Bernard's election diary - July 22

Key refuses to apologise to Tania Billingsley; Key says NZ First and Green policies not affordable; Labour to release regional development policy

22nd Jul 14, 8:25am by Bernard Hickey

By Bernard Hickey

With 60 days left until the September 20 election, here's my daily round-up of political news from in and around Wellington on Tuesday July 22, including Labour Leader David Cunliffe announcing after a crisis caucus meeting that he would change his campaigning approach and that, in hindsight given poor poll results, he would not have taken a three-day skiing holiday in Queenstown with his family last week.

He also said he knew who the Labour source behind a critical article published on Sunday was, but said the source was not a Labour MP. He would not say who it was.

"We're going to make a number of changes. We'll be changing some of our internal systems, focusing on a narrower range of topics and messages and making sure all of our people at all levels are on the same topic at the same time," Cunliffe told reporters after the meeting, where the Party's low poll ratings were low.

Cunliffe said he took responsibility for things he "could have done better." He said he would be moving into campaign mode and Deputy Leader David Parker would lead a central campaign office.

He said he did not resile from his comments about "being sorry about being a man," but that the way it was reported was not helpful. He said he would be more careful with his comments and about details such as wearing a red scarf in future.

He admitted he had gotten some things wrong. "I am, I am. I'm being straight up. Things I that could have done better. Things I will do better."

Labour would talk about a narrower range of issues for longer. "It's stick to the Labour knitting and make sure everybody hears the same stuff at the same time so there are no doubts about what we're on about," he said.

He said the narrower issuers would be "jobs, homes, families", while issues such as cosmetics was not Labour's knitting. Labour announced its policy last week on animal welfare, which would have affected the availability of cosmetics. Labour MP Trevor Mallard was also criticised for talking about genetically engineering moas.

Hauiti going

National List MP Claudette Hauiti announced she will not stand again at the election.

Hauiti replaced disgraced National MP Aaron Gilmore last year and recently chose to return a Parliamentary expenses credit after incorrectly using it to buy personal flights to Australia. She is National's candidate in the safe Labour seat of Kelston and had been told she had been allocated a relatively low list position.

National Party President Peter Goodfellow said the Party would re-open nominations for Kelston on Wednesday and select a candidate in early August.

Prime Minister John Key said Hauiti had received "feedback from the party in a number of levels that she was unlikely to get a good list ranking as a result of the public disclosures last week."

"I think she didn't intend deliberately to fall foul of the rules and she certainly made it clear that she is going to pay it back, but I think the party at her electorate level were very disappointed by her actions."

Key's non-apology

Speaking at his weekly post-cabinet news conference, Key declined to apologise to Tania Billingsley, the Wellington woman at the centre of the sex assault allegations against a Malaysian diplomat.

"I don't make apologies unless there's a serious reason for me to do that. As I said at the time, I relied on the advice that was given to me by MFAT," he said.

When asked about Billingsley's comments that he appeared bored and unsympathetic, he said: "I'm just not going to engage in that discussion."

Radio NZ reported that Key had previously said he would apologise once he knew her name, but that was before her critical comments about him.

Later, Key told reporters in Parliament the Government had apologised. "In the end actually, I think what is far more important is that there is an inquiry. That is what the victim in this circumstance deserves and that is what she is going to get."

Labour regional policy

Cunliffe announced in a speech to the annual Local Government New Zealand conference that a Labour Government would put at least NZ$200 million in a fund for projects in regional areas.

“The regions are the lifeblood of New Zealand and Labour understands their vital importance to growing New Zealand’s economy. Many regions have been hollowed out under National with young people leaving for the cities and overseas. Things have become so bad there is speculation of abandoning communities or ‘red-zoning’ regions," Cunliffe said.

“Labour will not let that happen. Labour will stand alongside regions and work with them to fulfil their ambitions and keep their young people at home," he said.

“We will work with local government, communities and businesses to develop tailored Regional Growth Plans that identify strengths and opportunities for each region, boost growth and create jobs. Labour will support the plans with a new $200 million Regional Development Fund that will co-invest in infrastructure and industry projects which would create an economic step-change for our regions."

Cunliffe said the sorts of projects to be considered included the Opotiki Harbour Development, Marsden Point rail line and the Gisborne-Napier Rail Link.

National responds

Economic Development Minister Steven Joyce said the policy was a "desperate attempt to paper over the cracks."

"They've got all their regional MPs deserting them all over the park because they don't like their policies," Joyce told reporters before National's Parliamentary caucus meeting.

"The regions ultimately understand that most of Labour and the left policies are against the regions, so big carbon tax, big capital gains tax, water resources levies, anti-oil, anti-gas and anti-dairy are all very negative for the regions and they are supposed to be saying 'oh well, don't look at that, look over here at this $200 million slush fund'," he said.

TVNZ reported David Cunliffe denying rumours of a leadership challenge. NBR reported Deputy Leader David Parker denying rumours he was 'doing the numbers' on a bid.

(Updated with Labour regional development fund, Joyce reaction, Hauiti retirement, Kelston re-selection, Labour leadership reports, Cunliffe comments after crisis caucus meeting, Exchange in Parliamentary Question Time between David Cunliffe and John Key over regional development)

I'll keep updating this through the day.

See all my previous election diaries here.

See the index for Interest.co.nz's special election policy comparison pages here.

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45 Comments

by Bernard Hickey | 22nd Jul 14, 9:47am 1405979261

FYI Updated with Labour's NZ$200 million regional development fund.

cheers

Bernard

by dtcarter | 22nd Jul 14, 10:37am 1405982256

When asked about the middleclass tax cuts proposed for the next term, John Key replied:

"The questions New Zealanders need to ask themselves is: where is the money coming from? Not:' is the idea a good idea',"

"I'm sure that's a lovely idea, but actually that's going to blow a NZ$3 billion hole in our books. Every New Zealander knows it will, because there isn't NZ$3 billion of money just sitting out there waiting to be picked up,"

by cowboy | 22nd Jul 14, 11:14am 1405984488

How does higher taxes help NZ??

We need more disposable income to be spent into higher margin goods and service, not less...and we certain don't need to give more of that much needed premium to the government to flush down the usual channels!

You want 45% tax rate then YOU pay it. no one is stopping you. Just keep your grubby hands out of my pocket.

by PeakEverything | 22nd Jul 14, 12:12pm 1405987972

I thought you said you only earned $20K. So nobody will be putting any hands into your pockets if that is the case. (I might have you mixed up with someone else on the forum)

Higer taxes do help economic activity as lower income people tend to spend a higher percentage of their income 100% + just to get by. Wealthier people tend to save excess money. Having the excess money redistributed, while arguably immoral, does result in more money being spent.

by cowboy | 22nd Jul 14, 8:21pm 1406017260

Indeed I did make only that, up to 34k, now (gross).

Higher taxes don't help economic activity, unless they happen to fall in the right place. And 9 times out of 10 they go to places of poor economic development (eg hospitals, childrens education, statistics, legislation) so while these thinga are all needed they don't create positive economic stimuli...as that's why those areas are poor in the first place being either lower wealth customers or cost centers.

If they are spending more than 95% of their net income they need to change life choices, and all those people who are putting in compulsory charges (eg rates, taxes, pass on charges) must re-think the economics of their actviity. A business mind is not one that chases profit for profit's sake - it's about making sure you've got the resources for what you need to do - if that need is just to survive on a low income...then there needs to be a business mindset about how the resources are managed.

Wealthier people "save" money? Just where do they "save" it, do they get a return for it? how and why? I guess because someone borrows it. So why don't the poor people have any money? They get 24hrs a day. If taking the money from the wealthy "savers" (or accumulators), and giving to poor people, results in more money being spent...guess where the problem must lie...

by steven | 22nd Jul 14, 12:27pm 1405988834

Because the important thing is the degree of spending, pretty much economics 101. So the rich in effect save money which takes it out of the economy so dont spend it while the poor spend all they get on essentials. Given there are more poor than rich and they have to spend it on essentials then that improves turnover through the economy. If the poor then have disposble income then they can spend it on premium goods just as easily as the rich and there are more of them.

gee sometimes wish I was a tax inspector. I'd make you and every libertarian I can find my personal interest, even down to collecting 45% tax on the bitcoins you are mining for, but not paying tax on. Hopefully even put a few in jail.

regards

by Ms de Meanour | 22nd Jul 14, 1:33pm 1405992825

So you are saying New Zealand's problem is that there is too much private saving?

by DFTBA | 22nd Jul 14, 5:10pm 1406005850

Surely you are not naively assuming that the rich keep their money in NZ? Or even if they do keep it in NZ, they keep it as a simple term deposit and pay their share of tax on it?

Who do you think is responsible for the billion + the country loses in tax fraud?

by Happy123 | 23rd Jul 14, 8:29am 1406060969

Where's your evidence that "the rich" don't pay tax? The rich generally pay way more tax than the poor but then use far less public services.

The main type of tax evasion I'm aware of is the good ol cash job which is not generally done by "the rich".

by DFTBA | 23rd Jul 14, 11:53am 1406073224

I shall have to disabus you of that notion...

http://www.nzherald.co.nz/nz/news/article.cfm?c_id=1&objectid=10887756

from the article:

"Two-thirds of New Zealand's richest people are not paying the top personal tax rate, with increasingly complex overseas schemes and bank accounts being used to evade the taxman.

Inland Revenue has found that 107 out of 161 "high-wealth individuals" who own or control more than $50 million worth of assets declared their personal income in the last financial year was less than $70,000 - the starting point for the top tax bracket of 33 cents in the dollar.

The multimillionaires used a variety of 6,800 tax-planning devices - such as companies, trusts and overseas bank accounts - to avoid paying tax. One had a network of 197 entities."

by iconoclast | 23rd Jul 14, 12:45pm 1406076305

Correct

Kerry Bullmore Packer, once one of Australia's most wealthy, if not the wealthiest at the time, was on record as not paying any tax at all for many years

Clive Palmer, one of Australia's current billionaire coal barons, now a member of parliament, is on record as having not paid any tax for the last 6 years.

It's a badge of honour, and they talk to one another, the grapevine works overtime

by cowboy | 23rd Jul 14, 8:03pm 1406102608

If they are so rich how can they not pay tax on their income? or is it not _their_ income?

by DFTBA | 24th Jul 14, 4:08pm 1406174904

I am not a lawyer or an accountant, so I have no idea of the financial vehices they use, or the tax loopholes they avail of in order to declare their income to be so low, when they are sitting on millions....

by cowboy | 24th Jul 14, 11:23pm 1406200995

you seemed to be enough of a lawyer or accountant to support and promote the premise that 6 billion was evaded, and that a group of people are evading tax.

So true? benefical? something we can act on?

Or just hearsay and rumor?

Chances are, if they paid that little in tax, then their personal income _is_ low. Sure they have access to wealth, but that's not legally taxable, and to manipulate the law in order to gain penuinary advantage when such advantage is not actually owed... is a rort (and illegal under the foundations of NZ law).

by Ms de Meanour | 23rd Jul 14, 9:10am 1406063458

Certainly not; rich people don't get and stay that way by allowing irrational sentiments such as patriotism to dictate where they invest their money. But I am not sure where this line of reasoning takes us.

For a start, it can't be bad for New Zealand both when a New Zealander invests money outside New Zealand, and when a foreigner invests money into New Zealand. Even if you can't quite bring yourself to recognise that a transaction freely entered into might actually benefit both parties, you have to accept that it will benefit one of them. So you cannot oppose both outward and inward investment.

Secondly, are you really saying that the only way in which privately owned wealth can bring benefit to New Zealand is when tax is paid on it?

Because this suggests to me that you're going to end up arguing that the best approach would be for the government to control all wealth. Many have argued that; but the historical evidence ain't exactly on their side

by DFTBA | 23rd Jul 14, 11:41am 1406072482

To recap, I was responding to this thread:

by steven | 22 Jul 14, 12:27pm

Because the important thing

Because the important thing is the degree of spending, pretty much economics 101. So the rich in effect save money which takes it out of the economy so dont spend it while the poor spend all they get on essentials

by Ms de Meanour | 22 Jul 14, 1:33pm

So you are saying New Zealand's problem is that there is too much private saving?

The point I was making was that when the rich save, they take it out of the economy and the country. So your question if there was "too much private saving" was facecious, as I suspect you well know.

But I agree, the rich don't get and stay rich by playing by the rules. One law for the rich, a multitude of others for those who can't afford to pay a bevy of lawyers.

And no, I am not saying that the only way privately owned wealthy can bring benefit to NZ is when tax is paid (on that wealth) - where did I say that?

But it would be nice if they adhered to the spirit as well as the letter of the law, and pay the tax they are supposed to. Tax evasion cost the country 6 billion in 2013. We could well have avoided the partial asset sales if people who owed tax, paid it.

by cowboy | 23rd Jul 14, 8:02pm 1406102544

where did the 6 billion go ?

I'm more of the opinion that the only wasted money was those overpaid to chase it....after all how do they know it was 6 billion, and if so how did they lose it...

by DFTBA | 24th Jul 14, 4:10pm 1406175015

If it is estimated that 6 billion in tax revenue was lost, one would have to assume that those who were expected to pay it, stil have it....

by cowboy | 22nd Jul 14, 8:08pm 1406016481

The problem is more a case of who is saving.

Those who have money can save/invest those who do not can't but they can borrow from the wealthy to spend...which keeps them poor and the wealthy wealthy.

by cowboy | 22nd Jul 14, 8:20pm 1406017256

saving money doesn't take it out of the economy, exactly the opposite, saving money puts it back into the economy for leveraged borrowing (unless saved under mattress).

Accumulating wealth into nice assets does tend to "heatsink" it out of the economy, but the higher value purchases are also putting money back into the economy.

The real issue, is that the wealthy are that way because they have created a net of income streams, either through investments, or through contacts in employment which put them higher on the hog. that way, every time a dollar is spent, a little bit of it trickles up to the investors/savers.

With the poor people they haven't the understanding, resources, time, priority or luck to get a decent net of income streams out there. They're relying on one or two fishing lines with a single hook, so for every day's GDP they can only snag a few cents at best. This is why trickle down was BS, the whole point of saving/investing is to get those multiple lines out there.

But for many wealthy folk they or their familes have made the necessary sacrifices and efforts, and worked prudently. They have the hard earned results to prove it. Why should people who aren't willing to do the work, get the same premium goods?

I spent the last year wearing pants made of two other pairs of ripped pants, just so I'd have a few extra investable dollars. I made el cheapo short cuts on my food bill, so I could afford solar PV panels. The choices are there for poor people, but they do have to be willing to live under their income level in order to get ahead. Finding accomodation in Palmerston North for $15/week 8 yrs ago was a challenge, why shouldn't I be the one to receive the benefit for making it happen? Why do you wish to penalise me 45% of my meager finally getting ahead income, just to give to pricks who aren't willng to do the hard yards.

by notaneconomist | 23rd Jul 14, 7:56am 1406059006

So your accusing Libertarians of cheating the tax system? Do you have evidence of Libertarians cheating the tax system? Or are you discriminating against people who have a different political and economic view than yours? If you want to make Libertarians your personal interest over Greens, Reds, Blues, or any other Political flavour then you are definately showing prejudice towards one group over others.......so where's your proof that Libertarians are ripping off the tax system???? Put up your proof Steven or are your just a mouthpiece proselytising.

The thing that amuses me the most is that there has never been a Libertarian style system in NZ yet you think that Libertarians are the cause of all societies woes politically and economically...........

by Grant A | 23rd Jul 14, 3:58am 1406044725

Yep cowboy, I think the saying goes.."don't tax you, don't tax me, tax the man behind the tree"....the refrain of the socialist who thinks that the latter is dumb and the socialist will be better off.

by notaneconomist | 22nd Jul 14, 1:11pm 1405991472

Kimy if you want things similar to Australia then you will want Stamp Duty, CGT, Payroll tax etc?

Think about it a little differently.....if you have to work the first 6 months of the year so the Government can take their cut......what does that actually do to the person doing the paying?.....they work half of every week just so we can afford Government and its spending.

by notaneconomist | 23rd Jul 14, 8:14am 1406060044

Taxes might get spent in the first round in NZ.....but thereafter where does it go? And we can't forget that some of that tax-take is spent on servicing Government debts!!

I'd prefer a system where all NZ'ers are really wealthy in their own right.......and redistribution cannot achieve that.......

There is no difference between buying and selling Goods and services......or buying and selling houses........or buying and selling debt........or buying and selling wealth and poverty......or buying and selling votes........when buying or selling anything......it should be fit for purpose........I'm not going to buy into higher taxes when I know that redistribution doesn't work......and the money ends up in the same place as interest.

by Bernard Hickey | 22nd Jul 14, 11:34am 1405985696

FYI updated with Joyce's reaction to Labour's Regional Development Fund and National List MP Claudette Hauiti's announcement that she will not stand again.

cheers

Bernard

by Muppet King | 22nd Jul 14, 11:44am 1405986264

Some of the election billboards are written in Mandarin.

by raegun | 22nd Jul 14, 12:29pm 1405988962

Why would they need to do that, aren't migrants supposed to have a reasonable command of the English language?

by cowboy | 22nd Jul 14, 7:49pm 1406015371

unless they are wealthy or already have relations in the country

by Christov | 22nd Jul 14, 1:57pm 1405994236

I've seen the white on Red and the White on Blue , the black on white the Green on green and white but have not yet spotted the Mandarin writing......

Is that ACT's new boards....? or that fuuny chapie on the shore , the one with the salami armed walk...damn it ,oh yes Colin thingy...?

by Gummy Bear Hero | 22nd Jul 14, 8:08pm 1406016530

Colin " funny bug eyes " Craig ? ... those billboards remind one of the driver's licence photo , the freakish unsmiling dial of a middle aged curmudgeon .. .. or the one on the passport , which makes you look like a super criminal , like the sort of guy who dumps folks into 44 gallon drums full of acid and turns them into human gravy .. ...

... what possesed the Conservatives to give that superbly crazy image of Colin the okey-diddily-dokily ?

by cowboy | 22nd Jul 14, 8:21pm 1406017308

mmmmm gravy...

by Gummy Bear Hero | 22nd Jul 14, 8:31pm 1406017889

by Bernard Hickey | 22nd Jul 14, 1:12pm 1405991530

FYI updated with Labour leadership rumours denied and Kelston re-selection news.

cheers

Bernard

by Christov | 22nd Jul 14, 2:11pm 1405995081

Labour leadership rumours denied................?

Wot you mean they're denying they have a leader...? or denying they have any leadership..? or denying that Grant Robertson has been caught reading aloud the Brutus solioquy while Jacinda does her best impression of Cleo getting bit on the asp.

Your basic problem here is that Labour have moved on from trench politics and now seek a candy assed committee meeting to ratify evey bloody thing.

Hell they even care what the Nats think.....they do not appear to want to Govern, (Cunliffe) excluded, because he has the stomach for the fight even though he's on a hiding to nothing.

They would be better to roll him now and lose showing some unity in a decision , than to lose and go about the long winded process only to find themselves here again at the next election.

by Happy123 | 22nd Jul 14, 3:45pm 1406000743

Roll him to be replaced by....

by Gummy Bear Hero | 22nd Jul 14, 7:47pm 1406015260

Bill English ! ... no one in Labour is up to the task ...

by cowboy | 24th Jul 14, 11:19pm 1406200779

roll his spin doctor... there's someone not doing their job!

"Sure I took three days to get in contact with my family and my roots. NZ is a great country and worth holidaying in unlike others who prefer to support foreign nations. The visit was a great chance to get my head away from the distractions of central politics and connect with where I come from and re-affirm my connection with the principles of hard working New Zealanders. We intend to win this upcoming erection, and bring about positive change for New Zealand. This means I'm going to be totally devoting my time and my family's support into making <insert preferred policies here> a reality. Not just for an election; Labour is building momentum to have a winning government and it starts here. "

A -good- politician takes the lemons supplied by fate (be it global, future opposition party members, or their own party) and _creates_ a better lemonade out of it. You go in thinking the guy is screwed, come out thinking perhaps he might be the one...

If he can't.... if his _team_ can't.... then as the contender they don't have what it takes to hold the throne.

by steven | 23rd Jul 14, 7:43am 1406058209

Trouble is I think those alternatives are looking even worse. Some of the seniour labour MPs might have delusions of grandeur but I think they'd be dashed when in front of the voter.

Cunliffe at the end of the day is a front for the party and its policies, to drop to 25% something is seriously out of wack with the swing voter who decide the election. Some of these problems are with the party and its image itself. Looking back at the UK labour party in the last 70s/80s and they were and looked a bunch of hard core communists no one in a moderate mind would vote for them, god I voted Maggie thatcher and Mr Grey, the alternative was anarchy/awful. Then along came Blair, centralist and appearing main stream, he stayed in power for many years, HC repeated that trick here.

Back to NZ labour today, they look like they are ruled by a bunch of vocal gay, lesbian and other fringe minorities and its obviously so. Now I am not saying go back in the closet, but really there is a dis-connect with mainstream (or what?). Something is badly wrong and the trend is looking like its going to be a 3rd disaster for labour.

regards

by Bernard Hickey | 22nd Jul 14, 2:28pm 1405996128

Updated with comments from Cunliffe after a crisis caucus meeting, including his pledge to improve and focus the Party's message.

by Gummy Bear Hero | 22nd Jul 14, 8:17pm 1406017050

... Bernard , I think that 50 % of the population ( those of us accidentally born with two hairy berries and a pink banana in our nappies ) have permanently tuned David Cunliffe out ...

The " man ban " was appalling enough ... a quota to get more " girlies " into parliament , not on merit , but just because they were born with lovely wobbly bits and a vagina ... oh dearie me ... next a quota for paraplegics ... Catholics ... Crusaders supporters ( actually , I'm in favour of that last one ! ) ... a quota for homosexuals ... a quota for people with an IQ less than 100 ( oooops , no need , they're all in parliament currently ) ...

... then the Cunliffe apology for being a man !!!! ....yer lost us all there , Davie boy , you made us all cringe at that comment ... that rehearsed comment to appease the particular group you were addressing at that moment ... sorry because through no fault of your own you were born with ... goolies !!!!

Blah blah blah ... we're not listening , David ... rhubarb rhubarb ... blahhhhhhhhhhhhhh !!!!!

by Bernard Hickey | 22nd Jul 14, 3:39pm 1406000344

Updated with Video of Exchange in Parliamentary Question Time between David Cunliffe and John Key over regional development

cheers

Bernard

by Happy123 | 22nd Jul 14, 3:40pm 1406000420

"Labour Government would put at least NZ$200 million in a fund for projects in regional areas"

I'm not sure you can call that a policy; if they said "we'll put 200m toward X or build Y" then you could say that's a policy. But saying they'll put aside 200m for.... dunno, something, anything as long as it's not spent in Auckland... is just odd.

If they can't decide what to spend the 200m on, who is? Do they want me to spend it for them...

by waymad | 22nd Jul 14, 3:46pm 1406000778

Happy, that munny was Yours to begin with.....it's not as though Gubmints are wealth generators....

But of course Labour have always secretly believed in the Magic Money Tree out there in the bush somewheres.....

by dtcarter | 23rd Jul 14, 11:03pm 1406113412

Crickey dick, just watched that parlimentry video. What an adolescent namecalling high school bully JK comes across as. I'm always surprised at what a snadpit the nations parliment is.

by DFTBA | 24th Jul 14, 4:14pm 1406175285

Yes - and those high school bullies govern us. It's scary.