Update on Hawkins and why a by-election would be good for Labour

In my last post I looked at how Labour leader Phil Goff was handling the fallout from Chris Carter's brain explosion, and the reaction of Labour MP George Hawkins to being mentioned in Carter's missive.

Carter claimed Hawkins was to face a challenge from within the party for the candidacy of Manurewa, the seat Hawkins has held since 1990. I said that Hawkins reaction demonstrated the same 'sense of entitlement' that Goff (justifiably) criticised Carter for in relation to large travel bills.

Hawkins has now announced an intention to stand for a local board in the October Auckland local body elections. He says he will withdraw his nomination for his parliamentary seat if he is elected, meaning that he will not stand at the next election. But if he is not elected to the local board he will stand for parliament again.

The least charitable interpretation of this would be to claim Hawkins is attempting to discourage a potential challenger to his seat, as nominations close on the 1 September. The most charitable interpretation was that standing down from parliament for the local board was always Hawkins intention, and Carter chose to put an uncharitable spin his intention for effect.

Yet in either case Hawkins still gives the impression of wanting to hang on for dear life, which looks like a sense of entitlement to me. I still hope the challenge happens.

The more I think about it, the more I think a by-election in a seat like Manurewa or Te Atatu would be entirely in Labour's interests. Take this for a scenario.

Hawkins resigns from his seat, and challenges Carter to do the same thing. Labour regain the initative, and Hawkins gains a graceful exit in the arms of a grateful party.

Explain to the public that while by-elections are expensive, at the end of the day democracy and the right of the people to have a say is worth more. This would tie in with a strong message about the lack of democracy in the Super City too. Highlight how National Maungakiekie MP Sam Lotu-liga oped to stay on the council after being elected an MP, and avoided a by-election for the political convenience of his CityRat mates.

At the beginning of the by-election campaign/s Labour annouce they will use every public meeting to tell people about the National party's attempts to bring back the Employment Contracts Act in drag, and every pamphlet delivered for the by-election will also be accompanied by a leaflet explaining the negative effects of the proposed employment law changes on 'every wage and salary earner'. Strong soundbites against '90 days' echo through news bulletins for three weeks.

Labour would be bound to win Manurewa with an ok candidate and Te Atatu with a strong candidate, which would help build momentum and exposure and make it more difficult for the Nats to control the news agenda. There is not likely to be any harm in the Greens running good candidates in either seat, for the same reasons.

So Chris Carter is going on two months 'sick leave'? Is this to waste just enough time so the 'election is too close for by-election' excuse can be trotted out? Please Chris, you may not care for Goff, but please resign from parliament immediately for the sake of the party you claim to care about. The public want you gone.

Open Country Cheese locks out workers seeking a union agreement

Open Country Cheese, a dairy product manufacturer set up by a couple of former National party cabinet ministers is planning to lock out its 100 staff for the audacity of seeking a collective agreement with basic redundancy and transfer of undertakings protection.

The company is also adopting aggressive public relations stance by telling lies about the wage claims made by the members of the Dairy Workers Union, and is enlisting farmers to make unsubstantiated comments in Open Country press releases, and encouraging them to scab on the workers by doing their jobs while they are locked out. The farmers involved are nothing but a modern version of Massey's Cossacks - the farmers who came to town to break the 1913 Waterfront dispute. The farmers ought to be wary here - the distaste of the towns for their behaviour was one of the drivers behind the formation of the Labour party in 1916.

Nor should the farmers be so ready to support Open Country's outright bullying tactics. One only needs to look at how the supermarkets have treated their suppliers to see how easy the company could later decide to maximise its own profits by pressuring the farmers into accepting lower and lower returns.

Open Country farmer Brendan Barrett claims the Dairy Workers Union approach is “outrageous” given the perilous state of the industry. “How the Union can credibly claim anything other than the status quo is beyond me. Suppliers have just had a 35% pay cut this year, and forecast another 15% drop this year. Our own returns have fallen 50% and yet the Union is demanding huge page increases."

Three days after this Open Country press release, the company increased its advance payment to farmers from $2.90 per kg of milk solids to $3.05, which appears to contradict the attempt at doom and gloom above. Is the timing of this increase really an coincidence?

Over on Red Alert Dairy Workers Union National Secretary James Ritchie outlines the very moderate claims the workers are seeking:
"There is no wage increase on the table. Workers are seeking a collective agreement which protects them from being made temporary or casual at any time. They want a say on how their rosters and hours of work can be changed so their family lives are not disrupted without notice and consultation. They want temp workers to be paid the same rate for the job after 3 months. They want temp workers to be made permanent after 11 months service. They want redundancy compensation if made redundant and they want to be paid for a meal break if they can’t leave the plant. - Most of all they want to be treated as human beings- not a commodity to be tossed aside when no longer required. They want decent jobs."

The Dairy Workers Union have not been involved in a strike for 20 years, so attempts to portray them as a 'radical union' are not going to have any credibility. Faced with a deeply ideological employer it seems Open Country have given the union no other option but to issue notice of strike action. Like the attitude of Infratil towards their bus drivers, the company have grossly overreacted to the situation by imposing a lockout.

Talleys Group, who the Standard have dubbed 'the worst employers in New Zealand' are the largest shareholder in Open Country Dairy, which in turn owns 100% of Open Country Cheese. Andew Talley and former National party cabinet minister Wyatt Creech are on both Open Country boards.

NoRightTurn points out that the actions of the company in imposing the lockout are a prima facie case of illegal undue influence, as employees have a legal right to decide whether to join the union or not. Open Country have demonstrated their ignorance of current industrial law by calling for industrial action to be restricted in the dairy industry, when in fact the industry already is classed as an 'essential industry'. There is no way protecting farmers profits should be treated as essential as firefighters, so NoRightTurn has drafted a bill to correct this error - it would be great if the bill could be drawn from the ballot in the next six weeks...

Please support the cheese workers at Open Country and help beat these ideological corporate bullies.

Silence from Labour on ministerial housing is a mistake

It is most unfortunate the Labour opposition have made the decision to join National's conspiracy of silence over the out-of-town housing allowances issue. Even if Labour had some dirty laundry themselves, it is more important to speak out and differentiate themselves clearly from National, who being in Government would normally take most of the rap.

Instead, Labour look like they are out of touch. When they have reluctantly commented on the issue they have appeared nervous and indecisive.

If Phil Goff was a better opposition leader he would have gained the initiative by immediately demanding an inquiry into the issue, freely admitting there may have been some Labour 'mistakes'. At the same time he could have barraged Key with suggestions on how to do things better. Good use of parliamentary questions and Trevor Mallard may have uncovered information that put ministers under more pressure.

Instead Goff let John Key gain some of the initiative with his soft as Teflon 'review'. Through their actions the right encourage cynicism toward politicians - it just so happens a electorate with less expectations of politicians usually suits their agenda. So in their silence, have Labour helped the right undermine faith in democracy?

Unfortunately, a 'plague on both your houses' has been a common theme this week - in more ways than one.

As for the Greens, IMHO they had nothing to worry about regarding the Green Futures Superannuation Scheme - the fact they have been more open about their arrangements for years should provide enough political cover.

There are reasonable and necessary expenses for being an out-of-Wellington MP. Its only the profit seeking rorts that need to stop.

I was working in Parliament in 2001 when National and Act's campaign against Hobbs and Bunkle was in full swing. It went far beyond just raising issues - it was the right of New Zealand politics at their most nasty, personal and vindictive. I remember thinking at the time there soon must come a point where the public would start feeling sorry for Hobbs and Bunkle - it really was that bad.

Richard Prebble was particularly obnoxious - it might be a small mercy, but the end of his second political career can be traced to his involvement in the Hobbs and Bunkle bashing. Speculation about his replacement as Act leader started soon after the 2002 election.

The memories of that National and Act campaign were a key motivation behind my posts this week.

Not that I am suggesting Labour and the Greens should now run a similar campaign - instead its more important to remind the public how nasty the Nats can be, as well as highlighting their obvious hypocrisy. How easy would it be right now to paint the Nats and Roger Douglas as greedy out of touch bullies? Unfortunately the opposition are failing to be an effective opposition right now.

Many of the National MPs who were frothing at the mouth in 2001 are now claiming, on questionable grounds, higher out-of-town allowances than Bunkle or Hobbs - it just beggars belief.

National's hypocritical bunkle over housing allowances

A number of National party ministers are renting out their own Wellington apartments at a profit while they claim allowances from the taxpayer to live more expensive homes. Murray McCully, Tim Groser and Phil Heatley essentially have Wellington property investments indirectly subsidised by the taxpayer by the fact they don't have to live in them. Additionally, Bill English claims around $50,000 a year of allowances to pay the mortgage on his $1.2 million dollar Wellington home.

When the story concerning Bill English's home first broke I was prepared to consider he may have a special case given it would be difficult to house his large family in a typical ministerial house. That said I expect that one could be found if required.

Yet as I thought about it more, two things made me less sympathetic. The first was the revelation of the rort being played by other ministers who already have Wellington apartments. More seriously, as my mind cast back to 2001 it became very clear that many of the Ministers in question are being simple hypocrites.

In 2001 National attempted to make a big issue out of Labour Minister Marian Hobbs and Alliance Minister Phillida Bunkle claiming out-of-town allowances to subsidise Wellington accommodation, worth up to $16,000 a year, while they were on the Wellington Central electoral roll. Both were eventually cleared of wrongdoing, but Bunkle did not get her job back.

In 2001 now local Government Minister Rodney Hide expressed disappointment* that an Auditor General's review of out-of-town accommodation allowanaces paid to Wellington based MPs was only going to look at the rules rather than the two MPs concerned, Hobbs and Bunkle. I very much doubt Rodney will be consistent and now say Prime Minister John Key's review should concentrate on the behaviour of certain individuals instead of just looking at the rules.

So what were Bill English, and Murray McCully saying in 2001 about this issue? Indeed it could be said McCully invited such comparisons in a speech to the house on 14 February 2001.
"I take the opportunity today to remind two members of this House of some words they have used on previous occasions, and to invite them to inspect their conduct of recent weeks against the yardsticks that I believe they have created for themselves."

Quite. Your turn Mr McCully. It is also interesting that in your attack on Bunkle you suggested the court of public opinion is a better guide as to what is right - so you can hardly claim to hide behind the rules now can you?
"To most members of the public, that looks like a person who lives in Wellington inquiring of the Parliamentary Service Commission, before she had even become a member, what she would have to do to collect the allowances, then contriving her circumstances so as to be able to complete the assertions that she did complete, and thus collect the Wellington allowance. That is how it looks to ordinary New Zealanders."

To most ordinary New Zealanders collecting rent on a Wellington apartment you own while you live in another taxpayer funded house looks like a taxpayer funded money making scam. Yet McCully's own words would also seem to doom his own deputy leader.

Bill English moved his family to Wellington some years ago - its where his wife works, and where his kids go to school. On these grounds most members of the public would regard him as a Wellington based MP. Claiming you live apart from your family in Clutha Southland seems like contriving your circumstances to collect allowances, which is rather similar to how the public regarded Phillida's claims she lived in Waikane.

With Heatley and English claiming between $48,000 and $52,000 its worth noting this is over three times the value of the allowances claimed by Hobbs and Bunkle.

On 14 February 2001 Bill English made this contribution to the debate on the Prime Ministers Statement
"Today's Evening Post headline sets the tone for the Government for the year: ``Ministers face legal probe''. When have we ever seen a headline like that in a newspaper? Two Ministers face a legal probe for a couple of simple reasons. One reason is that Marian Hobbs told Wellington Central people that she was a Wellington Central resident, while she was claiming an allowance for being an out-of-town MP. Ms Bunkle had any number of houses, one of which appears not to have existed while she was claiming an allowance for living in it. There will be more to be disclosed about that. But that is the tone that has been set. "

Has Bill 'any number of houses' English set the tone for his own Government this year? If you were to take his own words at face value it would appear so.

* Source: TVNZ, 25/1/01 'Another inquiry into MP allowances'

Free market electricity ripoff

This week the Commerce Commission released a damming report on the so called 'electricity market' in New Zealand. Electricity companies have overcharged New Zealanders over $4.3 billion dollars in six years.

While the report found no breach of the Commerce Act - its conclusions were far more devastating for those who would argue for further privatisation and the maintenance of a 'lightly regulated' framework. The Commerce Commission concluded the electricity companies used their market power to maximise profits in a legitimate way within the current market structure and rules. These being rules created by free market minded politicians.

The Otago Daily Times editorial puts the blame right where it ought to be - the National Government of the late 1990s and the Labour-led Government between 1999 and 2008. While Labour introduced the Electricity Commission, and appointed an old Rogernome to run it, their actions effectively embedded the infamous reforms of Max Bradford. I don't think I will be revealing any state secrets when I say the Alliance at the time was very uncomfortable in being asked to support the Electricity Amendment Act in 2001 - an Alliance Parliamentary adviser working on these issues told me it was so bad we should not have supported it at all. But Labour had light-handed regulation as a religion - and lack of regulation is one of the key problems identified by the Commission this week.

If Labour really had the will to fix things up they could have bought back Contact in 2004 when its parent company Edison Mission Energy was in need of cash. With the main four in Government control, Labour could have made the significant changes to the sector that are required, without the interference of the rent seeking privateers.

Our regulatory regime is so pathetic it doesn't even mandate the provision and collection of the data required for the calculation of competitive benchmark prices. Most other countries do. Professor Wolak, who crunched some of the numbers for the Commission said it took him more time to compile and clean the datasets on the New Zealand electricity supply industry than it did for all his previous projects put together - this includes an analysis of market outcome data from California, England, Wales, Columbia, Australia and Spain (p. 25).

It sounds very much like National and Labour have effectively allowed the electricity industry to design the system to suit themselves. Electricity companies do not even have to participate in the collation of meaningful data. Gee, in whose interests might that be?

A couple of comments from the Commission are worth highlighting. "The experience of countries that have liberalised wholesale electricity markets has shown that the assumption that markets will naturally produce a competitive result is not always justified....[T]he economics of electricity has specific attributes, which makes competition in this sector significantly different from that for most other products." These include very high market entry costs and the fact that demand is largely unaffected by changes in the wholesale price, as consumers do not immediately face price increases as scarcity increases. This companies gain substantial market power.

And before some clown points to the fact three of the major electricity companies are State Owned Enterprises (SOEs) and attempts to argue that government ownership is somehow the problem - I would remind them that the primary goal of SOEs is to make money*. So on this basis I would argue New Zealand already has an effectively privatised electricity system - it just so happens one of the robber barons is the government.

Sadly no SOE has ever gone Kiwibank and aimed to lower costs for consumers. Another model would see power companies run like non-profit trusts with the aim to produce power in the most socially responsible and environmentally sustainable way.

Dunedin blogger Chris Ford calls on the Government to order the electricity companies to pay back their ill gotten gains to consumers. While there is some justice in this proposal, this would effectively require the Government to pay out dividend money that now lives in the Crown accounts. I would sooner use a $4.3 billion pot to fix up the industry once and for all, and if nationalisation is the most effective means of achieving effective policy change, so be it.

The report by the Commerce Commission this week is a damming incitement on the current electricity system. Yet it also dams the agenda of those who want to further privatise the SOEs and maintain a lightly regulated market.

It is simply opportune nonsense for Energy Minister Gerry Brownlee to blame it all on the Electricity Commission - the problems go a lot deeper than that. The Commerce Commission have effectively demonstrated the difficulties in creating a functioning electricity market in a small place like New Zealand. Perhaps it would be better not to try.
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Cartoon credit: The cartoons in the above post are the work of a couple of creative Dunedin Alliance members (E. & H.). Thanks for giving me the ok to post them here.

* It could be argued the SOEs are failing to live up to a requirement in the State Owned Enterprises Act to exhibit a sense of social responsibility - unfortunately many other SOEs seem to ignore this too.

Report from Mt Albert Byelection: The Transport Forum

Just got back from a fiery Mt Albert Transport Forum, where the Mt Albert by election candidates faced over 100 people crammed into small lecture theatre at Unitech.

The meeting had a fantastic atmosphere - it was as good as the famous Aro Street election meetings in Wellington.

The fact that National announced their preferred option for Waterview only a few hours before the meeting gave it greater urgency and passion. To many locals, not only had politics arrived at the front door of their house, politics threatened to take their house completely.

National candidate Melissa Lee spoke first. Her opening words were a demand for water. She describes Waterview as 'a difficult issue' and said she felt for those in the 365 houses that would be lost due to the project. Really - is this the same woman who threatened many more houses with her 'above ground for me' proposal earlier this week. Attempted to make some noises about integrated ticketing and improving public transport. Lee also attempted some nasty dog whistle politics when she said a lot of burglaries were [the result of] people coming from South Auckland.

A comrade of mine, Lynda Boyd put it like this - "A meeting full of passionate Waterview residents who don't want to lose their houses and community, and a national candidate who needs to do her homework and learn a bit more about how to be respectful towards the general public". Similarly, on National Radio on Monday Laila Harre thought Lee's appearance on Q&A on Sunday demonstrated a "rather shrill and almost slightly nasty streak in terms of her communication towards David Shearer and people don't like that sort of stuff and won't respond well to it".

Act candidate John Boscawen spoke next. Act handed out their own a leaflet with an alternative route for Waterview. This only sought to confuse many locals who were worried this was the official plan. Yet on their map Act mislabeled Unitech as AUT University. The whole room roared with laughter when this was pointed out.

To be fair to John, his best moment came when he questioned a commitment to integrated ticketing just given by Lee. He pointed out National opposed a transport amendment bill to enable integrated ticketing in the last parliament, while Act supported it. Good point John.

Labour candidate David Shearer spoke about how Mt Albert needs an MP that will stand up for communities. He also said this community was about to be destroyed. He still backed the completion of the motorway, but only the tunnel option that was previously proposed by Labour. In his most memorable line, David Shearer said "If this motorway was being built for Paritai Drive or Remuera, we wouldn't be having this meeting"

Work is not expected to get underway until 2011, which also happens to be an election year. Shearer promised Labour would revisit the project if they became the government.

Green party co-leader Russell Norman started with a few slogans about the debate being between a green future and a grey past. Thankfully he soon dispensed with the slogans and used his sound knowledge of transport issues to directly address residents questions in a way that wasn't matched by the other candidates. He cited NZTA figures to show the Waterview motorway will be congested on the day it opens in 2015.

He talked about the Michael Joseph Savage memorial on Bastion Point and what that meant to people, and compared this with the Skytower - a syringe that is 'acts as a memorial to the Rogernomes'. It struck a nerve - a young woman with an Act party rosette responded with a single finger salute.

Norman made a strong case for prioritising public transport. For the same money that was going to be ploughed into Waterview, Auckland could have both the Avondale to Southdown rail link, and a rail line to the airport. He said he was not against the tunnel in the future, however he wanted the public transport investment to happen first. In 10 years time he suspected the Waterview connection would not be needed, particularly given the expected rise in the cost of oil.

Libertarianz candidate Julian Pistorius was predictable - let the market decide everything. He believed it was not up to the government to decide where to build roads. Property rights were sacrosanct - roads could only be built where people were willing to sell their properties. Its fair to say Pistorius was not taken particularly seriously by the audience - his manner was a bit arrogant at times, such in the way he claimed the other candidates 'don't know what they are talking about'. Perhaps Pistorius' only function was to make the Act members uncomfortable at the enthusiasm of their candidate for running roadshot over the 'property rights' of residents losing their homes. A few Act members left early.

Act candidate John Boscawen said the Waterview project should have been completed 15 years ago. Norman said the only reason there is not a surface motorway through this community is because this community had risen up to stop it. He promised to help the community fight the proposed motorway, saying we need money, experts and lawyers. He thought many lawyers would work pro-bono as the proposal was so stupid. He also saw a role for civil disobedience and protests outside the offices of Auckland National MPs.

At the conclusion of the debate, someone bought up the issue of Melissa Lee's alleged use of taxpayers money to enable a National party political video. There were loud chants of 'pay it back' from the Labour crowd at the back, a little piece of utu as 'pay it back' was the favourite of National party hacks following Labour's alleged overspending during the 2005 election. The added presence of Boscawen could well have made it sweeter.

The back of the room was a sea of large National and Labour party placards. No doubt they were there for the TV, but they did nothing to gain the votes of the locals who complained they could not see past.

Most that I spoke to afterward thought Norman won the debate. I should point out none of these people were Green party members. As for the audience, Norman gained by far the most applause for both his opening and closing statement.

Perhaps Shearer was second - another friend of mine accurately described his performance as Green-lite. I have tried to be fair to the candidates here - but Melissa Lee is clearly not the candidate the National party hoped she would be.

Update: Radio NZ is reporting Lee said people drove to the electorate from South Auckland, and that the new motorway extension could divert some of that traffic and criminals from Mt Albert. This and Not PC's comments confirm Lee made similar comments more than once - I wrote down her comment about burglaries at the time. On Newstalk ZB this morning she claimed 'I didn't actually say South Auckland' - oh yes you did - and the Radio NZ audio proves it. Given she said it more than once it will not be credible for National party spinmisters to claim it was a one off gaff. Later on Radio NZ she apologised to South Auckland people who were offended by her comments. Not PC seems to agree that Russell Norman won the debate and was the most well informed candidate - even if he disagrees with what Norman said.

Auckland rail stations to prop up a debt ridden KiwiRail?

The decision the National Government to abandon the regional fuel tax, but promise to fund Auckland's rail electrification left a number of other significant transport projects unfunded. This included railway station upgrades, ferry terminals and (long fought for) integrated ticketing.

The Auckland Regional Council (ARC) based its budgets on income that was expected from the regional fuel tax, only to find the rug pulled out from under it by unilateral action from central government. Its not the ARC being irresponsible here*.

Now it appears National may have had an ulterior motive. To cover the shortfall, the ARC may be forced to cede the region's control of 41 railway stations to government owned KiwiRail, with Mike Lee calling the move a 'technical confiscation'.

If another Government was attempting to pull the same trick and the train stations happened to be privately owned National would have been crying communism and predicting the end of the capitalist world order. That said, its a pity Labour were not this hard nosed with Toll Holdings, the former owners of the railways.

I don't discount there may be strategic advantages to having KiwiRail own the stations - but the way National is going about it is very underhand, particularly as they are dealing with locally owned public assets. The ARC is likely to be the more responsible public owner at present, particularly when National is attempting to run spending cuts across the public service.

At the same time Transport Minister and former Hollow Man Steven Joyce is announcing new investment in KiwiRail as a 'stimulus package', when it is nothing of the sort. Instead Joyce is merely re announcing investments made by the previous government, and forcing KiwiRail to take on more debt as a means of gaining long overdue new locomotives. He is also cutting public transport funding to build more roads. In other words, cynical public relations spin many people would just call lies.

There may be a link between Joyce's demands to reorganise the train set in Auckland and in KiwiRail nationally. By acquiring Auckland's rail stations KiwiRail gains significant assets and land to add to its balance sheet. This would only encourage National to load yet more debt onto KiwiRail - is this the grand plan?

* One wonders Stephen Joyce, as one of the more 'cynically motivated' Nats has an ulterior motive for attempting to undermine the ARC, with the Royal Commission into Auckland Governance soon to report, and Mike Lee likely to be the main challenger to John Bank's quest to be 'Lord Mayor' of Auckland. Hmmm

Beneficiaries need cellphones. Nat + Lab rght wng pollys sux

Letters from Work and Income telling debt ridden families to take out more loans and pawn off cellphones is more evidence of a mean and punitive culture within the organisation that neither major political party has done anything significant to change.

Its a little hard for a prospective employer to ring you if your cellphone is at the pawn shop.

While the letter approved an application for a Temporary Additional Benefit it also suggested some rather obnoxious additional steps to be taken.

• Taking out loans to cover arrears (in other words talk to a loan shark)
• Pawning cellphone and children's playstation
• Ringing debtors to reduce payments or refinance debt (in other words talk to a loan shark)
  
• Seeking budgetary advice
  

It was good to see Social Development Minister Paula Bennett quickly dismiss the practice when she was questioned about it in Parliament yesterday. One wonders if some of her National party colleagues may have been less quick to do so.

The issue was raised by former Labour party minister Annette King, yet it was the decision of the former Labour government to abolish the special benefit that largely created this situation. The 'replacement' Temporary Additional Support (TAS), placed more restrictions on emergency support - removing a degree of discretion the special benefit made available to WINZ staff. In essence Labour were telling WINZ staff they had to be tougher on beneficiaries.

In March 2008 Green MP Sue Bradford explained how Labour's April 2006 changes led to more beneficiaries being forced to susist within "an endless cycle of debt".
"Up until that point the special benefit had provided a third-tier level of last ditch discretionary assistance for people in the situation where the gap between their actual income and the necessities of life was too high to bridge by any other means. With benefits remaining low and even some low-wage workers requiring assistance from Work and Income, the special benefit played a key role in allowing case managers a way of topping up people’s benefits to liveable levels."

One will certainly end up in even more of an endless cycle of debt if your case manager is telling you to take on more.

In order to be eligible for TAS "cash assets" held by a person can not exceed a prescribed amount. Cash assets as defined in the 2005 Social Security Regulations includes cash and "other assets of the person that can be converted readily into cash". Motor vehicles, caravans and boats worth less than $2000 are excluded from the calculation, as are 'personal effects', however cellphones are not specifically excluded. Nor are student loans, even thought WINZ have attempted to claim this as "cash" in the past.

Later Social Security Regulations added further exclusions, suggesting the TAS is simply poor policy. Its worth noting that following the election National passed another such regulation to exclude ReStart payments.

A history of the special benefit by Advkit Para Legal Services reveals that in 1994 Labour (including Clark, Cullen and Maharey) strongly criticised the decision of the then National Government to restrict the discretionary nature of the special benefit, yet in Government Labour abolished it completely.

While Labour may have raised the issue in the house, in fact it was nothing more than their own right wing Blairite welfare policies coming back to haunt them. Policies that National also supports I might add.

Election 2008: Extreme Makeover Parliament Edition

A couple of days before Saturday the reality of the likely result started to sink in. Polls had looked poorly for some time, but in the final week I suspected the overall trend was a further swing towards National. Particularly after Mike Williams ineffective attempts to land mud on John Key.

Apparently this was Williams' personal crusade - yet just like the medieval variety it failed to find the relics and caused a great deal of collateral damage in the process.

On Friday a friend attempted to console me that the late polls may be going the other way, but my head was telling me otherwise.

The scale of the National party win is still a shock. John Key is in a strong position in Parliamentary terms, with a clear majority for confidence and supply from Act, United Future and possibly the Maori party. That said, there is no mandate for radical change. It is good to see Key recognise this with his reassuring noises about leading a centrist government, and ruling Roger Douglas out of cabinet. I have some lingering doubts here - I will return to this and the Roger issue in a later post.

While I feared the Labour vote would be hollowed out, I did expect the Greens to do better. I will return to this issue also.

Watching the so called roof top party that formed part of TV One's coverage, I was dismayed at some of the reasons given by some people for switching their vote to National. I can respect people who take a liking to a particular policy of a party, but 'time for a change' is meaningless. It demonstrates a sense of disengagement that regards politics as a mere commodity, as merely the faces they see on the TV each night. Extreme Makeover Parliament Edition.

Yet many of these same people will act with alarm if National attempts to restart a more radical right wing agenda. They will be dismayed when their kids are dismissed from their job without reason after 90 days. How long before the reality of change sinks in?

As they say on TV, move that bus!

TV3 debate

I found the TV3 debate fairly dull. I agreed with one of the commentators, I believe it was Jane Clifton, who wondered if both leaders had been trained by their media minders to be just plain dull and avoid talking about policy.

Overall I would call it a minor points victory for Helen Clark, but the debate was so dull is unlikely to have much impact on the wider campaign. I think Clark did well given that the tenor, questions and underlying assumptions behind the debate were framed against her. Like Audrey Young, I think there were occasions where host John Campbell did not give Clark a fair go to respond.

That said, the weakness in Clark's performance tonight was the same issue that has plagued the 08 Labour campaign - being too negative. Campbell gave her plenty of opportunities to talk about new policy initiatives - yet she failed to mention the promise of a universal student allowance once. Clark fluffed the chance for a strong closing statement by closing on Key, although I think Key/Campbell cut her off again here too.

While some Labour activists hope the 'Mary' ad will turn things around - I doubt it. To my mind, Labour would gain more votes if they toned down the frequency of the negative ads and ran the CTU videos on TV instead!

Proportional representation and right wing whinging

The Herald on Sunday editorial calling for the election to produce a 'clear mandate' is nothing more than right wing winging about the demise of first-past-the-post and the inability of their National party friends to gain the support of more than 50% of New Zealanders for their policies.

The Herald questions whether Labour would have a legitimate claim to power in the case where Labour gets less votes than National, but Labour forms a government with support from a number of smaller parties. They claim a government formed by Labour, Greens, Progressives and the Maori party would be running "counter to the plainly expressed view of the people"

This position is simply constitutionally illiterate, as NoRightTurn has pointed out. A government needs to demonstrate that it carries a majority in the House on confidence and supply. What matters is winning the numbers on a confidence vote - it does not matter how those numbers are made up.

Of course, National and their supporters do not actually believe the largest party in parliament has an automatic 'moral right' to be the government. As my friend Peter T pointed out on Friday night - if this was the case Don Brash should have conceded on election night 2005. Labour won a greater share of the party votes than National. While I think Brash made a mistake not acknowledging that Clark was in a better position to form a Government in 2005, he was still entitled to conduct discussions to find out whether a government led by him would enjoy the support of the house.

Now in the event National do win more party votes than Labour on Saturday, one can respond to Tories demands for an immediate concession with a simple question. Did Brash offer his immediate concession to Clark in the case where Don saw a slim chance of a National led Government? No? Well if thats the case, don't expect a concession from Helen either.

CTU Video: National win election 2008 part 2

Latest campaign video from the Council of Trade Unions. Helps if you are a fan of Lord of the Rings...



Part one of National win election 2008 is here.

National MP runs down protester with a motor vehicle

:John Hayes the National MP for Wairapara thinks it ok to use a motor vehicle to run a local man off the road. (Hat tip newzblog)

"Local activist James Sleep was today exercising his democratic right to protest when he was approached by an entourage of 4WDs carrying Wairapara MP John Hayes and John Key. Sleep attempted to get out of the way however he soon found himself being propelled backwards by the force of Hayes’ car. The car continued to accelerate for 20 metres until bystanders forced him to stop. Sleep described the incident as frightening and thought he was going to be run over. When the car stopped Sleep was aggressively tackled onto the ground by a male escorting Hayes."

Sleep has laid complaints of assault and careless driving with the police. Good on him. James has written about the incident here.

Perhaps it is relevant to quote the contribution of John Hayes to the debate over the section 59 bill.

"...Labour camp and in the Greens, is undermining the social fabric of our country. They are passing this bill on the back of having undermined every teacher and every policeman in this country. Two weeks ago, at the Golden Shears in Masterton, a couple of young kids were sitting on the bonnet of a car, causing trouble and abusing old people. Someone said to them: “Listen, boys. Naff off!” It was not me doing the telling; I witnessed this. “You can’t tell us that, mister. You can’t do that,” the boys said. The guy said he was going to get the police. “They can’t do anything either,” he was told. That is why we have so many children out of control in Masterton and elsewhere in the small towns of the Wairarapa. It is because this Labour Government has pulled the rug of authority from every institution in this country, whether schoolteachers, police officers, or, now, parents."

Clearly Hayes believes he should use the bonnet of his car to maintain the 'rug of authority'. Isn't it an irony how many times those that bemoan the breakdown the the rule of law often find themselves on the wrong side of it?

Worse of all, National leader John Key appeared to endorse the actions of his blunderbus MP by attempting to make jokes about the incident. "Mr Key said he would like to borrow the protester to take home, as he made a lot of noise and could be used in the early morning and on dusk to scare ducks from landing on his pool.". If Key endorses running down protesters with motor vehicles, perhaps he could ask Hayes and his 4x4 to come and shoo the ducks away for him?

Does National party strategy come from the CityRats?

Chris Trotter poses an interesting question. Did the success of the Citizens and Ratepayers Campaign in the last Auckland local body elections provide a 'dry run' for the general election campaign of National led by John Key? Is the same strategy at work?

"Like Banksie, Key is promising that he and his followers have changed. That they’re no longer the flinty-faced mob they used to be under Don Brash. Oh dear me no, they have turned over a new leaf, and become kinder, gentler tories: National-Lite. Also, like Banksie and his C&R strategists, the Nats are relying on the voters’ rapidly waning affection for the incumbent left-wing adminstration to carry them into power without having to first undergo too much in the way of intense media scrutiny.

Could this explain the Opposition’s extreme reluctance to talk about too much policy detail? In case somebody ends up disagreeing - i.e. attracting attention and making news? Is Key hoping to take down Helen Clark’s government in the same way that Banksie took down Dick Hubbard’s - by default?"

Trotter believes the Left opened the way for the CityRats to win in an environment where there was little public scrutiny of their ideas or what they stood for. I largely agree with Trotter's analysis here. I would also note that a compliant media was also a factor.

This suggests a Labour party general election campaign based around 'keeping National out' is less likely to succeed than a campaign based on big ideas (like interest free student loans). Announcing progressive policy is more likely to force the Nats to talk about policy in a way they wish to avoid. Act's Roger Douglas may have this effect too. Labour would not need to run the negative message, as National and Act will scare the horses all by themselves, just like Maurice Williamson did with his $50 a week estimate of road tolls.

I posted the following as a comment in response to Chris' post - I thought I might as well note it here too.

Another related issue is the failure of the centre-left/left to come up with a credible electable candidate for the Auckland Mayoralty for as long as I can remember. While Hubbard won in 2004, he ran a dreadful campaign in 2007. Hubbard’s politics are centrist at best - I am sure many voted for him because he was on the left of Banks, which is not saying much. In 2001 there was the fracas created by the Labour wing of City Vision endorsing a failed National party cabinet minister who also ran a dreadful campaign, and lost badly.

Could we please have a centre-left candidate at the next mayoral elections who people of the left actually want to vote for? A candidate who can generate some enthusiasm around local body issues and encourages a greater turnout?

The Winniebox and the Serious Fraud Office

GWith the announcement by the Serious Fraud Office of an investigation into donations made to his NZ First party the position of Winston Peters as Foreign Affairs minister is fast becoming untenable.

The smartest thing for Peters to do now would be to stand down. He could use the opportunity to claim he is doing it for all sorts of important sounding reasons other than saving his own skin, such as maintaining confidence in the government, a sacrifice for the good of the nation. Peters gets an opportunity to grandstand, an opportunity to clearly state his belief in his own innocence, and his expectation of coming back as a minister as soon as this nonsense is cleared up.

Peters would also be free of any sort of collective cabinet responsibility for the election campaign, which being Winston could bring some advantages.

Sadly, it appears that Winston Peters is simply too arrogant to take the most pragmatic political course of action.

But if Peter's won't go, Helen Clark must suspend him. She has suspended her own ministers for less, in fact David Parker stood down over a whole lot less. If Peters remains a minister while the SFO investigate, it will be difficult to avoid the perception that ministerial standards have dropped to levels not seen since the end of the Shipley administration. That perception has the potential to cause problems not only with the public, but inside the Labour caucus, as any MPs disciplined by Clark will wonder why Peters is being treated so leniently. Many may start to question Clark's judgement, and perhaps even Clark herself.

This Labour-led government is not in free fall - yet. I still rate their chances of remaining on the Treasury benches around 50/50. Despite the National party leading in the polls, they can not lead the Government unless their vote plus their allies adds up to 50% - and that has been a struggle for National all year.

In the case that Peters remains a minister and Labour lose the election, perhaps some people will cast their mind back to the post election negotiations in 2005 when Labour cast off the Greens in favour of NZ First and United Future. In doing so, did Clark write her own political death warrant three years later?

The more hopeful scenario is that Labour scrape home in 2008, and the numbers force the Labour leadership to form a government with the Greens as the primary support partner. In the same way that some people credited the Alliance with rejuvenating the Labour party in 1999, perhaps the Greens can do the same thing for Labour in 2008. One hopes Labour and their supporters can be grateful.

Labour is complicit in National's work-for-the-dole madness

The Standard highlights the likely implications of National welfare spokesperson inviting an Australian work-for-dole 'provider' to visit New Zealand. National plans to give them business by introducing work for the dole if it becomes the Government.

While Collins adopts the key approach of 'deny deny deny', Mission Australia's chief executive is keen to cross the Tasman.

Steve Pierson at the Standard is right when he describes work-for-the-dole as a nice sounding slogan that does not work in practice. In adopting such a policy "National is following ideology, rather than doing what makes sense."

But there is a problem with this analysis. The fact is that Labour adopted significant assumptions of the underlying ideology behind work-for-the-dole when they passed the Social Security Amendment Act. I have blogged on similar issues before. As Louise Humpage and Susan St John point out this amendment changed the fundamental purpose of the Social Security Act.

"[T]he Social Security Amendment Bill wipes away any notion that our social security system is about ensuring everyone can participate as citizens. Instead, it makes getting people into a job, any job, the fundamental duty of citizenship. This principle is baldly stated “Work in paid employment offers the best opportunity for people to achieve social and economic well-being”.

Even worse, the new Act allows for pre-benefit activity to be completed before a person can even apply for an Unemployment Benefit. So thanks to Labour, National will not even have to change the law to bring in work-for-the-dole, they can just pass a regulation to require registration for make-work schemes as part of 'pre-benefit' activity.

It is an irony that the right make so much of the 'excess' jobs offered by NZ Rail prior to corporatisation in the 1980s, when these jobs where of far more value to society than the neo-liberal work-for-the dole schemes, of the late 1990s, and of the early 1930s. In his book 'The Slump' historian Tony Simpson described how this philosophy and practice failed to address the demands of the depression.

"By and large it reflected the 19th century viewpoint that anything for nothing would be instantly exploited by the unscrupulous and feckless poor. The circumstances of giving must be unpleasant as possible and it must never amount to more than the lowest wage available otherwise it will encourage sloth."

The 1930 Unemployment Act provided for a sustenance payment of 21 shillings a week to unemployed men, with an additional 17s and 6p for a wife, and 4 shillings per child (even though working women contributed, they were not eligible). This was financed by a poll tax - in effect it was a compulsory insurance scheme.

"These rates were never paid. Instead, the unemployed were referred to local authorities, which were instructed to provide work and granted subsidies from taxation with which to pay the workers involved. A stern instruction accompanied this scheme. No one was to be given payment unless they actually reported for work. This led to ludicrous, even scandalous, situations where local authorities scrambled to create work which was clearly unnecessary or even useless (such as shifting sandhills from place to place)."

If local authorities could not create work payment was withheld. Despite this example being from the 1930s it still demonstrates the weaknesses of a work-for-the-dole policy, and how it can lead to further retrenchment. The work involved is either going to replace genuine jobs or it is not. If not, this can only mean sandhills. If a government (or a private provider) is inclined to cut 'benefit' costs further, restricting the amount of 'work' available becomes a very handy way to do this.

Its not just the Social Security Amendment Act. Consider Sue Braford's analysis of Steve Maharey's 'Jobs Jolt' policy from 2004.

"In this context, for those people who are living in poverty, on wages and benefits which aren’t enough to sustain a remotely decent standard of living, the ‘Jobs Jolt’ means little more than increased harassment by the State in a situation where there are still far from enough jobs to go around....This is why I view the ‘Jobs Jolt’ and the thinking behind it as intrinsically right wing, fundamentally unjust from a social equity perspective, and a clear signal that Labour is far keener on picking up votes from the beneficiary-bashing part of the political spectrum than it is from low income workers, unemployed people and beneficiaries, and those who support their right to jobs and a living wage.... Overall, I sense that the Government’s lurch to the Right on welfare as epitomised by the ‘Jobs Jolt’ is a product of their lack of any cohesive ideology or coherent thinking about solutions to structural unemployment, endemic poverty, a failed, fractured welfare system and an entrenched and increasing gap between rich and poor in Aotearoa New Zealand. "

In other words, the circumstances of giving must be unpleasant. If the Nats introduce work-for-the-dole it will be a logical extension of Labour's own policy, or perhaps lack of one. If Labour had wished to vanquish work-for-the-dole to the historical dustbin it belongs, perhaps it should have made more effort to challenge the neo-Victorian attitudes underlying the ideology of work-for-the-dole.

In 1938 Labour's proposed Social Security Bill was the centrepiece of its election campaign. The National party called it 'applied lunacy', a bribe and a cheat. Labour not only won a majority, it won a majority of the votes cast - a first in New Zealand history.

Note: Made a small edit when I established Mission Australia are technically a charity rather than a private company. That will teach me for blogging too late at night. If National devolves welfare delivery to the charities sector it will like going back to a pre-1930s situation!

National's u-turn on Kiwisaver should not be trusted

The National party attempted to make a swift u-turn today when its Industrial Relations Spokesperson Kate Wilkinson told an employment relations forum that National would do away with the compulsory employer contributions to Kiwisaver. "The National party is not a party of compulsion".

Under pressure from her boss, John Key, Wilkinson issued a later statement claiming she had "misinterpreted the question" (yeah right). "National will release its Kiwisaver policy later this year, but suggestions that National will do away with compulsory employer contributions to the scheme are incorrect.

According to Key, Wilkinson "got it wrong", and added that National's industrial relations spokesperson is not involved in the setting of National's Kiwisaver policy. Perhaps Wilkinson was only guilty of telling National's wealthy backers what they want to hear. Perhaps this is a also a sign many National MPs are currently sharpening their hatchets, desperately looking for ways to cut government spending to fund tax cuts, following a budget that tied up most of the cash.

Despite it not being National's day, I think the media have missed something important, and have subsequently let Key off the hook with his refusal to outline any further detail about National's Kiwisaver policy.

While employers have to make contributions to their employees Kiwisaver accounts, employers also gain tax credits for doing so. These tax credits reinburse 100% of employer contributions up to a maximum of $20 a week. In situations such as the 2+2 scenario (where employees put in 2% and employers 2% to make up the 4% minimum) Kiwisaver does not end up costing employers any money more money (than paying 1%) when the tax credits are taken into consideration (for those earning less than 52,000 a year). Labour have set aside a total of $2.4 billion to compensate employers for their 'contributions' over the next four years.

National's denials come with a pungent stench of weasel. National could keep the employer contributions, but give employers greater tax breaks so a greater proportion of employer 'contributions' actually end up being effectively subsidised out of the public purse. National could pay for this by trimming the government contributions, and dangle the prospect of greater tax cuts. This would be consistent with the comments made today.

The effect of such a policy change would also deliver to National's big business backers, who prefer corporate welfare when they can get it. The 650,000 New Zealanders who belong to Kiwisaver should not take any relief from National's blundering policy announcement today. As far as Kiwisaver is concerned, the National party still refuses to answer the key questions regarding their Kiwisaver plans.

Hat tip for some of the links NoRightTurn.

Leading the tax system in a progressive direction

Vernon Small of the Dominion Post has made a cheeky post where he speculates on how Cullen could stop the very rich from taking the lions share of benefits from tax cuts.

His solution - introduce a new top tax rate of 42c in the dollar on incomes above $150,000, and thus allow greater tax relief to be given to those on lower incomes.

While I don't think its going to happen, I like it. The call for tax cuts could be answered, yet the left could claim a victory in making the tax system more progressive. If there are to be tax cuts, this does not necessitate complete submission to the screaming of the right.

There are many other ways the tax system could be improved. I would be happier about cuts to the top tax rate (39c at 60,000) if Cullen used the opportunity to introduce structurally useful changes such as a capital gains tax on secondary residential properties, and/or a financial transactions tax to discourage short term speculation. While the currency speculators may have means of avoiding the later (eg the EuroKiwi), it may still lead to a lower and more stable currency, which makes the Kiwi a less exiting toy for international currency speculators.

Many other countries have a higher top tax rate than 39c, but they generally apply at a higher threshold. If Cullen dared to introduce a new top tax rate, the National party would scream on behalf of its very rich mates, and Cullen could point this out with some of his trademark glee. Yet in order for this to work Cullen would be best to deliver tax cuts before the election, so voters can't be hoodwinked by the Nats into believing a $150,000 threshold is going to affect them.

As the Nats have called for the New Zealand tax system to be more like Australia, shouldn't we also have higher tax rates at higher thresholds? Kevin Rudd recently increased the threshold of 45c tax rate to $180,000 - why do the right wingers never mention the existence of the 45c rate?

State owned companies must act in the national interest

In the wake of the foolish decision of Air New Zealand to operate a charter flight to ferry Australian troops on their way to the war in Iraq, Fran O'Sullivan has questioned whether a publicly listed company can be expected to uphold 'national interest' considerations.

Given the status of Air New Zealand as 'national flag carrier' the actions of the airline are more likely to reflect on New Zealand than other companies. Aviation can be a boom and bust business, but it is in New Zealand's interest to ensure we always have an airline. While I do not want to see any State Owned Enterprises (SOEs) sold, it could be said that there are stronger reasons for turning Air New Zealand into an SOE, than would be the case for many existing SOEs.

The Companies Act requires directors to act in the interests of all shareholders, not just the majority owner. In the case of Air New Zealand, some would argue that, in effect, the airline has been acting more in the interests of its minority shareholders for some time. If the Government is unable to ensure that the actions of entities that it owns do no contradict with public policy objectives, the value of public ownership is diluted.

In fact the company board have been diluting the Government's shareholding for some time, by issuing more shares to be bought up by private owners on the stock exchange. The proportion of Government ownership has dropped by 82% in October 2001 to 76% now. This is nothing but privatisation by stealth.

The current issues surrounding Air New Zealand are also relevant to more open privatisation threats. Since 2005 the National party have made noises about selling partial stakes in state assets such as Solid Energy. Under such a policy it is likely that some SOEs would be turned into companies with a similar structure to Air New Zealand. The current situation with Air New Zealand, where the Companies Act places restrictions on its ability to act in the national interest is a very good demonstration of why partial privatisation is a really dumb policy.

Of course the Nats may well have designed the policy to fail in this way, in an attempt to create a situation where they can push the case for full privatisation. Its a policy that could be compared to a Trojan horse - made of wood and full of borer.

Brash is gone, well done Nicky

Pleased to see Don Brash resign - even if only half the allegations in Nicky Hagar's book are true he is simply not the kind of person most New Zealanders would want to see running the country.
Perhaps National party President Judy Kirk secretly agrees - it was interesting her press release said she 'supported and respected' Brash' decision to resign. Under normal circumstances one would expect the word 'regret' to be used - but it wasn't. And being 'thanked for your contribution' can act as a euphemism for being fired.

In seeking an injunction in an attempt to prevent his emails being published Brash may as well have picked up a megaphone and shouted 'I have something to hide'.

The fall of Don Brash is a significant setback for the new right in New Zealand. They appear to know they will never be popular enough to be openly elected to implement their policies, so they rely on portraying a reassuring and misleading image of themselves (Labour in 1984, Bolger's 'decent society' in 1990), only to invent an economic crisis after the election and implement the policies they wanted all along.

I must say I find some of the reaction to Hagar's book from the Labour party more than a little opportunistic. Labour spilt a lot of venom at Hagar for his previous book 'Seeds of Distrust', yet because they believe the conclusions of the Hollow Men may suit their political interests some within Labour are heralding the book before they have even read it.

If Hagar ever decided to write a second volume of the Hollow Men I am sure he could find some links between the corporates and the Labour Party Helen and Co would prefer to stay hidden. That said I would expect such a book on the Labour party to be significantly shorter than Hagar's book on National - while the forth Labour government were disgracefully dishonest I doubt the current lot are as bad - or as cynical as Nicky seems to think National have been under Don Brash.