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Posts Tagged ‘user pays’

Cutting taxes toward more user-pays – the Great Kiwi Con

31 January 2017 4 comments

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Introduction

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The following is the amount spent by Labour, on Vote Education in the 2008 Budget;

Total 2008 Vote Education: $10,775,482,000 (in 2008 dollars)

Total students in 2009: 751,330* 

spend per student: $14,341.88

The following is the amount spent by National, on Vote Education in the 2016 Budget;

Total 2016 Vote Education: $11,044,598,000 (in 2016 dollars)

Total students in 2016: 776,948**

spend per student in 2016 dollars: $14,215.36

Total 2016 Vote Education: $9,608,800,000 (re-calculated in 2008 dollars)

spend per student in 2008 dollars: $12,367.37

Calculated in real terms (2008 dollars), National’s spending on Vote Education was $1,166,682,000 less last year than Labour budgetted in 2008.

In dollar terms, in 2016, National spent less per student ($14,215.36) than Labour did in 2008 ($14,341.88). Converting National’s $14,215.36 from 2016 dollars to 2008 dollars, and the sum spent  per student is even less: 12,367.37.

In real terms, National has cut the total*** education budget by $1,974.51 per student.

*  Not including 9,529 international fee-paying students

**  Not including 11,012 international fee-paying students

*** Total spent on Vote Education, not just schools and tertiary education.

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Tax-cuts and Service-cuts

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Writing in the Daily Blog recently, political commentator Chris Trotter had this to say on the matter of taxation and social services;

Speaking on behalf of the NewLabour Party, I felt obliged to spell out the realities of tertiary education funding. I told them that they could have free education or low taxes – but they could not have both. If the wealthy refused to pay higher taxes, then students would have to pay higher fees. If the middle class (i.e. their family) was serious about keeping young people (i.e. themselves) out of debt, then they would have to vote for a party that was willing to restore a genuinely progressive taxation system.”

Since 1986, there have been no less than seven tax-cuts;

1 October 1986 – Labour

1 October 1988 – Labour

1 July 1996 – National

1 July 1998 – National

1 October 2008 – Labour

1 April 2009 – National

1 October 2010 – National

 

The 2010 tax-cuts alone were estimated to cost the State  $2 billion in lost revenue.

Taxes were raised in 2000 by the incoming Labour government, to inject  much needed funding for a cash-strapped health sector. The previous National government, led by Bolger and later Shipley, had gutted the public health service. Hospital waiting lists grew. People waited for months, if not years, for life-saving operations. Some died – still waiting.

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four-forced-off-waiting-list-die-the-press-15-march-1999

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During that time, National cut taxes twice (see above). Funding for public healthcare suffered and predictably, private health insurance capitalised on peoples’ fears;

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heartwatch-insurance-cover-advertisement-otago-daily-times-21-february-1998

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A decade late, National’s ongoing cuts, or under-funding, of state services such as the Health budget have resulted in wholly predictable – and preventable – negative outcomes;

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patients-have-severe-loss-of-vision-in-long-wait-for-treatment

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A critic of National’s under-funding of the health system, Phil Bagshaw, pointed out the covert agenda behind the cuts;

New Zealand’s health budget has been declining for almost a decade and could signal health reforms akin to the sweeping changes of the 1990s, new research claims.

[…]

The accumulated “very conservative” shortfall over the five years to 2014-15 was estimated at $800 million, but could be double that, Canterbury Charity Hospital founder and editorial co-author Phil Bagshaw said.

Bagshaw believed the Government was moving away from publicly-funded healthcare, and beginning to favour a model that meant everyone had to pay for their own.

“It’s very dangerous. If this continues we will slide into an American-style healthcare system.”

Funding cuts to the Health sector have been matched with increases to charges;

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prescription-price-rise-hits-vulnerable

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cuts to NGOs offering support services;

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kiwi-charities-and-ngos-face-closure-with-impending-funding-cuts-tvnz-tv1-news

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… and  leaving district health boards in dire financial straits;

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The critical correlation between  tax cuts and consequential reduction of state services was nowhere better highlighted then by US satirist and commentator,  Seth Meyer. He was unyielding with his  scathing, mocking, examination of  the travesty of the Kansas Example of “minimalist government”;

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Here in New Zealand, National’s funding cuts have not been restricted to the Health sector and NGOs. Government agencies from  the Police , Radio NZ, to the Department of Conservation have had their funding slashed (or frozen –  a cut after inflation is factored in).

The exception has been the Prime Minister’s department which, since 2008, has enjoyed a massive  increase of $24,476,000 since 2008 and  a near-doubling of John Key’s department and Cabinet expenditure since Michael Cullen’s last budget, seven years previously.

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Tax cuts, slashed services, and increasing user-pays

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By contrast,  parents are finding more and more that the notion of a free state education is quietly and gradually slipping away. User-pays has crept into the schools and universities – with harsh penalties for those who fail to pay.

In May 2013, National’s Tertiary Education Minister, Steven Joyce, announced;

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student-loan-defaulters-to-face-border-arrest

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True to his word, in January 2016, the first person was arrested for allegedly “defaulting on his student loan”. By November the same year, a third person had been arrested. Joyce was unrepentant;

“There probably will be more, we don’t know of course how many are in Australia but that’s a very good start, and I think it’s probably a reasonable proportion of those who are in Australia.”

Joyce, of course, has nothing to fear from being arrested for defaulting on a student loan. His tertiary education was near-free, paid for by the tax-payer.

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joyce

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National had no choice, of course. The entire premise of user-pays was predicated on citizens paying services that until the late ’80s/early ’90s, had been either free or near-free. With student debt now at an astronomical $14.84 billion, National cannot afford to let ‘debtors’ get off scott-free. That would send the entire unjust system crashing to the ground.   According to Inland Revenue;

… nearly 80,000 of the 111,000 New Zealanders living overseas were behind on their student loan repayments.

IRD collections manager Stuart Duff said about 22 percent of borrowers living overseas were in Australia.

He said the $840m owed to New Zealand was a substantial amount of debt.

Figures show that student debt has been increasing every year since it’s inception in 1992. At this rate, student debt will achieve Greece-like proportions;

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Graphic: acknowledgement - NZ Herald

Graphic acknowledgement:  NZ Herald

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Unsurprisingly, loan ‘defaulters’ have surpassed $1 billion, including $16 million  written off through bankruptcy. Some never pay off their “debt” with $19 million  lost after death of the borrower.

But it is not only tertiary education that has attracted a user-pay factor. School funding has also been frozen, with operational grants the most recent to suffer National’s budgetary cuts;

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at-risk-school-funding-revealed-with-1300-to-lose-out-under-new-model

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Education, Inc.

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Schools are so starved of funds that they are having to rely on outside sources of income  to make up shortfalls;

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schools-using-foreigners-fees-to-staff-classrooms

 

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Reliance on foreign students to make up shortfalls in government spending is essentially turning our schools into commercial ventures; touting for “business” and ensuring “clients” achieve good results so as to ensure repeat custom.

When did we vote for a policy which effectively commercialised our education system?

Schools are also funded more and more by parents – to the tune of hundreds of millions of dollars. Fund-raising and ever-increasing school fees are required, lest our schools become financially too cash-strapped to function.

In 2014, school “donations” (actually fees by another name) and necessary fundraising reached  $357 million and is estimated to reach a staggering $1 billion by this year;

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parents-fundraise-357m-for-free-schooling

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It is estimated that a child born this year will cost his/her parents $38,362 for thirteen years of  a “free” state education. In 2007, that cost was 33,274. Our supposedly “free” state education is being gradually whittled away, and replaced with surreptitious user-pays. According to Radio NZ;

Some school principals say many schools are considering a hike in parent donations next year and cutting teacher aide hours, as they respond to a freeze on core school funding.

More than 300 school principals responded to a survey by teacher unions.

About 40 percent of school principals said they were considering cutting back on the hours of teacher aides and other support staff next year.

Thirteen percent said they were looking to increase parent donations.

The president of the teacher union NZEI, Louise Green, said the survey showed it was students who miss out when school funding was frozen.

The neo-liberal princiciple of user-pays is being covertly implemented throughout the public sector and nowhere is this more apparent than in education. Parents and guardians are expected to pay more for education and this is “off-set” by cuts to taxes. This is core to the concept of user-pays.

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User-pays is hard to pay

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The problem is that this is not an overt policy by National. The public have not been given a clear choice in the matter and instead increasing user-pays has crept in, barely noticed by the voting public. Even when challenged, a National Minister will use mis-information to attempt to use Trump-like “alternative facts” to hide what is happening;

But Education Minister Hekia Parata said parents contributed just $1.80 for every $100 spent by the taxpayer on education.

The Government was set to invest $10.8 billion in early childhood, primary and secondary education, more than the combined budget for police, defence, roads and foreign affairs.

New Zealanders have been lulled into a false sense of security that, even after seven tax cuts, we still have “free” education.  But as Chris Trotter pointed out with cool logic;

I told them that they could have free education or low taxes – but they could not have both.

The question is, what kind of society do New Zealanders want: a free education system or  tax cuts and more user-pays?

Because we can’t have both.

At the moment, politicians are making this choice for us.

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Postscript

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From a Dominion Post article on 24 January;

Student loans are getting bigger and graduates are taking longer to pay back the money they owe.

Figures from last year’s Student Loan Scheme Annual Report show the median loan balance in this country grew from $10,833 in 2008 to $14,904 in 2016.

The median repayment time for someone with a bachelor’s degree also lifted from just over six years, to eight and a half.

Since a peak in 2005, the numbers of people taking up tertiary education have declined.

[…]

Labour education spokesman Chris Hipkins said there was a variety of factors that lead to higher student loans and longer repayment times. Tuition fees continued to rise, as did living costs.

“The long term impact for people is quite significant, basically they have a large debt for longer,” Hipkins said.

“If they’re weighed down with student loan debt it will be difficult to get on the property ladder, it’s already a burden, and this is making it even harder for the next generation.”

Universities New Zealand executive director Chris Whelan said that when it came to universities fees increasing, one need only look at published annual accounts of the country’s eight universities to see they were not “raking in” a lot of money.

Currently two-thirds of the cost of tuition was covered by subsidies, and one-third was covered by the student.

LOANS ON THE RISE

Median loan balances

2010 – $11,399

2012 – $12,849

2014 – $13,882

2016 – $14,904

Median repayment times for a bachelors/graduate certificates or diplomas

2010 – 6.9 years

2012 – 7.8 years

2014 – 8.5 years

 

 

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References

Reserve Bank NZ: Inflation calculator

Treasury: Vote Education 2008

Treasury: Vote Education 2016

Educationcounts: School RollsStudent Rolls by School 2005-2009

Educationcounts: School RollsStudent Rolls by School 2010-2016

The Daily Blog:  Don’t Riot For A Better Society: Vote For One!

Infonews: Government’s 2010 tax cuts costing $2 billion and counting

The Press: Four forced off waiting list die

Otago Daily Times:  Heartwatch Insurance Cover

Radio NZ: Patients have ‘severe loss of vision’ in long wait for treatment

Fairfax media: Researchers claim NZ health budget declining, publicly-funded surgery on way out

Radio NZ: Patients suffering because of surgery waits – surgeon

Fairfax media:  Prescription price rise hits vulnerable

TVNZ News: Kiwi charities and NGOs face closure with impending funding cuts

NBR: Leaked document shows 10 District Health Boards face budget cuts – King

Fairfax media: Police shut 30 stations in effort to combat budget cuts

Youtube: Kansas Tax Cuts –  A Closer Look

Scoop media: Budget cuts continue National’s miserly underfunding of DOC

Fairfax media: Student loan defaulters to face border arrest

NBR: Arrested student loan defaulter claims to be Cook Island PM’s relative

Fairfax media: Third arrest of student loan defaulter made following government crackdown

Radio NZ: Govt tightens education purse strings

NZ Herald: ‘At risk’ school funding revealed – with 1300 to lose out under new model

Fairfax media: Student loan borrowers seeking bankruptcy as millions in debts wiped due to insolvency

NZ Herald:   Schools using foreigners’ fees to staff classrooms

NZ Herald: Parents fundraise $357m for ‘free’ schooling

NZ Herald: Parents paid $161m for children’s ‘free education

NZ Herald:   School costs: $40,000 for ‘free’ state education

Motherjones: Trickle-Down Economics Has Ruined the Kansas Economy

The New Yorker: Covert Operations

CBS News: Kansas loses patience with Gov. Brownback’s tax cuts

Kansas City Star: Gov. Sam Brownback cuts higher education as Kansas tax receipts fall $53 million short

Bloomberg: Kansas Tried Tax Cuts. Its Neighbor Didn’t. Guess Which Worked

Fairfax media: Tourism industry claims DOC will be severely handicapped by funding cuts

Previous related blogposts

The slow starvation of Radio NZ – the final nail in the coffin of the Fourth Estate?

12 June – Issues of Interest – User pays healthcare?

The Mendacities of Mr Key # 16: No one deserves a free tertiary education (except my mates and me)

The Mendacities of Mr Key # 19: Tax Cuts Galore! Money Scramble!

The seductiveness of Trumpism

Steven Joyce – Hypocrite of the Week

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This blogpost was first published on The Daily Blog on 26 January 2017.

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Letter to the editor: Setting it straight on user-pays in tertiary education

19 February 2016 4 comments

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Frank Macskasy - letters to the editor - Frankly Speaking

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Labour’s promise of a return to (limited) free tertiary education appears to be unsettling some, for whom the last thirty years has been dominated by the implementation and bedding-in of  user-pays (often gradually, so as not to spook the punters) ; reduced-tax; and minimalist-government ideology;

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letter to editor - the wellingtonian - sue usher - student debt

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I replied to Ms Usher’s public expression of “guilt twinges”…

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from: Frank Macskasy <fmacskasy@gmail.com>
to: The Wellingtonian <editor@thewellingtonian.co.nz>
date: Sat, Feb 13, 2016
subject: Letter to the editor

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The editor
The Wellingtonian

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Sue Usher defends user-pays in Universities, asserting, “anyone who takes out a loan on anything surely knows that there’s no such thing as a free lunch; you are not given money, you are lent it”. (letters, 11 Feb)

Prior to 1992, there were no student loans/debt. Tertiary education was paid from taxes, with the expectation that graduates would, in turn, pay for following generations.

That was the social contract.

That contract dissolved when successive governments introduced user-pays, with seven tax cuts in 1986, 1988, 1996, 1998, 2008, 2009, and 2010. The burden of higher education shifted from society, onto individuals. By 2014, student debt reached $14.8 billion.

Ms Usher admits this unfairness, “I acknowledge that repaying a loan and trying to buy a first home is a mighty challenge and feel slightly guilty that my generation did not have any such system”.

John Key and Tertiary Education minister, Steven Joyce, should also feel a twinge of guilt. Both obtained their University degrees free, paying almost nothing.

Those who parrot the cliche that education is a “private good” should consider if our doctors, scientists, engineers, teachers, et-al, all decided to pack up and move overseas.

Or if none of us could read and write.

Education benefits us all, which user-pays fails to recognise.

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-Frank Macskasy

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[address and phone number supplied]

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Additional

Salient: A short history of tertiary education funding in New Zealand

Ministry of Education: Student Loan Scheme Annual Report 2014

IRD: Student Loan Scheme Amendment Act 2014 – Arrest at border

Fairfax media: Joyce defends student loan crackdown

Fairfax media: Student loan arrest could prompt others to address debt

NZ Herald: ‘I don’t think I’m a criminal’

Teara.govt.nz: National Party – The ‘mother of all budgets’

Sunday Star Times: Politics – John Key – A snapshot

Wikipedia: Steven Joyce

National Party: Steven Joyce

Related blogposts

Letter to the Editor: Steven Joyce – Hypocrite of the Year

The Mendacities of Mr Key # 16: No one deserves a free tertiary education (except my mates and me)

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This blogpost was first published on The Daily Blog on 14 February 2016.

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Letter to the Editor – User Pays is not a very clever solution

19 June 2015 6 comments

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Frank Macskasy - letters to the editor - Frankly Speaking

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Some of these “free market types” don’t really follow through on their “bright ideas”…

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dominion post - 18 june 2015 - alan waller - public transport

 

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Mr response;

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from: Frank Macskasy <fmacskasy@gmail.com>
to: Dominion Post <letters@dompost.co.nz>
date: Fri, Jun 19, 2015
subject: Letter to the ed

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The Editor
Dominion Post

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Alan Waller demands  “what is wrong with user pays” and complains about “regional ratepayers subsidising a train service that is bleeding money and has never made money and is continually bleeding passenger numbers”. (Letters, 18 June)

Perhaps Mr Waller would realise what is “wrong with user pays” if train fares rose to full market rates, pushing thousands of commuters back into private vehicles, further clogging our already congested roads.

The cost to our local economy would be horrendous.

The purpose of public transport is not to make money. It is to take cars of our roads, thereby lessening congestion; pollution; increased fuel imports; and adding to greenhouses gas-emissions.

The problem with “user pays”, as Mr Waller advocates, is that full costs are often hidden – a fact he might consider next time he is stuck in traffic.

As for claiming “bleeding passenger numbers”, a Fairfax story dated 11 February this year, stated,

“A record 11.9 million passenger trips were taken on Tranz Metro trains last year, a 5.2 per cent increase on the 11.3m in 2013.”  (Ref: ‘Record Wellington train use set to stave off fare increases’)

Mr Waller should check his fun-facts first.  Something he can also do next time he is stuck in traffic.

-Frank Macskasy

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[Address and phone number supplied.]

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References

Fairfax media:  Record Wellington train use set to stave off fare increases

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Letter to the editor – hitting charities where it hurts, courtesy of the Nats

16 February 2015 1 comment

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Frank Macskasy - letters to the editor - Frankly Speaking.

A cash-strapped government – having frittered billions away in two tax cuts for the rich – now seeks to penny-pinch voluntary organisations and charities to make up for the gaping deficits they have created?!

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Fee for police background checks slated by charities

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from: Frank Macskasy <fmacskasy@gmail.com>
to: Sunday Star Times <editor@star-times.co.nz>
date: Mon, Feb 16, 2015
subject: Letter to the ed

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The Editor
Sunday Star Times

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This government is planning to implement a user-pays charge whereby charities; other voluntary organisations, and non-profit groups are required to pay for police vetting of volunteers and employed staff.

How long will it be before the $5 or $7 vetting fee becomes $10? $20? Then full recovery costs? If there is one thing we know about government charges, once they are introduced, they invariably increase as governments look to cut taxes, and raise user-pays charges for state services. Tertiary fees, fuel taxes, gst, prescription fees, court costs, are all examples of government shifting costs on to the individuals and public organisations.

One day, New Zealanders will wake up to the realisation that far from being “prudent fiscal managers”, National’s track record in managing the government books are ad hoc and worse still, penalise those who need help the most.

This is penny-pinching in the extreme, and shows how we are still paying for two ill-considered and unaffordable tax-cuts in 2009 and 2010.

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-Frank Macskasy

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[Address and phone number supplied]

 

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References

NZ Herald: Fee for police background checks slated by charities

Radio NZ:  Education and charity sector worry about cost of police checks (Audio - 12′ 24″ )

 


 

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Skipping voting is not rebellion its surrender

Above image acknowledgment: Francis Owen/Lurch Left Memes

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Letter to the Editor: Kiwi style or American style?

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old-paper-with-quill-pen-vector_34-14879

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FROM:       "f.macskasy" 
SUBJECT:     Letters to the editor
DATE:        Wed, 14 May 2014 23:59:33 +1200
TO:         "Dominion Post" <letters@dompost.co.nz> 

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The Editor
Dominion Post

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I am dumbfound. Absolutely gobsmacked.

With New Zealand's sovereign debt now around $60 billion (as
at November 2013) and having increased by $27 million a day
since National took office - John Key is kite-flying with
suggestions of further tax cuts?!

Is this how National exercises fiscal responsibility -
bribing voters with yet more unaffordable tax cuts?

Previous tax cuts in 2009 and 2010 were paid for with assets
sales; taxing children on their paper rounds; increasing
prescription charges; as well as unsuccessful  attempts to
tax carparks and cellphones. Currently, National is planning
to sell off 5,000 State houses that were once homes to
low-income families.

Instead of tax cuts, New Zealanders might care to tell the
Prime Minister that we should be funding education so that
parents don't have to fork out  $357 million a year in
so-called "voluntary donations" and spend long hours 
fundraising to pay for  supposedly "free" schooling.

It is patently simple. We can have free education and public
healthcare. Or we can have tax-cuts. But we cannot have
both. 

This is the moment we decide whether we want public services
for all New Zealanders, regardless of their financial
circumstances - or an American-style user-pays.

I hope we choose wisely.


-Frank Macskasy
[address & phone number supplied]

 

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References

NZ Herald:  Parents fundraise $357m for ‘free’ schooling

Fairfax media: Public debt climbs by $27m a day

Radio NZ: PM John Key dangles tax cut carrot


 

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Skipping voting is not rebellion its surrender

Above image acknowledgment: Francis Owen/Lurch Left Memes

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That was Then, This is Now #21 – Increasing Govt Charges for Services: Labour vs National

13 January 2014 4 comments

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TWT TIN 20

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Oh dear. It seems the Nats have rather short memories when it comes to criticising the previous government for increasing Court charges…

This blogpost was first published on The Daily Blog on 4 January 2014.

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Previous related blogpost

That was Then, This is Now #20

References

Scoop media: 450% increase in court fees is ‘tax by stealth’ (2004)

Scoop media: Vulnerable children at risk from Family Court fees increase (2012)

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The gentrification of Te Papa

28 June 2013 4 comments

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Te Papa logo

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Te Papa – Our Place?

What does $17.50 buy at  a supermarket? Or $10.50?

For a low-income family who are struggling to pay rent ($300 – $400  p/w);  power ($30 – $50 p/w);  medicine ($5 per prescription); insurance; school fees; car rego and fuel; debts; etc,  $17.50 or $10.50 can mean the difference between food in the pantry or fridge – or running out of bread, milk, potatoes, eggs, cheese, before the next pay-day or State social security payment.

If you’re earning $1,100 a week (gross), $17.50 or $10.50, you have discretionary income for to buy tickets to a Te Papa exhibition.

If you’re on minimum wage ($13.75/hr) and earning $550 a week (gross), buying tickets to a Te Papa exhibition is the last thing on your mind.

Since 1984, the concept of User Pays has been firmly embedded in our society. It was part of neo-liberal “reforms” where, in exchange for six tax cuts since 1986, individuals were expected to pay for services that, previously, had been free (collectively paid for by everyone).

The most well-known example of this is tertiary education. Once upon a time, it was free. Post 1992, student fees were introduced, along with student loans, and a measure of  User Pays resulted. (See previous blogpost:  Greed is good?)

The rationale for the implementing a new User Pays regime was that higher education was a “private good”. However, as more and more highly trained/skilled professionals leave New Zealand, that notion of “private good” seems to be questioned more and more.

If the loss of thousands of professionals and tradespeople migrating to Australia weakens our economy, this becomes a socio-economic loss for us. For Australia, it becomes a socio-economic good. This part of the equation seems to have escaped the attent of “free” market neo-liberals.

We lose out when we assign an arbitrary monetary value to something that benefits society as a whole – as well as it’s individuals – and some or many are excluded, solely on the basis  of inability to pay.

Because in the final analysis, that is what User Pays is; if you can’t pay, you can’t use it.

This was highlighted (again) to our household recently when we considered attending an exhibition that Te Papa is currently holding,

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te papa andy warhol exhibition

Source: Te Papa – Warhol Immortal

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The description of the Exhibition was intriguing and it seemed to offer an interesting way to spend a few hours on a Saturday afternoon.

Then we saw the price of admission,

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te papa andy warhol exhibition admission prices 9.6.2013

Source: IBID

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$17.50 admission price!?

No thanks.

One of us in our household, with a strong interest in art, will still visit the exhibition. For the rest of us, for whom it would only have been a mildly entertaining/interesting event, we would rather spend that money elsewhere.

However, the thought occurred to me; how many low-income families, or individuals, would not have the same choice whether to attend or not, as we did?

How many people would see $17.50 as the difference between food for the mind or food for their bellies? For a low income family of four, the Family “Concession” of $46.50 could buy food for a several days, or make a payment on their power bill to stave off disconnection for a while longer.

I put this to Te Papa in a recent email,

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From:               Frank Macskasy <fmacskasy@gmail.com>
To:                   bridgetm@tepapa.govt.nz
Date:                9/06/2013 at 12:51 p.m.
Subject:           Exhibitions

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I am aware  that it has long been Te Papa policy to charge for various exhibitions.

For example, you current exhibition on Andy Warhol has the following charges for entry;

Adult – $17.50
Child (5–15 years) – $10.50
Child (under 5 years) – Free
Family (2 adults + up to 3 children) – $46.50 Concession – $15.50 Friend of Te Papa (adult) – $11.50 * Friend of Te Papa (child) – $6 *

10+ adults (per person) – $11.50
School group (self-guided, per person) – $8 Audio guide – $5

I would submit to you that the amounts listed above are beyond the ability of many low income families to pay, and therefore this policy excludes a sizeable sector of the community.

Whilst I understand that many of these exhibitions incur a cost, that your current charging regime means that many miss out.

I would remind you that Te Papa is a public facility which has been paid for by tax/ratepayers.

I would like to suggest that Te Papa reconsider their admission fees policy, with a view to making it more inclusive for those on low/fixed incomes.

My suggestion is that Te Papa make the last two days of an exhibition,

1. Free entry for Community Services Card holders

or,

2. Entry upon a coin donation for Community Services Card holders

and,

3. Free entry for all schoolchildren from low-decile schools.

The current system, I submit is totally unfair and maintains a two-tier class structure  where some are deemed second class citizens simply by their inability to pay an entrance fee.

This is especially unfair on children of low income families who miss out on cultural and history aspects of our nation.

Enjoying our culture and history should not be predicated on ability to pay.

– Frank Macskasy

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To their credit, Te Papa responded promptly,

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From: ridget MacDonald <BridgetM@tepapa.govt.nz>
To: Frank Macskasy <fmacskasy@gmail.com>
Date: Mon, Jun 10, 2013 at 4:15 PM

   

Kia ora Frank

Thank you for your email comments and concerns regarding Te Papa’s exhibition pricing. I will pass your comments on to relevant staff for consideration for upcoming exhibitions.

We are very conscious of the need to make our exhibitions as accessible to a wide range of people.

You may not be aware that for every charge-for exhibition we also have the Wellington Free Day in partnership with the Wellington City Council.  This means that upon proof of local residence, for example a library card, rates invoice or utility bill with a local address, all Wellingtonians can attend the exhibition free of charge on that day.  This has been very popular for past exhibitions and we have been delighted to have a large number of families attend.

The Wellington Free Day is held on a Thursday, open late till 9pm, and advertised by us and also the Wellington City Council online and in The Dominion Post. The date for the Wellington Free Day has not yet been announced for Warhol: Immortal.

Our free events programme complements our exhibition programme and offers our visitors opportunities for insight into related subject matter through films, performances, floortalks, workshops, children’s Discovery Centre activities and much more. We have also included a selection of works from the exhibition on our new website http://www.arts.tepapa.govt.nz/on-the-wall/warhol-immortal. This site and activities such as our blogs support our programmes and offer behind the scenes information and glimpses into collections and exhibitions.

Thank you for your interest in our exhibitions at Te Papa.

Ngā mihi

Bridget

Bridget M [full surname redacted]

Senior Corporate Affairs Adviser

Museum of New Zealand Te Papa Tongarewa | 55 Cable Street, PO Box 467, Wellington, New Zealand
[other contact details redacted]

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I wrote back to Bridget,

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Kia Ora, Bridget,

Thank you for your prompt reply.

The Wellington Free Day is a good start. As Te Papa is New Zealand’s National museum, it would be even better if all low income families could somehow benefit from a special day or on-going discount upon presentation of a Community Services card.

This would encourage out-of-towners to participate, as well as Wellingtonians.

The Wellington Free Day is a step in the right direction.

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As I pointed out, Te Papa is New Zealand’s national museum. As such, the benefits of exhibitions  should be made accessible to as many people as possible.

Whilst the “Wellington Free Day” is a good start – for which I applaud Te Papa – one has to ask; why Wellington only? Shouldn’t we have a “National Free Day”* where as many New Zealanders as possible can have the opportunity to visit their own museum?

As I pointed out in my 9 June email, the last two days of an exhibition could be easily made free-entry for all Community Card-holders (and their immediate family).

Otherwise, Te Papa’s admission policy will continue to be discriminatory,  excluding those New Zealanders for whom User Pays is a barrier to enjoying part of our culture that the rest of us take for granted. In effect, this creates a two-tiered society, with those at the bottom of the socio-economic ladder missing out. (Though some might argue – with justification – that free access based on presentation of a Community Services card, also constitutes a form of discrimination. The Lesser of Two Evils Factor might apply here.)

Not only is this a dangerous thing, to discriminate and  alienate a group of people from society; but it is also morally wrong. This is another indication that our society is fracturing, splitting  along a socio-economic rift.

The fact that this is happening, and New Zealanders think this is ok, is a sad reflection of the times we live in.

This is the neo-liberal paradigm. We are living it now.

Te Papa – Not everyone’s  place?

Addendum

A link to this blogpost will be emailed to Te Papa.

This blogger wishes to thank Bridget for her timely and candid responses to my emails.

* Postscript

I don’t mean a day free of  the National-led government. Though that is a tempting thought. Post 2014 will be a National-free government.

This blogpost was first published on The Daily Blog on 15 June 2013.

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National prescribes bad medicine for the poor

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Frank Macskasy Blog Frankly Speaking

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National’s tax cuts are coming back to bite us firmly on our collective arses.

In April 2009 and October 2010,  National cut income tax and raised gst from 12.5% to 15%.  Key and English insisted that the tax cuts/gst rise were “fiscally neutral”.

Like so many of National’s statements, that “fiscal neutrality” turned out to be a fiction,

The Green Party has today revealed that the National Government has so far had to borrow an additional $2 billion dollars to fund their 2010 tax cut package for upper income earners.

New information prepared for the Green Party by the Parliamentary Library show that the estimated lost tax revenues from National’s 2010 tax cut package are between $1.6-$2.2 billion. The lost revenue calculation includes company and personal income tax revenues offset by increases in GST.

“The National Government said that their signature 2010 income tax cut package would be ‘fiscally neutral’ – paid for increased revenues from raising GST. That hasn’t happened. The net cost for tax cuts has been about $2 billion,” Green Party Co-leader Dr Russel Norman said today. “

See:   Govt’s 2010 tax cuts ‘costing $2 billion and counting’

As taxation revenue dropped,  National’s deficit has risen alarmingly,

The government took in $1.57 billion less tax than expected in the first nine months of the fiscal year, reflecting a tepid economy, Treasury figures show – reflecting what the Finance Minister says has been a ‘difficult year’.

The Crown took in $39.8 billion in tax in the nine months ended March 31, against a forecast in the Pre-election Economic and Fiscal Update estimate of $41.3 billion, according to the government’s financial statements. “

See:  Govt tax take down by $1.57 billion

Massive borrowings over the last three years has not staunched the bleeding of government revenue. Soon after the April 2009 taxcuts, government revenue had begun to drop,

The Crown accounts for the year to June, released yesterday, showed an all-up deficit of $10.5 billion, compared with a surplus of $2.4 billion the previous year.

The state’s core operations – such as health, education and defence – recorded a deficit of $4.5 billion as tax revenues fell while spending grew. “

See:  $250 million: What our Govt borrows a week

After the October 2010 tax cuts, that borrowing had risen, and by mid-2011 stood at around $380 million a week,

”  The Government is borrowing $380 million a week and next week’s budget will carry a record deficit of about $16 billion, Parliament was told today.

Finance Minister Bill English said the Government’s financial position had deteriorated “significantly” since late 2008.

“The pre-election update in 2008 forecast that the deficit for this year would be $2.4 billion,” he said.

“It’s much more likely to be around $15b or $16b.”

That level of deficit, as NZPA has previously reported, will be the highest in New Zealand’s history and Mr English confirmed that today.  “

See:  Govt borrowing $380m a week

See:  Government debt rises to $71.6 billion

History lesson over.

Test: what can we deduce from tax-cuts – especially made during a recession?

  1. Government revenue will fall.
  2. Government will have to borrow to make up the short-fall.
  3. Goverment will have to either increase taxes or cut services and/or increase User Pays charges for the public.
  4. All of the above.
  5. We don’t have to do anything, because National is a fabulous fiscal manager;  John Key waves his hands; and money magically falls from the sky.

If you, the reader picked anything except Option 4 – feel free to re-read the above and go do some further research on Basic Economics 101.

If you picked Option 5, then you are a  hopelessly committed National supporter.  Seek professional help – stat.

The fact of the matter is that none of the tax-cuts were ever affordable.

Common sense will tell even the most die-hard National groupie that if you reduce revenue, then one  has to cut expenditure and services; borrow to make up the shortfall; raise  user-charges; or all three. There ain’t no other way.

National has borrowed billions – that much is crystal clear from media reporting using  Treasury data.

What the New Zealand public also need to understand is that National will also be cutting expenditure and services and raising user-charges.

National has begun a programme of increasing user-pays charge for,

  • Prescription Charges

Prescription charges will increase from $3 an item to $5 an item in next week’s Budget, as the Government moves to offset the cost of extra health spending in the “zero Budget”.

The new charge will cover up to a maximum of 20 items from January 1 next year, raising $20m in the first year and $40m after that. “

See:  Prescription cost to rise to help pay for Budget

  • Raising the compulsory student loan repayment rate and cutting student allowances,

Up to 5000 students will be affected by the National-led Government’s cut to student allowances, Tertiary Education Minister Steven Joyce revealed this afternoon.  The Government announced a raft of changes to student loan and allowance schemes last week, including a stop to allowances after 200 weeks. “

See: Allowance cuts to affect up to 5000 students

”  The changes would see more than 500,000 people forced to pay back their student loans more quickly and people studying for more than four years would no longer be able to claim an allowance…

… The repayment rate for loans will be increased to 12 per cent from 10 per cent for any earnings over $19,084.

See:  Outrage at student loan changes

  • Government has cut back on the state sector, sacking 2,500 employees, including  60 frontline bio-security border staff.

The cost to our economy, should the Queensland fruit fly take hold, would be in the hundreds of millions. And if foot and mouth ever took hold, the cost to our economy could be in the order of  $10 billion over a two year period!  National is gambling with our economy, simply for the sake of a few million dollars.

Pests such as the Varroa mite and the Psa virus have already taken hold in our environment. The latter, the Psa virus, could impact on our $1.5 billion kiwifruit export industry.

See:  Kiwifruit disease Psa explained

See:  2500 jobs cut, but only $20m saved

See:  Risks involved in cutting MAF Biosecurity jobs

  • Teachers numbers “capped” and class numbers increased.

The ratio of teachers to students in New Zealand schools is set to be changed, Education Minister Hekia Parata announced today.

For year one the ration will remain at one teacher for every 15 pupils while the ratio for those preparing for NCEA exams in years 11-13 will be standardised to one teacher for every 17.3 pupils…

…  The Government is also putting a cap on the number of teachers by keeping it at the present level.

Parata says the Government is not reducing teacher numbers, but claims $43 million can be saved by not hiring any extra teachers. “

See:  Teachers ‘pushed out the door’ in Budget shake up – Greens

The implications of this cost-cutting exercise are mind boggling. Not only will be see class sizes increase, but there is the strong possibility that students with special needs will miss out. Larger class sizes will put extra pressure on teachers and students; make one-on-one teaching harder; and will possibly force many teaching staff to quit or move to Australia.

At a time when our society desperately needs more educated and trained young people, this is a counter-productive step that beggars belief.  Only a bean-counter (unmarried, no children of his/her own) could devise such a crazy proposal.

Ian Leckie, the New Zealand Educational Institute national president, said,

Essentially every child gets less attention, and if we’re ever going to be concerned about what happens for our children, we want them to get the best of service, put more children in the class, it makes it harder for the teacher, harder for children to succeed.”

New Zealand’s youth unemployment currently stands at 83,000 – up from  58,000 last year. How many believe that National’s plan will improve on that dire situation?

See previous blogpost:  Bennett confirms: there are not enough jobs!

How many believe that is not a desperate cost-cutting exercise?

And how many suspect that the “cap” will quickly become staffing cuts – as happened with state sector workers?

  • Government closes down Gateway Scheme – where those on low incomes were assisted to buy there own homes,

Prime Minister John Key says a scheme to provide up to 100 affordable homes at Auckland to people on low incomes is not needed because low interest rates mean there is greater capacity for people to buy their own homes.

Mr Key has been explaining the Government decision to scrap its Gateway scheme to help those on lower incomes buy homes in its flagship Hobsonville Point development, in Auckland.

It would have provided affordable homes in a flagship Auckland housing development but has been wound up with just 17 houses built. “

See:    Low interest cuts need for cheaper houses – Key

See:    Key backs cut-off for cheap homes plan

There will be other cuts to social services and/or rises in User Pays charges.

The net effect is that those who received tax cuts under $40,000 will find that the cuts have been swallowed up. Low and middle income earners may find that they are now not only no better off – but are having to put up with higher government charges and  less services.

Those on $100,000+ p.a.  have done very well.

Those earning $70-$80,000+ p.a. may escape  relatively unscathed.

Low income earners, on minimum wage ($13.50 p/h) or just above,  facing higher prescription charges,  will effectively  be paying for tax cuts for the high-income earners, wealthy, and asset-rich.

If the tax cuts were designed to reduce government expenditure; increase user-pays; and raise incomes for the top 10% – then National has achieved it’s goal.

National is continuing it’s 1990s agenda, albeit more slowly, and stealthily.

I wonder – is this what 1,058,638 New Zealanders voted for, when they cast their ballot for National. More user pays?

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Information

Tax Cuts April 2009

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Frank Macskasy Blog Frankly Speaking  tax cuts april 2009

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Tax Cuts October 2010

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Frank Macskasy Blog Frankly Speaking tax cuts 2010

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By contrast,

Health Minister Tony Ryall said the $5 cost would be applied to the first 20 items of medicine per family each year, so no family would pay more than $100 a year for their prescription costs.

The current maximum for prescription costs was $60 a year. “

See:  Meds price hike: ‘Children will die’

The last word goes to Mana MP, Hone Harawira,

”  Doctors are saying right now that children’s health is being threatened by the price of medicine now. You have to assume that if Government raises that price then children will die as a result of that measure.

I don’t believe that any Government could be so callous.

Absolutely I think that these measures, although it is going to be difficult to prove, will lead to children dying, through the inability of their parents to afford the charges for medicine that are being proposed by this National/Maori Party Government.

Every price rise impacts poor people in a far greater way than it does people on the kinds of levels of income that him and his mates are on. So yes it is going to hurt every poor person in this country – Maori, Pacific and Pakeha”.

See: Ibid

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Additional

Government delivers April 1 2009 tax cuts, SME changes

Budget 2010: What the tax cuts mean for you

Prescription cost to rise to help pay for Budget

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Greed is good?

28 August 2011 54 comments

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As we look back on the last 25 years of neo-liberal “reforms”, including User Pays; the canning of “Labour’s” superannuation savings plan in 1975 (by Muldoon – after being elected into office with his infamous “Dancing Cossacks”  TV ad); and National’s continuing high popularity in the polls, despite their avowed proposal to sell-down 49% of several State assets,  – it seems abundantly clear who has been  pulling the “strings”.

No, it’s not Washington. Nor the Bilderbergers. Nor the UN/New World Order/Illuminati.

The answer is mind-numbingly far more prosaic:  it’s us – the Baby Boomer generation. The 1960s and 1970s rebellious youth  weren’t just an “aberration” – they were a clear signal that the Baby Boomers had arrived; could be inclined to  incredible selfishness (hence the term the “Me Generation”); and we voted individually for personal gain – on a collective basis.

Yep. We have seen the “enemy” – and it’s us; graying; self-centered; resentful of the young (who we’ve well and truly shafted);  and looking back at ourselves in the mirror, wondering where it all went wrong.

The case of  Surgeons Ian Penny and Gary Hooper, who tried to rort the tax system using Trusts  and companies – even though they had graduated BEFORE student loans and fees were implemented in 1992 – is the clearest example ever of our collective unbridled selfishness.

To re-cap;

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A court battle is over for two surgeons who challenged Inland Revenue over claims they tried to avoid tax bills worth tens of thousands of dollars.

The Supreme Court has ruled unanimously against Ian Penny and Gary Hooper, saying they underpaid themselves from their own businesses to avoid the top personal tax rate.

The issue arose after the previous Labour-led Government raised the top personal tax rate to 39%, compared to the company rate which was then 33%.

The orthopaedic surgeons openly paid themselves a lower salary than the market rate, arguing that they had a choice about how they operated their business.

They tried to challenge a Court of Appeal decision that found in favour of Inland Revenue, which said the surgeons had paid themselves salaries too small to be commercially realistic.

It said they were therefore able to avoid paying the top tax rate, while the balance of their businesses’ profits went as dividends to family trusts.

The trusts funded items such as a loan for one surgeon, and a holiday home for the other.

Inland Revenue said using those business structures to create artificially low salaries amounted to tax avoidance, saving each man between $20,000 and $30,000 a year for three years, beginning in 2002.

Supreme Court Justice Blanchard on Wednesday delivered a judgement supporting that argument, ordering Mr Penny and Mr Hooper to pay Inland Revenue $25,000 in court costs.

Mr Hooper told [Radio New Zealand ]Checkpoint the court has created a salary benchmark that is higher than the one countless private practitioners have been using.

He says they have been following Inland Revenue advice and calculating their salaries based on public hospital rates.

An Inland Revenue deputy commissioner welcomed the ruling, telling Checkpoint it clearly states and reaffirms what the department’s commissioner felt was the case all along. Carolyn Tremain says IRD has yet to fully absorb the implications and consequences of the ruling.

PricewaterhouseCoopers John Shewan, who appeared as a witness for the surgeons, said the case is important for individuals and firms. He said tens of millions of dollars may now be claimed by Inland Revenue from cases it still has open on this matter.

Source:  Radio New Zealand

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Specifically,

Surgeons Ian Penny and Gary Hooper set up companies, owned indirectly through trusts, to buy their surgical services and paid themselves artificially low salaries.

After 2000, Hooper’s personal income fell from $650,000 to $120,000 a year. Penny’s dropped from $302,000 to $125,000, and then to $100,000, while the income of their companies grew.

Source:  Dominion Post

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What makes this case of case of tax avoidance stand out is that none of it was ever necessary in the first place.

Dr Ian Penny received his Bachelor of Medicine Bachelor (MB ChB) of Surgery from Otago University in 1981.  He became a Fellow of the Royal Australasian College of Surgeons in 1990.

Dr Gary Hooper received his Bachelor of Medicine Bachelor (MB ChB) of Surgery  from Otago University in 1978 and became a Fellow of the Royal Australasian College of Surgeons in 1985.

In simple terms, they graduated as doctors in the late ’70s and early ’80s. Tertiary education then was still nominally free. Plus,  student allowances were available to most students,

“Up until 1992, nearly every student (86.4 percent) studying at a public tertiary education institution in New Zealand received a living allowance or grant while they studied.

 Prior to the mid 1970s, student support was based on a system of bursaries and scholarships. In 1976, a new system of government-funded tertiary bursaries was introduced. This included a study or living costs grant that was available to most students.”

Source: NZUSA

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Student fees and student loans came into effect in 1992, during the Bolger-led National Government, when Ruth Richardson was Minister of Finance (and coincidentally the same year that Shortland Street came on air).

In simpler terms, Dr Penny and Dr Hooper enjoyed the benefit of near-free tertiary education before fees were raised in 1992. They had no student loans to repay, as  medical students currently do, and may well have benefitted from receiving a Student Allowance.

Contrast their free tuition with that of medical students, in the 21st Century:  “on average medical students will graduate with around $80,000 of debt and nearly 90% will have a student loan“, according to the  New Zealand Medical Students’ Association in April, last year.

So with a free education; in receipt of student allowances; and no student loan; Dr’s Penny and Hooper were, as Revenue Minister Peter Dunne stated;

… the important thing about this decision is to bear in mind the scale of what was happening. This wasn’t people minimising their income because they were reinvesting in their business. This was people minimising their income because they were actually minimising their tax liability but still enjoying the full benefits of the income they were in reality earning.

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So not only did these gentlemen benefit from a free education – but they were now minimising their income because they were actually minimising their tax liability [whilst] still enjoying the full benefits of the income they were in reality earning.”

God, you’ve no idea how sick this incident has  made me.  Let me explain why.

Prior to the introduction of “Rogernomics” in 1984 (and National’s addition from 1990 onward),  education in this country had been free (or as close as possible to free) to nearly all New Zealanders. Education whether at Primary School or University was funded by the previous generation; our Mums & Dads; Grandmothers & Grand dads. The idea was terribly simple; education was a right, and not to be determined by ability to pay.

In turn, as we graduated from schools and Universities, we – my generation, the “Baby Boomers” – were to fund our children through their education, through our taxes.

Except, it did not quite happen that way.

In 1984 we unknowingly elected a Labour Government that had been taken over by a secret cabal of neo-liberals, conservatives, and proponants of the Free Market. A raft of  radical changes were implemented throughout the economy and impacting directly on society.

Despite public objection; mass protests; and even vocal opposition from within the Government by some Labour MPs such as Jim Anderton, Labour was re-elected in 1987.  Curiously, they had increased their majority from 55 to 57.

During Labour’s two terms (1984 to 1990), they cut taxes twice, and implemented a new tax in 1986, called GST.

National followed, implementing User Pays in tertiary education whilst  cutting taxes in 1996 and 1998.

In 2008, despite evidence that the world was plunging into a global recession, John Key promised that National would again cut taxes. As New Zealand went into deep recession; unemployment rose; businesses closed down – National cut taxes in April 2009 and October last year.

Most of the public, it seems, will swallow User Pays if they stand to reap a benefit from tax cuts.

The social contract therefore, was well and truly broken between our (the Baby Boomers) generation, and our parents/grandparents.

We had taken their gift – that of free education which they had paid for – but we decided not to pass it on to our children. Instead, we accepted one tax cut after another. And social services were either cut or User Pays applied, to pay for those tax cuts.

To my generation of fellow Baby Boomers, I say this; we’ve well and truly  shafted our own children. We denied them the very same opportunities of a free education that our parents had bequeathed to us. Instead, we voted ourselves seven  hefty tax-cuts; instigated User Pays; and left our children saddled with $13.9 billion in student debt.

Is it any wonder that our children our leaving New Zealand in greater and greater numbers? They’re not just emigrating to seek better paying jobs – they’re sticking it to us for our unmitigated greed. Whether consciously or sub-consciously, our children realise what our generation has wrought, and by god, they are not happy.

No doubt there are some folk who will cheer on Drs Penny and  Hooper. These people  feel that paying taxes is “unfair” and that it is unreasonable for the State to take the money that they have worked hard for.

Perhaps I should take a moment to remind these people what their taxes were, and in many cases  are still, used for…

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Inter-island Ferry, Aramoana

Dams and other power generation projects

Our first television broadcast system

Roading and highways

Hospitals

University education

Dental care for our Children

Our Police and justice system

Railways and other public transport

Schools

State Housing

Infrastructure such as power transmission lines

Social welfare and superannuation

Bridges

Postal and telecommunications systems

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Many of these assets no longer reside in public ownership – but they were originally built and maintained by previous generations of taxpayers; our parents, grandparents, et al.

As the Baby Boomer generation, what have we built and left our children?

$13.9 billion in student debt?

No wonder they are departing our shores…

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But I leave the last word to this expat Kiwi, now living in Australia,

A Victorian-based Kiwi with a student loan debt, who did not want to be named because he did not want to be found by the Government, said he did not intend to pay back any of his student loan.

The 37-year-old’s loan was about $18,000 when he left New Zealand in 1997. He expected it was now in the order of $50,000. The man was not worried about being caught as the Government did not have his details and he did not want to return to New Zealand.

“I would never live there anyway, I feel just like my whole generation were basically sold down the river by the government. I don’t feel connected at all, I don’t even care if the All Blacks win.

“I just realised it was futile living [in New Zealand] trying to pay student loans and not having any life, so I left. My missus had a student loan and she had quite a good degree and she had paid 99c off the principal of her loan after working three years.”

Source: Dominion Post

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Further Reading

Greed of boomers led us to a total bust

New Zealand’s wealth gap widens

Over-55s own most of NZ’s wealth

 

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London Burning. Where next?

10 August 2011 2 comments

The question that many are asking is “why?”.

Ms Penny’s opinion piece is the clearest attempt at understanding why these riots happened (and are still happening, as I write this) in a supposedly peaceful, civilised society.

I would add a further point: it is no coincidence that these riots are happening at a time when the “Arab Spring” has unleashed a human wave of rebellion in middle eastern countries ruled by authoritarian regimes. The common element is a deep disaffection with the status quo. Ms Penny explains it all in a simple, coherent, meaningful way…

I’m huddled in the front room with some shell-shocked friends, watching my city burn.

The BBC is showing footage of blazing cars and running street battles in Hackney, of police horses lining up in Lewisham, of infernos that once were shops and houses in Croydon and Peckham.

There have been hundreds of arrests and dozens of serious injuries. A 26-year-old man shot in a car in Croydon is reportedly the first fatality, but police have not said whether he had been participating in the rioting or was a bystander.

This is the third consecutive night of rioting in London, and the disorder has now spread to Leeds, Liverpool, Bristol and Birmingham. Politicians and police officers who only hours ago were making stony-faced statements about criminality are now simply begging the young people of Britain’s cities to go home. Britain is a tinderbox and, on Friday, somebody lit a match. How the hell did this happen? And what are we going to do now?

In the scramble to comprehend the riots, every commentator has opened with a ritual condemnation of the violence. David Lammy, MP for Tottenham, called the disorder ”mindless, mindless”.

Speaking from his Tuscan holiday villa, the Prime Minister, David Cameron – who has finally decided to return home to take charge – declared simply that the social unrest searing through the poorest boroughs in the country was ”utterly unacceptable”. The violence on the streets is being dismissed as ”pure criminality”, as the work of a ”violent minority”, as ”opportunism”. This is madly insufficient.

Angry young people with nothing to do and little to lose are turning on their communities, and they cannot be stopped, and they know it. Tonight, in one of the greatest cities in the world, society is ripping itself apart.

Violence is rarely mindless. The politics of a burning building, a smashed-in shop or a young man shot by police may be obscured even to those who lit the rags or fired the gun, but the politics are there.

A peaceful protest over the death of a man at police hands, in a community where locals have been given every reason to mistrust the forces of law and order, is one sort of political statement. Raiding shops for technology and trainers that cost 10 times as much as the benefits you’re no longer entitled to is another. A co-ordinated, viral wave of civil unrest across the poorest boroughs of Britain, with young people coming from across the capital and the country to battle the police, is another.

The truth is that few people know why this is happening. They don’t know, because they were not watching these communities. Nobody has been watching Tottenham since the TV cameras drifted away after the Broadwater Farm riots of 1985.

Most of the people who will be writing, speaking and pontificating about the disorder have absolutely no idea what it is like to grow up in a community where there are no jobs, no space to live or move, and the police are on the streets stopping and searching you as you come home from school. The people who do will be waking up this week in the sure knowledge that after decades of being marginalised and harassed by the police, after months of seeing any conceivable hope of a better future confiscated, they are finally on the news.

In one NBC report, a young man in Tottenham was asked if rioting really achieved anything.

”Yes,” said the young man. ”You wouldn’t be talking to me now if we didn’t riot, would you? Two months ago we marched to Scotland Yard, more than 2000 of us, all blacks, and it was peaceful and calm and you know what? Not a word in the press. Last night a bit of rioting and looting and look around you.”

There are communities all over the country that nobody paid attention to unless there had recently been a riot or a murdered child. Well, they’re paying attention now.

Riots are about power, and they are about catharsis. They are not about poor parenting, or youth services being cut, or any of the other snap explanations that media pundits have been trotting out. People riot because they have spent their whole lives being told they are good for nothing, and they realise that together they can do anything – literally, anything at all. People to whom respect has never been shown riot because they feel they have little reason to show respect themselves, and it spreads like fire on a warm summer night.

No one expected this. The people running Britain had absolutely no clue how desperate things had become. They thought that after 30 years of soaring inequality, in the middle of a recession, they could take away the last little things that gave people hope, the benefits, the jobs, the possibility of higher education, the support structures, and nothing would happen. They were wrong.

And now my city is burning, and it will continue to burn until we stop the blanket condemnations and blind conjecture and try to understand just what has brought viral civil unrest to Britain. Let me give you a hint: it ain’t Twitter.

After reading Laurie Penny’s analysis in the Sydney Morning Herald – perhaps we should be asking, “where next“?

Because the disaffection, anger, and resentment shown by the young folk of Britain exists in other countries as well. Governments seem to have forgotten that nations are first and foremost societies – communities of people. Economies are built on societies, not the other way around.

Something to reflect on here in  supposedly peaceful, civilised New Zealand.

What really angers me is  that Baby boomers and neo-liberals castigate the young for their irresponsibility and selfishness.

Pardon?!

Is this the same Baby Boomer Neo-Lib generation that enjoyed free tertiary education, free medical prescriptions,  etc, etc – paid for by our parents and grandparents?

And when it came time for Baby Boomers to pass these same social services onto our children, we held up our hands and said, “Nah. You kids pay for what you want.” And then we introduced User Pays and gave ourselves hefty tax cuts, whilst privatising many of those state assets that used to provide us with good services.

And we expect the younger generation not to be selfish?!?!

Maybe I’m turning into a Grumpy Old Bugger, but I say “a pox on my generation” – my sympthathies are with the younger people who were well and truly shafted by my lot.

As for the neo-liberals and middle classes;  you  got what you wanted; a society of individuals out to get what they wanted; screw society; and devil take the hindmost.

And it was all utterly predictable, 20, 30 years ago.

We have seen the warning signs.