WHY MINING IS NZ’S LAST CHANCE TO AVOID THIRD WORLD STATUS

Source: NZ Herald, Matthew Hooton 14-June-24

Matthew Hooton is on the money in this Opinion piece. He stated three key facts:

• New Zealand’s gross debt is set to increase by $212 billion between 2008 and 2028.

• Fifty years ago, Norway decided to assure the sustainability of its welfare state and low taxes by drilling for oil.

• Now, the Norwegian government’s share in state-owned oil giant Equinor is worth around five times the commercial entities and shares owned by the New Zealand Government.

Matthew took aim at both National’s Sir John Key and the Ardern Labour Government for the soft debt options that highlighted this era. He said with Sir Bill English as Finance Minister New Zealand’s debt ballooned by $56bn over 8 years – and under Grant Robertson’s term as Finance Minister it was even worse, borrowing $90bn over 5 Budgets. Matthews says that Nicola Willis, as the current Finance Minister, is heading in the same direction.

Unfortunately, we have continued in a productivity spiral downwards for the last 20 years and, if we don’t correct this and don’t find a way to repay our debt then New Zealand is fast heading towards a Third World standard of living.

To his credit (and Matthew has shown that he is no friend of the National Party these days) Matthew has suggested a solid solution. He is advocating for New Zealand to use its natural mineral wealth, as Norway did 50 years ago, to turn our economy around. To be fair to National, National Ministers like Energy Minister Simon Bridges also saw our predicament and were heading in the right direction, before Jacinda Arden made her “Captain’s Call” to ban oil and gas exploration – which was the worst decision, based solely on a left-wing ideology rather than good science, and has sent our economy spiralling south.

 

Hooton offers the Norway solution

His Opinion piece said: Fifty years ago, Norway decided to assure the sustainability of its generous welfare state and low taxes by drilling for oil.

It established a 100% state-owned oil company, Statoil, with the Government also owning 50% of every production licence. Profits went into Norway’s equivalent of our Super Fund.

With external capital, Statoil, now called Equinor, is worth around $140bn, employing 23,000 people in 30 countries.

The Norwegian government’s 70% share is worth $100bn, five times the commercial entities and shares owned by the New Zealand Government. Yet Norway and New Zealand’s populations are almost the same.

Despite that, Equinor has become Europe’s biggest energy provider, wealthy and powerful enough to be leading that continent’s transition to renewable energy.

Norway’s pension fund is even more impressive, now with $2.7 trillion under management. Our Super Fund is worth less than 3% of that. Even throwing in every last KiwiSaver account, New Zealand has saved just 6% as much for our retirements as Norway, despite near-identical populations.

Given climate change, some New Zealanders are squeamish about drilling for oil. Yet Norway achieved economic security producing just 2% of the world’s annual oil. With the US, Russia, Saudi Arabia, Canada, Iraq and China and the four other top-10 producers continuing to increase production, Norway’s contribution to global warming is minuscule and falling.

In any case, New Zealand’s main target isn’t oil but natural gas. To the extent natural gas replaces New Zealand burning coal - imports of which soared under the Ardern-Hipkins regime – extracting and using gas lowers global warming.

If New Zealanders are squeamish even about gas, what possible environmental argument is there against us searching for and extracting whatever undiscovered deposits of copper, chromium, molybdenum, lithium, graphite, titanium, bauxite, iron, nickel and cobalt may lie beneath our land and sea? All are critical to support global moves to renewable energy.

For that matter, what possible climate arguments are there against looking for and mining any uranium or remaining gold deposits? What if we found diamonds?

Norway’s Equinor (formerly Statoil) is developing as a broad energy company, leveraging strong synergies between oil, gas, renewables, carbon capture and hydrogen. Our ambition is to be a leading company in the energy transition, creating value through the opportunities the energy transition brings, breaking new industrial ground by building on our 50 years of experience.

New Zealand must quickly learn from the Norway experience, if we are to survive as a 1st World country. Perhaps we could sell off the Government's Pamu (Landcorp) farms and use that money to fund renewable energy exploration.

Allegations of misuse of 2023 Census data

Stats NZ has asked an independent external party to investigate allegations of misuse of census data collected for the 2023 Census. Last year Stats NZ partnered with Whānau Ora Commissioning Agency to lift low response rates from Māori in Auckland. The collection operations with non-responding and partial-responding Māori households were led by Te Pae Herenga o Tāmaki. As part of this, Whānau Ora worked with Manurewa Marae.

In the first week of June Stats NZ received allegations relating to the inappropriate use of census data collected at Manurewa Marae. “We are taking these allegations very seriously,” Government Statistician and Stats NZ Chief Executive Mark Sowden said. “It is paramount that the information collected via census forms or any Stats NZ survey is kept private, secure, and confidential, and that it is only used for the purposes in which it is collected.”

There are also calls for a Formal Inquiry into John Tamihere's Political/Charity Empire. John is the President of Te Pati Māori, as well as COO of BOTH the Waipareira trust

Investigations and public scrutiny of Te Pāti Māori and John Tamihere’s various electoral campaigns and state contracts are finally starting to happen. Inquiries at varying levels now involve the Electoral Commission, the Police, Statistics New Zealand, and Health New Zealand Te Whatu Ora. The Ministry of Social Development, Charity Services, and the Privacy Commissioner have also been involved.

The Whanau Ora Commissioning Agency (WOCA) is actually the trading name for Te Pou Matakana Ltd. WOCA distributes government/Whanau Ora funding to various charities including the Waipareira Trust. But the Trust and WOCA are related parties. The Waipareira Trust is a minority shareholder in WOCA and shares the same CEO – John Tamihere. JT’s wife, Awerangi Tamihere is also the chief operating officer of both the Waipareira Trust and WOCA. Last year, as well as being the CEO of Manurewa Marae, Takutai Moana Natasha Kemp was also a director of WOCA – only resigning from the board on 31 December 2023.

The latest financial accounts for the Waipareira Trust show that WOCA provided Waipareira Trust with $16.8m of government commissioning funding for the financial year ending 30 June 2022 and that Waipareira Trust is charging an annual $6m management fee payable by WOCA. An eye-watering fee usually only seen in private equity businesses.

There are growing calls for a more thorough, interconnected investigation of the myriad allegations. Questions have been asked about why Charities Services isn’t taking a tougher position against Waipareira and Tamihere. Interestingly, its three person Registration Board, which looks at its most difficult cases, is chaired by Gwendoline Keel, a lawyer who is also the general counsel for Waikato-Tainui and was the recent Labour Party candidate for Port Waikato!

Political commentator David Farrar has also examined the voting booth data, and calculated the margin of difference between Kemp and Henare for the advance and election day votes:

§ Manurewa Marae (advance): +39% in favour of Kemp

§ Manurewa Marae +16%

§ Clendon Community Centre (advance): +6%

§ Pak ’n Save Clendon -6%

§ Pak ’n Save Clendon (advance): -10%

§ Clendon Community Centre -40%

Farrar says that you might normally expect that voting booths in the same suburb would be quite similar, but in this case, there was a huge advantage to Kemp at the Manurewa Marae.

Hence, the details of these interconnected scandals could be consequential. Former Cabinet minister Peeni Henare has confirmed he is considering his options and may complain to the Electoral Commission.

TRANSPORT GPS (Govt Policy Statement) Has been released by Minister Simeon Brown

All comments regarding Local Government are my personal views, and do not purport to represent the views of our Regional Council – of which I am an elected representative.

The previous Labour Government took at least four years to produce their draft GPS (and in 6 years they never finalised it). Minister Simeon Brown has produced the latest GPS in just 100 days. It is fantastic to get some certainty and a clear understanding of where this National Coalition Government is heading. Yes – some won’t like it, but there is a clear determination to get rid of the wasteful and (often) woke thinking of Labour and the Greens.

The vast majority of New Zealanders, whatever their age of lifestyle, will leave their homes most days, and almost all of them use the transport system when they do, whether it be a footpath, cycleway, bus, train, local road or State Highway. It means the $20bn GPG just released by Minister Brown is an intensely political document. 

The main job of the GPS, which is really a draft transport budget, sets out how much money the Government will take from road users and what programmes they intend to fund. Minister Brown’s plan would see between $4.8bn and $6.2bn spent each year (local government transport spending will add billions more). It’s not a lot compared to the likes of health and education, which is probably why these spending decisions are so bitterly contested.

Minister Brown has already indicated that that he will be very targeted in his transport spending and public transport is an example. He stated that when Labour came into power in 2017 the farebox recovery rate for PT was at 40%, and this fell under their watch to just 13%.

In my March Newsletter I identified that in the Bay of Plenty’s Urban Bus Services (ie Tauranga, Rotorua & Whakatane) the farebox recovery is currently just 6% ($2.28m) - with local ratepayers (100% targeted rate) paying 42% ($16.87m) and Central Government paying 49% ($19.94m). This is clearly not sustainable over the longer term.

The Western Bay of Plenty will do very well out of the announced 13 RONS (Roads of National Significance). This will not be funded out of NZTA’s Budget, but with separate Government funding. They have allocated $1.9 billion for State Highway 29 (over the Kaimai’s) and $627 million for the second stage of State Highway 2 (Te Puna to Omokoroa) in the next three years.

The big question facing NZTA will be their ability to deliver these programmes – on time and within budget.

Note: This is over $7bn a year for the next 3 years.

Note: National’s plan for 2024/25 is to spend $80m more than Labour planned for Transport.

 David Parker’s plan had 36% of land transport spending going on public transport, rail, walking, cycling etc. The Brown plan has that reduced to 28%, which is still quite generous. The big winner is state highway improvements up 37% and local road maintenance up 14%.