. The policy would distort and even discourage investment in power generation.”
Acknowledgement: NZ Herald: National gobsmacked at Labour idea
“Gobsmacked” is about right.
And ironically enough, “Muldoonism” was a product of the National Party – not Labour. Hilarious stuff, indeed!
This is nothing less than a full-scale retreat from market-driven political orthodoxy. In effect, Labour has done the unthinkable; it has publicly announced that neo-liberalism and it’s supposed “free” market economics does not, and cannot, deliver all of society’s needs.
We get a glimpse of what it must have been like in 1989 when Mikhail Gorbachev sat down with his colleagues in the Soviet Politburo and announced to a stunned meeting,
“Comrades, our communist ideology and centralised economic system has failed.”
Mark 18 April 2013 on your calendar as the day that one of our two main Parties (or, two out of our three main Parties, if Green political support keeps increasing) renounced neo-liberal free market ideology as a failure.
There is now a clear, unequivocal difference between an increasingly right wing, ideologically-driven National, and a decidely more-leftist – but pragmatic – Labour.
And the public now has a clear choice as well, for whom to vote;
Option A (for the Blue Team): maintain the neo-liberal status quo; proceed with privatisation; and hope-like-hell that Max Bradford’s promises eventually, maybe, one day, will come true.
Option B (for the Red Team): vote for change; abandon our slavish adherence to neo-liberal dogma; and, as a side-effect, enjoy cheaper power bills.
Continued at: The Politics of Power and a Very Clear Choice – Part Rua
This blogpost was first published on The Daily Blog on 24 April 2013.
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*
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Previous Related Blogposts
History Lesson – Tahi – Electricity Sector “reforms” (4 March 2012)
John Key: Man of Many Principles (28 Sept 2012)
Labour, Greens, NZ First, & Mana – A Bright Idea with electricity! (10 March 2013)
References
NZ History Online: Dancing Cossacks political TV ad
NZPA: Splitting up ECNZ expected to cut wholesale power price (16 Dec 1998)
NZPA: Reforms aimed at business – Luxton (21 April 1999)
Otago Daily Times: Power Prices Set To Soar (12 May 1999)
Otago Daily Times: No case for regulation (24 May 1999)
Otago Daily Times: Lower power prices coming says Bradford (3 June 1999)
Otago Daily Times: Power prices to rise by up to 15.1% (29 June 1999)
Otago Daily Times: Reforms blamed for hike (13 July 1999)
Scoop: Alliance to hold Winston Peters accountable (8 Oct 1999)
NZ Herald: Peters ‘forgets’ NZ First support for power reforms (13 Aug 2008)
Fairfax: Government to seek inquiry into power price rise (30 September 2008)
NZ Herald: Put prices on hold, Brownlee tells power companies (21 May 2009)
NZ Herald: Mighty River directors’ 73pc pay rise realistic – Key (5 April 2013)
Scoop: Labour-Greens to rip up the book on electricity pricing (18 April 2013)
NZ Herald: Labour-Greens plan could work, says Vector CEO (19 April 2013)
NZ Herald: National gobsmacked at Labour idea (19 April 2013)
NZ Herald: Power plan likened to Soviet era (19 April 2013)
NZ Herald: MRP chief slams socialist’ plan (21 April 2013)
TVNZ: Q+A – Transcript of Steven Joyce interview (21 April 2013)
NZ Herald: Bernard Hickey: Power barons fail to fool the public this time around (21 April 2013)
Radio NZ: Power prices nearly double since 2000 (21 April 2013)
Other blogs
Kiwiblog: Electricity Prices
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= fs =
Meridian Power?
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Our household is with Meridian Energy.
If that’s the next “on the block” to be part-privatised, I’ll be on the phone within sixty seconds to change to Genesis.
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= fs =
Binding future governments – a question.
A letter to the editor of the NZ Herald…
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from: Frank M <fmacskasy@gmail.com>
to: NZ Herald <letters@herald.co.nz>
date: Tue, May 14, 2013 at 1:24 PM
subject: Letters to the editor.The EditorNZ HERALD.
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Kia ora,
The National government wants to bind future governments to the Sky City deal for the next 35 years.
Can a Labour-Green government bind future National governments to not selling our state owned enterprises?
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-Frank Macskasy
(address & phone number supplied)
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= fs =
An Occupation to remind the Government…
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NZ, Wellington, 7 May 2013 – Since the anti-asset sales march on 27 April (see: 27 April in Wellington – A Protest Against State Asset Theft (Part Tahi)), a new occupation has been set up at the foot of Wellington Cenotaph, at the intersection of Lambton Quay and Bowen St.
A much more low-key event than the occupation of Wellington’s Civic Square in January 2012, the occupiers number only a few, with two tents, and signage;
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Edd (L) and James (R), standing beside their tents.
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James told this blogger that the occupation started soon after the 27 April protest march and he expected others to join in as time went by. He used the phrase,
“Get an education,
Join the Occupation!”
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The Occupation supports and promotes several causes which are odf concern to communities around the country – issues which National studiously ignores, in favour of Big Business;
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But the main message is one of peaceful protest against the sale of assets which we, the people, rightfully own;
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And the accent is on a peaceful protest;
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Edd and James keep the area clean and clear of rubbish and leaves at all times. The Council can rest easy that this Occupations will not result in an unsightly mess;
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They are both keen to keep negative elements away from the Occupation;
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In fact, James told this blogger that they had learned from their mistakes from the previous occupation of Wellington’s Civic Square and were adamant that they wanted no alcohol, drugs, or “feral” element associated with their protest. At all times, James insisted, they wanted to stay On Message, and to engage with the public – not freak them out.
James said that their staunch insistance on no alcohol or drugs and good behaviour had resulted in a positive response from Police and the Council. They also had full support from the Global Occupy movement and from Tainui, which was planning to visit them.
Staying On Message – and the message was simply;
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According to James and Edd, their actions were for the country and for future generations. James said,
“People get used to being debt slaves,” and the loss of state assets would push up prices and place our country further into into.
James is not wrong. As the chart below shows, private debt has ballooned in the last two decades;
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Source: NZ Reserve Bank
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When a passerby asked James,
“So you want to destroy the government ?”
James replied,
“No, We want you to learn.”
Amen to that, brother.
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*
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Previous Related Blogposts
27 April in Wellington – A Protest Against State Asset Theft (Part Tahi)
27 April in Wellington – A Protest Against State Asset Theft (Part Rua)
Copyright (c) Notice
All images are freely available to be used, with following provisos,
- Use must be for non-commercial purposes.
- Where purpose of use is commercial, a donation to Child Poverty Action Group is requested.
- At all times, images must be used only in context, and not to denigrate individuals.
- Acknowledgement of source is requested.
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.
= fs =
27 April in Wellington – A Protest Against State Asset Theft (Part Rua)
Continued from: 27 April in Wellington – A Protest Against State Asset Theft (Part Tahi)
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NZ, Wellington, 27 April – Under a clear, sunny sky and only a slight breeze, the march pushed off at around 2.45pm, with a police escort;
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Following the police vehicle, the lead marchers, proudly grasping a message aimed at all National ministers;
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The marchers were in good spirit – knowing that they were on the side of the angels on this issue;
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Labour and Mana standing side by side. A portent of things to come after the 2014 election? (Or earlier, if this rotten government collapses, or Key has a Muldoon-“moment” and calls for a snap election.)
If the sale of Mighty River Power goes badly for the thieving Nats; or Ohariu MP, Peter Dunne realises that the government he is a part of is on a hiding to nowhere, a snap election may be on the cards.
We can only hope/pray…
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Lots of smiling faces; lots of hope and optimism for the future of this country;
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A bit of humour from one of the protesters;
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Aside from a couple of clowns who thought they were being clever (see dickhead on the left), we received good support from by-standers. Several joined the protest march – note the lady in the pink jersey on the right, who stepped off the footpath, and walked with us;
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Bringing up the rear of the protest march;
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Where there were smart-arses yelling desparaging comments, they were generally inarticulate boofheads. These four young ‘gentlemen’ yelled abuse, and in the process showed us the calibre of right wing fools. No doubt they’ll become typical National Party (or ACT, if it survives) politicians;
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Ngarie had so much energy, as she took part in the chants and had some highly critical comments of her own to shout. People were left in no doubt what she thought of National and our illustrious Dear Leader;
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Near the end of the march; these guys may be at the bottom of the socio-economic heap, but they had a huge amount of positive, good nature and were staunch in their condemnation of National’s thieving of our state assets. When the poorest of the poor are politicised, the end is nigh for neo-liberals and their fellow-travellers;
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The march eveventually wound it’s way up the entrance-way to Parliament. Note the senior citizens leading the way!
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By the time the protesters had reached the Parliamentary fore-court, their numbers had swelled to around 500-700 (estimated);
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Some street theatre by Aroha Priest, giving us a glimpse of a chilling future, where poverty has increased and homeless street-life is the ‘norm’;
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Howard Phillips – Vice President of the Rail, Transport and Maritime Union – gave a rousing speech to the crowd, reminding us how many thousands of jobs had been lost over the last four years;
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Peter Hicks – Tasmanian singer-song writer – and Marama Te Kira – local performer/songwriter – entertained the crowd with good music, assisted by an excellent sound-system.
A fine sunny day; good music; and “giving the fingers” to the Nats – what could be a better day?
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And Marilyn Head – from the NZ Nurses Organisation – expressed an excellent appraisal of how the s TPPA – currently being negotiated in secret – will affect this country’s economic sovereignty. Marilyn pointed out that, in the past, we were able to re-nationalise stressed former-SOEs (KiwiRail and Air New Zealand).
Marilyn pointed out that the TPPA would no longer allow a New Zealand government the option of bailing out and re-nationalising a stressed ex-SOE (eg; Mighty River Power) and would tie it’s hands considerably. She raised the issue of trans-nationals suing our government; the loss of PHARMAC’s effectiveness; and secret overseas tribunals deciding disputes between coroporations and governments.
Marilyn said that the Australian government had refused to be a party to permitting corporations to sue them in Investor-Government disputes – but that National was prepared to sign up to that accord.
Held in secret tribunals, it puts New Zealand in a very dangerous position. More foolishness from National.
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And meanwhile, lurking in the background, was this character. Perhaps waiting for the death of our economic sovereignty?
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Not if we don’t let it happen.
Aotearoa – it’s NOT for sale!
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Copyright (c) Notice
All images are freely available to be used, with following provisos,
- Use must be for non-commercial purposes.
- Where purpose of use is commercial, a donation to Child Poverty Action Group is requested.
- At all times, images must be used only in context, and not to denigrate individuals.
- Acknowledgement of source is requested.
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= fs =
27 April in Wellington – A Protest Against State Asset Theft (Part Tahi)
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NZ, Wellington, 27 April – On a crisp, summery day, citizens of Wellington (and some from further afield), began to assemble at Te Aro (“Pigeon”) Park, in Manners Street, to send (another) message to National ministers: Aotearoa is not for sale!
TV1 cameraman, with Police and protest organisers, together planning the march route and other measures to keep people safe during the event. There was excellent co-operation between both parties. ANFS has a solid record for peaceful, non-violent, law-abiding protest;
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From about 2pm, the crowd quickly swelled from a few dozen, to several hundred. Ages ranged from young children, to the elderly. It was interesting to note that over half the assembled people were in their 20s or 30s.
The issue of state assets belonging to the people, has become an inter-generational matter of concern and deeply-held beliefs;
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Question. Will all our assets be gone – flogged off to investors from Beijing, Berlin, or Boston – by the time this young fellow grows up? Will he be a tenant-worker in his own country – a country that was sold out from under his feet by venal, ignorant politicians and a distracted middle-class?
Answer? Not if we have anything to say about it!
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From the young, to the older. This is an issue that cuts across generations, race, gender, class, etc;
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Some good sounds from the Brass Razoo Solidarity Band;
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Good representation from the young people of the Mana Party;
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Plenty of good humour evident amongst the protest group. I wonder if Dear Leader would like this piece of art?Perhaps for a small sum donated to a worthy charity?
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ANFS (Aotearoa Not For Sale) organiser, Ariana, addressing the crowd,
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Young New Zealanders who want what we took for granted as children ourselves; clean rivers and clean seas. Is this too much to ask from a consumerist generation?
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Simple messages on home-made placards;
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Once Key and his cronies sell of our assets, what will be left for this young lady? And will she and her young generation curse us for letting it happen?
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Another simple, home-made message from a New Zealander to the government;
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A young socialist in the making? The struggle does not end here, nor will neo-liberalism triumph. Not whilst the young continue to bear the banner;
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Another view of the crowd, listening to ANFS co-organiser, Francis, barely visible in the background (holding bullhorn);
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I think a good number of people in this country would agree with these messages;
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A good message – and one all governments should consider;
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Three staunch MANA Party supporters. Note the message on the placard. Aside from simple-minded Tory supporters, who really believes that power prices will fall, once Mighty River Power, Meridian, and Genesis are partially-privatised?
Will investors really settle for a drop in returns on their share investments? Yeah, right, of course they will… *pfffft!!*
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A very clear message. This banner will lead the march;
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Valerie, addressing the crowd about the protocols of the march,
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Two cars painted to promote the day of action. Using corporate-style vehicle-advertising – how cool is that?
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Continued at: 27 April in Wellington – A Protest Against State Asset Theft (Part Rua) – Where the march heads for Parliament grounds!
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Copyright (c) Notice
All images are freely available to be used, with following provisos,
- Use must be for non-commercial purposes.
- Where purpose of use is commercial, a donation to Child Poverty Action Group is requested.
- At all times, images must be used only in context, and not to denigrate individuals.
- Acknowledgement of source is requested.
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= fs =
Breakfasts, Brain-fades, and Bullshit
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Acknowledgement: Dominion Post – Key met spy candidate for breakfast
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The best response amongst the comments posted was this one, in response to a right winger trying to deflect on to Shearer and Norman,
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Acknowledgement: Dominion Post – IBID
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Brilliant reposte.
’nuff said.
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= fs =
Blogger lays complaint with Commerce Commission
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As of today, 1 April 2013, this blogger has laid a complaint with the Commerce Commission regarding National minister’s questionable dealings with Rio Tinto and proposed subsidies for electricity prices,
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Your details
- First Name: Frank
- Last Name: Macskasy
- Email: fmacskasy@gmail.com
Your address
Your complaint
- Business you are complaining about: New Zealand Government
- Street: Molesworth St
- Suburb: Thorndon
- City/Region: Wellington
- Post code: 6160
- Business Contact Number/ Mobile number: (4) 817 9999
Description of complaint
What happened?
Tony Ryall has recently announced that the NZ Government is intervening directly in negotiations between Meridian Energy and Rio Tinto (which is 80% owner of Tiwai Aluminium Smelter).Mr Ryall has said,
“With this in mind, the Government has been in contact with Pacific Aluminium’s international parent company Rio Tinto this week to discuss helping to bridge the gap in their positions over the short to medium term, if this could be of assistance in concluding an agreement.
“In the meantime, we understand Meridian’s existing contract with Pacific Aluminium remains in place at least until 1 January 2016 with significant financial and other obligations beyond that.”
Ryall added that “all relevant information – including about the smelter electricity contract – will be reflected in the Mighty River Power offer document which is currently being finalised”.
Source: NZ Herald, Govt steps in to sort out stalled Tiwai power deal ( http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=10874174)
I therefore submit the following;
(1) This appears to be a prima facie case of the NZ Government manipulating the future stock price of Mighty River Power (and other state owned powercos), by offering a subsidy to Rio Tinto.
(2) This subsidy is not available to any other company nor individual.
(3) As such, I submit that the NZ Government’s intention to subsidise electricity that is provided to Rio Tinto is done with a view to reduce competition in the market.
Specifically, I draw the Commission’s attention to the Commerce Act 1986; sections 27, 30, and related clauses.
(4) Furthermore, I submit that if any other corporation, company, institution, or individual attempted such an act, that they would be deemed to be guilty of price fixing and manipulation of the market.
I await your response and thank you for your consideration of my complaint.
-Frank Macskasy
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I will keep readers posted as to what, if anything results from this complaint.
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Relevant sections
Section 27: Restrictive trade practices
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Section 30: Price fixing
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Pre-register your disinterest in buying Mighty River shares
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Not keen on buying shares in state assets you already own?
Are you wanting to pre-register your dis-interest?
Get in quick, now, and we’ll guarantee all pre-registrants 25% extra of NO shares at all!
This Facebook page is a great idea, and a simple, 5 second means by which you can indicate your disinterest in the sale of our state assets!
Get in Now! Get in quick!
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Pre-register your disinterest in buying Mighty River shares!
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Click the ‘Like’ Button to go to the Facebook Page!
Click the ‘Like’ Button to go to the Facebook Page!
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(And don’t forget to share this with your friends, family, workmates, etc! The more the merrier!)
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392,000 New Zealanders send a clear message to John Key – Part Rua
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Continued from: 392,000 New Zealanders send a clear message to John Key – Part Tahi
NZ, Wellington, 12 March 2013 – Ms Maniapoto Jackson introduced the first speaker, Greypower’s President, Roy Reid,
“So please welcome up the man who initiated this historical moment for us – the biggest citizens initiated referendum in [New Zealand’s] history!”
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Roy Reid
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“As President of Greypower, I wish to inform you that Greypower has been opposed to the sale of state owned assets for a number of years. And this was reconfirmed at our annual general meeting two years ago. We advised all the political parties in this House that we were opposed to them selling any of our assets.
Our generation worked hard. We paid the taxes, to build our existing assets. They’re not for sale. They belong to all New Zealanders.
I sincerely thank all those who worked from one end of New Zealand to the other, to collect those 394,000 signatures just behind us. It’s the biggest petition ever presented to this House.
I pay tribute to our co-supporters, the New Zealand students association. For being involved with us, because it shows the country that we are united from the elderly to the younger generations……I’m sure that we’ve got enough valid signatures in those boxes to force the referendum. And [despite] no respect for what this government today says, the people of New Zealand will have their say.”
It as perhaps fitting that Mr Reid was given first opportunity to address the crowd. It was indeed his generation, and others before him, who sacrificed so much to build what we have in New Zealand today. And which a few greedy, short-sighted number of our fellow New Zealanders seem unable to comprehend that these assets do, indeed, belong to us all.
Not just to those with the cash to buy shares.
Our elected representatives certainly did not hesitate to show their agreement with Mr Reid’s comments,
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Ms Maniapoto Jackson then invited the next speaker; ex-Vice President of the Auckland Students Association and Ngai Tahu; Arena Williams,
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Arena Williams
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Ms Williams greeted the crowd in Te Reo and her following message was short, blunt, and to the point,
“There’s one message that the government needs to take home from such an over-whelming support of this petition, and that’s Stop the asset sales and give New Zealanders a chance to have a say on this really important issue!”
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The next invited guest-speaker was economist, Peter Conway, from the Council of Trade Unions,
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Peter Conway
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Mr Conway said,
“The Union movement is really proud to be here today at this amazing event and I just want to say, fantastic effort. Well done everybody! It’s awesome.
Now it might have been a little bit easier if for me to have the backing of a one million dollar advertising campaign, and maybe if we we’d been able to do it all on line. But I actually think that the fact that we went out there into communities where people work, live, and play and debated the issues; talked to people about it and got such a fantastic response, is really a testament to our democracy…
… So this is part of our democracy. And what we’re saying to the government; respect democracy… Let’s get this referendum up, and the Council of Trade Unions, on behalf of the union movement, is calling on the government to halt all asset sales and listen to the people.
Kia kaha, and thanks very much.”
Ms Maniapoto Jackson then welcomed the Leader of the Labour Party and MP for Mt Albert, David Shearer,
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David Shearer
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After expressing his welcome, Mr Shearer gave a brief thanks to the people, followed by a similarly brief message,
“Look, I just wanted to start by saying ‘thank you’, ‘thank you’ for all of those people who went out day after day, weekend after weekend, who stood on cold corners in the middle of winter and got people to sign this petition. Thank you to the hundreds of thousands of New Zealanders who care about this country so much that they put their signature to this petition.
This is about the transfer of an asset that we all own into the hands of a very few. That’s what it’s about, it’s about fairness. It [asset sales] is not fair.
This referendum will make the government listen to New Zealanders.
The fight will go on. It’s not finishing today. It will go on and we in the Labour Party will continue to fight this until 2014.
I wanted to say, as the boxes were being put up there, I was thinking that “Another Brick in the Wall” tune came into my mind, and I was thinking “We Don’t Want your Asset Sales Programme John Key”…
… Once again thank you for your effort, thank you for being here today. Kia Kaha, let’s take it to the government.”
Before Ms Maniapoto Jackson introduced the next speaker, Green Party co-leader Russell Norman, she briefly pointed out that the Parties behind her were unified, “with only the odd absence, which was duly noted“.
Mr Norman then addressed the people,
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Russell Norman
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Mr Norman then addressed the people,
“Today we stand here here on behalf of the millions of New Zealanders who are opposed to the sale of their assets. Today we stand here on behalf of the hundreds of thousands von New Zealanders who have signed this petition, behind us. Today we stand here on behalf of future generations who are relying on us to stand up for our country.
And that is why we have done this massive piece of work that you see behind us.
It has been incredibly hard work on behalf of thousands and thousands of people to go out and collect these signatures. It is despicable that the Prime Minister then says that the people who signed this petition were children and tourists! Prime Minister you do not know New Zealanders!
If the Prime Minister of New Zealand thinks that the people who signed this petition, the 400,000 people who signed this petitition, are not real New Zealanders, then he is in the wrong country…
… Real New Zealanders are the ones who worked and laboured to build those assets up so that we could inherit them. Real New Zealanders are the ones who will look after them so that we can pass them on to those who come after us…
… We have a mandate to keep our assets. The Prime Minister has no mandate to sell them.”
Ms Maniapoto Jackson then introduced Mr Peters, saying “if there’s anyone who can talk about justice and fairness, it’s Winston Peters“,
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Winston Peters
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“…Mr Key does does not have a mandate to make these sales. We all know the last election result and he relies upon the vote of Peter Dunne, who you know, with your money, at the last election had TV adverts saying that he would not do that. So there is no mandate.
We come now to the referendum, which is a chance for Mr Key to see whether he’s got the public backing and he doesn’t have even have the backing of one third of the National Party vote by every survey that you and I have seen.
Ladies and gentlemen, it’s going to be difficult over the next few months on this issue, but I want to make something very, very, clear. Unless we make it clear to everyone who’s buying, that after the next election, whenever they fly the white flag, we intend to take back those shares at no greater price than they bought it for, then we will not be making the message very clear for Mr Key who governs for the few and very few.
Now your problem is, you don’t own a casino. Otherwise he’d be listening to you.
And you’re you’re not a Hobbit or some wide-boy from Hollywood, otherwise, he’d be listening to you.
No wonder he fell upon the defence of tourists, because that’s what Mr Key is; a CV Prime Minister, who will soon go, on issues like that…
… this is just the beginning. It is not the end.”
Next up, Ms Maniapoto Jackson introduced “the wonderful leader of the Mana Party, and MP for Te Tai Tokerau, Hone Harawira“,
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Hone Harawira
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Mr Harawira injected a note of humour into the afternoon, and the crowd enjoyed his off-beat way of giving a speech,
“Look I’m going to do most of my korero in Maori, so the best way for you to support it is, every time I stop to take a breath, clap like crazy!”
The crowd obliged with enthusiasm, clapping and cheering each time he paused during his korero.
Ending his speech in Te Reo, he added,
“Now just for a short chant, a short chant, eh? Because Moana get’s all the the recording rights for this little gig, so mine is going to be a short little chant. So just follow after me. You ready?
“Aotearoa is not for sale!”
The crowd responded, “Aotearoa is not for sale“.
“C’mon, c’mon, now you can do better than that,” he ‘admonished the crowd with a smile.He repeated, “Aotearoa is not for sale!”
The responded boomed back, “AOTEAROA IS NOT FOR SALE!”
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“Tell John Key to Go to hell!”
“TELL JOHN KEY TO GO TO HELL!”
And with that, Hone Harawira finished with a cheerful “Kia ora tatou!”.
As far as political speeches went, it was one of the shortest and more entertaining that this blogger has heard for a while. He certainly injects a bit of fun into a political event.
As an intriguing aside, this blogger managed to capture this picture of two Davids and a Damian. Their body language seemed to belie any suggestion of tension or ‘struggle between Messrs Cunliffe and Shearer.
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(L-R) David Shearer, David Cunliffe, Damien O’Connor
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Hmmmm… One has to wonder…
On a closing note, Ms Maniapoto Jackson ‘encouraged’ (dragged!) Hone Harawira back to the microphone to sing a duet – an old song from their protest days together,
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And final posed-pics from Ms Maniapoto Jackson and Hone Harawira, after their singing-duet finale,
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It’s interesting to compare the persona of Hone Harawira in the media, especially in his early days in Parliament – with the man who presents to the people, at public gatherings. There is a warmth and sincerity to the man that is almost wholly lacking in his MSM appearances – but a warmth and humour that is obvious when seeing him in person.
And from the Green Party caucus, this lovely snapshot. They deserve thepride they were feeling in being part of a movement to collect nearly 400,000 signatures,
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In conclusion…
John Key’s casual dismissal of the petition, and the nearly 400,000 New Zealanders who signed it, was not a “good look”. It spoke volumes of Key’s persona; his arrogance; and his pettiness.
He could just as easily have accepted the petition as part of the democratic process and congratulated New Zealanders for participating. It would have made him look statesmanlike; stand above petty politics; and increased his mana.
Being derisive; suggesting that the signatures were from “children and tourists”; was offensive.
It was unnecessary and uncalled for.
It was childish.
It publicly revealed John Key’s innermost insecurities – as he knows that the people are not with him on this issue. It must be a debilitating, depressing feeling, knowing that three million New Zealanders are angrily opposed to what Key and his cronies are up to.
“Where is the love”, he may well ask?
“Where is the respect”, we ask him.
An open message to John Key…
The Prime Minister insists he has a “mandate” to part-privatise our state assets.
I disagree. More people voted for Parties opposing state asset sales than voted for Parties endorsing said sales.
John Key has a one seat “majority”, due in part to manipulations during the 2011 election, and MMP rules that prevented some Parties from gaining representation in the House. For example, the Conservative Party won twice as many votes as ACT – but gained no seats. (see: Mandates & Majorities)
That’s not a mandate, Mr Prime Minister – that’s an accident of circumstances.
Mr Key – if you truly insist that you have a mandate, then put it to the test. Hold off on the sharefloat for Mighty River Power. Let the people have their say in a referendum.
I, for one, will accept the verdict of a referendum, whatever the outcome. If the majority – even the slimmest margin over 50% – support your asset sale programme, you’ll not hear one more word from me on this issue ever again.
Are you willing to put your “mandate” to the test, Mr Prime Minister?
Are you willing to listen to, and abide by, the will of the People?
I am.
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Additional
Radio NZ: Petitioners confident of asset sale referendum
Dominion Post: Government to ignore asset sales referendum
NZ Herald: Asset sales petition arrives at Parliament
TV3: PHOTOS: Asset sales petition presented
TVNZ: Petition against SOE sales delivered to Parliament
Newstalk ZB: Opposition MPs greet anti-asset sales petition
Copyright (c) Notice
All images are freely available to be used, with following provisos,
- Use must be for non-commercial purposes.
- Where purpose of use is commercial, a donation to Child Poverty Action Group is requested.
- At all times, images must be used only in context, and not to denigrate individuals.
- Acknowledgement of source is requested.
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392,000 New Zealanders send a clear message to John Key – Part Tahi
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NZ, Wellington, 12 March 2013 – Another beautiful sunny day with blue skies (apologies to farmers) was a perfect setting this afternoon in Wellington, when a couple of hundred marchers arrived on Parliament’s grounds, bearing 68 boxes, containing 392,000 signatures.
The referendum requires 304,000 valid signatures to precipitate a nationwide referendum. The 392,000 signatures gives a 22% ‘buffer’ against invalid signatures; people not on the electoral roll; duplicate signatures; and malicious attempts to undermine the petition.
There was a small number of people on Parliament’s grounds awaiting the march, amongst them tino rangatiratanga activists, Brenda and Fran,
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At about 1pm, marchers arrived, bearing the boxes that contained a priceless treasure – signatures of 392,000 New Zealanders. Media flocked around them. This was an historical event,
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They walked onto Parliament’s grounds to cheers and applause of those waiting,
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On the steps to Parliament, more media and elected representatives from Opposition Parties were waiting. (Curiously, none from National, ACT, or United Future were in attendance. Their ‘invites’ must’ve been lost in the post?)
Politicians clapped as the marchers approached. Men, women, young, old, Maori, Pakeha, these were New Zealanders who believed that the People’s Assets were not to be stripped and flogged off by a handful of politicians,
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Sixty eight marchers proudly carried a prized box each,
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The boxes were carefully passed over a security barricade, to be stacked on the Parliamentary forecourt,
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Meanwwhile, the crowd watched, as the stacking of boxes progressed,
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The leadership of the Green and Labour Parties, with Brendan Horan (far left, standing beside Metiria Turei); former AUSA President, Arena Williams (standing beside David Shearer); Grey Power National President, Mr Roy Reid; Annette King; and (far right – no slur intended, Mr Conway) CTU Economist and Director of Policy, Peter Conway .
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Mana Party leader, Hone Harawira, joined the Party leaders shortly afterward (NZ First lreader, Winston Peters was standing off-camera, to the left),
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NZ First leader, Winston Peters, being interviewed by a MSM journalist,
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A panoramic view of part of the assembled crowd,
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Green MP, Jan Logie; NZ First leader, Winston Peters, and NZ First MP, Andrew Williams, at the stacked petition boxes. At this point, the invited guest-speakers were preparing themselves – and their notes – to address the crowd and media,
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With a unique style and flair she has become reknowned for, Moana Maniapoto Jackson welcomed people to today’s presentation of the petition,
“We are celebrating people power…”
Coaching the crowd, to chime in with “Ohhhh yeahhhh” as the chorus, Ms Maniapoto Jackson launched into a short protest-style song. Her powerful voice belted out the words, making her microphone and speakers practically redundant, as she filled Parliament with her lyrical sounds,
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“Hey, hey Mr John Key,
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You say you’ve the mandate
We’re here to help,
it’s not too late,
People here are standing strong
a hundred thousand – can’t be wrong
We’re here to help you get back on track,
Let’s stop the sales,
Let’s pull it back.Crowd’s chorus, Ohhhhh Yeahhhhh!
All together now!
OHHHHH YEAHHHH!”
Ms Maniapoto Jackson then welcomed the first of “a long line of luminaries, that are positively glowing with energy and excitement as we deliver to the government a very strong call from New Zealanders.”
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To be continued at: 392,000 New Zealanders send a clear message to John Key – Part Rua
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Additional
Radio NZ: Petitioners confident of asset sale referendum
Dominion Post: Government to ignore asset sales referendum
NZ Herald: Asset sales petition arrives at Parliament
TV3: PHOTOS: Asset sales petition presented
TVNZ: Petition against SOE sales delivered to Parliament
Newstalk ZB: Opposition MPs greet anti-asset sales petition
Copyright (c) Notice
All images are freely available to be used, with following provisos,
- Use must be for non-commercial purposes.
- Where purpose of use is commercial, a donation to Child Poverty Action Group is requested.
- At all times, images must be used only in context, and not to denigrate individuals.
- Acknowledgement of source is requested.
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Letter to the Editor: Regarding asset sales, mandates, and little green apples…
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Regarding asset sales, mandates, and little green apples…
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from: Frank Macskasy < fmacskasy@gmail.com >
to: Dominion Post < letters@dompost.co.nz >
date: Tue, Mar 12, 2013 at 11:14 AM
subject: Letter to the EditorThe Editor
DOMINION POSTSpeaking from his latest hat-wearing excursion to Brazil, Dear Leader John Key dismissed the petition calling for a referendum on the question of asset sales, by saying,
“…sure as little green apples [that] huge numbers of them are not bona fide names on the list” and would subsequently have to be struck off from the total number. (“Government to ignore asset sales referendum”, 12 March 2013)
That seems a curious thing to say.
How does Mr Key know “[that] huge numbers of them are not bona fide names on the list”? Does he have some inside knowledge that the rest of us are not privy to? Let’s hope that fundamentalist National and ACT supporters have not been deliberately undermining the petition.
That would indicate a gross contempt for the democratic process and for the views of New Zealanders.
Politicians bend over backwards to earn our vote at election time, and promise to “listen” to our concerns. Instead of just promising to listen to us every three years, Mr Key might consider doing likewise in-between elections.
-Frank Macskasy
Blogger,
“Frankly Speaking”
[address and phone number supplied]
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from: Frank Macskasy < fmacskasy@gmail.com >
to: Sunday Star Times < letters@star-times.co.nz >
date: Tue, Mar 12, 2013 at 11:19 AM
subject: Letter to the editorThe Editor
Sunday Star TimesJohn Key keeps insisting that he has a “mandate” to partially-privatise our state assets. But a simple bit of arithmetic puts his assertion into serious doubt.
Votes from Parties endorsing asset sales:
National: 1,058,636
ACT: 23,889
United Future: 13,443
Total: 1,095,968Parties opposing asset sales:
Labour: 614,937
Greens: 247,372
NZ First: 147,544
Maori Party: 31,982
Mana: 24,168
Conservative Party:* 59,237
Total: 1,125,240Though the Conservative Party did not win seats because of MMP’s 5% and one-electorate seat thresholds, it still won twice as many votes as did ACT –
which did win a seat – with the help of some none-too-subtle machinations between John Key and John Banks over a very public cuppa tea.
The up-shot? 29,272 more voted for Parties opposing asset sales than voted for.
Something that Mr Key might bear in mind next time he tries to claim a mythical mandate to hock off our state owned enterprises.
-Frank Macskasy
Blogger,
“Frankly Speaking”
[address and phone number supplied]
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from: Frank M < fmacskasy@gmail.com >
to: NZ Herald < letters@herald.co.nz >
date: Tue, Mar 12, 2013 at 11:22 AM
subject: Letters to the EditorThe Editor
NZ HeraldDear Leader John Key is confident that he has a “mandate” to part-sell our state assets to private investors.
His dismissive response to 320,000 signatures on a petition, calling for a referendum on the issue, suggests otherwise.
Key knows full well that his “mandate” is mythical and based solely on two seats in Parliament – Epsom and Ohariu – that were won through some very dodgy back-room deals. That’s not a “mandate” – that’s manipulation.
I challenge him to put the decision to the people. If Key truly believes he has a real mandate, he won’t mind holding off on the sale of Mighty River Power, to test said “mandate”?
-Frank Macskasy
Blogger,
“Frankly Speaking”
[address and phone number supplied]
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If you’re keen to add your voice(s) by writing letters to editors, feel free to use the email addresses above. Mention John Key by name, and his clipping-service will most likely dump it on his desk.
Happy writing!
[Note: Letters-to-editor require full name, residential address, and contact phone number to allow verification of authenticity.]
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References
Government to ignore asset sales referendum (12 March 2013)
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A Clear Warning to Investors in SOEs…
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The recent financial crisis and near-collapse of Solid Energy – one of the five, state owned enterprises planned for partial-privatisation – should serve as a warning for those investor-vultures circling to buy shares in any of the SOEs.
In fact, recent history regarding Air New Zealand, Kiwiwail, and (non-privatised) BNZ in 1991, are indicators that privatisation of state assets is not a guaranteed roadmap to wealth,
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It is noteworthy that one of the cause of Air New Zealand’s collapse was it’s foolhardy buy-out of Australian airline, Ansett,
First, the decision by Air New Zealand to pay dividends and second, the decision to buy the second half of Ansett. Both moves turned out to be considerably more beneficial to the interests of Brierleys than those of Air New Zealand.
Take the Ansett purchase. In early 1999, Cushing announced that Air New Zealand was vetoing Singapore Airline’s bid to buy News Corp’s 50% of Ansett Holdings (Air New Zealand had held the other 50% of Ansett since September 1996). Instead, it decided to pay News Corp $A580 million and get 100% control.
It’s most likely true that Air New Zealand paid too much for the stake and that directors had too little information about Ansett’s financial and engineering state. These are well-aired opinions, but are secondary to the main question that should be asked: Why did Air New Zealand buy the second half of Ansett at all? It’s not just that it was hopelessly out of its depth buying an airline twice its size. It’s just hard to see any benefits – to Air New Zealand, that is.
Source: IBID
On top of that were big dividend demands from one of Air Zealand’s major shareholders, Brierley’s,
The at times cash-strapped investment company held between 30% and 47% of shares over the period so, based on the total dividend of $765 million, Brierley reaped an estimated $250 million to $380 million from the airline. And Air New Zealand’s decision to buy the second half of Ansett, cutting Singapore Airlines out of the deal, contributed to Brierleys being able to do its own deal with Singapore.
In April last year, two months after Air New Zealand bought Ansett, Brierleys sold Singapore Airlines all its Air New Zealand “B” shares for $285 million, or $3 a share. It was arguably the last exit option for Brierleys from these shares, and, apart from a spike at the end of last year, Air New Zealand shares have largely tracked downwards ever since – they were trading around 30 cents as Unlimited went to press.
Source: IBID
In other words, Air New Zealand had over-extended in unwise investments (as has Solid Energy), and was bled dry by rapacious demands for dividends (as did Faye Richwhite in NZ Rail in the early 1990s).
How does this relate to the upcoming partial-sale of Mighty River Power?
Recent revelations that Mighty River Power has shaky investments on Chile, should cause potential investors to pause for thought,
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According to the TV3 story above, “Mighty River Power has spent $250 million at the geothermal plant in southern Chile, but has just written off $89 million as the investments struggle“.
To which Key responded casually,
“There is always risk.”
Dear Leader seems somewhat blase about investors’ risks? Of course he is. It’s not his money.
The Crown Ownership Monitoring Unit (COMU) reported,
Impairments
During the period, the Company recognised $91.4 million of impairments principally reflecting its investment in the GeoGlobal Partners I Fund (GGE Fund), and its greenfield explorations for potential developments in Chile and Germany.
This impairment followed higher than expected costs at the Tolhuaca project in Chile due to the worst winter in 40 years adversely affecting drilling performance and only one of the two wells having proven production capacity. The value of GGE’s investment at Weiheim in Germany, has been impacted by increased costs due to required changes in the drilling location following the 3D seismic surveys and delays from environmental court challenges which have been resolved post balance date.
The GGE Fund had not raised capital from other investors by the end of the 2012 and Mighty River Power made the decision not to invest further capital into the existing structure. Overall, the impairment charge of $88.9 million for the German and Tolhuaca assets and the management company of GGE LLC leaves a residual book value of $91.8 million.
Source: Mighty River Power LtdResults for Announcement to the Market
On top of Mighty River Power’s dodgy investment in Chile, New Zealand is now experiencing what is being called the worst drought in seven decades (see: North Island’s worst drought in 70 years). As Climate scientist Jim Salinger said about New Zealand’s current weather patterns continuing, and becoming similar to the Mediterranean,
“What it means is that if it just doesn’t rain for at least four months of the year, it means you have to bring in your water from elsewhere.”
Source: IBID
As all investors should bear in mind; most of our power generation is generated from hydro stations. Mighty River Power, especially, derives most of its electricity from eight hydro-electric stations on the Waikato River.
Mighty River Power CEO, Doug Heffernan has given a clear warning,
“Following the lower than average inflows into the Waikato catchment during the last quarter [to December 31], Mighty River ended the half year at just 69 per cent of historical average [hydro storage].”
And Equity analyst Phillip Anderson of Devon Funds stated,
“The same period last year they got really strong inflows, and this is the exact opposite . . .
In the second half of this reporting year they’re going to have to buy a lot more electricity to feed their customers, either on the spot market at a lot higher cost or use their [Southdown] gas plant.
We expect the second half of this year is going to be a lot tougher for them, they should get their margins squeezed if that all plays out.”
Source: Parched Waikato could hit Mighty River Power
The equation is blindingly simple,
Less rain = less water = less electricity generation
The question that begs to be asked is; where does the risk of investing in SOEs fall – private investors, or the State?
The answer I submit to the reader is, that like Air New Zealand, it will be private investors who bear the brunt of all risk. The State will simply pick up the pieces, buying up shares at bargain basement prices, should anything go wrong.
Electricity generators like Mighty River Power will simply never be allowed to fail. Had the Labour government in 2001 allowed Air New Zealand to collapse, the fall-out to the rest of the reconomy would have been too horrendous to contemplate, and flow-on effects to other businesses (eg; exporters and tourism) and the economy would have been worse than any bail-out.
But any bailout will involve a massive loss for investors, as their share-value plummets. Again, Air New Zealand was an example to us all.
As the impact of climate change creates more uncertainly for our state power companies, investors need to think carefully before committing one single dollar toward buying shares,
“Do I really want to bear all the risk?”
Those who lost out on their investments in Air New Zealand in the 1990s will probably answer,
“No.”
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References
The Air New Zealand crash (1 November 2001)
A history of bailouts (7 April 2011)
Foreigners important for SOE sell-downs: Treasury (30 June 2011)
No law stopping foreign investors (16 Dec 2011)
Parched Waikato could hit Mighty River Power (22 Feb 2013)
Mighty River Power shares float mid-May (4 March 2013)
Taking the plunge in Mighty River (9 March 2013)
Key struggles to push Chilean investments (9 March 2013)
North Island’s worst drought in 70 years (10 March 2013)
Other blogs
Seemorerocks: An Appeal for a New Zealand Risk Assessment
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Labour, Greens, NZ First, & Mana – A Bright Idea with electricity!
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What?
A part of me is mightily pissed off at Labour.
Like, really ticked off.
From 2000 to 2008, they had ample opportunity to safeguard state assets and remove them from any prospect of privatisation by ideologically-driven, rightwing elements in our political system.
But perhaps, I suspect that most folk – including the Left – had believed that privatisation had been abandoned by National as an ideological dead-end experiment, leading nowhere except eventual foreign ownership and profits remitted to offshore investors. Which, as a consequence, worsened our already shabby Balance of Payments deficit.
More importantly, we had every right to expect that National believed that asset sales would be a sure-fire way of losing an election.
However, someone – some bright, zealous, political strategist working in some back-room somewhere – must’ve come across a “cunning plan” to make asset sales palatable to at least half the voters.
That’s all the Nats needed; 50% of voters.
Why?
To pay for tax cuts in 2009 and 2010. Those tax cuts dug a $2 billion-plus hole in government revenue (see: Govt’s 2010 tax cuts costing $2 billion and counting, see: Outlook slashes tax-take by $8b). The shortfall could only be made up by borrowing more – or selling something. National opted for the latter.
How?
Post 2011 Election, has demonstrated that National has not changed it’s free-market stripes. Given an opportunity, they would hock off as much of the country as possible. For “the good of the nation”, you understand.
At the 2011 election, National were handed that opportunity, on a gold plate*, by a voting public who seemed to be distracted by smoking magic mushrooms. Whilst voters expressed disdain at National’s privatisation – they voted National regardless.
(Call me old fashioned, but I tend not to vote for things I disagree with.)
Go figure.
Note that I said “they voted National” – they didn’t vote for National. It may seem as if I’m splitting hairs on a molecular level – but bear with me.
Consider the facts;
- 1. In 2011, National won 1,058,638 votes – or 47.31% of votes cast. That gave them 59 seats.
- 2. The 2011 election was the lowest voter turn-out (74.21%) since 1887.
- 3. Whilst Labour’s vote dropped from 2008 to 2011, overall the anti-asset sale bloc gained more popular votes in 2011 than the pro-sale bloc,
| National , ACT, United Future Party Votes | Labour, Greens, NZ First, Maori Party, Mana, and Conservative Party votes |
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National – 1,058,636
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Labour – 614,937 |
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ACT – 23,889
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Greens – 247,372 |
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United Future – 13,443
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NZ First – 147,544 |
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Maori Party – 31,982
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Mana – 24,168
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Conservative Party* – 59,237
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TOTAL – 1,095,968 |
Total – 1,125,240 |
* Whilst the Conservative gained no seats in Parliament (because of the 5% threshold), their numbers are included because they gained over double the electoral-support for ACT.
In effect, Key could claim an mythical “mandate” simply because the MMP rules in 2011 gave ACT a seat, but no representation for the Conservatives – even though support for the latter was double that of ACT.
- 4. Voting patterns are reflected in polls which consistantly show public opinion opposed to asset sales. Generally, the figure is around two thirds opposed and less than a third supporting. (see: Most of us oppose selling NZ)
In fact, this blogger cannot find any reputable poll favouring National’s privatisation programme.
However, the harsh reality is that, for politicians, unless faced by a populist revolt and tens of thousands taking to the streets (see: Huge protest says no to mining on conservation land) , the only numbers that really count are bums-on-seats. Parliamentary seats.
Political machinations in Epsom and Ohariu gave Key the two seat Parliamentary majority he needed, and that’s what counts as a “mandate”. For the Nats, that’s the end-of-story.
Who?
As Dear Leader has oft been quoted,
“On the mixed-ownership model debate, the Government has been very clear about its intentions since well before the 2011 election.” – John Key, 24 June 2012 (see: Most of us oppose selling NZ)
Thus far, 200,000 have pre-registered (see: Mighty River pre-registrations top 200,000) – which, whilst a sizeable number, is still only around five percent of those who voted for National in 2011. And I suspect many are pre-registering for a variety of reasons,
- self interested naked greed
- a desire to keep shares in local hands
- and a few bogus pre-registrations to subvert the process (a surreptitiously organised covert resistance? You might say that, but I couldn’t possibly comment)
The 200,000 pre-reguistrations is still dwarfed by signaturies to the petition, which is fast approaching 400,000 (see: Asset sales referendum likely)
So, did all 1,058,638 voters who voted National in 2011 also endorse asset sales, either in whole or partial?
The answer is a clear no. In a poll just over a year ago (see: Poll shows asset sales unpopular), around 32% – about one third – of National supporters disapproved of asset sales.
That’s 338,764 voters who opposed asset sales who ticked the box for National in 2011, despite knowing full well that Key was promising partial floats on Meridian, Genesis, Mighty River Power, Solid Energy (now in doubt), and a further sell-down of Air New Zealand.
338,764 people who voted for something they didn’t want.
As Marcus Lush said on Radiolive on 28 February this year (2013),
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[click on image to access Radiolive link]
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Good question.
The answer, I think, can be distilled down into two categories of voters.
- The first group simply either didn’t taken notice of the asset sales campaign, or, more likely did not believe that Key would go ahead with the policy. They may even have thought that Key’s coalition ally(ies), United Future and/or the Maori Party, would stop the sales from proceeding. There was a kind of “in denial” mentality going on here.
- The second group is perhaps more complex. Whilst they don’t support asset sales per se, they perhaps believed National Party rhetoric that shares would remain in New Zealand hands. Considering the consequences of Contact Energy’s privatisation – where the majority of shares are now in Australian hands – this would seem to be a forlorn hope.
Having spoken with National Party voters belonging to Group 1, I believe that asset sales will impact to varying degrees on National’s support at the next election. Having woken up to the fact that Key has no intention of backing away from sales, there are 300,000 National voters who may think twice before voting National again.
Expect National to drop in the next few polls following the sale of Mighty River Power.
However, unless something totally unanticipated happens between now and May, the partial sale of Mighty River Power will probably proceed. Followed by Genesis and Meridian. Followed by hefty power price increases if past history is anything to go by.
Where (to from here?)
NZ First’s Winston Peters has promised that any government he is part of will buy back state assets. (Which, by the way, if he’s not telling lies, means that any coalition deal with the Nats is off the table. I’m not holding my breath on this. The 1996 election is still fresh in my mind.)
On 4 March this year (2013), Peters announced,
“New Zealand First will use its influence on the next coalition Government to buy back our state-owned power companies which are being flogged off by National and we are committed to buying back the shares at no greater price than paid by the first purchaser.”
Source: One More Quisling Moment from Key
This is do-able. Especially if NZ Superannuation funds are used, which would not impact or have any bearing on a new Government’s books.
By announcing that the shares would be re-purchased “at no greater price than paid by the first purchaser” – Peters is effectively putting all purchasers on notice: expect to incur a loss if you buy into National’s thieving (and let’s be clear – selling goods that don’t belong to you is theft) programme.
And a year earlier, in March 2012, Hone Harawira had promised the same in an open letter to investors,
“So today I think it only proper to send a warning to overseas investors – steer clear of any share offer in the above SOE’s. The purchase of these shares is likely to see you caught up in legal battles and direct action from citizens determined to protect their own interests, both of which will be lengthy and costly and have an adverse impact on the value of your investment.
As the leader of the MANA Movement and Member of the New Zealand House of Representatives, I wish to advise that MANA is opposed to the privatisation of state assets and will strongly argue for any shares sold to overseas investors to be returned to New Zealand hands.”
Source: Hone Harawira: Open letter to overseas investors
By contrast, in an attempt to appear “fiscally responsible” to Middle Class voters, Labour and the Greens were luke-warm, at best.
Green co-leader, Russel Norman said,
“We just can’t make the promise that Winston is making. We will do whatever we can, but it is two years away, the books are getting into a terrible mess because of National, and closer to the time we will make an announcement but at the moment we can’t.”
Source: Peters: Use super funds to buy back state assets
And Labour’s Clayton Cosgrove effectively went, ‘ditto’,
“… I can’t commit to an open-ended fiscal envelope. That would be fiscally irresponsible in my view.”
Source: IBID
Which is all pretty timid stuff.
This, my fellow New Zealanders, is why the Centre-Left lost the 2011 Election: no boldness in vision; no measurable difference to the Nats; and no unshakeable courage of their/our convictions.
All that Labour and the Greens said was “no” to asset sales.
And when Cunliffe suggested that a future Labour-led government would re-nationalise these SOEs – he was firmly slapped down by his Party.
On 4 December 2011,
“I don’t stand for a paler shade of blue, and I want to look down the barrel and say this: if the Government is going to sell off precious state assets then we would not rule out re-nationalising some of them. And people need to be aware of that regulatory risk.”
When asked by host Guyon Espiner whether he would buy them back, Mr Cunliffe replied “we would look very hard [at buying them back].” – Source
On 5 December 2011,
Labour leadership aspirant David Cunliffe has moved to clarify his position on the buyback of state assets.
He believed comments he made in a weekend interview, where he didn’t rule out buying back partially privatised SOE’s, had been misinterpreted.
Mr Cunliffe said it was not an explicit promise to buy back all shareholdings National may sell. – Source
That’s not “manning the barricades” stuff – that’s an open retreat in the face of a remorseless enemy.
Which, in turn, emboldened National to openly mock and taunt the Labour Opposition, seven months later,
” Hon BILL ENGLISH (Deputy Prime Minister) : I move, That the House take note of miscellaneous business. We are still waiting, this week, for the Labour Party to commit to buying back the shares of the 49 percent of the energy companies that the Government is planning to sell, mainly to New Zealanders. New Zealand First has made that undertaking. New Zealand First has shown that the Labour Party has persuaded New Zealand First that its arguments are so strong, New Zealand First should go and buy them back if it has a role in a future Government. But the Labour Party has not been able to persuade itself. Labour members have been in the Chamber arguing, hour after hour, day after day, week after week, that these proposed share offers are fiscally irresponsible, economic nonsense, and a sell-out to foreigners, but they are not so fiscally irresponsible that they are going to buy them back. They are not such a sell-out to foreigners that they are going to buy them back. They are not such an economic nonsense that they are going to buy them back.” – Source
At a time when Labour should be tearing strips of National and setting their own counter-agenda – we’re getting precious little of that. Instead, the agenda is being set by Key and his cronies with bugger-all opposition. The Greens and NZ First have scored more ‘hits’ against the Nats than Labour.
On top of that, the Greens have become the “go to” opposition Party, for criticism of National policies. If you doubt me, check out the next 6pm TV news bulletin. Which opposition party spokesperson is interviewed? Keep tabs over a few night. You’ll quickly see what I mean.
So, what options does Labour have?
It has two options;
- Carry on with a conservative course. There is a 50/50 chance it will lead the next government, with perhaps a one or two seat majority, consisting of Labour/Greens/Mana/NZ first.
- Strike out with a strategy of aggressive and bold announcements of initiatives. Announce;
- radical policies that are a departure from neo-liberalism and declare that the Great Neo-liberal Experiment is dead; “we come to bury the bastard, not praise him”.
- focus on the message that the 30 year experiment in neo-liberalism has failed utterly, and is one reason we’re driving our young people to Australia
- a policy that all state assets will be re-purchased at cost-price (as a coalition deal with NZ First)
- a list of National policies that will be ruthlessly reviewed and dumped (eg, the Hobbit Law)
- a focus on job creation; attacking the root causes of child poverty; and a committment for decent housing for all New Zealanders
- a full review of the tax system, with a plan to reduce (or eliminate gst) and replaced with a comprehensive Capital Gains Tax; Financial Transactions Tax; and other non-income related taxes
- Comprehensive food-in-schools programmes
- looking at how our Scandinavian and Nordic cuzzies are running their economies/societies
- cheaper education for our kids
- a conversation with New Zealanders as to what kind of society we want to live in – and are we willing to pay for it and set goals to achieve it?
- etc, etc.
As part of Option 2, I have one further Bright Idea…
A Libertarian acquaintaince and I were chatting one evening at ‘Backbenches’ (prior to it catching fire – and no, our conversation wasn’t that heated) . We were talking about the three state owned power companies.
He asked me; why should there be three state owned companies; all producing the same service; at roughly the same costs and prices – have three sets of management; CEOs; offices; accounting systems; staff; etc? Wouldn’t it make more sense to combine the three and pass the savings onto consumers?
Damn it, he was right. What is the point of having three state owned electricity companies?
One could do the same job – and cheaper.
Just as we had the old ECNZ, prior to Max Bradford’s so-called “reforms” in the late 1990s. At the time, Mr Bradford promised cheaper electricity through competition. Instead, power prices have doubled sinced the start of the century. (see: The 30-year power price hike , see: Power prices over decade)
“Ministry of Economic Development (MED) statistics show average power prices rose from 13.9 cents per kilowatt-hour on average in May 2001 to 26 cents in May 2011.” – Source
The problem is not just to re-nationalise our electricity companies.
The next problem is what do we do with them?
How do we make them socially responsive to domestic consumers as well as efficient?
Do we re-combine Mighty River Power, Genesis, and Meridian back into one single unit, a new ECNZ?
Do we ensure that there are Board members elected to a new ECNZ whose constituents are domestic users? Perhaps any such Board should have directly-elected representation?
Do we entrench a new, state owned ECNZ in legislation so it’s future is protected from predatory governments seeking either maximum returns (ie, price gouging) or to privatise it?
Could a new ECNZ afford to offer each domestic household their first 300kwh per month, free, as has been suggested by Victoria University researcher, Geoff Bertram? (see: Call for free power )
These are the issues which the Opposition should be focused on.
And thus far, we’ve not heard much from them.
If Labour-Greens-NZ First are serious about being an alternative government, then by the gods, they should be serious about giving us that alternative.
Conclusion
When National started campaigning in the 2008 election, it began two years in advance with a series of aggressive policies. It was acting like a Government-in-Waiting.
By contrast, Labour and the other parties are an Opposition-in-Waiting. They are timidly watching and waiting for the public love affair with Key to wear off, and for National to f**k up.
Well, news flash guys. That doesn’t seem to be working too well. The Nats have been excoriated with scandal after scandal last year and this year; unemployment rising; Mainzeal and Solid Energy collapsing – and the Nats are still high in the polls?!
My message to Labour, Greens, NZ first, and Mana;
If you want the voting public to take notice of you, you have to give them something that’ll make them notice you.
Be bold.
Be aggressive.
Offer alternatives.
Offer practical solutions.
Give the public a vision.
And at all times, work together.
If you don’t give the public an alternative, why should they look away from National?
Give the people of New Zealand an alternative, better way of living – and they will look at you.
But not until then.
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(* Plate will soon be auctioned on Trademe.)
Previous Blogposts
Politics through a crystal ball, palmistry, or chicken entrails?
History Lesson – Tahi – Electricity Sector “reforms”
Additional
Cunliffe: buy back any sold assets
Cunliffe not promising to buy back assets
Parliament: Hansards – Wednesday, 20 June 2012, Bill English on Asset Sales
More heat in power struggle as prices go up
Government in $112b barney over accounting
Electricity prices tipped to rise steeply
Heavy traffic hits Mighty River Power share site
One More Quisling Moment from Key
Other blogs
MANA threaten overseas investors not to buy assets – Bloomberg pick up on the story
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How to sabotage the asset sales…
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Something I blogged on 25 June 2012, and now more appropriate than ever…
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On last weekends’ (23/24 June 2012) “The Nation“, the issue of asset sales was discussed with NZ First leader, Winston Peters; Green Party MP, Gareth Hughes; and Labour MP, Clayton Cosgrove,
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Whilst all three parties are staunchly opposed to state asset sales, NZ First leader, Winston Peters went one step further, promising that his Party would buy back the assets.
Gareth Hughes and Clayton Cosgrove were luke-warm on the idea, quite rightly stating that there were simply too many variables involved in committing to a buy-back two and a half years out from the next election. (And Peters never followed through on his election pledge in 1996 to buy back NZ Forestry – “to hand back the envelope”, as he put it – after National had privatised it.) There was simply no way of knowing what state National would leave the economy.
Considering National’s tragically incompetant economic mismanagement thus far, the outlook for New Zealand is not good. We can look forward to more of the usual,
- More migration to Australia
- More low growth
- More high unemployment
- More deficits
- More skewed taxation/investment policies
- Still more deficits
- More cuts to state services
- And did I mention more deficits?
By 2014, National will have frittered away most (if not all) of the proceeds from the sale of Meridian, Genesis, Mighty River Power, Solid Energy, and Air New Zealand.
In such an environment, it is difficult to sound plausible when promising to buy back multi-billion dollar corporations.
Not to be thwarted, Peters replied to a question by Rachel Smalley, stating adamantly,
” The market needs to know that Winston Peters and a future government is going to take back those assets. By that I mean pay no greater price than their first offering price. This is, if they transfer to seven or eight people, it doesn’t matter, we’ll pay the first price or less. “
Bold words.
It remains to be seen if Peters will carry out that threat – especially if a number of his shareholders are retired Kiwi superannuitants?
When further questioned by Rachel Smalley, Peters offered specific ideas how a buy-back might be funded,
” Why can’t we borrow from the super fund, for example? And pay that back over time? And why can’t we borrow from Kiwisaver for example, and pay that back over time…”
The answer is that governments are sovereign and can make whatever laws they deem fit. That includes buying back assets at market value; at original sale price; or simple expropriation without compensation. (The latter would probably be unacceptable to 99% of New Zealanders and would play havoc with our economy.)
Peters is correct; funding per se is not an issue. In fact, money could be borrowed from any number of sources, including overseas lenders. The gains from all five SOEs – especially the power companies – would outweigh the cost of any borrowings.
Eg,
- Cost of borrowing from overseas: 2% interest
- Returns from SOEs: 17%
- Profit to NZ: 15%
We make on the deal.
The question is, can an incoming Labour-Green-NZ First-Mana government accomplish such a plan?
Should such a radical policy be presented to the public at an election, the National Party would go into Warp Drive with a mass panic-attack.
But it’s not National that would be panicked.
It would be National going hard-out to panic the public.
National’s scare-campaign would promise the voters economic collapse; investors deserting the country; a crashed share-market; cows drying up; a plague of locusts; the Waikato River turning to blood; hordes of zombie-dead rising up…
And as we all know, most low-information voters are highly susceptible to such fear-campaigns. The result would be predictable:
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But let’s try that again…
A more plausible scenario would have the leadership of Labour, NZ First, the Greens, and Mana, meeting at a secluded retreat for a high-level, cross-party strategy conference.
At the conclusion of said conference, the Leaders emerge, with an “understanding”, of recognising each others’ differing policies,
- Winston Peters presents a plan to the public, promoting NZF policy to buy-back the five SOEs. As per his original proposals, all shares will be repurchased at original offer-price.
- The Mana Party buy-in to NZ First’s plan and pledge their support.
- Labour and the Greens release the joint-Party declaration stating that whilst they do not pledge support to NZ First/Mana’s proposal – neither do they discount it. At this point, say Labour and the Greens, all options are on the table.
That scenario creates considerable uncertainty and anxiety in the minds of potential share-purchasers. Whilst they know that they will be recompensed in any buy-back scheme – they are effectively stymied in on-selling the shares for gain. Because no new investor in their right mind would want to buy shares that (a) probably no one else will want to buy and (b) once the buy-back begins, they would lose out.
Eg; Peter buys 1,000 shares at original offer price of $2 per share. Cost to Peter: $2,000.
Peter then on-sells shares to Paul at $2.50 per share. Cost to Paul: $2,500. Profit to Peter: $500.
Paul then cannot on-sell his shares – no one else is buying. Once elected, a new centre-left government implements a buy back of shares at original offer-price @ $2 per share. Price paid to Paul: $2,000. Loss to Paul: $500.
Such a strategy is high-stakes politics at it’s riskiest. Even if Labour and the Greens do not commit to a specific buy-back plan, and “left their options open” – would the public wear it?
The certainty in any such grand strategy is that the asset sale would be effectively sabotaged. No individual or corporate buyer would want to become involved in this kind of uncertainty.
Of less certainty is how the public would perceive a situation (even if Labour and the Greens remained staunchly adamant that they were not committed to any buy-back plan) of political Parties engaging in such a deliberate scheme of de-stabilisation of a current government’s policies.
The asset sales programme would most likely fail, for sure.
But at what cost? Labour and the centre-left losing the next election?
We may well end up winning the war to save our SOEs – but end up a casualty of the battle.
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Related Blog posts
Additional
Asset sales remain unpopular for NZers
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319 million reasons not to part-privatise our power companies
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There are at least 319 million reason why it is sheer madness for National to be considering part-privatisation of state-owned power companies,
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Acknowledgement for above media reports: Radio New Zealand
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The half year (not even a fullyear!) profit for the above three power SOEs is: $319.5 million.
Combined dividends paid the the government will be: $224 million.
If 49% of all three SOEs is sold to private investors, the State (ie, You and Me) will lose out on approximatelt $110 million.
That will be $110 going into bank accounts of institutional investors, or the pockets of wealthy New Zealanders with sufficient income to buy shares.
It will mean a drop in government income.
Worse still, going by historic events in the late 1990s when the ECNZ (Electricity Corporatrion of NZ) was split up, and the newly formed Contact Energy was split off and fully privatised, power prices will continue to skyrocket,
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National-led government – NZPA – 12 May 1999
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Privatisation will not mean competition resulting in cheaper power prices any more than competing fuel companies are giving us cheaper petrol prices.
In fact, as Economics Professor, Geoff Bertram said on 13 February 2013, at an anti-asset sales rally in Wellington,
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“… It’s my view that probably the most important political consequence of the part-privatisation of SOEs is to place private investors in those enterprises and thereby immunise them against possible future policy that might reduce their value.
And since I think an important part of an improved government policy would indeed reduce their value, I am opposed to the asset sales…
…The companies have a very high valuation. The reason why they have a very high valuation is that they have successfully participated in a long-running rort to extract cash from residential electricity consumers by the inexorable driving up of prices of electricity.
That rort, has been possible, because government policy has allowed and has indeed supported the emergeance of a cartel of five, large, vertically-integrated, generator-retailers – three of whom are SOEs – which have been able to operate without any effective regulation, at the expense of consumers who were too vulnerable to protect their interests against price hikes.
And if you looked at the tracks of electricity prices over the last 20, 30 years you will have noticed that large industry has protected itself very successfully; commercial electricity buyers have done fine; residential who are the dis-organised, unrepresented, undefended, captive group of customers have seen their prices go up in real terms 100% since 1986.
And the main consequence of the electricity reforms has indeed been that doubling of the cost of electricity to ordinary households.
That’s a major cause of energy poverty; it’s been an important part in the growing inequality of income and wealth in this country; and it’s something that a socially responsible government would, in my view, be taking serious action to reverse.”
Geoff Bertram continued,
“Just to put that doubling of the residential price in context. New Zealand’s pretty much on it’s own in the OECD and if you look at the figures for other countries around the OECD, from 1986 to the present, the price of electricity to residential consumers in OECD Europe, in Australia, and in the United Kingdom, is still the same as it was in 1986. In the United States, Japan, and France, prices are down 25% , compared to where they were in 1986, in real terms. In South Korea they’re down 50%, compared to where they were in 1986.
New Zealand is the only only OECD country that has gone out there and driven up electricity prices 50%. We’re also pretty much the only country that doesn’t have a regulator in place, and where government doesn’t have any particular social policy relating to the pricing of essential services to the public.”
Prof Bertram explained,
“And here’s how it works.
You take a bunch of assets with a given value, and you look at the existing price, to consumers of the product, and you say “well look, we can get the price up”; so you project that higher price; you capitalise that; and then if you can get the price up the asset will be worth more; so then you re-value the asset; and then you go and use the higher value of the asset to justify raising the prices, and then you repeat.
And this is the circular process which has been going on in New Zealand now, in electricity, for more than a decade. It is completely legal under New Zealand law.
It is not illegal to profiteer or to gauge captive customers in this country. [In] very few countries is that true.
And it’s consistant with New Zealand’s generally accepted accounting practice which basically tells you that there’s a rotteness at the core of accounting practices in this country.”
And added this shocking insight,
“Here’s the problem. Electricity was once an essential service provided to households at the lowest price, consistent with covering the industry’s costs.
Since 1986 the sector has been corporatised and part-privatised, and it’s pricing has been driven by the quest for profit by giant companies that have the market power to gouge their consumers.
As the owner of three of those companies, the New Zealand government has therefore become a predator. And now the Treasury wants to cash in on that rort by selling out half the government’s stake.
What that means in terms of the options for the future for government to turn around and come back from the predator model and return to a social service approach for energy supply, is being closed off.”
Concluding with,
“But if you want to deal with energy poverty and get kids out of hospitals with asthma and other respiratory diseases and so on, one of the really good things that you can do is get cheap energy into New Zealand households and that would be sustainable on the basis of the current government owned assets.
About 300 kwh free. [But if] you sell Mighty River and what’s feasible comes down to 200 [kwh]. You sell Genesis and what’s feasible comes down to 100 [kwh]. You sell Meridian and it’s gone…
What I’m saying is the contract that supplies the Rio Tinto smelter down at Bluff, the old Comalco contract, is the contract New Zealand households should have had from the start.
And it still could be done.”
See previous blogpost: Wellingtonians rally to send a message to the Beehive! (part rua)
As Radio NZ reported on 21 February,
“Electricity prices paid by Mighty River customers rose 2% over the period while costs fell 22%.”
See: Mighty River Power profit quadruples
Which leads us to these points to consider,
- Despite a glut of electricity, prices continue to rise. There is price-gouging going on by all power companies, whether State Owned or by privately-owned Contact Energy. There is no competitive force driving prices down. There is no indication that part-privatisation will create any competition.
- At least state ownership means that most electricity profits stay in New Zealand and contribute to the State, to pay for health, education, roading, etc. However, one wonders if this sort of punitive, indirect-taxation, on low income families is fair, whilst more affluent households can afford insulaion, solar power, and other energy-saving strategies.
- As Prof Bertram maintains, partial privation will most likely close off future progessive governments’ abilities to reform the electricity industry and return to a social service approach.
See also previous related blogpost – with Max Bradford’s response on this issue: History Lesson – Tahi – Electricity Sector “reforms”
Meanwhile, some of our past political leaders are waking up to the realities of historical state asset privatisations,
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See: Bolger – Telecom sale a mistake
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Better late than never?
Nah. Better now than later.
These mistakes are too expensive and we all end up paying.
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Nothing quite sez Rich Man’s Conference than this event
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As reported on Radio NZ’s ‘Morning Report‘ this morning (22 February), ACT’s 2013 Annual Conference kicks off today.
Part of the Conference will be held on Alan Gibb’s farm-estate at Kaukapakapa, about 50kms north of Auckland,
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An Annual Conference on an isolated, private property, belong to one of New Zealand’s richest men; Alan Gibbs.
Gibbs – worth an estimated $420 million according to a NBR report – spends most of his time in London. This doesn’t seem to stop him from influencing politics in this country.
Holding a conference on Gibbs’ private property, away from any urban centre does hold several benefits.
Firstly, attendees can marvel and appreciate Gibbs’ very private art collection,
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And secondly, there’s a low-to-zero risk of pesky demonstrators turning up, protesting at the neo-liberal policies that have been in effect for 30 years.
After all, having a bunch of poor folk turning up to a predominantly Rich White Men’s (there appear to be no women or Maori speakers at the Conference) political party, to protest policies which have increased poverty and widened the income/wealth gap, is probably not a good look.
The question I always ask myself, though is, are they locking us out? Or are we locking them in?
Meanwhile, the sell-off of the people’s assets to wealthy men like Alan Gibbs, and others like him (aka, the One Percenters), continues,
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References
Radio NZ audio report: ACT meets at weekend for annual conference
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Wellingtonians rally to send a message to the Beehive! (part toru)
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Continued from:
Wellingtonians rally to send a message to the Beehive! (part rua)
NZ, Wellington, 13 February 2013 – At this point, there was some light entertainment – firstly from this chap,
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“John Key” – first tried to convince the crowd that he’s really a “nice guy”. The response from the crowd was anything but ‘understanding’.
“John Key” then sang his now-famous version of the New Zealand anthem, which he said was now “partially privatised” – so minus every third or fourth word. Thwe song made bugger-all sense – much like asset sales themselves.
The anthem was missing the last line, which he said, had been “sold in it’s entirety, including the word ‘New Zealand’.
After “John Key” was ‘helped’ off the stage with accompanying boos and cat-calls, Energy campaigner, Molly Melhuish took the microphone.
Ms Melhuish spoke for Greypower. Like Geoff Bertram, she is also deeply knowledgeable about all facets of the energy industry, including pricing systems used for residential, commercial, and industrial sectors.
As always, listeners leave a talk by Ms Melhuish with a greater knowledge and insights into the electricity industry in our country,
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Ms Melhuish first explained a bit of the background of the “Keep our Assets” campaign,
“… Greypower was essentially asked to front this campaign, and we said at the first strategic meeting of the ‘Keep our Assets’ campaign that we wanted to co-front it with the youth, so we found a youth group, it was the University Students Association.
Because we believe this campaign is about those older people. Surprisingly many of our members were involved in building those assets. We said they’re ours, we want to keep them.
But we speak to our grand-children and our grand-children recognise… they just don’t want them sold. So the Greypower group board as a group, supported this ‘Keep our Assets’ campaign, all seven zones.
There are a small number of individuals in our meetings who really believed John Key when he said ‘we have to sell the assets so we can re-pay the debts’. Geoff [Bertram] told you how wrong that is, but people are conservative, want to be safe, and many, or most of the people who still say ‘we have to sell the asssets’ do so because they believed [John Key]. John Key is a show pony, he’s… telling the story told to him by others. He’s a used car salesman. Would you buy a used car off that guy? I wouldn’t.”
“…Just yesterday afternoon, I spoke to Mana Tawa… The very very first question I asked was ‘Why can’t we have solar power on our houses? Our family in the U.K., you know, they got money to put photo-voltaics [on our roofs] and they were able to pay it off on our power bills. She said, ‘Why can’t we have that?”
We could, but we have to vote for it.
We won’t under this administration.
Another one said, when I bought my place in a retuirement village in Porirua, we were promised lower bills. We are now paying more for our little retirement village than I paid for a four bedroom house.
So you get a captive consumer and they can hike power bills not twice, but four times!
Greypower now has a policy that says energy leglislation must say [that] all household energy and especially electricity must be provided in a manner that’s fair, sustainable, efficient, and reliable. That was the law in 2001- Labour changed the law to make that. [But] National government took away “fair and sustainable” [from legislation]. That is wrong.
What to do about it? Change the government!
The only way you will get a change is to change the government! Vote for it! Peter Love told you that in the first speech; vote for change. Greypower sez vote for change. That’s your job – We Greypower can support it but it is your job to vote for change.”
And she’s right. The only way we can effect change is by the ballot in the Voting Booth. Deciding not to vote because of some half-arsed cliche about “all politicians being the same” is defeatist garbage. It is craven surrender to forces who welcome people giving away their vote because vested interests have persuaded you that “change is not possible”.
Change is possible. But not when cynicism guides your decisions.
Molly Melhuish was followed by Aotearoa Not For Sale activist, Frances, who spoke of her own ‘journey’ to set aside her apathy and become active. Despite English being a second language from Frances, her words were truly inspiring. A million New Zealanders like her, and no government would dare risk selling our treasures,
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Frances first described the desperate conditions that afflict the poor or unemployed in other countries, where social welfare services barely exist, or not at all. She referred to the shame of someone loosing their job, and killing themselves and their entire family by mass-suicide – because the provisions that we often take for granted (or that right-wingers complain about), do not exist in their society.
“…I saw this country as a country so beautiful and with a humanity and the government with a heart [?] to looking after the poor and the under-privileged and the vulnerable groups. But throught the years I don’t know what has happened, I was too busy looking after kids, young children, and being someone who didn’t speak very good english. I sort of stayed low and keeped quiet and don’t want to say much about nothing against government. Although I do complain a lot at home if I say something, I see the government doesn’t do something nice to people.
But then I accidently walked through a public meeting … beginning of last year and then that was about state asset sale. And I was so shocked about what ‘s going to happen. And I thought, well, for the last 15 years my shower time from … ten minutes down to three minutes, because we need to have a budget for our power because the power bill kept going up.And then I cut my hair short so I don’t have to spend so much time [in the shower]. So all these things, and I decided maybe this year I will not harass my kids to have a showers if they don’t want to because it’s just getting more and more expensive.
There might be more stinky people around the city.
And hey, we are from middle income family, and during the winter time we fight often … argue with my husband about whether we should have the heater on. And I just never thought will come to this day!
And now they’re going to privatise these companies and sell to all those rich, only going to benefit the very rich few. Especially some foreign companies. And I was like, that’s not right, I can’t afford to pay even higher bills.”
And I thought, what happened? … From me not paying attention to politics. I actually don’t like politics. I want to just appreciate art and literature, but then from me not doing anything for so many years, what has this country become? Because a lot of people are like like me, they don’t like politics. They don’t want to take action; “I often give them moral support, I’ll give you some dollars, but you do the work. You go against the government.”
But then this time I realised what example I was setting for my children…
… But I feel great because I work with so many dedicated people and so many beautiful people, and selfless. And they are wonderful. We are all trying to make this country a better place for us, for others, for our children.
And for middle income like us, we struggle, and I just hate to think how the low income, how the beneficiary actually survive. And this government keep taking things away from the general public, from the weaker and from the vulnerable group. …
… Being a housewife, what can I do? I go out to collect signatures because that’s easy thing for me to do. It takes a lot and time and a lot of effort, but I’m glad I can make contribution. And I feel everybody here can make contribution…
… And being at home I can teach my kids, say, well don’t believe everything you heard from the media. And don’t just listen to what people say, you watch what they do. Especially our Prime Minister.
Frances finished with these thoughts,
“We can all make a difference… I saw so many people on the street. Some are angry but most of them are so depressed because they think government will never listen, and they think what we are doing going to be in vain, just not going to change anything. And I say to them, I say, if you don’t make any noise for this, what do you think government are going do to us next?
I want to set example to my children to say, if you really believe, and you have to believe, you can make a difference, you can change something. You just take actions and do whatever you can….
… But we have to still have to pressure the government, we want our referendum now, not later!
… One day when my kids ask me ‘mum have you done anything to protect us from being attacked by our government’ then I can say, I have done something. And I hope we can all say that, say we have done something to protect you from bad government policies.”
Amen to that, Frances.
Frances struggled at times with the English language – but the message she gave was as clear and meaningful as words could possibly convey.
This blogger found her to be truly inspirational.
As clouds darkened the evening sky, and the southerly ‘breeze’ gave a ‘bite’ to the assembled crowd, there was final entertainment from Steve and John,
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And finally, a rousing applause given to Richard, who shouldered much of the responsibility in organising the event,
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Meanwhile, further down the waterfront, others were more comfortable with their boutique beers and frothy lattes,
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Want to help?
Make a donation (any size) to: BNZ, 02-0560-0158770-00
Volunteer by contacting: saynotoassetsales@gmail.com
Go to: any of the Relevant orgs listed below.
Additional
TV3: Asset sales referendum likely (6 Feb 2013)
TV3: Govt under fire over Contact redundancies (14 Feb 2013)
NBR: Supreme Court to ignore govt deadline on water rights decision (15 Feb 2013)
Youtube: Say No to Asset sales in Aotearoa NZ.mov
Copyright (c) Notice
All images are freely available to be used, with following provisos,
- Use must be for non-commercial purposes.
- Where purpose of use is commercial, a donation to Child Poverty Action Group is requested.
- At all times, images must be used only in context, and not to denigrate individuals.
- Acknowledgement of source is requested.
Relevant orgs
Aotearoa is Not for Sale | Facebook
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