Long stories shortest: The Government’s international investment conference ignores the facts that PPPs cost twice as much as vanilla debt-funded public infrastructure, often take longer, and often have to be relitigated or bailed out later. The biggest projects pitched also make no economic or fiscal sense for taxpayers. Also, the school lunch scheme continues imploding and long covid is squeezing our labour force.
(There is more detail, analysis and links to documents below the paywall fold and in the podcast above for paying subscribers. If we get over 100 likes from paying subscribers we’ll open it up for public reading, listening and sharing, although we’d love it if you subscribed to support our ability to make this journalism public. All students and teachers who sign up for the free version with their .ac.nz or .school.nz email accounts are automatically upgraded to the paid version for free. Also, here’s a couple of special offers: $3/month or $30/year for under 30s & $6.50/month or $65/year for over 65s who rent.)
Long stories short, my top six news items in Aotearoa’s political economy around housing, climate and poverty on Friday, March 14 are:
PM Christopher Luxon and much of his Cabinet pitched to pension fund managers at a conference in Auckland yesterday for tens of billions of their funds to invest through Public Private Partnerships in motorways, hospitals, prisons and more. (Hear more detail in the podcast above)
The unspoken assumption no one in the media or conference challenged was that simply using Crown borrowing to fund these projects would be faster, cost taxpayers half as much, be simpler and less risky. That’s because previous big infrastructure PPPs such as Transmission Gully were fiendishly complicated to negotiate, generated massive litigation and were eventually rewritten anyway.
The other unchallenged problem with many of these projects is they don’t stack up in their own right as projects, often generating marginal or even negative benefit to cost ratios, even without a proper accounting for climate emissions or public health costs.
Labour is flirting with saying it would honor any PPPs written by the current Government, while also saying it wants to retain ownership of hospitals, schools and prisons.
In another sign of how covid’s shadow is hanging over our political economy, the share of New Zealand’s work force reporting they had to work fewer hours because of sickness or injury increased from around 2.5% of the workforce in 2020 to around 3.5% by the end of 2024. That represents around 31,000 people. (See chart of the day below)
In line with ACT’s original campaign to shut the school lunch programme completely, a Huntly school has become the first to abandon it altogether. Kimihia School Principal Pamela Dunn told parents1 last night she was suspending the new Compass school lunch programme from today because of the “substandard quality of meals,” instead asking parents to ensure students brought their own lunches such as sandwiches as muffins. (See more in quotes of the day below)
My Pick’ n’ Mix Six of scoops & deep-dives elsewhere
Media scoop: 'Shake-up is necessary' - NZME's biggest shareholder backs board cleanout NZ Herald-$$$’s Shayne Currie
Politics scoop: Govt considers getting us to contribute more to KiwiSaver NZ Herald’s-$$$ Jenee Tibshraeny
Politics scoop: Another ACC deputy chief executive stood down over alleged ‘inappropriate behaviour’ Stuff’s Paula Penfold
Climate scoop: Second firm halts plans for offshore wind farms Newsroom Pro-$$$’s Marc Daalder
Politics news: Labour open to compromise on PPPs Newsroom’s Fox Meyer
Politics news: Power to shed light on tax of wealthy may be snuffed out. NZ’s wealthiest people look set to enjoy greater privacy once again, knowing they can’t be forced to give information to the Government about their tax arrangements. The Post-$$$’s Tom Pullar Strecker
Podcast of the day
I spoke with former Primer CEO Sean Gourley about AI and defence tech
Quotes of the day
‘The living wage allowed me to thrive’
“The Living Wage basically allows me to survive. Before the Living Wage came in I was really struggling to afford groceries, especially considering how high my rent was, and the Living Wage has allowed me to thrive in what would be seen as a very basic sense. This is all I have and if I'm not going to be paid enough then I'm going to struggle even more than I am.” Cleaner Robert Shaw commenting via RNZ on the Government’s decision this week to remove the need to pay the living wage in procurement rules.
‘They got what they wanted’
“We said it from the start - it was going to be our children who would pay the price for David Seymour’s botched school lunches programme. It’s a sad reality that some children may now go hungry and struggle in class because of his choices and the prime minister’s inability to step in.” Labour Education spokesperson Willow-Jean Prime.
Chart of the day: Covid’s shadow
Self-reported sickness reducing hours worked increased from late 2020
This chart from Stats NZ’s Household Labour force survey shows the percentage of of the labour force reporting they work less hours due to sickness or injury. The trend shows an increase in illness reducing work hours from around 2.5% of the workfrce in 2020 to around 3.5% by the end of 2024. That represents around 31,000 people.
Substack essential today
Cartoon of the day
Timeline-cleansing nature pic of the day
Ka kite ano
Bernard
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