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False economy

Written By: - Date published: 11:13 am, March 6th, 2012 - 16 comments
Categories: economy, jobs, national - Tags: , , ,

What ideas has National had to grow the economy?

There was the promise that tax cuts would magically do the trick, but that was never anything more than a blatant election bribe. There was the cycleway, but that’s a joke. There was tearing up our best conservation land, but the public quite rightly stepped up and smacked that down. Anything else?

If they have had other ideas, they haven’t worked yet. That’s because National’s approach is cuts and austerity, completely the wrong methods for difficult times. Because constructive ideas and growth are far too hard, they’ve focussed instead on the one and only goal of deficit reduction, which they think they can achieve with slash and burn (like a dieter fixated on a target weight who decides to reach it by hacking off their own limbs). And how’s that working out?

2500 jobs gone but state service saves only $20m

A squeeze on state service backroom functions has saved just $20 million in two years, Treasury boss Gabriel Makhlouf has revealed.

The Government has shed more than 2500 jobs in the past three years and ordered chief executives to shave their IT and human resources bills as part of a drastic overhaul of the public service.

But despite ambitious plans to save $1billion over three years, a `benchmarking’ report to be published next week will show 31 agencies and departments have managed to reduce spending by just $20m. …

In last year’s Administrative and Support Services Benchmarking Report, Treasury estimated government agencies could save more than $230 million a year from back-office functions

$20 Million? For 2,500 jobs lost (and who knows how many other lives affected). Was it worth it? (I wonder if that calculation even takes in to account the increased spending on unemployment and other benefits.) Is that the way that we’re going to save our economy? Bollocks it is.

Meanwhile other opportunities are slipping by. Investment in techniques for a sustainable, green economy, “cleantech”, could be the very answer that we’re looking for. But no, still fixated on short-term, destructive mining, the bungling of the Nats means that “NZ risks falling off green wave“.

No sign of a Brighter Future wherever we look. No wonder Kiwis are fleeing NZ in near record numbers…

16 comments on “False economy”

  1. Pete 1

    Treasury warns of deficit blowout

    “The Treasury said tepid wage growth and employment sapped source deductions, while insurance companies sought GST refunds, and companies paid less tax than forecast”. This government couldn’t manage an economy even if Bill English had a book called How to manage the economy in three easy steps.

  2. Kaplan 2

    Treasury warns of deficit blowout
    I’d like to think if nats and the treasury were on the board of public company they’d have had their backsides handed to them by now.

  3. Sanctuary 3

    2,500 unemployed x $250PW (single, 25+, accommodation supplement) unemployment benefit x 52 weeks = $32,500,000 in additional government spending.

    $250 per person per week is actually on the light side in terms of benefits available.

    Now, how big was that “saving” again?

    • vto 3.1

      $20,000,000 for 2,500 jobs equals $8,000 per job for 2 years.

      So, the clever dunces in this govt save $4,000 and spend $32,500.

      This lot are bloody thick. They simply can’t do maths. It is exactly like putting the ACC premiums up to make it more efficient for the private sector.

      Bill English needs to give his job up to a fifth form maths student.

    • Ianupnorth 3.2

      There is of course the assumption (on the part of NACT) that those 2500 laid off will walk into new jobs, except, those new jobs simply do not exist, as many people’s skill sets are quite different to those in the labour market.

    • Bored 3.3

      I would suggest that that number is totally under the radar….for a comparison lets go back to Marty Gs column a few years ago…. http://thestandard.org.nz/tax-cuts-for-rich-at-heart-of-debt-problem/

      So $1,500,000,000 borrowed for tax cuts for the rich PLUS $2,145,000,000 for unemployment (165000 employed at $250 per week times 52 weeks a year)…you might draw the conclusion that without the tax cuts we would only be in half as bad a position.

      This is a tribute to economic genius of Shonkey Jonkey, the bankster who used to gamble with others peoples money. Now he’s gambling with yours and your childrens childrens money.

  4. Kotahi Tane Huna 4

    Police are scratching their heads after a man was involved in a traffic collision involving his car and a bus stop, three letterboxes, some outdoor furniture and a tree. Security camera footage however, shows that the car was parked the whole time. The driver, a Mr. English, claims that he switched the engine off just before the crash.

    • Vicky32 4.1

      Talking of police, I just heard on 3 News, that police are to be given the option of “your pay or your job”.. I don’t remember details, I was listening whilst correcting someone’s English for their website… (Such (unpaid :( ) fun!)
      But it can’t be good…

    • David H 4.2

      One of Bill English’s Brighter family members involved??

  5. muzza 6

    Here is an example of why the savings have been so poor….

    Large public body, had foreign head leading large resourcing department, in a temporary capacity. During temporary leadership, contracts were signed with foreign based consultancy. Temporary head, now works for foreign consultancy, who have large number of “heads” inside the public body!

    Not really going to save anyone anything is it!

  6. Bored 7

    Actually, I think we could have benefited hugely with the public service cuts….Treasury disbanded completely and replaced with a $5 Tarot card reader….huge efficiency and cost savings gains.

    • Draco T Bastard 7.1

      Why pay $5 when we can get tarot readings for free? In fact, that site has a huge amount of choice for our governmental divination decision making.


  7. Ianupnorth 8

    There is a hope that one day someone will have the balls to do this to our leader
    Does this sound familiar (my emphasis)

    Geir Haarde, who was ousted after Iceland’s three biggest banks collapsed and the country’s economy went into meltdown, could be jailed for two years if found guilty of gross negligence in failing to prepare for the impending disaster. He denied the charges and claimed that “only in hindsight is it evident that not everything was as it should have been”.
    Haarde was instrumental in transforming Iceland from a fishing and whaling backwater into an international financial powerhouse before the credit crunch caused the economy to crash almost overnight.
    The Icelandic parliament’s “truth report” into the causes of the crisis that forced the country to borrow $10bn (£6.3bn) to prop up its economy, accused him of “gross negligence”. He is also accused of failing to rein in the country’s fast-growing banks, whose paper value before the crash had ballooned to 10 times the gross domestic product of the island state of 320,000 people. And he is alleged to have withheld information that indicated the state was headed for financial disaster.

    • Kotahi Tane Huna 8.1

      His best defence is that he is a stupid man who got where he is by good luck, not merit. At least that angle would have the virtue of being backed up by research.

  8. Hami Shearlie 9

    Now we hear the tax take is down. But no talk from Blinglish of reversing the tax cuts to the wealthy. People could have understood a tax cut to large businesses who were willing to use it to employ more people, but giving it to ALL wealthy people was crazy!! The reason given was that it would kick-start the economy. FAIL! Giving a huge tax cut to people who did not use it to expand a business and employ more staff was madness – most of them put it in the bank or spent it on holidays overseas, so nz didn’t even get any of that back in revenue to nz businesses. I’m thinking that they won’t reverse the tax cuts purely out of self-interest, they love their fattened pay packets and their family trusts must be overflowing by now. After all, being a minister(and aren’t there a huge number of those) gets you twice the pay of a backbencher!

    Maybe now we are all starting to see why Simon Power left. He obviously knew all the new and very foolish policies that were being planned and didn’t want to be connected with them. The Nats are realising the loss of Power now, he was popular with many people, and it’s funny, they’re only just starting to realise that their beloved Steven Joyce ain’t a popular guy!! Who’s left to take over from Shonkey – Judith Collins? I bet she even scares her husband!!!

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