Scoop Election 08: edited by Gordon Campbell

Bill English’s Homing Instincts, for the Money

August 7th, 2009

Clearly, the first item on the review of ministerial expenses is going to be to create a clear definition of what constitutes ‘home’ – because judging by the performance of deputy Prime Minister Bill English, ‘home’ is a word that means what he chooses it to mean. And Dipton – even if it is not where he or his family have lived or his children have gone to school for the past ten years or more – is what he regards as home, and the taxpayer is paying to humour him in this homage to his roots. Normally though, when people display such devotion to their home town – or to Tipperary – they don’t expect other people to pay for it.

English has not had a good week, or fortnight, on this issue. Earlier in the week he decided to pay back half of what he has received since the election in housing assistance – and then rather spoiled the effect of the gesture by calling it ‘leading by example’. In fact, the gesture put him on the same housing assistance rate as ordinary MPs – so it was rather hard to see the ‘leadership’ bit. Normally, that means being out in front of the troops. In a week when unemployment hit a ten-year high – and is forecast to get worse before it gets better – leadership might have meant foregoing any extra housing assistance at all, and getting by on his $274,000 salary.

That point seems to elude English entirely. It should not have eluded National’s spin merchants. Salary packages that include bonuses for housing, travel etc may be par for the course in the private sector – but they are historical anomalies among parliamentarians. The overseas travel perks for life that Sir Roger Douglas has availed himself of so enthusiastically were a reward created by a grateful nation in a bygone era when MPs were foregoing career advantages for life, in order to serve on salaries far below what they could achieve elsewhere, within a relatively prosperous society.

That wage gap and that general prosperity have now largely vanished – amidst a sharp rise in income inequality that the Douglas economic policies did a great deal to make possible. Even so, English and Douglas cling to their perks as if they were rights written in stone – apparently, with no sense of what this self indulgence looks like to families struggling to get by. If it was ever was, NZ Inc is no longer in a position to afford such largesse to the people steering the ship of state.

The pleas over the past fortnight from John Key and his spin merchants that Ministerial housing assistance is necessary to keep the families of Ministers happy, and together, have been a particularly grotesque miscalculation. Previously, the MPs concerned were getting housing support at half the current rate – now, as Ministers, their salaries have virtually doubled. Yet to keep their families happy and together, taxpayers must also double their housing allowances as well? Spare me.

By that logic, former Labour Ministers during the Clark government – who have seen their housing allowances halved over the same period – should be stampeding into the divorce courts. Perhaps the taxpayer can be expected to sponsor counseling for former Ministers and families making the painful transition back to life on $144,000 a year, heavily discounted travel, and $24,000 a year in housing assistance. Like an opium den, the Beehive seems to snare its inhabitants in a virulent form of the culture of dependence. We need to be compassionate about these housing handout fiends. Some toughlove, and cold turkey, is called for.

What Might Have Been

Last year, thanks to a last-minute intervention by the Clark government, Auckland International Airport narrowly avoided a takeover bid by the Canadian Pension Plan (CPP). This year, the Key government has signaled its intention to revise the rules for foreign ownership – supposedly, in order to foster the kind of foreign investment that New Zealand needs. In the process, the Key government plans to scrap the procedures that Michael Cullen invoked to thwart last year’s attempted takeover.

Would CPP in fact, have provided the sort of capital input that would enable Auckland International Airport to flourish – or would it have milked the asset to the detriment of New Zealanders ? We’ll never know for sure, but we can hazard a reasonable guess – because CPP’s fortunes have plummeted in the wake of the global economic crisis, and CPP directors have been taking a hammering in the Canadian press and in the Canadian Parliament for awarding themselves huge bonuses even while the fund’s fortunes shrunk by 18.6 % during fiscal year 2009. Is this the sort of enterprise that would had any inclination or ability to put fresh productive investment money into growing its assets in New Zealand? Hardly.

On the evidence of what has happened to CPP, New Zealand should be thanking its lucky stars that its prime tourism and transport hub did not pass into the hands of a pension plan in crisis. The lesson being – not all foreign investment is virtuous. Some of it can be about extracting monopoly rents from captive New Zealand customers. Back in the 1980s, it might have been possible for the naïve market zealots of the Lange government to treat the private sector and foreign investment as being inherently virtuous. In this day and age, it is almost criminally stupid to do so.

Unfortunately, the current government is giving no indication that it has learned from say, the asset stripping history of foreign ownership of NZ Rail. Or from New Zealand’s apparent inability to conduct such transactions competently. Earlier this decade for instance, New Zealand seems to have sold the South Island high voltage electricity grid to a US bank via a Cayman Islands tax shelter. without even realizing it had done so.

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    1. 8 Responses to “Bill English’s Homing Instincts, for the Money”

    2. By Ann Lynch on Aug 7, 2009 | Reply

      In these days of universal economising, it would definitely be “showing leadership” if all parliamentarians were subject to the same criteria as other HNZ clients. Electorate MPs should reside in their electorates, the better to represent them; a dedicated block of flats with shared “entertainment” areas would enable the hosts of overseas guests to discharge their duties adequately, and the families of MPs would be then on a par with the families of servicepeople on overseas service. Although I expect the latter have less generous travel allowances.
      Indeed, how can we expect our politicians to recognise the potential for asset-stripping foreigners to damage this country when they themselves are exhibiting similar propensities towards their fellow-countrymen and women?

    3. By Marie on Aug 9, 2009 | Reply

      No one has mentioned the MPs electorate allowance which all MPs get to operate their electorate office/s, including list MPs who do not have an electorate (about 40 odd thousand I believe)

      This needs to be out in the open as well and open to the Official Information Act

    4. By Robert on Aug 10, 2009 | Reply

      Sour Grapes, Gordon. Bill is a good Catholic boy with ll children and only one partner in his long parliamentary career. English has saved us from the excesses and cuts that Grosser, Key, Lockwood, Williamson, Heatley, Collins, et al would doubtlessly impose.Bill with an IQ of what l42? doubtlessly desrves his $220,000 salary and two large houses. Sour Grapes and just the media’s desire to even up for the real wxceses of Carter, Douglas and Collins.

    5. By Dr Strangeglove on Aug 11, 2009 | Reply

      He’s a smarty Robert, and Gordon did not claim Bill was a philandering ho bag .
      Nice work by pointlessly defending Blinglish by throwing us one test score.One that would seem to claim that Billy Boy is fully capable of working out NZ’s current economic situation and of what taking unneeded luxuries means right now.
      Saying he had the IQ of a Dolphin would pose a better defense for Bill’s self interested very “banker” like symbolic gesture.
      Hes not hurting, and neither are the Banks.

      “Bill English, faced with the politically embarrassing spectacle of those same four banks having piled up $4.5 billion in profits (recession? What recession?), begging them to please pay nice and scale back their flagrant profiteering.”

    6. By brian marshall on Aug 13, 2009 | Reply

      Gordon, two things. Firstly Dipton is still considered his home under the Electrol Act, even if he spends most of his time in Wellington. Many MPs from all policital parties own their own house or flat in Wellington and it makes sense to as they would spend so much time there as part of their job. I understand Helen Clark did also for example, but I could be wrong.
      I think that it is comendable to have MPs that want to not have their families and marrages broken up, but still able to represent their electorates.

      Second point, It has been reported that no overseas investment at all has been stopped by the law the Labour govt introduced to stop the proposed sale of Auckland Int airport. Another useless law. Even if the CPP did purchase part of Auckland Int airport, the commerce commission has strong powers to deal with monopolies such as Auckland Int Airport.

    7. By Dr Strangeglove on Aug 13, 2009 | Reply

      @ Brian
      Blinglish gets over a quarter of a million dollars a year.
      You say on top of his exorbitant salary(in a banking crisis) he felt he needed to take extra taxpayer funding?

      Business NZ or the RBNZ are the interest groups who should fund the ” Save Poor Bills marriage and family bonuses” .
      Poor Bill.
      Cry me a river.

    8. By Martha Mitchell on Aug 14, 2009 | Reply

      Classic quote from the Dipton Dipper

      “I didn’t know I could take less”

    9. By Bob on Sep 29, 2009 | Reply

      All very interesting,I’m sure,but when will someone put forward the possibility that our Bill is just a greedy bastard like the rest?

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