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Archive for February, 2009

Economic Debate – Do We Need The Cullen Fund?

The PM is sandwiched on Cullen Fund questions between ACT (which has Green support in backing calls to suspend payments into the fund) and United Future’s Peter Dunne (urging National not to tamper and warning against making state pensions a political football). John Key is keeping his powder dry: he hasn’t ruled out suspending or […]

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Infrastructure Seen As New Economic Cure All

The Govt in setting up an infrastructure unit under Treasury’s umbrella has put a Treasury Deputy Secretary Mike James in as interim head, and is planning to establish an Infrastructure Advisory Board whose members will be chosen for their financial, engineering and project management skills. Some authorities believe the new unit should act as a […]

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Searching For Options To Plug The Deficit Drain

With the recession slicing billions off Govt revenue, the Govt faces an operating deficit of $6.2bn (an $8.4bn deterioration from before the election). Besides tax revenue falling, many Crown agencies are seeing their revenue dropping off. Though the Crown’s debt level is currently quite low (2.3% of GDP), on current assumptions the Govt will have […]

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Economic Debate – To Bail Or Not To Bail?

Govts can do whatever they like to help troubled companies at the best of times, let alone in a deepening recession when the political pressure goes on, from leaving all firms to their fate in an unfettered market to nationalising the lot. What they should do lies somewhere between, the closer to the do-nothing end […]

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Resisting Pressure To Lift NZ’s Commitment To Afghanistan

After talks with his counterparts in Canberra and London, Defence Minister Dr Wayne Mapp is heading to Krakow in Poland for a meeting of the member countries in the Nato-led International Stabilisation Force in Afghanistan. Like other countries NZ will almost certainly be coming under heavy pressure from the Obama administration to step up its […]

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Auckland Governance Could Hold Economic Key

The Govt is looking to the Royal Commission on Auckland governance, due to report next month, for some proposals which will streamline the system under which NZ’s largest metropolitan region has to labour at present. Some experts think reform of Auckland’s local Govt structure could be the step which more than any other could unlock […]

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Economic Debate – To Spend Or Prune?

It sounds good: $483.7m of publicly funded infrastructure projects (housing transport and education) are being fast-tracked to boost the Govt’s economic stimulus programme. How much more such capital investment is needed is arguable, but if money is the lifeblood of the economy, and farming the backbone, then infrastructure is the alimentary canal and plenty of […]

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Starting The Huge Task Of Filling The Infrastructure Gap

In fast-tracking $500m of projects spanning the housing, transport, and education sectors, the Govt says it will create work for businesses in the regions, and will help keep suppliers and sub-contractors afloat. More than $100m worth of projects are to start before June 30. Education is to be allocated $216m for new schools, maintenance and […]

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Govt Finances A Balancing Act On A High Wire

Now the hard yards begin. The Govt has to frame a budget under the harsh restraints of falling revenue, a deepening global recession, increasing job losses and shrinking corporate profits. NZ is on negative credit watch. The health of the banking sector is under daily scrutiny. The pillar of NZ’s export sector, the dairy industry, […]

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New Urge For FTA Between Korea And NZ

The deepening recession may have sharpened protectionism in Europe (Trade Minister Tim Groser has been working the traps in Davos and Brussels over the EU’s plan to bring back farm subsidies), but it may be having the opposite effect in some parts of Asia. Korea in particular wants to accelerate lowering trade barriers. In a […]

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Govt Sets Sights On Defence Review

The Govt is preparing to write a major review of NZ’s defence policy in the form of a new white paper. Ministers may appoint a small team of experts to pull together the paper with the Ministry of Defence, NZ Defence Force, MFAT, Treasury and border control agencies. In Opposition, National believed the Govt had […]

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Economic Debate – How Much Intervention Is Too Much?

So far so good, for those who fear a slide back towards Muldoonism. The PM has done no more than tell us he is keeping in touch with the banking sector in times of trouble. His Govt needs good information about (as he explains) the lubricant to keep the economy going, and face-to-face chats will […]

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