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Abandoning a winner

Written By: - Date published: 1:37 pm, July 3rd, 2009 - 12 comments
Categories: national/act government - Tags: ,

Government’s put out this press release:

“Finance Minister Bill English has welcomed news that the Budget operating deficit of $7.2 billion for the 11 months to May 31 is lower than the forecast $8.4 billion…

Most of the $1.2 billion variance was due to higher-than-forecast investment gains by the NZ Superannuation Fund and ACC”

Yup, the NZSF made $1.2 billion in April and May. About 10% in two months. Sure glad they cut those contributions. Don’t want to keep on making huge profits. Lucky to have such financial geniuses running the country.

12 comments on “Abandoning a winner ”

  1. IrishBill 1

    So yesterday English attacks doctors, nurses and teachers without any reason to do so and today he boasts about how much money the two funds his government is attacking have made.

    Is he a deep-cover Labour Party mole?

    • Maynard J 1.1

      Well there was that election in 2002…

    • gingercrush 1.2

      Where is he boasting? If it was Labour you’d be hearing how great this news is when in effect English’s response is muted. Exactly where it should be. So ACC and the NZSF have seen gains. Not surprising when sharemarkets have been recovering and growing lately. The fundamental numbers and the more important news. Tax coming in and expenditure going out is still bad hence why we have such a large deficit at the moment.

      —-

      You also don’t get why National has chosen to suspend the fund. Though they still contributed 250 million into that fund. National isn’t naive and knows that a sharemarket will have periods of growth. That has always happened. While contributing to the fund makes sense when we are in surpluses, to borrow money to then put in that fund to off-set Superannuation in 15-20 years+ time is something they simply can’t agree with. Its not National alone in that thinking. Many conservative thinkers feel the same way about the Super Fund.

      As so happens to sharemarkets and other investments things don’t always stay rosy. Indeed, sharemarkets in particular are known for their volatility. Hence, why so many retirees in New Zealand and elsewhere are in trouble because what they thought they had for retirement (and remember this came from savings and not from borrowing) are sharply lower than what they were forecast to get. This will undoubtedly do damage to many retirees at the moment and retirees of the future.

      —-

      BTW I do find it odd that any RAM voter would be calling on a government to borrow money to invest in things like sharemarkets.

      • Anthony Karinski 1.2.1

        They don’t have to borrow for the fund. They can claim to borrow for whatever is on their books, like motorways or other infrastructure, and channel tax revenue directly into the fund. Its a matter of priorities and political ideology. Apparently the Mt Albert connection and a cycleway with no cost/benefit analysis done easily trumps looking after old battlers.

  2. As they say, “Past returns are no indication of future performance”. Surely recent events have shown this fairly conclusively?

  3. toad 3

    Ah, so that’s why they want to privatise ACC – it’s making them too much money.

    • George.com 3.1

      Is this the same ACC that Nick Smith only a few months ago said was failing?

  4. Craig Glen Eden 4

    GC “Conservative thinkers” Come on GC don’t make me laugh, you honestly believe Conservatives think!

    Hell you wouldn’t want National to invest in the CULLEN FUND and it actually be a success oh no! That would mean it would help reduce the operating deficit further. NOOOOO stop give the money to the rich so they can buy more imported goods that will help!

  5. sausage fingers 5

    And if it failed, Craig Glen Eden (is that your real name, by the way?) then you lot would just shrug your shoulders, ’cause it’s not your money anyway.

    • Pascal's bookie 5.1

      ’cause it’s not your money anyway

      yes it is. shows what you know.

  6. Tim Ellis 6

    So by Zetetic’s shoddy analysis, all the government has to do is borrow gazillions of dollars, invest it in the super fund, and all our economic woes will suddenly fade away.

    • Anita 6.1

      It’ll work as long as we either invest in pixie dust or give the money to the underpants gnomes to invest on our behalf.

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