Monthly Archives: Apr 2016

John Key and the foreign trusts

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So, Mossack Fonesca bites again. A few weeks after the “Panama Papers” had National scrambling for answers to counter the rage on the centre-left, Prime Minister John Key’s Government has been left embarrassed again by new revelations that his lawyer had lobbied intensively to stall what they thought was going to be a law change on foreign trusts. As the dust begins to settle on this latest twist in the Mossack Fonesca saga, I have to wonder how many more hits this Government can sustain before it causes them damage that cannot be repaired.

Thus far the pollsters have been very quiet over Mossack Fonesca. A cynic might say that they work for the Government, and that the media are supremely biased in National’s favour. But to some extent the failure of Labour and the Greens to join New Zealand First in making a sustained attack on National using these revelations could be the reason for the latter continuing to climb in the polls and the other two remaining largely unchanged.

So, what  is the latest?

Simply put Prime Minister John Key’s lawyer Ken Whitney lobbied the Government after hearing reports that the then Minister for Revenue Todd McClay was considering a law change to how foreign trusts work in New Zealand. Mr McClay was supposed to attend a meeting held at the Antipodes Trust where Mr Whitney works. The agenda for the meeting included discussing the Government making a commitment to not changing the law. After that the Government decided there would be no change in the law as the Antipodes Trust claimed it would be severely damaging to the industry.

A brief timeline of events looks like this:

  •  In 2013 the Inland Revenue Department warned about the risks posed by foreign trusts
  • In December 2014 the Antipodes Trust began lobbying against proposed changes
  • The same month I.R.D. again warned about the risks posed by foreign trusts
  • Still in December 2014 the then Minister for Revenue Todd McClay met with Antipodes Trust
  • In May 2015 Mr McClay announces there will be no change of the law
  • In the same month I.R.D. tells their staff that there will be no change in foreign trust law
  • In April 2016 Mossack Fonseca is found to have released a massive number of files relating to foreign trusts around the world – New Zealand is mentioned up to 60,000 times
  • In April 2016 Prime Minister John Key’s lawyer Ken Whitney, who works for Antipodes Trust is found to have lobbied on their behalf for the Government to not change the law

Well, even before the Mossack Fonesca leak occurred, it would seem that New Zealand’s reputation amongst criminal elements as a haven for financial dirt was causing I.R.D. some problems. And it would seem that the Government elected to sweep it under the carpet in the hope that it would not be noticed.

Am I surprised?

Not particularly.

Rebuilding New Zealand’s police force

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Over the last few weeks we have seen some shocking violent offences in Auckland being perpetrated. After each there has been an interview with the victims, often minimum wage workers working long/late hours. They have been traumatized by the incident. They fear for their safety, and without doubt they wonder what will happen if the Police are not able to find the perpetrators. Nobody can blame them.

And it is not because we have a lousy force. In actual fact, we are very lucky to have the Police force that we do in New Zealand. Among its many redeeming features are that:

  • The force is comparatively free from corruption and unethical behaviour compared to their equivalent in other countries
  • They are more community oriented in that more time, and face to face interaction is spent on meeting locals, local community groups
  • As yet, they are not carrying firearms on regular patrol, though I understand that officers have access to them

However, since the 1990’s both major parties have cut back police funding. Both have forced the police to prioritize calls, leaving low level offending to sometimes drop off the radar because there are other crimes that have higher priority. The prioritizing has lead to some unfortunate decisions, that have cost lives. As budgets continue to tighten despite both parties saying they care about reducing crime and bringing offenders to justice, the only likely outcome is a progressively more restrictive regime of prioritization.

In part because of this, but also because of a slow but long term break down in societal values that seems to be in progress, brazen criminal offending such as the petrol station ram raid and other violent attacks on stores afflicting Auckland is on the increase. It has been shown to criminals that they can offend and have a high probability of getting away with it in terms of being caught. And unfortunately this sad fact is catching on.

Perhaps also, there is an element of political correctness slipping into the system. I am certainly not saying that New Zealand should revert back to capital punishment. Nor am I saying that that the rights for prisoners should be revoked, as there is undeniably strong case law for just that. But the idea that judges should worry about whether a person could have their employment prospects impacted by a sentence for child abuse or fraud has no credibility with me at all.

When Police take a case with overwhelming evidence to court that they have elected to pursue this far, how demoralizing it must be for them to see it get a watered down sentence. But what bothers me here is the number of cases they actually have the time and the resources to take to court in the first place. A victim of sexual violence has virtually zero prospect of seeing their attacker get put away, and sometimes the Police do not take their case seriously – is that because of poor attitudes or because they are not properly trained or funded? I do not know the answer, except that whatever the case it is not a nice one.

Sadly I do not fancy the prospects of the perpetrators of the recent violent offences including the attack on the dairy, the recent petrol station ram raid, among others being brought to court. Will it be because the police were not able to get someone into the case fast enough; because they could not spare a dog handler and his/her canine to find them? Pass.

But there is one thing we can and should do: rebuild the Police force.

Trouble in the Green Party?

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Unable to gain traction on issues such as corporate tax evasion, and running the risk of alienating potential supporters with their support for more immigrants,  the Green Party has been in a slump in the last few months. Like other parties, their share of support in the polls has waned as New Zealand First’s has grown. The change in leadership, with Russel Norman leaving to join Greenpeace and being replaced by James Shaw does not seem to have helped them – or hurt them.

At the same time though the news that three senior figures in the Party have left in the last few months, raises questions about what is happening inside. Although not surprisingly the Party denies any problems, the timing in a part of the year coming up to the 8th fiscal budget of this Government when the Greens need a sharp communication of their thoughts, could be problematic.

Although the new male co-leader to complement Metiria Turei needs a bit of time to settle, he has a steep hill ahead to lead his troops up if the Greens are going to regain their place as the third party of New Zealand politics. To their credit though, they still have a number of well performing Members of Parliament. Julie Anne Genter whose knowledge of transport issues and her persistent niggling attacks on the Government’s transport policy continues to hound Simon Bridges. Another Member of Parliament who is worthy of mention is Gareth Hughes, for his work on energy policy

But there are others who are starting to look a bit like they are past their best, including Kennedy Graham and Kevin Hague. Mr Graham’s Global Affairs portfolio unfortunately still bears the hall mark of Keith Locke, whose work on human rights is to be noted. Unfortunately his attacks on the Defence Force are part of why people such as myself will not consider moving further to the left than we already have. Others such as Marama Davidson and Steffan Browning might well be working hard on their portfolio’s in the background, but the surface expression of their work in terms of media time and activity in Parliament is hindering them.

With half of National’s third term now finished and Prime Minister John Key’s popularity still very high for a third term Government, the Greens like New Zealand First and Labour are under real pressure to grow their support and present a credible alternative. Although it is too early to start releasing policy, like New Zealand First and Labour, they need to be filtering out their potential candidates and looking at holes in their manifesto from the previous campaign.

 

 

Government underestimating value of water based recreation

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For years we have been hearing about the value of irrigation to the economy. We have been hearing from farmer groups, dairy and – of course – irrigation part suppliers themselves how important it is that the Government invest in this part of the economy. And the Government has without a doubt listened. Some (with justification)might say it has listened too well, shutting out reminders from others about how other uses of fresh water contribute to the economy as well.

I have no doubt that there is a significant value to the fresh water based recreation industry in New Zealand. We are very lucky to have the assortment of small medium and large rivers and lakes that we do and also to have had the ability to do quality research into their form and function. One estimate recently suggested that the value of both the fresh water and salt water recreation may be worth as much as N.Z.$1.7 billion and have created 8,100 jobs.

Even if one takes the salt water substantial fishing industry in New Zealand, and the catches of recreational fisherman seeking sea going species is put aside, there is still a quite substantial boost to the economy. A thesis by Jiang (2015)found that in Otago alone the value of recreational fishing might be anywhere between N.Z$88-130 million.

However I am quite bothered by the last 15 years of Government policy that has enabled a significant and currently ongoing deterioration of the quality of our fresh water, the ecosystem that it sustains and the economic and social benefits that arise from them. The policy is quite deliberately enabling users to take water that simply might not exist, and it is also breaking what for me is a cardinal rule of ensuring that fresh water under ones property leaves in as good condition as it arrived in.

What does this have to do with fresh water recreation? Much. Not least because deteriorating conditions may put off recreationalists and make them spend less time and money on the pursuits that I have described below. They might also tell their friends and/or family who might be considering joining them that the quality of the experience has deteriorated.

A healthy river will be flowing, and have a clean bed for fish species to spawn in. Around and above it will ideally be stable banks that do not collapse easily to silt the riverbed, enabling weed carpets to grow, slowing the flow of the water and covering areas for fish to spawn. The water will be of a condition that a dog can enter it without ingesting cyano bacteria which can be lethal.

A healthy river system will attract a range of fresh water recreationalists. Some might be there just for a swim if that is feasible, whilst others might be there to kayak, boat, or fish. In order to do so they might also invest substantial money in fishing gear, or a water going craft. All will expend vehicle fuel and time getting there. Some might even stay the night, pitching a tent or staying in building accommodation such as a house hotel/motel or camping ground nearby.

 

No obvious contenders for 2017

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New Zealand is half way through the current term of the New Zealand Parliament. And in all the time I have been monitoring New Zealand politics I have not seen so late in the third term of a Government, a Parliament so lacking in a potential winner.

But do I think there will be a hung Parliament in 2017? I certainly hope not, because that would be three more years relying on politicians who will have had ample time by the end of this term to make a decisive impact. But as we move into the second half of this term, with National still clearly leading in the polls (which are never 100% accurate), despite having not made any meaningful changes for the better for most people in 7 1/2 years, this is increasingly starting to look the case.

For years I have been hoping that any one of the various leaders of Labour or their Party President would issue a “dead wood” edict, just like National did in the middle of its time on the Opposition Bench. The purpose of that edict was to encourage long term Members of Parliament to consider moving on so that the ranks can be freshened up with a view to taking back the Government Bench. It worked and between 2005-2008 a number of National Party Members of Parliament retired from their political careers. By the time the 2008 election rolled around National had a person who could lead the Party to victory, and despite their mediocre performances, a set of Members of Parliament who could become Ministers.

Labour are scared stiff of National. Too scared to be a centre left Party. Too scared to release more than token policy. Too scared to issue their own “dead wood” edict, despite it now being one of the primary reasons why they look doomed to spend a fourth term on the Opposition Benches. Back in 2002, after watching National get trounced at the election and plummet to 27 seats, I actually had a bit of sympathy for them because healthy politics have both an active Government and a robust Opposition. The Government was robust and doing things, but the Opposition was in trouble. But after the 2002 election they did some serious rebuilding – rebuilding that I am yet to see in Labour.

What I found impressive was that New Zealand First has managed to grow by half its Parliamentary size again since 2011, whilst the Greens have stagnated after years of growth. Following the 2014 it had 11 Members of Parliament. Then National M.P. for Northland, Mike Sabin, resigned abruptly causing a by-election, which  its leader the Right Honourable Winston Peters won, enabling a 12th Member of Parliament to be brought in (Ria Bond). Mr Peters, a veteran of Parliament for 30 years, continues to be one of Parliament’s star performers.

And finally we have the Greens. The resignation of Russel Norman to take up the top job at Greenpeace might be in the latters favour, but it certainly has not helped the Greens. The party under Metiria Turei and James Shaw seems to have declined somewhat in the last 18 months both in terms of being an effective ally for Labour. It’s share of the seats in Parliament has been overtaken by New Zealand First in the polls.

There are two ways I think New Zealand can end this National-led Government. One is that the Greens and New Zealand First work together and Black-Green 2017 becomes a rallying cry, which could take away centrist votes from National and pick up their disaffected “Blue-Greens”. The other is Labour gets its backside into gear.

Or we end up with a hung Parliament. And possibly another election within the year.