Taxpayer Update: Nicola swings the axe ✂️ | Winston wants a taxpayer bank 💸 | Hipkins’ car crash interview 🚗
Hi,
What. A. Week.
The Good: Nicola Willis borrows a leaf from your humble Taxpayers' Union. ☺️
The Bad: Winston Peters wants to buy [checks notes] the bank that nearly saw the Crown go bust in the 1990s. 💸
And the Ugly: Hipkins has a car crash interview (not to be missed! 😂) and the wheels fall off Labour's keystone election policy – they want to shift round Crown-owned enterprises but refuse to release any costings, citing the Treaty... 😬
Plus, Wellington City Council is furious with the Taxpayers' Union and our friends at the Wellington Ratepayers' Alliance for publishing a "Wellington Town Hall Rich List" – it turns out local council bosses don't like the public knowing just how much they are paid.
Let's go.
We love you (?) Nicola Willis ❤️
Just a few months ago, Finance Minister Nicola Willis was holding up our Pathway to Surplus report and rejecting your humble Taxpayers' Union's respectful suggestions, describing them as "human misery" at a press conference in Wellington.
Of course, all we were doing was pointing out the elephants in the room identified by her own economic and Treasury boffins: New Zealand's fiscal path is unattainable, no meaningful tightening of the belt has yet occurred (in fact, under Willis spending and the rate of borrowing has grown!) and the longer we wait, the harder the decisions.
Well, times have changed.
And so too, it appears, has the appetite of the Finance Minister to grasp the mantle and deal with New Zealand's fiscal challenge.
On Tuesday, Minister Willis announced she's going to take the scissors to Wellington’s bloated bureaucracy, promising to cut 8,500 back office jobs, merge departments, and increase efficiency with AI.
Sir Humphrey's growth: One third more bureaucrats since the Key/English-era ⬆️
Let's set out the context: Since the Key/English Government left office, the expansion (more like explosion 💥) in total public service jobs under Ardern/Hipkins was 33.6 percent, even though the population grew by less than 11 percent.
The big increases have come with information professionals (i.e. spin doctors and data analysts), legal, human relations, finance professionals, and managers more generally.
As pointed out by Richard Harman's POLITIK, the number of "traditional public service pen pushers, clerical and administrative workers, are up, but by about only half of how much managers have risen."
Click on the table for a larger version (or click here to read on POLITIK)
Bureaucracy "grew" 33.6 percent, but "slashed" by 0.73 percent... 🙄
Of course, we welcomed Willis' announcement. But given similar promises were made by National prior to the last election, the proof of the pudding will be in the eating.
To date, the 'massive cuts' you hear about on the news have amounted to just 0.73 percent of the bureaucracy.
Promising savings is the easy part. It allows Nicola Willis to 'bank' the savings within Treasury's forward projections in next week's Budget and bring the (forecast) surplus forward.
But, for taxpayers, it's the delivery that matters.
And that doesn’t mean “reprioritised”, nor shifting roles into the arms (i.e. wallets) of "consultants".
The numbers must. Actually. Fall.
That was the point Jordan made on 1News at 6 o'clock: taxpayers should welcome the target, but they should also keep the pressure on.
But already, the special pleading and backsliding have started...
Foreign Minister Winston Peters is reported to be “thumbing his nose” at Nicola Willis’s hopes of slashing the public service, with the Foreign Minister scoffing at future MFAT savings and saying:
Well, that’s comforting.
If every minister treats their own patch as special, protected, and immune from savings, then taxpayers will get the usual Wellington routine: bold targets, soothing forecasts, but business as usual in the costly head office.
Minister Willis deserves credit for setting a firm target. Now she needs to make it stick. Debt is ticking... ⏰⏰⏰
Now to finish the job: New report on how to get the Budget "Back to Black" 🖤
Having acted on our calls to scrap Chris Hipkins' wasteful Fees Free scheme, and now the announcement on bureaucrat numbers, we thought it only fair to provide an updated edition of our 2025 Pathways to Surplus report.
Yesterday, we released Back to Black: A plan to rebuild New Zealand’s public finances before it’s too late.
Because I have to be frank with you, even with the recent announcements, the numbers are very grim.
New Zealand’s government debt has blown out from $46 billion in 2008 to $291 billion today, and is forecast to hit $363 billion by 2030.
Per household, that's a change from $29,000 in 2008 to a stonking $162,000 for every Kiwi household!
Ouch.
So our helpful Back to Black fiscal cheatsheet identifies $14.11 billion in savings for next year – that's enough to wipe out the forecast $13.9 billion deficit and achieve a $210 million surplus.
👉 Read Back to Black here 👈
Another government-owned bank: What could possibly go wrong? 😬
While Nicola Willis reaches for the axe, Winston Peters reaches for a fax. He wants to go back to the 1980s when the Crown had the majority share in the Bank of New Zealand.
Going rogue with the taxpayer chequebook, Winston Peters announced he's eyeing up the BNZ with plans to renationalise it.
Yes, that bank. The bank whose history with Crown ownership is not exactly a bedtime story for taxpayers.
Our Chair, Hon Ruth Richardson, might know something about this. She was Minister of Finance the last time BNZ had to be bailed out. Her response to Peters' speech:
“The last time the Crown was the majority owner of the Bank of New Zealand, it nearly sent us bankrupt. Now Winston Peters wants to do it all over again 30 years later.”
And it seems Ruth touched a nerve...
Borrowing to buy a bank while credit ratings agencies are breathing down New Zealand’s neck about government debt is not economic strategy, it is Muldoonism – and we all know where that left us.
We all agree that New Zealand needs more banking competition. But let's do that by allowing new generation fin-tech banks to enter the market, rather than retry a government-owned model subject to political pressure, and too often ending in tears (i.e. bailouts).
Bad banks cost shareholders, but bad government banks cost taxpayers.
The Geographic Board belongs in Willis’ bureaucracy clean-up 🗺️
The problem with Wellington is not just how many bureaucrats there are. It is what too many of them think they are there to do.
Voters can sack politicians. They cannot sack taxpayer-funded boards that decide they know better than the public, Parliament, or the ministers supposedly in charge.
Labour refuse to provide costings for "cornerstone policy" 🤣🤣🤣
Now, I love parlour games as much as the next person. But one game I’m not willing to play is Labour’s “guess the cost of our policy” lottery.
This week, the NZ Herald reported:
Labour has admitted key details about its Future Fund, including the cost to the Crown and which state assets will be rolled into it, will not be released until after voters have gone to the polls.
On Tuesday, Labour’s finance spokeswoman Barbara Edmonds admitted the party doesn’t itself know which public assets will go in the fund, and won’t know until it gets advice from officials after the election.
Explaining why this was necessary, Edmonds said some state-owned enterprises (SOEs) may have Treaty of Waitangi obligations attached to them.
The Government would need advice on these obligations, which could only come after an election, meaning Labour will not decide on which assets go into the fund before Kiwis go to the polls.
First, it was “commercial sensitivity”. Now, apparently, it's Treaty obligations. What next? The dog ate it?
Amber, Chris Hipkins and Barbara Edmonds are mixing fiscal policy with peek-a-boo. Voters deserve better.
And this is despite Hipkins promise less than a year ago to "stand behind our promises because every single one of them will have been properly researched, fully costed, and we will have a plan to deliver on it".
It's literally still on the Labour Party website!
Labour can't even keep promises in Opposition.
This is really treating the voters as gullible idiots. They are claiming they can’t give details because of Treaty obligations.
The real answer is that they know their numbers don’t add up. They think if they give no details before the election, then they can’t be scrutinised on their credibility.
Asking voters to sign a cheque before disclosing the amount is just not credible. Can we afford it?
From bad to worse: Hipkins car crash interview with Jack Tame 💥🚗
If you need a reminder of what the last Government's spin-over-substance approach sounded like, Jack Tame's Q&A interview with Hipkins over the weekend is absolutely worth a watch.
You can watch the full 21 minute interview here – or just our highlights reel of Chris Hipkins getting roasted. 🤭
Bring popcorn. 🍿
Taxpayers milked for $1.07m cowshed loan 💸🐄
And it’s not just Labour’s election promises where taxpayers are being asked to sign blank cheques.
We’ve written before about how the Regional Infrastructure Fund is looking more and more like the Provincial Growth Fund: a new Government, a new fund, but the same old pork barrel politics.
Now Rhys has uncovered that the taxpayer-backed $1.07 million cowshed upgrade in Taranaki is expected to sustain just 1.8 ongoing jobs.
Yes, 1.8 jobs. Not 18. Not 180. One point eight.
Documents released under the Official Information Act show the project received $900,000 in loan funding through the Government’s Regional Infrastructure Fund, despite only $120,000 in co-funding from Omuturangi 6E & 7A Ahu Whenua Trust.
Large parts of the application, financial analysis, loan terms, risk assessment, and decision-making material were blacked out.
Moo-ve along. Nothing to see here...
If the project stacks up commercially, why couldn’t the Trust get a loan from a bank like it has before? And if it doesn’t stack up, why are taxpayers being asked to carry the risk?
Farmers across Taranaki would love help upgrading their cowsheds. But most of them are stuck paying rates, taxes, interest, and compliance costs without being able to send the bill to Wellington.
Wellington City Council’s bureaucratic Rich List 💰🏛️
And from taxpayers being milked in Taranaki, to ratepayers being squeezed in Wellington...
Our sister group, the Wellington Ratepayers’ Alliance, has launched the Official Wellington City Council Rich List - exposing 35 Council figures paid more than $200,000, including 34 Council staff paid more than Mayor Andrew Little.
Top of the pops is Town Clerk Matt Prosser on $531,616, while five Chief Officers sit at salary-band midpoints of $440,000. The Mayor, on $201,947, comes in last.
All up, these 35 officials cost ratepayers around $9.3 million a year.
That’s roughly the entire annual rates bill of 1,800 average Wellington households.
Not a bad gig if you can get it.
No one is saying councils don’t need capable staff. But when Wellington has the second-highest average residential rates in the country, the highest commercial rates, and a bureaucracy where dozens of officials earn more than the person voters actually elected to lead the city, ratepayers are entitled to ask whether they are getting results to match the payroll.
We are reliably informed by a Wellington City Councillor that expletives were flowing in the "Executive Lounge" at the Council when the Rich List appeared full page in Tuesday's edition of The Post...
If you're paid the big bucks, we say it ought to be transparent. In the UK, the salary of every single public sector worker is searchable via an online database. The kerfuffle this rich list has caused speaks to a culture where highly paid executives expect to remain behind closed doors, unelected, and unaccountable.
I'm sure that many on the Town Hall Rich List will be worth what they are paid. Others, not so much. But when they fight simple transparency – including a legal threat from the Council received on Monday – for simply advertising information that is publicly available (albeit not widely promoted) speaks to a culture that is not serving ratepayers well.
👉 View the Rich List at WellingtonRichList.nz 👈
Thank you for your support! Enjoy the rest of your week.
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