TL;DR: The top six things I’ve noted around housing, climate and poverty in Aotearoa’s political economy in the last day are:
The National-ACT-NZ First’s budget cuts are now clearly biting into front-line services and staff across the hospital and welfare system, contrary to promises made before the election that tax cuts would be paid for by painless ‘back office’ cuts to spending;
Unfortunately and often tragically, the spending cuts and various politically-driven (ie evidence-lite) decisions are storing up future deaths, accidents, pollution, emissions debts, hospital admissions and overtime costs for future budgets and Governments to deal with;
In solutions news, China’s LDV just slashed the price of its electric double-cab ute to $41,990, making it cheaper than other new electric cars and diesel utes;
In chart of the day, Treasury forecasts a slump in capital expenditure requests in the next three years as officials scramble to meet the directions of the new Cabinet to avoid spending now, in order to pay for tax cuts that began this week;
In quote of the day, the new Groceries Commissioner has been forced by an intransigent supermarket duopoly to review its new code for suppliers, who are still being bullied and squeezed; and,
In climate graphic of the day, a new global warming analysis shows the acceleration in temperatures over 2023 and 2024 may have slowed in recent months, but not enough to be sure the worst is over.
(Full paying subscribers can see and hear more detail, analysis and commentary in my podcast above and below the paywall fold. They also have access to my daily Pick ‘n’ Mix of links elsewhere and The Kākā’s daily Journal of Record below. If we get more than 100 likes, we open these articles up for full public access and sharing online.)
Top Six Things to note on Friday, August 2:
1. The mask comes off: this is an austerity Government
Election promise to only cut back-offices dissolves into front-line cuts
This week the Government’s promise to only cut back-office staff and to keep existing publicly-available services in health and education finally dissolved in front the nation’s eyes, with numerous examples where any pretense was dropped, or the opposite was so obvious it couldn’t be denied.
Here’s examples from today alone:
Scoop: Proportion of Health NZ staff in ‘back office’ roles falling, not rising. The Post-$$$’s Tom Pullar-Strecker
News: Hundreds more doctors could be trained if government funded them - report RNZ
News: Fewer pharmacists stock Covid-19 anti-viral drugs after funding cuts RNZ
News: Kāinga Ora to slash Māori-focused housing team in half RNZ
News: Children’s Minister defends cuts to Oranga Tamariki service providers. Stuff understands one charity, Family Start, is expected to lay off more than 100 staff. They work with pregnant women and young families to ensure they’re ready to look after their children. Stuff’s Tova O’Brien
2. The feedback loops worsening the services deficits
Repeatedly, the Government has chosen to cut capital expenditure and spending plans in ways that makes the Budget look better this year and helps pay for Budget 2024’s tax cuts that kicked in this week. They’ve also changed policies that appear to allow the economy to grow faster in the short term. But both moves just build and shift bigger costs that will have to be paid in later years.
The old adage of penny wise and pound foolish often applies, as in these cases identified from today alone:
News: 'Lives at risk': Trauma surgeon fears speed limit increases will drive up deaths NZ Herald
News Doctors told to make beds, clean commodes amid hospital staff shortage RNZ
The other area of short termism is in the sacking of scientists:
News: Workers monitoring natural hazards among GNS scientists facing axe NZ Herald
News: 'Sleepwalking into a climate disaster': NIWA scientist's parting shot RNZ
Olaf Morgenstern finished up after 15 years at NIWA last Friday - one of four experts culled from a 10-person climate modelling team.
His expertise has already been snapped up by Germany, and Morgenstern has left New Zealand with a warning: climate science in this country is under threat.
We do this science for the public good, not necessarily just our own country's good; climate science is very much an international endeavour.
"We would be truly in dire straits if everybody else followed New Zealand's commercial ideology because we'd be sleepwalking into a climate disaster."
3. Solutions news: $41,990 for an electric double-cab ute
This is encouraging, via Matthew Hansen at Stuff. China’s LDV has cut the price of its run-out model of electric double-cab ute to $41,990, which makes it cheaper than electric cars and cheaper than equivalent diesel utes.
After another round of discounts, LDV's e-T60 (which is, so far, the only electric ute on sale in New Zealand) is sitting at $41,990, nearly a 50% drop on its initial price of $79,990.
This positions the eT60 ahead of the likes of the recently discounted prices of the GWM Ora ($42,990), BYD Dolphin ($43,990), MG4 ($46,990), and the Omoda E5 ($47,990).
LDV's price drop could be to clear existing inventory ahead of a next-generation update, which was shown off overseas recently, but we've had no indication of a hard launch, let alone when local stock might land.
None of the major manufacturers - Ford, Toyota, Mitsubishi - have indicated when an electric ute will land from them. Ford has the plug-in hybrid Ranger on its way, Toyota has a mild-hybrid Hilux already on sale, and Mitsubishi is reportedly following Ford's footsteps, although it hasn't officially said anything.
And a bonus bit of news on this front:
News: Samsung Just Showed a 600-Mile Solid-State EV Battery, Charges in 9 Minutes Rideapart
4. Chart of the day: This is the (lack of) ambition.
Officials dial down capex funding requests
5. Quote of the day
Surprise. Surprise. Duopolists don’t give up power easily or quickly.
“The Commission is starting the review less than a year after the Code came into effect as there are concerns that systemic issues are not being addressed and suppliers may not be benefiting from the full protections of the Code due to built in carve out provisions.” Grocery Commissioner Pierre van Heerden announcing a review of the new Grocery Supply Code less than a year after it was enacted and well before the two-year deadline for a review.
6. Climate chart of the day
Phew? Not really. The jury is still out, says Zeke Hausfather
I take my cues on these issues from Zeke Hausfather, who writes for CarbonBrief and has an excellent substack called The Climate Brink. Here’s his latest on whether the amazing temperatures are something unnerving.
Earlier this year NASA’s Gavin Schmidt and I separately wrote that the evolution of global temperatures in 2024 would be important to tell us if the “gobsmacking” conditions we saw in the latter half of 2023 represented a new persistent condition for the climate or more of a temporary phenomenon.
Gavin suggested that we would have a better sense by August if conditions were stabilizing or the climate was heading into “uncharted territory”.
With August almost upon us we remain in something of a liminal space. Both June and July were notably warmer than I expected earlier in the year (coming in 0.4C and 0.3C respectively above the last big El Nino year of 2016). At the same time, we have moved out of record territory, and we still expect some additional cooling influence from fading El Nino conditions and potential La Nina development.
So I think we will still have to wait and see, though if the spike in temperatures over the past few weeks persists to push August 2024 to set a new record it would be a worrying sign. Zeke Hausfather via The Climate Brink.
The best of the rest
News and opinion elsewhere on August 2
Here’s my Pick ‘n’ Mix of the top six news, analysis, deep-dive and opinion links elsewhere as of 8:00 am on Friday, August 2:
Analysis: Show me the money: an apology is fine, but will there be compensation for abuse victims? The Post-$$$’s Steve Kilgallon
Analysis: No, Māori aren't taking over NZ's beaches. The foreshore and seabed debate is back in the public discourse - and so are the misconceptions that Māori want to block access to beaches. 1News’ Te Aniwa Hurihanganui
News: Christchurch City Council gives up on missing $78m for public transport. The Press-$$$’s Keiller MacDuff
News: Family mulls moving to double accommodation supplement RNZ
News: Health NZ drops tool that factored in ethnicity for waitlists, despite review findings RNZ
News: Banks relax borrowing test rates RNZ
The Kākā’s Journal of Record for August 2
Here’s the top six announcements, reports, news conferences, statistics & surveys in the last day to 8:00 am on Friday August 2:
Poverty: Arotuki Tamariki the Independent Children's Monitor's report details how multiple government agencies failed to protect 5-year-old Malachi Subecz before he was murdered by his carer. It also finds that government agencies haven't implemented recommendations made eighteen months ago in order to protect similarly at-risk children. News: RNZ, 1News
Health: A PwC report commissioned by Universities of Otago and Auckland finds that their medical schools have the capacity to train around 300 more doctors a year with extra government funding. Budget 2024 confirmed 25 funded medical places for 2025. News: RNZ, 1News
Education: A Ministry of Education consultation document proposed grouping financially weaker polytechnics into a federation receiving educational programmes and ‘back-office support’ from the Open Polytechnic. Polytechs with a ‘clear pathway to financial sustainability’ would remain autonomous entities. News: RNZ
Infrastructure: Transpower's report on the collapse of a Northland power pylon found it was caused by a poorly trained and supervised worker removing nuts from three of the four pylon's legs. Evidence also suggests Omexom workers failed more than once to follow the standard procedure of removing nuts from only one pylon leg at a time. News: RNZ, Stuff
Treaty: Ngāti Whātua filed High Court proceedings challenging the Government's plans to tighten the criteria for applications for customary title over marine areas. Ngāti Whātua says that their claims for customary marine title in the Whangārei Harbour and Whangārei Coast would be overturned under the amendments to the Marine and Coastal Area Act. News: Stuff
People moves: Treasury chief executive Caralee McLiesh has been appointed Australia's Auditor-General. Finance Minister Nicola Willis had a lot of input into advertisement for the vacancy published yesterday. News: NZ Herald
And finally, some fun things
Cartoon of the day: Know the feeling
Timeline-cleansing nature pic
‘Hey! I bought the stick back for you! I’m amazing!’
Mā te wa
Bernard
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