Mixed Mood of the Boardroom but “too many committees”

Not surprisingly there are mixed responses on NZ Herald’s annual ‘Mood of the Boardroom’ survey. a majority thing that the Government  has worked to their expectations (that is not necessarily positive), and NZ First have been a moderating influence on union moves.

  • 59% said the Coalition had worked to their expectations
  • 23% said worse than expected
  • 15% said better than expected

The significance of that depends on what expectations where.

NZH Mood of the Boardroom: 150 CEOs deliver their verdict on the Government

Unsurprisingly, the survey of 150 chief executives confirmed business confidence one year into the Coalition Government is wobbly, and in some policy areas, struggling to stay on its feet, but there were contradictions aplenty in their responses.

While some expected the influence of NZ First and Winston Peters to be problematic, others saw NZ First as a potentially moderating influence when it came to acknowledging the harmful impact on business confidence from union-led law reforms.

It is like that a Labour-Green only government would have been much more compliant to union demands.

But generally, CEOs were united in citing the Coalition’s lack of experience, “too many committees and not enough action” and unclear agenda.

A challenge for Ardern is to be much clearer on specifics of her Government’s agenda rather than making grand but vague proclamations.

The survey confirmed one overarching contradiction: the economy is showing the highest level of quarterly growth seen in the past two years but business confidence is sinking.

The chief concern of CEOs was uncertainty – “general uncertainty about the impact and direction of current Government policies”.

The rest of the top five ranking factors also pointed to uncertainty: skills and labour shortages, regulation, employment law changes and transport infrastructure.

The uncertainty is fixable, but it could take some time for all the working groups and inquiries and committees to report back, and more time still for the Government to then decide what to do in response. This may take some negotiating between Labour, NZ First and the Greens.

For CEOs the single biggest factor that would assist their business remain internationally competitive from New Zealand, at 23.5 per cent, was Government/council policy.

Skills and talent was next at 22.6 per cent and specific Government/council policy third at 14.8 per cent.

That said, the Coalition’s “oil and gas ban” provoked a strong response from chief executives, with some 77 per cent of respondents agreeing the Government should have waited until the Productivity Commission set its path to a low emissions future and taken that advice on board first.

The Government rushed some decisions to give the appearance they were on the ball, and have since had to adjust their approach.

Recognised was the Coalition’s “pragmatic” response to international trade, where it had surprised by devising an early fix and signing up to the new CPTPP.

That was a good surprise for business interests, and complained about bitterly by trade and globalisation opponents on the far left.

If the Government learns from it’s mistakes and gets their act together in making decisions and progress then the boardrooms and business sector may improve their outlook, but the longer key decisions take the more chance that festering uncertainty can become a real problem for the economy.

 

 

Stuff repeats Herald mistake on foreign buyers

Yesterday NZ Herald:  It’s not 3% – ASB analysis suggests up to a fifth of properties sold to non-residents

Analysis from ASB has found that Statistics New Zealand’s estimate that non-citizens accounted for only 3 per cent of house purchases is well short.

Economists from the bank say the figure more likely sits between 11 and 21 per cent.

Examining transfers or purchases of New Zealand property, Mark Smith and Nick Tuffley analysed the information and reached different conclusions to those released by Statistics NZ.

“The estimates suggest that non-resident purchases made up around 3 per cent of nationwide house purchases over the March 2018 year. This was in a similar ballpark to previously published figures. However, anywhere from 11 per cent to 21 per cent of reported purchases over that period involved a non-NZ citizen, with the proportion considerably higher for some areas, particularly Auckland and Queenstown,” they wrote in their latest Economic Note.

This was criticised on Twitter:

Going deeper into the economic note, there is a strong sense that the reason non-residents and non-citizens are getting mixed up is because the authors of this report believe that citizens have more of a right to own property than non-citizens, even those who are resident here.

Hey , resident non-citizens who buy houses so they can live somewhere are not the same as the “overseas investors” that you’re worried about. Conflating them is not just misleading, but kinda dangerous eh?

ASB did the analysis, published an economic note/report, and then gave it to all the media agencies, who are basically just quoting what it says in the report. So pretty sure the fault lies with ASB’s economists.

ASB conflated them. The distinction matters because there are people who live in this country who are non-citizens, but they are definitely residents and shouldn’t be lumped into “foreign investor”

I know someone who was a permanent resident for over thirty years, part owning four houses, before becoming a citizen.

The Herald have since changed the headline to “sold to non-citizens”.

But today Stuff make the same mistake, if not worse: As many as one in five house buyers in NZ may be foreign

Restrictions on foreigners buying New Zealand property will depress prices, one economist says – and the effect may be greater than some have predicted.

The Overseas Investment Amendment Bill is working its way to becoming law.

But while official statistics and anecdotal evidence from the real estate industry indicate only 3 per cent of sales are to overseas buyers, ASB senior economist Mark Smith at ASB said that number might be deceptively low.

He said another 8 per cent of sales were attributable to resident visa-holders who were not citizens, such as people who had newly migrated.

And such as people who migrated years ago, and decades ago.

Another 10 per cent were corporate entities, for which ownership information is not available.

If there is no information then no assumptions can be made about nationality.

He said anything from 11 per cent to 21 per cent of purchases in the March 2018 involved a non-New Zealand citizen.

Actually that should be “anything from 3 per cent to 21 per cent of purchases in the March 2018 involved a non-New Zealand citizen”.

But it is unlikely to be anywhere near 21%. And permanent residents are likely to be a significant portion of 3-11%.

This is poor analysis from the ASB and very poor reporting from the Herald and Stuff.

 

Homelessness “is much worse than previously thought”

NZH seems to have got a report that is to be released this morning in advance – Homeless crisis: 80% to 90% of homeless people turned away from emergency housing

New Zealand’s homelessness crisis is much worse than previously thought, as a new report identifies a hidden homeless population that is not officially monitored by government agencies.

More than 80 per cent of all homeless people turning up to community emergency housing providers in the last year were turned away because the system is bursting at the seams, according to an independent housing stocktake to be released today.

And the number of recorded homeless people without a safe and secure place to live is expected to rise significantly, as more struggling people are told that help is available and come out of the shadows.

The report, authored by economist Shamubeel Eaqub​, University of Otago Professor of Public Health Philippa Howden-Chapman and the Salvation Army’s Alan Johnson, will be released this morning by Housing Minister Phil Twyford.

The report is understood to bring together figures across a number of areas including homelessness, the rental market, housing affordability – including the rising costs relative to wage increases – and housing supply nationwide, with a specific focus on Auckland.

One of the report’s main focuses will be to highlight a hidden homeless population that is not officially monitored or recorded.

However, community emergency housing providers report they are at full capacity, and their data from last year indicate that for every 10 homeless people that approach them, eight to nine are turned away.​

The report will refer to a burgeoning “floating population” – people without safe and secure housing, including in temporary housing, sharing with another household, or living in uninhabitable places.

The report is understood to say that greater awareness of the issue, along with more information campaigns about where to get help, is expected to lead to reported homelessness getting worse.

The report is intended as analysis of the housing issue, and is not expected to make any recommendations for action.

Odd that the Herald keeps referring to “The report is understood to…” when they obviously either have a copy of the report (have they broken an embargo?) or have been provided with details.

The Government describes it as an independent stocktake of the housing crisis to help focus its work. But National’s housing spokesman Michael Woodhouse has call it a “smoke and mirrors” exercise to find the numbers to fit the Government’s narrative, when the housing market is “flat to falling”.

Politics aside, there is obviously a problem with homelessness and difficulties in finding suitable housing for many people.

Context box: Homelessness crisis

  • 8 to 9 out of every 10 homeless people turned away from emergency housing providers
  • Hidden homeless population with no official monitoring or recording
  • 1 in 100 live in severe housing deprivation in 2013 census, up from 1 in 120 in 2006 and 1 in 130 in 2001
  • Auckland Council says 23,409 in severe housing deprivation last year, up 3000 from the 2013 census
  • 7725 on state house waiting list, up 5 per cent from Sept quarter
  • MBIE figures show a nationwide shortfall of 71,000 houses; 45,000 in Auckland

Regardless of a report trying to detail and quantify the extent of the problems, the key is what the current Government can do to alleviate both homelessness and the wider housing shortage.

New Zealander of the Year

It’s getting close to that time of year when ‘best of the year’ claims on a range of things are announced. NZ Herald is getting votes for their New Zealander of the Year: People’s Choice Award

They don’t say how they have selected their list to choose from. Here they are:

Bronia Tindall & Fabrizio Clementi

They gave a homeless man a slice of their wedding cake.

Nathan Spitzer

“The builder, a contractor on farms in the Waikato, become the toast of Ngaruawahia when he jumped into the fast-moving Waikato River in November to rescue an 8-year-old girl who was near-hypothermic and clinging for her life to a pier.”

Lance O’Sullivan

“…admiration and respect for the Kaitaia GP was renewed when he stormed the stage at a local screening of an anti-vaccination documentary.

“Already, O’Sullivan’s impact on local public health has been immeasurable, including setting up a low-cost health clinic at Kaitaia Hospital and the MaiHealth programme, which offers a remote consultation to people without ready access to primary healthcare.

“He has also been instrumental in establishing programmes aimed at improving child health, including the Manawa Ora Korokoro Ora (Moko) foundation and the Kainga Ora (Well Home) initiative.”

He was named New Zealander of the Year in 2014.

Marnie Prickett

“Prickett, 33, a former staffer at Auckland Council programme Wai Care, and fellow advocates launched a charitable trust that became Choose Clean Water, which has proven a powerful and influential voice for our waterways.

“She and others travelled across the country, hearing from people who had watched their cherished rivers turn dry or green, before presenting a 10,000-strong petition to Parliament demanding tougher laws to make all waterways swimmable.”

Sarah Thomson

“…she decided to become the first person in our history to take the Government to the High Court — a bid that ultimately failed legally, yet succeeded in capturing the country’s attention.

“Among other points, Thomson alleged the Government had failed to review its climate targets, and that those New Zealand had pledged — slashing domestic greenhouse gas emissions by 11 per cent below 1990 levels and 30 per cent below 2005 levels by 2030 — were “unreasonable and irrational” against the seriousness of the issue.”

Andrew Nicolson

“Comeback hero Andrew Nicholson showed supreme courage when he won the prestigious Badminton Horse Trials in May.”

Steve Askin

“Decorated ex-SAS soldier and helicopter pilot Steve Askin died when his Squirrel chopper crashed while fighting the devastating Port Hills wildfire above Christchurch in February.

“In 2014, he received the NZ Gallantry Star for his efforts fighting in Afghanistan.

“While stories of his courage and selfless derring-do in fighting the Taliban — he was wounded in a five-hour shootout on June 29, 2011 after the Taliban stormed the InterContinental Hotel in Kabul — were shared, mum Leslie spoke about true heroes making a difference in people’s lives.”

Sarah Cato

“Detective Sarah Cato is battling incurable cancer — but that hasn’t stopped her battling major crimes. And it hasn’t stopped her raising money for other cancer sufferers.

“She was heavily involved in Operation Nepal — the brutal sexual assault and murder of 69-year-old Cunxiu Tian in her family home in Te Atatu in January last year.

“Cato is also instrumental in the ongoing investigation into the abduction and sexual
assault of an 11-year-old boy in Ranui.”

The people of Kaikoura and Waiau

“Many locals would say the last 12 months have been the toughest of their lives. And the only way they’ve got through it, is by standing together as a community. Looking after each other.”

They are all people who deserve some recognition, to varying degrees.

There’s another on the list who deserves a special mention.

Andrew Little

“On his first day as Minister of Justice Andrew Little said he would look again at the compensation given to Teina Pora for his wrongful conviction and 20 year imprisonment. Within a fortnight he had done just that and signed off on an inflation adjustment for Pora’s compensation — adding almost $1 million to bring it to a total of $3.5m.”

“Just three months earlier, Little had acted on another ‘right thing to do’ by stepping down as Labour leader. Little’s was not the easiest decision to make and may well have been made for him had he not handed over the job himself to Jacinda Ardern. But his decision, and endorsement of Ardern, made it a smooth handover — and gave Labour a chance at the election.”

I agree with the decision to properly compensate Teina Pora.But one act by a politician deserves a major award?

I agree that Little’s capitulation as Labour leader substantially changed the election campaign, but I’m not sure he deserves a lot of credit for that, some but not a lot. One could claim that Metiria Turei had more influence on the election campaign and outcome than anyone.

And the merits of the Government that Little’s stepping down helped enable are far from clear yet. As are his plans as a Minister.

I think it’s fair for Little to be considered as politician of the year, albeit with question marks over his standing compared to all other politicians – notably his successor, Jacinda Ardern.

But one politician as overall ‘people’s choice’? Seems an odd choice to be on the list.

You can vote here.

 

 

‘Recession likely’, or not

Different views on the likelihood of a recession.

Forbes: New Zealand, An Economic Success Story, Loses Its Way

On September 23, the people of New Zealand elected 37-year-old Jacinda Ardern as prime minister, the youngest prime minister in New Zealand’s history. Ardern has brought youthful energy to New Zealand politics, but her scary rhetoric during the campaign (like calling capitalism a “blatant failure”) has some people wondering if she will take the country back to the bad old days of the 70s and early 80s.

One of Ardern’s first acts as prime minister was to ban foreign ownership of residential real estate; New Zealand has, by anyone’s measure, one of the biggest housing bubbles in the world. Banning foreign ownership of property sets the country up for a possible real estate crash.

Ardern also opposes high levels of immigration, along with her coalition partner, Winston Peters. It is set to drop dramatically. Immigration, especially skilled immigration, has been a big contributor to economic growth over the years.

It seems likely that New Zealand will experience a recession during Ardern’s term. Nobody is predicting a return to the bad old days of the 70s, but New Zealand will probably lose its status as one of the most open, free economies in the world. It takes decades to weaken an economy, just like it takes decades to strengthen it. But investors will probably want to avoid New Zealand for the time being.

Jared Dillian is the author of All the Evil of This World, and the editor of the 10th Man newsletter for Mauldin Economics.

Liam Dann (NZH): What Recession? Local economists pick good growth

The verdicts are in and despite what Forbes contributor Jared Dillian says, there are no economists picking a recession for Jacinda Ardern’s Government.

Most of New Zealand and Australia’s major economics teams have now reassessed their economic forecasts to factor in the effect of the new Government.

The loose consensus – bearing in mind no two economists ever agree – seems to be that GDP growth is going to be less flash than previously expected next year.

But it’s not crashing through the floor either. Growth forecasts between 2.4 per cent and 3.2 per cent for 2018 still look pretty good by international standards.

Apart from a few random think pieces though – written by offshore commentators who can’t quite believe New Zealand changed Government with the accounts in such good shape – most of the economic and financial community still seems pretty relaxed about the new regime.

It’s very early days to see what the Government will do, and what the economy will do.

And as far as the economy is concerned, it is most at risk from overseas influences.

Farce news, when comedy becomes the headline

There are enough problems with passing comments on social media becoming ‘news’ stories, but now ‘claims’ by a comedian have hit the headlines.

Click bait headline at NZH: Did Trump mistake Jacinda for Justin Trudeau’s wife?

The question that no one seems to have asked apart from the Herald’s headline writer is answered in the article.

The article leads:

When US President Donald Trump first met Jacinda Ardern at Apec in Vietnam last week, he thought she was the wife of Canadian Prime Minister Justin Trudeau, according to comedian Tom Sainsbury.

Sainsbury, who is well known for his impersonation of National MPs on Snapchat, made the claim on Radio Live this afternoon.

How well known? I haven’t heard of him before.

He said he was chatting with Ardern while they were backstage at the Vodafone NZ Music Awards on Thursday night.

“I don’t know if I should be saying this, but she said that Donald Trump was confused for a good amount of time thinking that she was Justin Trudeau’s wife.”

Sainsbury said Trump eventually realised who Ardern was, and that Ardern had also said that Trump was “not as orange in real life”.

Comedians could have a lot of fun if media make a habit of turning their jokes into news.

In a statement, Ardern said: “Someone thought the President had confused us, but in all of the conversations we had it was clear to me he hadn’t, and recalled the conversation we had late last month.”

Ardern said she exchanged pleasantries with the US president and shook his hand, but did not have a substantive conversation.

That has been widely reported, including, I presume, by the Herald, so suggesting via a headline that a comedian joking is news is not a joke, it’s seriously suspect. I didn’t see if they ran it as breaking news or not.

Toby Manhire also pushed the comedian story at The Spinoff: ‘You’ve done well for yourself’: Did Trump mistake Jacinda Ardern for Trudeau’s wife?

This could be called farce news.

I wonder if Justin Trudeau’s wife has a name – but I guess an investigative jouranlist would be required to find that out.

Balanced politics, and unbalanced Stuff

On the eve of the election Stuff has a very unbalanced political page, favouring Winston Peters, Labour and Greens.

StuffElectionEve2017

https://www.stuff.co.nz/national/politics

And that is negative for National and TOP.

The Herald is more general and more balanced:

NZHElectionEve2017

http://www.nzherald.co.nz/politics/news/headlines.cfm?c_id=280

Very balanced at RNZ:

RNZElectionEve2017

Very good to see information for voters prominent at Newshub:

NewshubElectionEve2017

http://www.newshub.co.nz/home/election.html

The two large parties dominate at 1 News:

1NewsElectionEve2017

https://www.tvnz.co.nz/one-news/election

The Spinoff features the last pre-election poll from Newshub (asimilar result to Colmar Brunton) plus general election information.

TheSpinoffElectionEve2017

https://thespinoff.co.nz/category/politics/

Newsroom focuses on Maori (not positively), Labour and the Greens.

Overall today’s election coverage looks very balanced, apart from Stuff in particular and also Newsroom.

 

Former coroner calls to Break The Silence on suicide

The next article in a series at NZ Herald on suicide:  Let’s Talk: Former chief coroner Neil MacLean joins call to Break The Silence on suicide

Warning: This article is about youth suicide and may be distressing for some readers.

Former chief coroner Neil MacLean says breaking the silence on suicide could curb the “horrifying” number of young New Zealanders killing themselves.

“This is a drum I’ve been beating for a long time. We cannot ignore the sheer numbers and rate – it’s bigger than the road toll,” said MacLean, who retired from the post in 2015.

New Zealand has the worst teen suicide rate (officially those aged 15-19) in the world and the second worst youth suicide rate (25 and under). Our annual number of deaths has shown no signs of abating in the past 20 years.

In a special series called Break the Silence, the New Zealand Herald is aiming to bring youth suicide out of the shadows. MacLean has been one of the country’s biggest crusaders in this area and said suicide was one of the most difficult issues he faced during his almost 40 years as a coroner.

“Any unexpected death is going to produce a different type of grief, but with a suicide, particularly as it gets younger, there’s a new intensity of grief,” he said. The youngest suicide MacLean was aware of in New Zealand was that of an 8-year-old boy.

“There’s a feeling of waste, blame and anger. Everybody struggles to understand why it is when, generally the will to live is so strong, that a significant proportion of people get to the end where there is no option.”

Misunderstanding breeds fear. “It’s almost as if there’s a fear suicide is something you can catch, almost like an infection, and that if you stomp it out or ignore it, it will go away.

Some think it’s best to bury our head in the sand. Not me,” MacLean told the Herald.

During his time as chief coroner, MacLean controversially kickstarted the release of New Zealand’s annual provisional suicide statistics, allowing the public to see the number of suspected suicides for the first time.

Silence on suicide has been orthodox in New Zealand since the mid-1990s, largely because of a school of thought that talking about the issue could lead to suicidal ideation, copycat deaths or suicide contagion.

MacLean received swift criticism for releasing the statistics at the time, but stands by his decision.

“If people know what’s going on there is a better chance to do something about it. Like start talking about what we can do to help these kids.”

“The reality is, that although there are various theories of sociologists, psychologists and other disciplines, we are no closer to understanding why it is when the substantial majority of the population, including youth, do not commit suicide, and life is seen as precious, a small minority do not see life as precious.

“Despite my long experience in this area, neither do I. However, one thing I am very clear on through contact with thousands of New Zealanders, whether at inquests, lectures, talks, seminars or the like, is that our understanding in this area is still plagued with misinformation, and reluctance in some circles to open up the discussion and to face the reality of this puzzling phenomenon.

“I know from personal experience, most people want more information, particularly when someone they know is involved. What are the signs to look out for and how can they help?

“There are some encouraging signs of a willingness to open up the whole area of self-harming and self-inflicted death in New Zealand. I believe that done properly, such discussion can be beneficial and that to dismiss such discussion as dangerous and unwise is not helpful.”

Full article:

Previous articles:

WHERE TO GET HELP:

If you are worried about your or someone else’s mental health, the best place to get help is your GP or local mental health provider. However, if you or someone else is in danger or endangering others, call police immediately on 111.

OR IF YOU NEED TO TALK TO SOMEONE ELSE:

• LIFELINE: 0800 543 354 (available 24/7)
• SUICIDE CRISIS HELPLINE: 0508 828 865 (0508 TAUTOKO) (available 24/7)
• YOUTHLINE: 0800 376 633
• NEED TO TALK? Free call or text 1737 (available 24/7)
• KIDSLINE: 0800 543 754 (available 24/7)
• WHATSUP: 0800 942 8787 (1pm to 11pm)
• DEPRESSION HELPLINE: 0800 111 757

ComCom and Dominion don’t get it

Today’s Dominion Post editorial complains The Commerce Commission doesn’t get it

Do they?

The ground is moving under journalism companies everywhere. Readers are migrating in their hordes to the web, with its endless flood of information.

Newspapers are fighting for survival, and news websites, even the most prominent, struggle to compete with the ravenous global attention-grabbers – the Facebooks and the Googles.

These are all banalities by now. It is a shame for New Zealand that the Commerce Commission has not properly grappled with them.

Fairfax needs to do a lot better grappling with the real problems facing media in New Zealand.

It ought to have seen how massive the media challenge ahead is – and allowed the companies to join, to give them a fighting chance of pushing on for years to come. Instead, it looked to the past

Bigger and bigger media companies is from the past to perhaps.

The Commission took a far too rosy view of the near future, banking on newspapers’ survival, lethargy from the broadcasters, and the continued success of the companies’ websites. But the market is in a state of near-constant upheaval.

So more innovative change is required than merging into a bigger company. That won’t address the problems – unless Fairfax and NZME thought it would enable them to just put up a pay wall. That could easily be a disaster.

Fairfax-NZME merger ruling today

The Commerce Commission will be announcing it’s decision this morning on whether Fairfax and NZME will be allowed to merge.

If allowed this would combine most of the country’s newspapers into one company, as well as the Stuff and NZ herald websites.

Stuff: Regulator set to rule on Fairfax, NZME merger

Publishers Fairfax New Zealand and NZME will find out on Wednesday whether the Commerce Commission will let them join forces.

If the merger is allowed, what would the combined company own?

The Stuff and NZ Herald websites, almost all of the country’s major newspapers with the exception of The Otago Daily Times, a raft of community newspapers and magazines, and about half the country’s commercial radio stations, including Newstalk ZB, The Hits and ZM.

It would also own daily-deals site GrabOne, video entertainment site WatchMe and majority stakes in fast-growing community site Neighbourly and internet provider Stuff Fibre.

The traditional media business model has been under severe pressure for years due to the competition introduced by widespread Internet use and dramatically diminished advertising revenues. Online advertising is dominated by Google and Facebook.

And printed newspapers are struggling to survive.

It’s easier to do crosswords online now as well as get a wide variety of news.

Whatever the decision today NZME and Fairfax face challenging futures.

Regardless of the decision this may not be the end of it.

If the ruling is ‘yes’, could it be appealed?

All the interested parties that attended a Commerce Commission conference in December would have the right to appeal.

They include Television New Zealand, Three-owner MediaWorks, and Allied Press, which owns The Otago Daily Times.

However, the costs and risks involved mean an appeal might not be a given.

And if the ruling is ‘no?

Fairfax NZ and NZME could appeal and may already have identified possible grounds.

Those grounds centre on whether it can reject an application solely because of concerns that it can’t put a value on, like media diversity.

But the appeals process on a point of legal principle could go on for years. Both companies told the commission in March that when it came to the merger “later will be too late”.

Lawyers may fiddle while newspapers burn.