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US economic data positive; expectations of China stimulus fade; EU avoids recession; Aussie retail sales weak; IMF expects global economy to expand faster; UST 10yr 4.08%; gold and oil up; NZ$1 = 61.2 USc; TWI-5 = 70.2

Economy / news
US economic data positive; expectations of China stimulus fade; EU avoids recession; Aussie retail sales weak; IMF expects global economy to expand faster; UST 10yr 4.08%; gold and oil up; NZ$1 = 61.2 USc; TWI-5 = 70.2

Here's our summary of key economic events overnight that affect New Zealand, with news the IMF now expects a global soft landing in 2024 and 2025 after authorities seem to have successfully quelled inflation.

But first, an update on dairy prices. We mistakenly signaled a full GDT dairy auction overnight in our report yesterday. But we got that wrong; it is next Wednesday, February 6, 2024. But there was a GDP Pulse event overnight instead and that delivered higher prices. WMP prices were +1.1% higher than the last equivalent event a week ago. SMP prices were +0.3% higher. These gains were less than anticipated in the dairy futures markets, but both continue the recent trend of rising prices.

Meanwhile, the US Redbook retail index of bricks & mortar stores came in +5.0% higher last week than a year ago, maintaining the recent gains. And don't forget these are off heady rises a year ago, so there isn't any indication yet American consumers are flagging under household budget pressures in these results.

And the widely-watched Conference Board survey of consumer confidence rose in its January edition, largely as expected. Consumers are feeling the most upbeat in two years.

And there has been a trifecta of good American data out overnight with the US JOLTS report surprising with a rise in job openings in December. They surged by +101,000 from the previous month to over 9 mln, the highest in three months and above the market consensus which expected to hear of a retreat.

The only American data out overnight that was negative was the Dallas Fed's survey on the service sector in the oil patch. Like the factory survey, it retreated.

In China, market optimism for an economic rescue package is fading. China’s stock and bond markets are giving a clear signal to policymakers that they need to take more steps to revive investor confidence. Stocks fell for a third day on Tuesday, pulling back from last week’s rebound. Their benchmark 10-year bond yield dropped to the lowest level in more than twenty years, as traders now expect the central bank will release additional monetary stimulus to boost growth. But direct solutions for the troubled sectors still seem unaddressed. The IMF may agree with Beijing that current approaches will be enough, but financial markets remain sceptical.

In Europe, sentiment was broadly stable in December.

And the EU released it's Q4-2023 GDP result overnight - and it looks like they have avoided a recession, even if the result was weak. They stalled in the last three months of 2023, following a -0.1% contraction in the previous quarter. Analysts had expected Q4 to decline too. But these are preliminary estimates. They avoided a recession because of better-than-expected growth in Spain and Italy while the French economy stalled and Germany, which is the largest one, contracted. They will be relieved at the overall result, but in fact it doesn't really paid an encouraging picture.

Australia said that December retail sales were weaker than expected, falling -2.7% from November to be just +0.8% higher than year ago levels. That was the steepest drop since August 2020. This follows a revised rise of +1.6% in November and a fall of -0.2% in October 2023. Meanwhile inflation ran at about 4.3% over the same time, so retail volumes in 2023 shrank about -3.5%.

Overnight, the IMF chimed in with an updated 2024 growth forecast, one they raised (which was a bit of a surprise). They now expect 2024 global economic activity to expand +3.1%, and improvement from 2.9% seen in October while keeping the forecast for 2025 unchanged at 3.2%. The key improver came from greater-than-expected resilience in the US and several large emerging market and developing economies, as well as anticipated fiscal support in China. 2024 growth forecasts were revised higher for the US (2.1% vs 1.5%), China (4.6% vs 4.2%) and India (6.5% vs 6.3%) but the institution expects lower growth for the Euro Area (0.9% vs 1.2%) and Japan (0.9% vs 1%). They foresaw small improvements in Australia over the next two years but at modest levels, but forecasts for New Zealand were not included.

The UST 10yr yield starts today at 4.08% and down -2 bps from this time yesterday. The key 2-10 yield curve inversion is deeper at -30 bps. Their 1-5 curve inversion has also deepened, now by -80 bps. And their 3 mth-10yr curve inversion is slightly deeper at -130 bps. The Australian 10 year bond yield is now at 4.17% and down -1 bp from yesterday. The China 10 year bond rate is down -3 bps at 2.48% and a twenty year low. The NZ Government 10 year bond rate is down -4 bps at 4.74%.

Wall Street has opened its Tuesday down -0.2% on the S&P500. But it is still hovering near its record highs. Overnight, European markets were mostly +0.5% higher. Yesterday Tokyo ended its Tuesday session up +0.1%. But Hong Kong fell a sharp -2.3% and Shanghai was down -1.8%, both reflecting local gloom. The ASX200 ended its Tuesday session up another +0.3%. The NZX50 ended largely unchanged.

The price of gold will start today up another +US$8/oz from yesterday at just on US$2035/oz.

Oil prices are up +US$1 at just over US$78/bbl in the US while the international Brent price is now just over US$82.50/bbl.

The Kiwi dollar starts today at just on 61.2 USc and marginally firmer than yesterday. Against the Aussie we are up +20 bps at 92.9 AUc. Against the euro we are unchanged at 56.5 euro cents. That all means our TWI-5 starts today at 70.2 and up +10 bps from yesterday.

The bitcoin price starts today firmer yet again. It is now at US$43,177 which is up +2.1% from this time yesterday. Volatility over the past 24 hours has been modest at just on +/- 1.1%.

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91 Comments

So National promised they would pay for tax cuts by only making cuts to the back office.

Now they’ve left it up to CEs to propose the cuts and those may include front line services.

https://www.newshub.co.nz/home/politics/2024/01/frontline-services-coul…

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is that tantamount to a breach of promise? They campaigned on getting rid of a lot of the Wellington drones. I would not be surprised if many of those CEOs now see how they can preserve their empires and NOT deliver more resources to the front lines. 

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The lie was that National told people there were so many comms people that they could just cut those and pay for tax cuts. They knew it wasn’t true, the media knew it wasn’t true and challenged national on it but they swore black and blue that they wouldn’t need to cut front line services - and here we are.

I also understand that National promised they would line by line. But now it’s the CE’s doing it.

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National are also increasing the trust tax rate to 39%. This de-facto makes the company tax rate 39% for a majority of sizable  NZ owned businesses as most businesses are owned with trusts. So they increased the tax rate on real businesses that produce real products or provide a real service so they could pay for the removal of the removal of interest deductibility on residential property speculators.....  

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They are throwing commercial property landlords under the bus too - no more depreciation for them, affecting all the NZX-listed REITs that will be part of many Kiwisavers.

Anything to preserve the business of buying old houses and renting them out - the true route to wealth creation. 

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Day 65 of waiting for a single new economic initiative from the coalition govt.

 

 

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They will come up with something 6 weeks before the next election.

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As a former tax professional most trusts are just tax avoidance structures.

The asset protection selling point, like everything else has been abused and simply enables many to avoid accountability and responsibility in commercial and personal relationships.

It's a great fee earner for accountants though.

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I have no problem with public service having to "right size" for current economic conditions we face, my wife worked in public sector for years and the stories of wasted trips for meetings about nothing, the need to make sure your "budget" is spent or you may not get that funding the next year, and the we only work 37.5 hour weeks and not a minute over, was rife. The private sector is constantly going through this process to meet market conditions. It should'nt be a lets increase the size of the public service at the rate of inflation for ever and ever.

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Front line services are police, health care, education, etc. If they are cut you are going to notice. Last year national said they’d add 500 police in two years, now it’s three years. But they are still very concerned about crime. 

People don’t understand. The government doesn’t actually spend that much on people working at desks in Wellington. And National isn’t going to massively cut those people because they want spin doctors and people to work up stuff for them - like Seymour’s ministry of regulation, he’s adding paper shufflers cause they are his paper shufflers.

So when National says they need to cut big for tax cuts, they are coming for the stuff you or your family need - health, education, defense, police, courts - you’ll notice it. Then you’ll ask yourself, was it worth it so a landlord can not pay tax on their rental income?

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Hopefully police, health care (except for the other health board and duplication of jobs) gets left alone. But don't get me started on the education ministry...

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Not too concerned about the extension from two to three years. I suspect that is just reality biting about ramping up recruiting, vetting and training. All of which takes time. Two years always seemed overly optimistic to me.

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Yeah it takes a fairly long time to go through the police recruiting process (from first hand experience). You can be waiting weeks, months sometimes to get a response with respect to each stage of the process, or you have to wait for an upcoming testing day for fitness testing and so on. 

It used to be more efficient when it was run by actual police officers (if I recall, each district would have 1-2 actual sworn officers, usually at the tail end of their careers or otherwise needing desk work, running the process). This was then changed over to a more conventional HR-type structure. When I did the process it was at the tail end of the former going into the latter, and it was 'night and day' the difference. I'm sure the proper HR types can follow the process better, but they just seem to add a lot of bloat. 

Making the recruiting process more efficient would actually be one way to get more staff I'd imagine, as there are people (I know as this was me!) who would be good candidates who drop out because the get fed up of waiting for the next step and instead want to move on with their lives or get offered better paying jobs in the interim.

 

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Police is a bit or a rort if you're a white male. I worked with a bloke who applied in 2019, took him 1year to get accepted for an interview, another 6months to get said interview, and then he had to wait on when there was a spot open for him in Wellington where he wanted to work. Took another year or so to finally get put through to the acadamy for training, although naturally many opt to go wherever they;re needed to get in earlier. If you were female you got prioritised, if you were Maori or Pacifica you got prioritised and if you were female and either Maori or Pacifica they would practically induct you within weeks. I can appreciate that there is a genuine need for a wide range of police frontline to better relate to different communities, but when I watched that process happen, it was appalling.
 

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@Hardly.  I worked in front line health.  And around the turn of the century I went several times a year to Wellington to be 'consulted' by the Ministry.  Their cost.

What a farce.

They genuinely busy.  But it led to nothing.

The mantra of the day was 'workstreams'.  (Nowadays 'Mahi' lol)

They would say things like.  "This policy workstream would inform that workstream which will commence next year".   But when you asked the following year they would look blank.  No idea of what you were talking about.

The projects involving dozens of people would just disappear.

The moral from this Hardly is that your assumption is wrong.  Your assumption that removal of high cost Wellington makework means front line services must reduce is wrong.

 

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See my comment below. Work disappears suddenly because of government change of direction or decision on whether to proceed or not with a project. It's natural, happens all the time in every public body everywhere. It isn't redundant work. You research options and provide advice and if the pollies decide they don't want to continue with the project it gets canned. 

Public sector work is much more complex than private sector work. The private sector has one overriding driver: profit. The public sector's driver is public good and what constitutes public good changes multiple times (in democracies)  through the year and normally significantly every 3 years after elections. 

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1.  You can't blame ministers for what I observed agnostium.  It was usually the ministry internal 'politics'

2.  It's an assumption only that 50 policy advisors and six months produce better work than 3 in a week.  The 50 may do much worse.

3.  Manager.  "We suggest a different HR policy.".  Peter Blake.  "Does it make the boat go faster"

4.  From organisational psychology 101.  Bigger groups make riskier decisions.

 

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I'm not blaming anyone. I'm saying it's the nature of the beast. The less policy people you have the less policies/research/analysis you can do. 

Re: point 2. Agree. Sometimes but sometimes not. I wouldn't recommend having 50 policy advisors on one topic and have never encountered that many on any given project ever. Normal number is between 1 and 5. Sometimes up to ten if they are researching a very big topic. 

And I've said it before. The work still needs to be done regardless. You cut the public sector policy advisors, the taxpayer ends up paying two or three times as much for a consultant to do the work. I've worked in private and public in this area.

The worse wastage is always when a new government comes in guns blazing to "cut down on waste". Big restructure, nothing happens for 6 months while the restructure goes ahead. Nearly all the best people leave. The new government then asks for the new team to do pretty much the same thing the old team was doing as they realise it was essential and the new team then hires the old employees back as consultants and we all pay 3 times more. This wastage pales in comparison to keeping on some experienced deadwood that can add some value (although not always that much). 

Why do you think the public service has been progressively becoming less efficient and more costly over the years?

It's privatisation and "cost savings" instigated by people that think private sector thinking can be equally applied to the public sector. All it does is to put private sector business between the government and the people they serve, and all the private sector does is add a massive margin. 

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That wasn’t my assumption at all.

My assumption is that if national cuts front line services that will mean less doctors and nurses  and therefore longer wait times and more pain and suffering.

You can’t cut 6.5% on what labour would have done and see no impact.

If national aren’t cutting from front line services they can come out and promise that.

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It happens everywhere.  Just watch the Aussie series Utopia. It’s satire but oh boy is it??!! 

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Utopia is a brilliant programme.   And could be described as a doco.

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500 extra Police over 2 or 3 years is short of what is required. I’m not exaggerating when I say 5000 is the realistic number. The Police have got themselves into a dire situation. Short staffed and not the correct calibre of staff.  And it’s all come about because of having to be kind and thoughtful. I don’t want the Police to be kind and thoughtful. I want the Police to do their job correctly and clean this place up. It’s not social services, it is the Police Force. That’s what it was called, The Police Force. Then it was The Police Service, Force was too forceful. Then it was The Police. Then they dropped the “The” and it is now just Police. I’m waiting for them to drop “Police” altogether and rename them something woke like “Group Services”

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Tell me you know very little about effective policing without telling me you know very little about effective policing. 

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Is that you, Mr Coster?

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Probably just has a different definition of 'effective policing.'

 

Might be one where the police follow up on all but the most trivial reported crimes, and find and charge offenders.

Then the next problem is the courts and the reel of pre-wetted bus tickets..

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Sounds a lot like the private sector as well.

The big corporations don't "right size" for economic conditions - they are "The Market" creating economic conditions -they do it so those at the top can keep enjoying the bonuses and perks whilst imposing austerity on those at the bottom.

Many SME's still have an element of humanity and many owners will act differently towards their staff until "economic" conditions make it impossible.

True leaders would lead by example and impose austerity measures on themselves first. Our politicians could start with many of the "privileges" provided by the taxpayer.

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Horrors.  The government is doing what they said it would.  And the people voted for.

As for the front line,  you could remove much of the circular workflows (previously known as mahi) from Wellington and front line services would be unaffected.

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You get what you deserve NZ..

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That's the idea so let's hope so 

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Austerity you middle name Kiwi?

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Actaully the government seem to be backing off a little from what they promised. 

As for your second sentence; that is somewhat less certain now. But you statement is so true. A lot of the work in Wellington could just vanish and the frontline may actually be better off for it. Less people distracted from delivering services to answer inane questions from head offices.

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Northcote Parkinson then, the maxim. Something like - work expands to fill the time available. To which you can add - and people available. Then of course there is  the internal empire building. The more staff my division has the more I should be paid. Those failings are by no means restricted to the public service though.

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There are just over 30 government departments. National need to cull about 30,000 employees on $100k to pay for their tax cuts, so about 1000 per department on average. Many of those departments wouldn't even have 1000 employees. And in the bigger departments its hard to see that there are more than 1000 unnecessary people. So it will have to be front line staff. Yet in many areas they have pledged to increase frontline staff (corrections, police, teaching?, health?). 

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Jimbo there are more than 30 govt organisations "delivering" for us if you include quangos and other quasi bodies.

One of the problems now in NZ is that people expect the govt to be the solution for pretty much everything  - when they should be the regulator and the backstop 

For me the further away they are the happier I am and I can get on with looking after self, family and community.

 

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" And the people voted for."

I wish people would stop with this nonsense.

It is what about 5-10% of swing voters voted for. It does NOT, nor does it ever, reflect what all people wanted. Nor can it ever reflect what people want on an issue by issue basis.

I would remind everyone that half the population have a below average IQ. Comments like that clearly identify which half the writer or speaker is in. Please stop. It is nonsense.

Our current form of democracy will never support such assertions.

 

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They can’t find all that money Labour were supposedly throwing away. What a surprise. . 

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They are chickening out. Don’t want to cut too many needless policy roles as it will destroy their property investments in the capital 

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I don't think they are chickening out. But I don't think there are 30,000 needless policy roles.

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100% this. 

If you don't have policy people researching, analysing and advising on direction you end up flapping about like a headless chicken. 

It's easy to say there are too many policy advisors but you have to remember they are responding to constant changes in govt direction. It's not unusual for a team to work on a policy proposal for a year or two and then find that the govt changes direction when they get the advice due to political considerations and the work is abandoned.

Is that wasteful or is that the nature of the beast? 

I think we can all see what happens when policy is made up on the fly based on ideological reckons and culture war narratives,  like the coalition of chaos did, and continues to do. The sums don't add up and the flip flopping is even more wasteful. 

Prime example of this shambles. If this were the private sector Luxon would have been sacked by now. 

https://www.nzherald.co.nz/nz/politics/pm-says-police-minister-mark-mit…

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The biases come through quite quickly dont they

I have read lots of that policy advice from MBIE, MAF, DOC, MOE and similar  and frankly lots of it is waffle and poorly researched -150 pages to justify a position (from uninformed civil servants) rather than factual concise "advice"

Never mind the really juvenile rubbish that comes out from EECA,  Work safe or MBIE's employer advice team

and the Boards leading a number of these organisations have been captured by the employees such that they are box tickers rather than leaders

So yes much change required in Wellington and some Govt organisations need to go completely to really improve NZ inc.

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Serious question, because people mention this type of thing often in line with the general 'clueless/lazy wellington public servants wasting time and money' trope, but I have not really seen any concrete examples of the type you have seen, are you able to provide links to any examples of the type of poorly researched policy advice, or juvenile rubbish from EECA, Work Save of MBIE's employer advice team?

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Well made points, especially so many of the policy analysts being ill informed on their subject matter.

Lots of policy generalists who are frankly providing some scarily ill informed advice.

when I criticise the Wellington bloat it’s more about the unintended consequences and costs of their advice that concerns me rather than the cost of employing them on the taxpayer 

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@ agnostium.   If that's your prime example of a problem, there is no problem at all.   If that's your prime fault within the coalition, then they are doing very well.

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It's not my prime example, it's just one of many instances of dishonesty displayed by Luxon. They lied about the 500 police in 2 years, their ex-policeman minister who has a higher level of integrity than corporate climbers acknowledges it and then Luxon comes in to continue the lie. 

Would you like to place a bet on 500 new police (net gain) will be achieved in 2 years? Maybe just bookmark this post and we can revisit. 

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Im pretty sure 30,000 is close to the entire core public service. So no, definitely not 30,000 people surplus to requirements.

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Not 30,000 but quite likely 10,000

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"Agency chief executives and their staff are expected to use their good judgement, and proposals for savings will describe any impacts to front-line services consistent with our priorities. 

"Ministers and Cabinet will make final decisions on whether to accept those proposals as part of the Budget 2024 process."

Seems reasonable, with clear accountability for the final decision. 

Of course, there are still opportunities for reducing or even eliminating extravagant nominal "frontline services" or even entire Ministries that were simply created to satisfy squeaky wheels & political dogma.

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So , the ministry of regulation will go ???

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A family member is at the executive level for a government department (obviously won't say which one) and when we caught up over the break they explained to me how the cost saving process is working out in their department - he couldn't say for others, naturally.

Firstly, it sounds like the process actually started under Labour (just accelerating under National) which I guess aligns with that knee jerk 'must save money' thing that Labour did in the election cycle. But that is besides the point.

He said the cuts process basically looks like this (they haven't been told how to make the savings, just that savings must be made)

  • Travel is heavily curtailed (all travel requests, no matter how small $-wise, must be approved by executive and they are basically going to find any excuse to say no). Up until this point, staff were travelling frequently both nationally and internationally. My family member is going from travelling 2-3x per week to once every month or so. If it means more space for me in the Air NZ lounge in Wellington, then I'm all for it :P 
  • When staff leave, some positions are not being replaced where it's not deemed necessary. 
  • When positions are open the recruitment process is deliberately slowed down as keeping the vacancy open longer means a reduction in wage bill (so they might find a good candidate who could be recruited in one month, but it will take two months to complete as that is one month of wages saved).

His view - which I trust - is that it shouldn't actually have an impact on this particular service in a frontline capacity as no budget has been taken away from the actual frontline aspects. Of course other departments/orgs might act in a different manner. He reckons there is a fair bit of waste in terms of things like excessive travel and duplicated back offices functions, but the primary concern on the cost-cutting side is that it becomes harder to retain staff as they don't like the change in conditions basically.

 

 

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Oh dear dumb thoughts.  Second rate management there.

Those are up there on the uselessness scale.  Like cheaper biscuits in the tearoom.

They need to look at how they do things.  And streamline processes to.get more done with less input.  My experience of ministries is that would produce massively.

Basic question for everything is. "does it make the boat go faster". (as per Peter Blake)

But they don't have the vision clearly.

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Which is quite a bit different to what we were told, that there tens of thousands of useless people they can just sack with no affect on service levels. 

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This department/org is definitely on the smaller side (they don't have a huge number of staff to begin with).

I have some personal experience with MBIE, for example, and that has always seemed very bloated (some of the staff literally seem to do nothing, based on interactions with them, how nebulous their outputs are and so on). 

My personal view, for what it's worth, is that both Labour and NACT have got it wrong on public service spending.

Labour's attitude seemed to be just throw more money at the problem regardless of whether anything actually improved or not, as if the mere allocating of more $$$ = more results. In doing so they've poisoned the chalice so to speak, and fed the public appetite for seeing cuts in the public sector because you can't really blame people for seeing more and more go in (from tax raised through bracket creep etc) with nothing to show for it. I imagine the average punter would care far less about the size of the public sector if they saw tangible gains in terms of frontline services.

National's attitude is equally absurd in the sense that most public service jobs are 'productive', and as you say it seems a long bow to draw to claim that there are tens of thousands of totally useless jobs. There would maybe be into the thousands, but not tens of thousands, and even if you fire all the truly useless people that isn't going to amount to enough $$$ saved to really make a difference.

There needs to be a middle ground of acknowledging that public service shouldn't be run like private business, but at the same time there has to be reasonable 'value for money' for the taxpayer and tangible delivery of improvements ... if only because otherwise those in the private sector get fed up with tipping more cash in for no gain, and then vote to burn it all down. 

Clowns to the left, jokers to the right and all that. 

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Agreed. I have no problem with National making cuts to public service. But I do have an issue with them pretending they can achieve free tax cuts when they can't. They did the same thing when Key was elected, ended up increasing GST to pay for it, will be interesting to see what they do this time. 

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Had a friend swap from private sector to MBIE recently. Much better pay and conditions. Quit within 6 months due to boredom, as work was completed by 10am on Monday. Gliding On is alive and well.

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This is part of the problem.

Those who are comfortable to 'glide on' (and let's face it, there are a lot of people happy to earn a decent, perhaps even good salary and take it easy) keep on gliding, whereas the more productive/motivated leave from boredom and frustration unless they can find a role that is sufficiently stimulating. 

I had a job once where I was paid very well for my age and experience, but had absolutely bugger all to do because the business owner had more dollars than sense and thought he needed a certain position filled. I reckon about 4 hours of actual work per week max in a 40 hour week. I did that job for about 18 months as there was nothing better I could find at the time, and it was awful for me both mentally and physically (I got so bored I'd just pig out at my desk for something to do).

In the end I had to pack it in as I was packing on the pounds, and going insane from lack of stimulation. There's only so much time you can spend reading Wikipedia articles as there's nothing else to do. But there are definitely people who would love a job like that. The issue is if the taxpayer is paying for such a privilege. 

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There's only so much time you can spend reading Wikipedia articles as there's nothing else to do

Or hanging out on interest.co.nz...

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Exactly. Very common. Huge bloat there. MBIE is one of the worst

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Another Profile true story..

If your imaginary friend really had joined the public service they would know that there is always more that needs to be done than is feasibly possible, so either they were a lazy bastard or didn't understand their role. 

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Unlikely a "lazy bastard" would leave an undemanding job? They didn't understand such mediocre roles could exist until they joined the public sector. Hardest part was turning down the coffee machine, valued at the price of a small car, and going back to Special Blend and no biscuits.

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I truly accept they are busy.  Trouble is it mostly does not produce anything in the end.

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The head count at the  Ministry of 3 things their staff know nothing about has doubled in 6 years. You could save 200 million in a heartbeat and no one would notice. When you see a public service job advertised it is always surprising how generous the salary seems and its always 5 weeks annual leave plus this and that. The other thing is the jobs adds seem to be written by a special AI language model that makes them unintelligible to normal people. Basically a red flag to say don't even bother to apply if this add dosen't make sense to you. Anyway we are only advertising this job because we have to. My mate from uni who works at department XYZ  has already been shoulder tapped for the job and this description perfectly matches his supposed skill set.

Its a giant game of musical chairs and the music is about to stop

 

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I don’t doubt that department has bloat. But let’s say you saved $200mil a year, that’s less than $100 a year per taxpayer or $2 a week. They need to find those savings in another 9 departments.
Not saying they shouldn’t do it, but it doesn’t save as much money as people assume. 

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I wonder if the "Agency chief executives" will take a 7% paycut?

20% bonus more likely , i think .  

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Wonder what this will do for AirNZ domestic ticket prices....

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OK, well here's a story from another department. There was $350M of shovel-ready, small scale construction projects spread across the country that would provide good benefits to local communities, all consulted on and endorsed by local community. These were immediately canned as soon as the coalition of chaos came to power. Announcement was buried along with a whole bunch of other real cuts on the same day Nicola "unintentionally" made a dick joke and didn't announce anything in the microscopic non-budget. 

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Don't be fooled, this coalition is analogous to the Tories in the UK. There are real public service cuts coming to real low and middle income families so that the coalition's donors can be repaid and the rich 1% can get richer. Nobody else benefits, nobody. 

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its going to be a long 9 years for you agnostium

 

If you want to see where the regional growth fund has spent its (sorry our) money there is a spreadsheet on the MBIE Kanoa web site 

https://www.growregions.govt.nz/established-funds/what-we-have-funded/

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I'd like to know why the regions get a fund and not the big cities who pay the majority of the tax? Its not like the cities don't have funding issues. 

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It wasn't the regional growth fund.

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@ agnostium.   Once upon a time there was the idea that if you spent more money you got better quality.   Still held as a belief in some corners such as the public service.

Then the Japanese set to and significantly reduced the cost of car production, and vastly increased quality.  All at the same time.  

 

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Apples and oranges KH. 

But hiring quality people? That is a real problem. Especially in government departments. It seems the priorities are more towards appearances and presentation than production. Competence and capability look like they are 11 and 12 on a list of 10 priorities for recruitment. 

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I don't know what your point is. Sometimes spending more gets you better things sometimes it doesn't. 

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My point was about beliefs.   Cost versus quality.   Two strains of thought on that. 

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OK I haven't come across the belief that more money always equals higher quality all that much in the public service. I've seen lots of it in the consultancy sector, we literally charge more for some projects than we need to to make the client think that they are getting a better product. It actually sits quite uneasily with me when we consult with public bodies. But as I said above that is the nature of the private sector, profit first and foremost. 

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Sounds EXACTLY like a story. Those shovel ready projects, the rural development fund. Stories. 

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It isn't the rural development fund. Just ask any of the Big Councils if the government had pulled funding from shovel ready projects just before Christmas and you'll get the list of projects. 

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Published yesterday but nothing new in the article, just food for lefties to keep them going through the long years ahead. 

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Wanna bet that CEOs of public institutions, to curry favor with the NACTF to ensure their own jobs are safe, cut jobs to the bone knowing full well it'll be two years at least before the public start complaining that services are terrible?

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Isn’t it refreshing when people are brave enough to say “but we got it wrong” and then move on to fix or improve.

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Could you link some examples of this said behaviour? Overheard last night that cuts to defense might also be on the table...(must be looking under the sofa for any loose change to afford the promised tax cut).

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I think he's referring to DC's mea culpa in the article above? Good sign of integrity and humility.

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Thanks..pre coffee Neuralink now working

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Who have said they got what wrong?

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Just keep taking the pills

The ones marked Friday. 

Home help will visit at lunchtime. 

:)

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The IMF turns bullish on the Global economy just after Evergrande goes into liquidation, conditions in the Chinese economy are set to worsen and Geopolitical tensions are getting worse not better? The World bank doesn't seem to share their optimism. 

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A leading accountant and agribusiness advisor says the present downturn in the rural sector is like no other he's seen in his nearly 60 years in the business.

Pita Alexander says there have been eleven financial downcycles since 1948, but this is the worst. He says a feature of downturns is that either prices fall, or costs go up.

But this time, it's unique because both have happened at the same time and that's a problem for the country - especially sheep farmers, with the present low prices for lamb.

"It's effectively a scissors movement which has gripped the ag sector," he told Rural News. \

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The IMF is predicting 3.1% global growth in 2024. (Yeah I know they tend to miss a lot.)

But our RBNZ is predicting just 1.4% ???

Does anyone else see something wrong here?
Why are we going backwards when compared to the rest of the world?

The RBNZ will have to answer those questions at some stage. I can't wait to see how they spin it. (It should be a mea culpa, and one without reservation or deflection.)

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NZ has been outperforming many other western economies for a while now, but there will always be times where we don't. The RBNZ are not required to maintain GDP growth. 

Also a lot of that 3.1% comes from the undeveloped countries. 

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Both of you are making pre-assumptions. 

Who said real growth was future-possible? 

Because I'll tell you that what we are doing now, isn't real growth. It's a count that lies via omission. (s). 

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Shouldn't it be the Govt explaining our terrible growth, not the RBNZ? They have a lot more levers to pull to affect the outcome

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I quite like Seymour's suggestion of "Stop Notices"

Just stop, go away, cease and desist, finish now, depart.

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