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Update on the AAE - DoC requests that logo be removed

Further to our questions about whether or not DoC is a supporter of the Australasian Antarctic Expedition (the scientific expedition that got stuck in the ice recently), yesterday we received another letter from DoC confirming that DoC has not supported the AAE. It states that DoC has now asked the AAE for its logo to be removed from the expedition's website.

To recap, after asking how much taxpayer money had been committed to the failed expedition, we discovered that the AEE was falsely claiming DoC as a 'supporter'. See my earlier posts here and here.

We look forward to receiving responses from the other New Zealand 'supporters', Landcare Research and the University of Waikato.

Click "continue reading" for the correspondence.

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Policy victory

Last week we released material showing that millions of dollars is being wasted in a CTU/Business NZ deal for health and safety training that, according to ACC's experts, for every dollar spent 84 cents is wasted. As you'll recall, the Minister of ACC, Judith Collins, labelled the scheme a 'sham' and a 'rort'. It was clear that millions intended to improve workplace health and safety was being used for programmes that did little, if anything, except 'raise awareness'.

We are pleased to report that, despite the initial doubt, the Taxpayers' Union has now confirmed that ACC is cutting the taxpayer funding of the Council of Trade Unions and Business NZ for this dodgy training program. We understand that the final contracts revealed last week dramatically reduce the funding Business NZ and the CTU receive.

This is a big win for levy payers - who will no longer have the burden of funding a deal that achieves little, if anything. For workers this is a win - the money can now be redirected to measures that actually reduces accidents. It's also a win for Business NZ and CTU members - no longer are the two organisations conflicted in their ACC advocacy for members.

ACC has now publicly stated that the this training programme will end this year. That, combined with the CTU and Business NZ's new contracts is a policy victory.

 

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Fiscal rules

Readers will be aware that Australia is facing huge deficits, despite the promise of the previous Government to get into surplus.

As a response to this, the Centre for Independent Studies has proposed some fiscal rules to bind future Governments. They are:

  1. require the federal fiscal balance to be maintained within a range of +2% to -2% of GDP on both an actual and forecast basis
  2. limit the net debt to GDP ratio to 10%
  3. cap the federal revenue and expenditure shares of GDP to 25%
  4. capping real growth in federal spending at 2% per annum

Fiscal rules are not new for Australia. The Labor Hawke/Keating Government set rules being:

  1. Not to raise tax revenue as a share of GDP
  2. Not to raise government expenditure as a share of GDP
  3. To reduce the budget deficit in absolute terms and relative to GDP

Anyway what I like most of all is their mechanism to encourage Governments to keep to the fiscal limits or rules. They propose:

This would involve cutting federal politicians’ overall remuneration by 1% for every percentage point breach of each fiscal rule for the duration of the breach.

Now that appeals!

NB: This post also appears on my personal blog kiwiblog.co.nz. Please feel free to comment on the post there.

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Business NZ finally responds to allegations of cosy deal

Stuff has just reported:

BusinessNZ rejects training scheme attacks

Business NZ has hit back at ACC Minister Judith Collins over her attacks on an ACC-funded health and safety training programme run by Business NZ, the Council Of Trade Unions and a private provider.

ACC announced this week that the $1.5 million a year programme would be canned at the end of of 2014 because it was not providing value for money.

Collins had joined criticism of the scheme, which has run since 2003, describing it as a cosy arrangement that had the hallmarks of a scam and a rort.

Business NZ today broke its silence on the issue, with a press release quoting its chief executive, Phil O'Reilly.

"For the record, Business NZ utterly rejects mistaken allegations made by lobbyist Jordan Williams since repeated by the ACC minister," O'Reilly said.

"The BusinessNZ family's involvement has been completely ethical at all times, and I am confident that this is also the case with the involvement of the CTU and Impac Services."

The CTU has also strongly rejected the criticisms by Collins and Williams.

O'Reilly said it was "unfortunate that important debate on workplace safety has been undermined by intemperate media comment".

Media reporting of uninformed assumptions by Williams appeared to have led to the minister's comments, O'Reilly said. continue reading...

Business NZ’s reaction ignores the fact that the criticisms we've highlighted are from ACC’s own experts - all the Taxpayers’ Union did was bring them to the public’s attention.  We made all of the material available online and before we went public we checked our facts with people within the industry. We stand by our statements.

Business NZ should focus on rebutting the criticism that it has accepted millions of dollars from ACC that did little, if anything, to improve workplace safety. Rather than getting personal Mr O’Rielly could tell us what exactly is ‘mistaken’.  All we’ve done is highlight ACC’s expert analysis which states that, even with optimistic assumptions, 84 cents per dollar spent was wasted. 

Click here to listen to Judith Collins on Wednesday's RadioNZ Summer Report ( 7' 08'' )

To blame us for the Minister labelling the Business NZ scheme 'cosy' and 'a scam' is flattering, but vastly exaggerates the influence of the Taxpayers’ Union.

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January 16, 2014

Waste watch ›


Why is the Government picking losers?

Yesterday Science and Innovation Minister Steven Joyce announced research and development grants that are set to cost taxpayers $140million over three years. The Herald reports:

More than $140 million has been earmarked to go to 31 New Zealand tech companies in research and development grants.
Science and Innovation Minister Steven Joyce yesterday named companies awarded R&D growth grants from Callaghan Innovation, the Government's high-tech development body set up in 2012.
Recipients include NZX-listed companies Rakon, Scott Technology and a company owned by Wynyard Group.
The grants provide a 20 per cent contribution to a firm's annual R&D spend, capped at $5 million a year.
PTo qualify for the grants, businesses need to commit to spend at least $300,000 and 1.5 per cent of revenue on New Zealand research & development.
The grants last for three years and after two years of receiving funding, a firm can apply for a two-year extension to the assistance.

 
Note that one of recipients of the grants is high profile technology firm Rakon, which share price has been in free-fall since 2007 and just announced to the NZX that it is closing its UK plant.

This is precisely why the government shouldn’t be trying to pick winners with taxpayer cash.

This isn't picking a winner - it's throwing money at a firm thats share price has been tumbling for years.

In 2007 Rakon’s share price reached $5.70.  Today it is trading at less than 4 per cent of that, at around 19cents. In addition, the Shareholders Association, and others, have been vocal in criticising the governance of the company. See for example the NBR back in August "NZ Shareholders Association to vote against reelection of Rakon chair, director" and stuff.co.nz "Rakon profit warning 'disturbing'":

"The Rakon shareholders have sent a powerful message to the board that they are displeased with the performance of the company and are looking for either an improvement in performance or a change in the composition of the board,"

Later in August, this Businessdesk update "NZ Shareholders Association to agitate at Rakon AGM" said:

The New Zealand Shareholders Association will next month vote against the reappointment of Rakon chairman Bryan Mogridge and director Darren Robinson, citing erosion of shareholder wealth and the desire to improve company governance.

The Shareholders Association will use its proxies to vote against the reappointment of Mogridge at the Sept. 6 meeting in Auckland after shares in the maker of crystal oscillators lost half their value the past year, making it one the worst performers on the stock exchange.

If the government is going to give out taxpayer money, at least give it to companies that are succeeding, not failing.

This is a grant to a company that is shrinking rather than growing New Zealand exports.

Looks to us like a big win for Rakon shareholders, but not so much for the taxpayer...

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ACC cans useless scheme publicly, but extended the contract within the last month

Yesterday it looked like the Taxpayers' Union struck up it's first win, with ACC announcing that it would scrap the health and safety training scheme which has cost levy holders $19million to date, with 84 cents per dollar being wasted (even with optimistic assumptions).

ONE News, 3 News, the HeraldStuff, Radio NZ, and Newstalk ZB all reported that ACC had decided to scrap the programme late last year.

The Minister for ACC agreed with the Taxpayers' Union, calling the scheme "a rort" and a "cosy deal".

ACC dumps workplace training scheme

 

This morning we read the small print...

The contracts released to the Taxpayers' Union on 5 December note that the ending date is 31 December 2013.

We now know that ACC has just extended the contracts to 31 December 2014

Despite the ACC telling media yesterday that it decided 'late last year' to can the programme, we learned this morning that the contracts were renewed in December. The end date is now 31 December 2014.

It appears that ACC only changed its tune since the Taxpayers' Union publicly exposed the rort.

Remember, it’s not the Taxpayers’ Union who labelled the training scheme a waste of money, it’s ACC’s own experts. Telling the public that they will scrap the scheme but waiting for the new contracts to expire is not good enough. They conveniently failed to mention that the contracts have just been renewed...

The Taxpayers’ Union is also backing the Minister for ACC’s reported comments that Business NZ and the CTU should pay the wasted money back to ACC. With such clear evidence that the money did little if anything to improve workplace safety, we think Business NZ and the CTU are morally obliged to stop wasting this money and compensate ACC levy payers.

UPDATE: We've been told that the rolled over contract is 'transitional' and reduces the amounts paid to the CTU and Business NZ.  We are trying to confirm this with ACC and have requested the documentation.

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Media coverage of Business NZ/CTU ACC rort

Tonight's TV news coverage of the corporate and union welfare exposed earlier today.

ONE News: $19m wasted on health and safety training with 84c per dollar wasted

Click here or the image below for video on demand.TVNZ screenshot

3 News: ACC dumps workplace training scheme

Click here or the image below for video on demand. 

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