The Fiscal Budget 2015


At 1400 hours yesterday, the Minister of Finance Bill English delivered the seventh fiscal budget of this Government. It had both nice surprises for beneficiaries with children and nasty ones, along with some unexpected taxation. So, what did Mr English offer in the 2015 Fiscal Budget?

First, lets be clear: the books have $684 million of debt on them that is expected to last until early next year when Mr English expects a surplus to be achieved, though he said it will be only about $176 million. In other words wafer thin. And the prognosis is that the deficit could potentially linger until as long as 2018. So, on that account Mr English was totally honest.

I have to admit to being surprised to hear, after Prime Minister John Key’s comments earlier this week that hinted at no plans to try to further assist children in poverty like situations, that at the cost of N.Z.$790 million over four years, National is allowing $25 extra per week to assist solo parents. Although I was not at all surprised that behind the dangling carrot was the wooden spoon of said parents having to go back to work, training after just three years instead of waiting until children start school.

The axe fell on the $1k kick start for Kiwi Saver with immediate effect this afternoon. If you try applying for Kiwi Saver today, the account will start with no government boost.

The other big surprise today was hearing that from 01 January 2016 there will be a $22 tax on travel outside of New Zealand. Effective from that day all travellers leaving New Zealand will be expected to pay $6, and $16 for entering, or a round trip of $22 or $88 for a family of four.

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So, perhaps Mr English does have some tricks still up his sleeve. They were however not the ones I was expecting or hoping that he would pull. Credit though where it is due on beneficiary payments. The payment had not increased noticeably for several years.

But all in all, Mr English is not out of the woods yet. He failed to keep his promise of National achieving a surplus in 2014/15 and his response has been to further tighten the spending by looking for areas of social spending to cut into. None of this was lost on the Opposition in the House of Representatives today. His Government has failed to significantly address the very pressing issue of the housing market and there is little room to manoeuvre on other spending areas, such as health, education, police and so forth.

 

An alternative budget


Over the last few months I have been thinking about an alternative budget for New Zealand. I have been thinking about what I think the socio-economic priorities need to be and what financial assistance they might need. From my previous blog posts it is, or should be by now, obvious that I am not a fan of this Government. The general failure of this Government, like the Labour one before it to significantly improve the socio-economic status of New Zealand and New Zealanders, proves a long held theory of mine that neither large party has or intends to develop a long term plan for improving New Zealand. It also disproves the National party claim that they are good managers of the economy. With that in mind, here is my alternative budget:

  • Introducing a capital gains tax on secondary properties (ones lived for less than six months per year) – nearly all countries in the O.E.C.D. have one; this would be around the median
  • Establish a long term debt repayment plan for national debt
  • More funding to tackle corporate fraud, corporate tax evasion and assist with compliance
  • Desisting with the sale or partial sale of further state assets

Outside of improving New Zealand’s fiscal situation

  • Investigating the legalization of cannabis for medical purpose – this would help reduce the number of people going to jail and also possibly be a source of additional revenue
  • Restore Department of Conservation funding to 2008 levels – with consolidation of existing programmes being the priority
  • Funding investigative work into a long term e-waste recycling/re-use programme
  • Ending the Roads of National Significance and giving higher priority to maritime and rail transport for freight – no new money would be allocated
  • Restoring and increasing government funding for Womens Refuge, Rape Crisis and establishing a male specific domestic/sexual violence organization similar to Womens Refuge
  • Investigating how much revenue would be lost with view to removing G.S.T. on fresh fruit and vegetables

This is based on the knowledge that there is only about N.Z.$1.5 billion in free money that can be allocated. It is done with a view that stale governance has led to a dearth of more original policy. Keeping debt in check is a priority, but it should not strangle the creation of jobs or damage the principles on which our society is established. More ideas about spending priorities can form as a national blue print for making New Zealand the best nation of its geographical size in the world evolves.

How N.Z. might become a Republic


This post is purely a hypothetical attempt at showing how New Zealand might become a Republic.

The republic debate is one that has been simmering off and own in New Zealand. It has had periods when politicians have advocated for a Republic and periods when there has been support for retaining the Monarchy. In his tenure as Prime Minister, former National leader Jim Bolger was an advocate for it, as was former Labour leader Helen Clark. Neither so much suggested it was imminent as an eventuality. Neither made serious steps in terms of getting New Zealand ready. And perhaps with good reason. Although the Monarchy took a hit in popularity when Princess Diana died and the Queen was viewed as out of touch with Britons, it staged a renaissance around the Queens 50th Jubilee.

I believe the time for a referendum on the issue should be after Her Majesty Queen Elizabeth II dies. At that point Prince Charles is likely to succeed as heir to the throne. It should be done in two binding referendums. A simple majority of 51% shall not be sufficient because it would be a contentious issue – a super majority that cannot be overcome, such as 66% or 75% of votes will be necessary. The referendum process should be a two stage affair:

  • Stage One: A referendum asking IF New Zealanders wish for the country to become a Republic
  • Stage Two (only to proceed if the question in Stage One is YES): Ask what type of Republic we want, and run off the two most popular choices if there is a dead heat

Whilst organizing the referendums, there will need to be national debate about whether or not a Republic should be formed. It will need to be held in public, in the media and in Parliament. It will have to answer basic questions about why New Zealand should/not become one. When it comes to what the options are, New Zealanders need to know it can take several forms:

  • A Parliamentary Republic such as France – the President is largely a figurehead and the Prime Minister does the day to day running
  • A Federal Republic such as Germany – this would involve states with their own senates and a
  • A Presidential Republic such as the United States – the President actually has considerable powers and in some respects is the nations top diplomat

Other forms of Republic that are not likely to be considered by New Zealanders are an Islamic Republic, such as what Iran is, or a Peoples Republic, as China is.

In terms of which we are closer to, it is probably a Parliamentary Republic. New Zealand already has a Parliament and the Prime Minister from one day to the next is responsible for the running of the country, which is how a Parliamentary Republic would run. It is the version I would favour because the disruption in the process of forming is likely to be the least of the three likely options.

 

The republic debate in New Zealand


When I was at high school I was asked to do an essay for homework one night to prove my writing skill in Year 12 English. I was given a range of essay subjects to choose from. Not being terribly excited by any of the others, I decided to give one about whether New Zealand should become a republic a go. My mark if I recall correctly was not flash, but not terrible either (about 60%). Reading the teachers comments, I noticed he wanted me to explore more the reasoning around my decision. Although the mark was not as high as I had hoped for, it did set in motion my interest in New Zealand eventually becoming a republic.

So, why a republic?

In 1995 when New Zealand won the America’s Cup, a major feat for a little nation then with no more than 3.5 million people, I was a Year 10 student in High School. I had not yet really developed the appreciation I have today for the ins and outs of political governance systems, but I was not really impressed by the idea of an old lady 12,000 miles away ruling my nation, one that she rarely visits. Although my thoughts have definitely matured on the subject of Her Royal Highness Queen Elizabeth II from those rather primitive ones of 1995, the basics remain the same.

It seems odd to me that a nation as stable and able as New Zealand should need a Head State in the form of a Monarch nearly 20,000 kilometres away. We have developed into a nation that is the envy of many other countries around the world: stable, democratic and respectful of diversity. Although the Monarchists correctly say we are a peaceful nation, it stems in large part from addressing the grievances raised by Maori. It stems from surviving two big wars that gave us an appreciation for democratic rights, and it stems from understanding as a nation of immigrants that to reasonably comment on the origin of others, we must respect those who move here.

People worry that if New Zealand becomes a republic it would interfere with the Treaty of Waitangi and its applications. It would not. The new President and the Government would still have the same responsibilities. It  is interesting to note a Bill of Parliament by former Green Party M.P. Keith Locke showed a way to negate any such interference by explicitly stating the responsibilities of the President. Although Mr Locke retired from Parliament some time ago, and the Bill never passed, it demonstrates that consideration has been given to this subject.

People worry that New Zealand would have to leave the Commonwealth if it became a Republic. Not so. India, Pakistan, Fiji, South Africa, Malaysia, Singapore, Nepal among others are all Republics and they are still part of the Commonwealth. Jamaica is considering becoming a Republic.

Australia is known to have a strong republican movement, but a referendum in the 1990’s that asked Australians whether or not they wanted to become a Republic did not give them the opportunity to determine whether or not they wanted a Parliamentary or publicly elected head of state. The referendum was therefore rejected. However many believe it is really a matter of time before another referendum is held.

Republics are portrayed as being more unstable nations than those that are Monarchs. This is not altogether true. In fact Tonga, which was until it suffered severe riots in Nuku’alofa in 2006, was ruled as an absolute monarchy. The riots precipitated constitutional reform that increased the democratic power of the population.

The case for and against a republic is laid out in the New Zealand Republic Handbook (Holden L.J., 2009, pp18-25 and  pp26-35 respectively).

 

 

Sheep-gate a blemish on New Zealand animal rights


Today a One News report revealed that the Minister of Foreign Affairs agreed to a Saudi Arabian businessman’s demand to delete rules regarding the welfare and treatment of export animals after they have been disembarked in the country of arrival.

I am not one to generally say much about animal rights, but I will say this much now:

It is quite unbecoming of a first world nation like New Zealand which prides itself on how it treats animals to be ceding to the demands of a foreign businessman with no understanding or interest in New Zealand other than it supporting a sheep farm venture. To agree to repeal provisions from rules set for the welfare of export animals because one businessman believes that they are hurting his business, when he should be – as much for the animals sake as that of his business – providing them food, water, living conditions that prevent them from overheating or dehydrating

It is a blemish because I honestly thought a New Zealand Government Minister, despite Ministers of this Government constantly lowering my expectations, would be above this kind of wimpish caving in. I honestly thought that they would be above this kind of deal doing, knowing it would be hugely harmful were it to surface.

And now it has. Now the New Zealand sheep and beef industry have to wear the consequences of the actions of one incompetent Minister, who perhaps should consider standing down for a time, until the dust settles. I doubt though, given the Prime Ministers view that New Zealand is the Saudi Arabia of agriculture, that any such action will be forth coming.

Our loss.

R.I.P. 5,000 sheep

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