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9/11/2018 — Economics, Politics and Government
A week of wins and losses
By Dene Mackenzie

It has been quite a week for New Zealand politicians.

The Government has had some wins and losses and the Opposition National Party has had some losses and wins.

Unemployment figures out this week showed a rate of 3.9%, the lowest rate since June 2008 when it was 3.8%. The good news on employment comes when business and consumer confidence continues to fall and provides counter intuitive evidence to the data provided by all of the confidence indices released.

National leader Simon Bridges is in an awkward position after claiming three months ago unemployment was too high at 4.4% and the Government was destroying the economy.

Social media has been flooded with his quotes from a few months ago complaining about high unemployment and comments this week from his finance spokeswoman Amy Adams.

Ms Adams says the drop in unemployment is welcome but the figures also highlighted the growing pressures in an economy where businesses are struggling to find workers.

In an attempt to turn good news into bad, Adams says the Government inherited a strongly performing economy and the figures with a lag effect, showed that.

National is now claiming Labour is backing off some of its more controversial employment law reforms because of the fall in unemployment and difficulty businesses have in finding workers. There is no evidence backing up this claim.

New Zealand First leader Winston Peters has agreed to use former National Party MP Jami-Lee Ross’ proxy vote in what will be an effort to further destabilise National. Mr Peters says the Botany voters need a voice in Parliament, and he will provide that through the proxy vote, in the belief Ross will eventually resign and force a by-election.

Ross offered his vote to Bridges but it was declined. With Peters having the use of the vote, the Ross saga will drag on further, something National can do without.

In a draw, Speaker Trevor Mallard and National shadow leader of the House Gerry Brownlee have come under public scrutiny for spending $24,000 of taxpayers’ money on a very short trip to Japan to meet so-called leaders.

Coincidentally, the two-day trip – including the business class travel to and from Japan – happened when the Baby All Blacks were playing Japan. Quelle Surprise.

Both men are keen sports fans and former rugby players. Calls for them to pay the money back have been dismissed by the two men.

The Government has taken a hit with its plans to now allow KiwiBuild purchasers to retain 70% of any capital gain if they sell their house within three years. The Government gets the other 30%.

The change of plan was snuck through under the cover of darkness. Previously, KiwiBuild purchasers would receive no capital gain if the house was sold within five years. Given the lack of demand for the houses, Housing Minister Phil Twyford has had to take some drastic action.

The deadline for the houses in Wanaka has been extended and demand is slow in other places. The houses, at $600,000 plus, remain unaffordable for most young workers.

Finally, the Government has rammed through its ban on new offshore exploration, a ban National says it will reverse. Given National is unlikely to be the Government until at least 2023, the country is in for some changes.

Increased imports of coal and gas are likely in the event of hydro lakes falling to low levels or the wind not blowing strongly enough to generate wind power.

The Government is blinded by the target of New Zealand being carbon neutral well into the future. It has not seen the short-term effects clearly.

Already, a Dunedin electricity company has been forced to close after high spot prices made its business model untenable. More independent small operators may be forced to disband and leave their customers to the larger generator/retailers.

If this happens, New Zealand power prices will start rising sharply, forcing more people to decide between food or warmth in winter.

*Dene Mackenzie is a Dunedin political commentator.

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