Treasury sees higher bond debt in PREFU, but misses reporting growing climate, health, productivity & housing debt due to public investment drought in tandem with 2% population growth for 20 years
What's even more worrying about that immigration chart is the unshown mix in the comings and goings.
I'm onboard with immigration designed for social and economic diversity and resilience, but I can't help feeling our long-term strategy is instead to import thousands of aged-carers (under the euphemism "economic migrants") to look after our 'landed gentry'; with Australia as the escape valve for our skilled and ambitious young renter class.
Not just 'landed gentry'. All old people. And all very disabled people being supported to be as independent as possible. Without all those immigrants we could only have neglect. We don't see the caring because it is all indoors but it's a serious issue
We've known for decades that this was where demographics were heading
Add to the list after carers, ladies from various Asian countries carefully painting shiny plastic onto the nails of Kiwi women in nail salons in every mall.
That might be the very best last line you’ve written, Mr. Hickey. Don’t hang back!
We laugh at the faux democracy and the perversities and weirdness of politics in the US and fail to understand that politics in NZ is also very irrational and the punters are victimised by politicians attempting to gain power or hold on to it.
Great charts with explanations, thank you. I wonder if Luxon/Willis will keep to the 30/30 ‘rule’ and when their tax plans come unstuck, will they start cutting benefits? I notice this morning on RNZ, Luxon said they would keep spending on frontline services and cut back office spending. Most govt departments can’t cope now with what is asked of them. So where will those cuts stop?
I can't wait until the oncologists are manning their own reception desks; teachers are making phone calls about absentees and photocopier toner; police are checking the tire pressure on their cars... Then we'll have a super-efficient public service I'm sure!
Maybe when the politicians start having to book their own flights and reply to their own OIA requests, they'll realise what the 'back office' was for?
And what about parliament itself. Cut the size of parliament by 10% and think of all those party staffers that could be repurposed as ... what are they good for anyway?
I know! They could sub-let whole Beehive floors to Migration Brokerage and Private Equity firms... What's the square-metre lease rates in downtown Wellington now? That could cover the cost of tax cuts!! That's some powerful market economics! 🤣
We now have an even better reason to vote for those parties, the Greens or Te Pāti Māori that will increase the size of Government to take care of growing climate, health, productivity & housing debt. We have no reason we have to remain near the bottom of the OECD in spending, taxing, and debt...with logically, poor outputs.
Top at 1% will be a spoiler at best. The Greens would join Luxon on a cold day in hell. Luxon is de facto climate denier with a thin green veneer for votes (cutting the rebates on electric and hybrids, dumping the ‘Ute Tax’ cutting, ignoring the ETS on our largest polluters, cutting funding on climate change initatives... while pledging to install a few extra charging posts). Economically he is a stanch neoliberal bent on lower spending and lower taxes while sticking to the working people in already one of the lower spending and taxing nations in the developed world. Then giving tax givebacks in the billions to housing speculators via cutting the bright line and deductions on rentals see https://thekaka.substack.com/p/repeat-the-hoon-around-the-week-to#details . Tell me again. Why would TOP support them?
Hi Brit! I don't think TOP would 'support' them at all. Perhaps I did not present what I understood Raf Manji to be saying at his TOP Auckland meeting well enough. What I took from it was that TOP will genuinely engage in policy discussions with everyone in parliament to promote progressive policies and argue for change that benefits all NZers.
TOP would fare much better if all prgressives actually voted for them.
I wish TOP the best. I like TOP. But at this point it papears that they will simply be a waste of center left votes. Hopefully we are wrong as we get closer to the election. But 4% addtional points for a minot party now at 1% is a very steep hill to climb.
In MMP it is not a wasted vote. It's like the empty restaurant: no one will step inside because no one is there. But if there are already a couple of full tables, people are more inclined to eat there. I'm doing what I can to encourage more people to seriously consider TOP. If you like them and wish them well, vote for them Brit. And tell everyone you know that you are doing so, for the sake of real progressive change!
In MMP, below the 5% threshold, it is a wasted vote at this point unless you all can pick up Ilam, which is possible, but increasingly unlikely. Otherwise, those votes will not accomplish anything except assisting in putting in a right-wing government. I wish that wasn’t true, but it is simple numbers. so if the left block loses by 2% and TOP gains 4% but not Ilam, all of us lose assuming that the majority of TOP in fact lean center left.
Surely all parties should insist that Treasury include expected future costs based on projected population growth etc. I mean I know that you've commented that there assumed population growth is well short fo the current reality, but even that is probably driving some fairly serious future costs associated with health, housing education etc.
Also - shouldn't they include expected costs that we may incur as per various climate agreements regarding our emissions?
Because nothing got done, will the incoming government in 2029 find, to meet 2030 commitments, it has to add $2.00 per litre to petrol and order half the dairy numbers to be culled.
So many people see a by date as being a when we'll get started doing something date, because in so many instances the by date gets pushed out or just removed because a new government decides it doesn't have to be done.
Hi Bernard thanks very much for this summary.. I note that Luke Malpass in his article via Stuff https://www.thepost.co.nz/a/politics/350071555/prefu-election-and-new-zealands-troubled-waters-ahead?utm_id=mh_stuff states "By 2024, debt servicing costs will gobble up $9b on the annual Budget and rising to $11b" - is that the case? I looked at your summary but couldn't see figures on debt servicing costs. Apologies if I've missed the debt servicing cost figures.
And what parties are these debt servicing costs owed to - is it the government paying debt servicing costs to the Reserve Bank i.e. to itself, or is it debt servicing costs to the private sector? Do debt servicing costs include capital charges on government departments? The numbers themselves do not look like a large portion of the total public spend.
Hi Bernard, this is excellent. I'm simply an ordinary gal who struggles to make sense of the economy and all who sail in her but since I caught up with you at Newsroom I have found your columns clear and succinct. This podcast about the prefu has really been helpful and I just wish more "undecideds" would listen to it.
Bernard - I feel that this note has slipped over the line from analysis to activism. IMO the PREFU definitely did not "expose the Opposition’s claims about the Government being ‘addicted to spending’". I am yet to hear a good explanation for why core crown spending went from $74b in 2017 to $128b this year (per PREFU). That is a 73% increase and spending this year is *higher* than during COVID. Some commentators have tried to suggest this number is much lower on a real per capita basis, but why should government spending increase in perfect correlation with inflation or population? Wage inflation has lagged consumer prices, and we don't need more policy analysts when more people enter the country. Also, isn't adjusting government spending for inflation a bit circular when one of the drivers of inflation is....the government spending? This would all be OK if we were getting better services but I see little evidence of that and there are numerous anecdotes of very low quality spending (bike bridge consultancy, Te Pukenga centralisation, etc). I am genuinely curious about this, but don't have the time to do the serious analysis needed to assess it. Blaming it on the floods is insufficient. The increase in spending has been so large, that it demands a line-by-line reconciliation of what has driven the additional spending and what the rationale for that spending is. I don't need or want a tax cut, but I sure would like the taxes I pay to be well spent.
From the Ahr Valley in Germany. (Yes we have offset our emissions.) 2 years on from massive floods similar to Esk valley but 188 deaths here. Massive rebuild has years to go yet and government is “governing “unlike in NZ. Cannot build or rebuild in many areas. Cannot put fossil fuel heating etc in new houses. Why are the Bald Headed Boardroom Bandit and the Little Man in Short Pants unable to get it.? NZ barrels towards climate armageddon because the economy and capitalism “Trumps” all. ( bad pun).The back pocket takes precedence over their children's children. Nice Autumn weather of 35C daily. No such thing as climate change!!!!
Please make this fully public, it is too important not to be.
What's even more worrying about that immigration chart is the unshown mix in the comings and goings.
I'm onboard with immigration designed for social and economic diversity and resilience, but I can't help feeling our long-term strategy is instead to import thousands of aged-carers (under the euphemism "economic migrants") to look after our 'landed gentry'; with Australia as the escape valve for our skilled and ambitious young renter class.
Not just 'landed gentry'. All old people. And all very disabled people being supported to be as independent as possible. Without all those immigrants we could only have neglect. We don't see the caring because it is all indoors but it's a serious issue
We've known for decades that this was where demographics were heading
And Bernard, thanks heaps for all that work.
Add to the list after carers, ladies from various Asian countries carefully painting shiny plastic onto the nails of Kiwi women in nail salons in every mall.
Excellent - needs to be 'out there', so please consider sharing.
Sociopathic. Someone needed to be brave enough to say it. And yes, please make it public – just in case some humane eyes and ears are open out there.
That might be the very best last line you’ve written, Mr. Hickey. Don’t hang back!
We laugh at the faux democracy and the perversities and weirdness of politics in the US and fail to understand that politics in NZ is also very irrational and the punters are victimised by politicians attempting to gain power or hold on to it.
Great charts with explanations, thank you. I wonder if Luxon/Willis will keep to the 30/30 ‘rule’ and when their tax plans come unstuck, will they start cutting benefits? I notice this morning on RNZ, Luxon said they would keep spending on frontline services and cut back office spending. Most govt departments can’t cope now with what is asked of them. So where will those cuts stop?
I can't wait until the oncologists are manning their own reception desks; teachers are making phone calls about absentees and photocopier toner; police are checking the tire pressure on their cars... Then we'll have a super-efficient public service I'm sure!
Maybe when the politicians start having to book their own flights and reply to their own OIA requests, they'll realise what the 'back office' was for?
Hi Tim
And what about parliament itself. Cut the size of parliament by 10% and think of all those party staffers that could be repurposed as ... what are they good for anyway?
I know! They could sub-let whole Beehive floors to Migration Brokerage and Private Equity firms... What's the square-metre lease rates in downtown Wellington now? That could cover the cost of tax cuts!! That's some powerful market economics! 🤣
We now have an even better reason to vote for those parties, the Greens or Te Pāti Māori that will increase the size of Government to take care of growing climate, health, productivity & housing debt. We have no reason we have to remain near the bottom of the OECD in spending, taxing, and debt...with logically, poor outputs.
And don't forget TOP, who unlike the Greens, are prepared to work with everyone.
Top at 1% will be a spoiler at best. The Greens would join Luxon on a cold day in hell. Luxon is de facto climate denier with a thin green veneer for votes (cutting the rebates on electric and hybrids, dumping the ‘Ute Tax’ cutting, ignoring the ETS on our largest polluters, cutting funding on climate change initatives... while pledging to install a few extra charging posts). Economically he is a stanch neoliberal bent on lower spending and lower taxes while sticking to the working people in already one of the lower spending and taxing nations in the developed world. Then giving tax givebacks in the billions to housing speculators via cutting the bright line and deductions on rentals see https://thekaka.substack.com/p/repeat-the-hoon-around-the-week-to#details . Tell me again. Why would TOP support them?
Hi Brit! I don't think TOP would 'support' them at all. Perhaps I did not present what I understood Raf Manji to be saying at his TOP Auckland meeting well enough. What I took from it was that TOP will genuinely engage in policy discussions with everyone in parliament to promote progressive policies and argue for change that benefits all NZers.
TOP would fare much better if all prgressives actually voted for them.
I wish TOP the best. I like TOP. But at this point it papears that they will simply be a waste of center left votes. Hopefully we are wrong as we get closer to the election. But 4% addtional points for a minot party now at 1% is a very steep hill to climb.
In MMP it is not a wasted vote. It's like the empty restaurant: no one will step inside because no one is there. But if there are already a couple of full tables, people are more inclined to eat there. I'm doing what I can to encourage more people to seriously consider TOP. If you like them and wish them well, vote for them Brit. And tell everyone you know that you are doing so, for the sake of real progressive change!
In MMP, below the 5% threshold, it is a wasted vote at this point unless you all can pick up Ilam, which is possible, but increasingly unlikely. Otherwise, those votes will not accomplish anything except assisting in putting in a right-wing government. I wish that wasn’t true, but it is simple numbers. so if the left block loses by 2% and TOP gains 4% but not Ilam, all of us lose assuming that the majority of TOP in fact lean center left.
Surely all parties should insist that Treasury include expected future costs based on projected population growth etc. I mean I know that you've commented that there assumed population growth is well short fo the current reality, but even that is probably driving some fairly serious future costs associated with health, housing education etc.
Also - shouldn't they include expected costs that we may incur as per various climate agreements regarding our emissions?
Because nothing got done, will the incoming government in 2029 find, to meet 2030 commitments, it has to add $2.00 per litre to petrol and order half the dairy numbers to be culled.
So many people see a by date as being a when we'll get started doing something date, because in so many instances the by date gets pushed out or just removed because a new government decides it doesn't have to be done.
Hi Bernard thanks very much for this summary.. I note that Luke Malpass in his article via Stuff https://www.thepost.co.nz/a/politics/350071555/prefu-election-and-new-zealands-troubled-waters-ahead?utm_id=mh_stuff states "By 2024, debt servicing costs will gobble up $9b on the annual Budget and rising to $11b" - is that the case? I looked at your summary but couldn't see figures on debt servicing costs. Apologies if I've missed the debt servicing cost figures.
And what parties are these debt servicing costs owed to - is it the government paying debt servicing costs to the Reserve Bank i.e. to itself, or is it debt servicing costs to the private sector? Do debt servicing costs include capital charges on government departments? The numbers themselves do not look like a large portion of the total public spend.
Hi Bernard, this is excellent. I'm simply an ordinary gal who struggles to make sense of the economy and all who sail in her but since I caught up with you at Newsroom I have found your columns clear and succinct. This podcast about the prefu has really been helpful and I just wish more "undecideds" would listen to it.
Bernard - I feel that this note has slipped over the line from analysis to activism. IMO the PREFU definitely did not "expose the Opposition’s claims about the Government being ‘addicted to spending’". I am yet to hear a good explanation for why core crown spending went from $74b in 2017 to $128b this year (per PREFU). That is a 73% increase and spending this year is *higher* than during COVID. Some commentators have tried to suggest this number is much lower on a real per capita basis, but why should government spending increase in perfect correlation with inflation or population? Wage inflation has lagged consumer prices, and we don't need more policy analysts when more people enter the country. Also, isn't adjusting government spending for inflation a bit circular when one of the drivers of inflation is....the government spending? This would all be OK if we were getting better services but I see little evidence of that and there are numerous anecdotes of very low quality spending (bike bridge consultancy, Te Pukenga centralisation, etc). I am genuinely curious about this, but don't have the time to do the serious analysis needed to assess it. Blaming it on the floods is insufficient. The increase in spending has been so large, that it demands a line-by-line reconciliation of what has driven the additional spending and what the rationale for that spending is. I don't need or want a tax cut, but I sure would like the taxes I pay to be well spent.
Were you away on another planet when the Earthquakes, Pandemic and climate disasters struck?
So chillingly well put BH. I wonder, however, if we [humans] haven't always left it to the next generation to fix the mess the previous ones made
Please release Bernard,
From the Ahr Valley in Germany. (Yes we have offset our emissions.) 2 years on from massive floods similar to Esk valley but 188 deaths here. Massive rebuild has years to go yet and government is “governing “unlike in NZ. Cannot build or rebuild in many areas. Cannot put fossil fuel heating etc in new houses. Why are the Bald Headed Boardroom Bandit and the Little Man in Short Pants unable to get it.? NZ barrels towards climate armageddon because the economy and capitalism “Trumps” all. ( bad pun).The back pocket takes precedence over their children's children. Nice Autumn weather of 35C daily. No such thing as climate change!!!!
Patrick Medlicott
Treasury are not the entity you should be looking to for reporting on anything other than government finances.
Even without the PDFs this was an excellent and clear listen. Thanks. (Make it public)