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Resignation watch

Written By: - Date published: 11:43 am, September 12th, 2011 - 39 comments
Categories: bill english, corruption, disaster, Gerry Brownlee, john key, sport - Tags: , , ,

Which minister will John Key fire this week?

Bill ‘Double Dipton’ English, who is embroiled in yet another personal corruption scandal following the revelations on his housing expenses in 2009 and the PEDA money in 2010. This time for an unadvertised, big-money contracting job has been handed to his brother Mervyn to set up the mysterious new ‘Health Sector Forum’, which looks like a stalking horse to get more publicly-funded work handed to private providers. As a one-off, the Finance Minister’s brother being given a high paying job in the public sector that wasn’t advertised would look dodgy. With English’s form, it looks like blatant corruption.

Gerry ‘The VIIIth’ Brownlee’s fiefdom in Christchurch is seeing a peasants’ revolt. Many red zone people are saying they will not accept the government’s inadequate offer for their properties. Option 1 (2007 RV) will not get people a replacement property and will leave people tens of thousands, in some cases hundreds of thousands out of pocket, after Brownlee and Key promised to protect them. Option 2 (government buys land, insurer pays replacement) is a no go because the insurers won’t pay replacement on red zone houses, even ones they had previously called write-offs. Homeowners are allowed to appeal their home’s categorisation in theory but Brownlee is denying them the geotech data with which to do it. Three hundred redzoners turned out to a protest yesterday. Brownlee has no plan on what to do with people who refuse to leave the redzone, including the 50-odd uninsured households who have received no offer from the government. He seems to think he can simply bully people. It’s not working. He needs to go.

Murray ‘drowned rat’ McCully delivered Key a huge embarrassment on Friday. Just hours after Key skited that critics of his ‘party central’ would be eating their words, people were jumping into the sea to escape the crush on the wharf while thousands of ticket holders missed the opening ceremony in the transport chaos. As Duncan Garner says, heads should be rolling. McCully was the point-man on sorting this. Steven Joyce also has responsibility for not putting enough into public transport over the past 3 years and wasting it on motorways instead. As does Rodney Hide, who took transport out of the democratic control of the Council. But, as the Dom says, the buck stops with McCully. He refused to offer an apology on Saturday.  McCully ought to be tendering his resignation within the week.

So, who will go? Will Key have the guts, and the principles, to sweep away all three of these yesterday’s men?

39 comments on “Resignation watch”

  1. tc 1

    Come on it’s all labours fault with the NACT, or someone else as for Blinglish his behaviour is typical ‘up yours proles, due process is for suckers’ and with ChCh I’m sure Sideshow has other ‘experts’ who say what a bang up job, bravo, 3 cheers for national.

  2. What makes you think he’s going to fire any of them? Particularly after the List announcement, I don’t think he’ll be doing any shuffling unless absolutely inescapable.

  3. tsmithfield 3

    “Option 2 (government buys land, insurer pays replacement) is a no go because the insurers won’t pay replacement on red zone houses, even ones they had previously called write-offs.”

    You have way overstated the problem here. My parents have a house written off in the red zone. They have taken option 2. They have already purchased a section. The 2007 land value was 194k (compared to 180k they have paid for a section in Wigram Skies). The capital value of the house was only 90k due to it being quite old. The offer from the insurance company for rebuilding their house is 266k, meaning their equity has increased by around $190k.

    My parents were at their red zone property the other day, and met a neighbour from across the road who was thrilled that her house, that had previously been deemed repairable was now considered a write-off and that she would now be able to get a new house on a new section as well.

    I agree that people with complete write-offs with total replacement policies are often much better off than people with repairable damage. However, that would be the case whether the property was red zoned or not.

    My parents’ insurance policy has an exclusion clause that says that the policy won’t apply for decisions made by governing bodies with respect to demolishing properties. So, I guess that is why people don’t get full replacement simply for being in the red zone.

    However, I do agree there needs to be a system to ensure fair assessments of properties. To this end the government could set up an appeal process where red zoners who are unhappy with the assessments from their insurance companies can appeal to an independent loss adjuster who’s determination would be considered binding.

    • Lanthanide 3.1

      “You have way overstated the problem here. My parents have a house written off in the red zone. ”

      Many more people appear to fall into the situation of having a house that is not a write-off. So there’s no overstatement of the problem at all.

      You’re simply extrapolating from 1 or 2 anecdotes to come up with some sort of conclusion that actually everything is fine for most people, when it demonstrably is not.

      “My parents’ insurance policy has an exclusion clause that says that the policy won’t apply for decisions made by governing bodies with respect to demolishing properties. So, I guess that is why people don’t get full replacement simply for being in the red zone.”

      The clause is (typically) based on the grounds of compulsory acquisition by the government for roading projects and the like. Compulsory acquisition of property as a result of earthquake damage really doesn’t fit the bill, and IMO the government should make a ruling that says that if a house is the red zone, and has this clause on their contract, the house should be considered to be needing a full write-off. My boyfriend observed that at the moment the government buyout is essentially a bail out for the insurance industry, nothing more.

      Alternatively these insurance companies quoting for repair are quoting as if they are repairing houses with their current foundations. But given the state of the land, surely they would need to be sinking whacking great concrete columns many metres into the ground for these houses if they were properly “repaired” on their current land, which will drive up the cost of “repairs” significantly to the point that in many if not most cases it would be cheaper to simply pay for a standard rebuild on sound land elsewhere.

      Seems to me like the insurance companies are having it both ways at the moment.

      • tsmithfield 3.1.1

        “Many more people appear to fall into the situation of having a house that is not a write-off. So there’s no overstatement of the problem at all.”

        What Eddie said was:

        Option 2 (government buys land, insurer pays replacement) is a no go because the insurers won’t pay replacement on red zone houses, even ones they had previously called write-offs.

        Here he quite clearly says that option 2 isn’t available for anyone and that insures won’t pay out full replacement at all. and that they have reversed write-off decisions in every case,

        The two examples I gave show this to be patently incorrect. i.e. it only takes one couter example to disprove a theory.

        “You’re simply extrapolating from 1 or 2 anecdotes to come up with some sort of conclusion that actually everything is fine for most people, when it demonstrably is not.”

        Actually, I personally know four people in the red zone who are getting full replacement and are very happy with the outcome. Therefore, since I, just a sample of one person, know of four happy families, it suggests that there are likely to be many out there happy with the results. Also, my Dad tells me that everyone he knows in his red zone area are very happy with the outcome. Given the number of protesters in the recent protest is only a small percentage of the total, then I think that most probably are happy.

        “IMO the government should make a ruling that says that if a house is the red zone, and has this clause on their contract, the house should be considered to be needing a full write-off.”

        Why would you think that? If they had been in the green zone with a repairable house, the house would have been repaired back to its previous standard, nothing more. So, why should red zoners with repairable houses get any more than a house of equivalent value to the one they are leaving?

        “Seems to me like the insurance companies are having it both ways at the moment.”

        And I have suggested there should be a process whereby those who are unhappy with decisions by insurance companies get quick access to justice.

        • Lanthanide 3.1.1.1

          “Here he quite clearly says that option 2 isn’t available for anyone and that insures won’t pay out full replacement at all. and that they have reversed write-off decisions in every case,”

          I didn’t read it that way, but I agree it can be read that way. I wouldn’t think that was a reasonable interpretation, though.

          “Actually, I personally know four people in the red zone who are getting full replacement and are very happy with the outcome.”

          The plural of anecdote is not data.

          “Given the number of protesters in the recent protest is only a small percentage of the total, then I think that most probably are happy.”

          There have been recent media reports saying that very few homeowners have actually returned their consent forms.

          “Why would you think that? If they had been in the green zone with a repairable house, the house would have been repaired back to its previous standard, nothing more. So, why should red zoners with repairable houses get any more than a house of equivalent value to the one they are leaving?”

          I’m not sure what you’re arguing here. I think you misunderstood what I said. I’ll put it another way: if your house is in the red zone, it should be classed as a write-off and any and all clauses in your insurance policy that apply to houses that are fully destroyed would apply to you.

          “And I have suggested there should be a process whereby those who are unhappy with decisions by insurance companies get quick access to justice.”

          Seems like all they need is a test case saying that to “repair” a house in the red zone will cost $$$$$ because of requiring large expense on the foundations, and that would be sufficient for the full replacement clauses to kick in for most houses as being the cheaper option.

          • tsmithfield 3.1.1.1.1

            “I’m not sure what you’re arguing here. I think you misunderstood what I said. I’ll put it another way: if your house is in the red zone, it should be classed as a write-off and any and all clauses in your insurance policy that apply to houses that are fully destroyed would apply to you.”

            No. I didn’t misunderstand.

            Just because a house that has repairable damage is in the red zone is no justification for complete replacement. If it had been in the green zone, it would have been repaired to the extent that it was restored to its pre-quake value via insurance. In contrast, someone with a complete rebuild gets a brand new house that is naturally worth more because it is new. So even in the green zone, there are people who do better simply because their house is more damaged.

            What the government has done is effectively put red zoners into the same position as green zoners. If there house is repairable, it is effectively restored to its pre quake value (i.e. cv for land and improvements). If it is a total write off they get a new house in another section with the consequential increase in value via their insurance.

            In principle, I really don’t see why this isn’t fair, especially when it is tax payers money that is largely funding this.

            • Lanthanide 3.1.1.1.1.1

              “Just because a house that has repairable damage is in the red zone is no justification for complete replacement. If it had been in the green zone, it would have been repaired to the extent that it was restored to its pre-quake value via insurance. In contrast, someone with a complete rebuild gets a brand new house that is naturally worth more because it is new. So even in the green zone, there are people who do better simply because their house is more damaged.”

              Lets flip that the other way, shall we?

              If someone in the green zone has repairable damage, the house will be repaired and they can keep living there. If that same house was in the red zone, despite being repairable, they are forced to leave the property by the government.

              In one case (green zone) they get the house repaired and get to live there. In the other case (red zone), even if it *could* be repaired they still have to leave.

              The whole point of having full replacement insurance is to replace your house should it no longer be liveable, eg, it burnt to the ground. The fact that houses are still largely intact in the red zone doesn’t change the fact that they’re unliveable (because the government/council is not going to rebuild services in that area).

              “What the government has done is effectively put red zoners into the same position as green zoners. ”

              Um, no, because the government isn’t paying out for land value on green zone property. There will be properties in the green zone that have substantial land damage but because they’re isolated they’re marked green. In this case they get $100k from EQC for the land and that’s it. Insurance companies don’t cover land, only the house, so if the house can’t actually be rebuilt/repaired on that land then you’ll just have to take the $100k payment to move elsewhere.

              So they are NOT treating people in the red and green zones who have equal land damage equally.

              • Lanthanide, you’re right. The government’s two offers are primarily structured in order to; first, ease the predicament of insurers; second, minimise the government’s exposure; and, third, provide some compensation for those in the red zone (necessary as soon as Key promised NZ would stand with Christchurch and Brownlee kept assuring anyone who’d listen that the government would preserve homeowners’ equity).

                When you’re third (last) in the priority queue I guess you can’t expect much.

                • tsmithfield

                  “In one case (green zone) they get the house repaired and get to live there. In the other case (red zone), even if it *could* be repaired they still have to leave.”

                  And get paid out at 2007 valuations which were formulated at the top of the property market. So a lot of red zone people will be doing better than many green zone people who have seen a considerable drop in property values since 2007.

                  “Um, no, because the government isn’t paying out for land value on green zone property. There will be properties in the green zone that have substantial land damage but because they’re isolated they’re marked green. In this case they get $100k from EQC for the land and that’s it. Insurance companies don’t cover land, only the house, so if the house can’t actually be rebuilt/repaired on that land then you’ll just have to take the $100k payment to move elsewhere.”

                  Its 50k + gst for the land btw, not $100k. I don’t really follow you here. It seems like you’re now trying to say that some green zoners will be worse off than red zoners. But if it turns out green zone land is in fact unbuildable, it will be red zoned too, from my understanding. So I don’t think your argument follows.

                  PG: “Lanthanide, you’re right. The government’s two offers are primarily structured in order to; first, ease the predicament of insurers; second, minimise the government’s exposure; and, third, provide some compensation for those in the red zone (necessary as soon as Key promised NZ would stand with Christchurch and Brownlee kept assuring anyone who’d listen that the government would preserve homeowners’ equity).”

                  Firstly, it is a very clean deal. Imagine if insurers had dug their heels in and we had 30000 civil cases against insurance companies in the pipeline. Secondly, the government should try to minimise the liability to tax payers since they are paying. Thirdly, it is an incredibly generous offer. 2007 capital values are excellent for most people, and many are doing incredibly well.

                  • TS, 2007 ratings valuations are themselves inequitable. I know you like anecdotes so here’s one.

                    I had a discussion with a friend who is a prominent valuer in Christchurch. We talked about the deal. He shook his head and said words to the effect that “we all know that rating valuations have historically been lower than they should have been in low income areas and higher than they should have been in high income areas”.

                    Rating valuations are done without property inspections. They bear little relation to the property market – hence your argument that the valuations were done “at the top of the property market” is irrelevant. Those valuations did not reflect the then existing market value.

                    As for your claim that the offer is “incredibly generous” I really think you need to look up a definition of ‘generous’. And the 2007 values – for reasons given to me by the valuer – are not “excellent for most people”. Haven’t you heard? Even John Key is getting bothered about how inadequate the deal is for people.

                    I also don’t know if you’ve been reading the letters to the editor page of The Press recently (the issue is starting to really hot up) but, if you have, you’ll have a pretty large anecdotal sample size from those in the red zones testifying to the fact that the deal doesn’t work for them – and why it doesn’t. 

                    I’ve extracted some letter writers’ comments in writing about this

                    • tsmithfield

                      Puddlegum, my wife is a real estate agent for Harcourts and according to her, for several years now properties have often been selling at below the 2007 valuations. So, this being the case, the 2007 valuations generally will be very fair, even if there is the occasional anomoly.

                      My wife tells me she is dealing with a number of red zoners, as are many of the other agents she knows. She hasn’t heard much complaining about valuations. One of the buyers she is working with has come out with $450,000 to purchase another property. This is going to be a major improvement on what that client has left behind.

                      Some of those red zoners in areas such as Bexley chose to build in the most undesirable land in Christchurch. Hence the land was cheap in the first place and hasn’t changed a lot in value since. The problem is that there is very little land of similar undesirability to replace it with.

                    • Lanthanide

                      “My wife tells me she is dealing with a number of red zoners, as are many of the other agents she knows.”

                      Haha. You realise that people from the red zone who are liasing with real estate agents at this point of time obviously have money or are getting full payouts from insurance.

                      That’s obviously a biased sample.

                    • tsmithfield

                      “That’s obviously a biased sample.”

                      Of course it is.

                      But so is the crowd of 300 or so unhappy residents that are doing the protesting that inspired Eddie to produce an over the top negative prognosis on the matter.
                      I would assume that 300 protestors would probably represent approx 100 houses. If this is all the angst there is out of the 3000 houses or so that have been red zoned thus far, then I think the government has done a good job.

                    • One of the buyers she is working with has come out with $450,000 to purchase another property.

                      Ermm, TS, I thought the first couple to receive a cheque from CERA (under the government’s offers) happened yesterday and was only on land (as is the next offer in line). That $450,000 can’t have much to do with the government’s offer. 

                    • Lanthanide

                      The point I have been making all along, ts, is you said this:

                      “You have way overstated the problem here.”

                      You’re speaking from anecdotal evidence of a handful of people and extrapolating this to mean the problem is “way overstated”.

                      Meanwhile we see dozens of letters to the editor as well as the rally of 300 people protesting the government. With there being something like 5000 households in the initial red zone, 300 is actually a sizeable sample.

        • ghostwhowalksnz 3.1.1.2

          Actually, I personally know four people in the red zone who are getting full replacement and are very happy with the outcome.

          Really ? . From what I have heard , after the govt announced the buyout in the red zone, the insurance companies went back to those they had offered to settle and withdrew the offer – under instructions from the re-insurers

          • tsmithfield 3.1.1.2.1

            Don’t know about that. One of the people I know has already purchased another replacement property at considerably higher value than their rooted property via insurance. My wife (a real estate agent) is assisting another to find a property. My parents just received their offer last week, and the other person just found out they had an insurance offer on the weekend.

      • aerobubble 3.1.2

        Pictures of new homes, recently built, on sandy liquifiable soils does help insurers
        cause, when did the council know of the liquifaction risk and/or why didn’t it.

  4. Jim Nald 4

    Fire?

    The bonfire that I have been planning for this year’s Guy Fawkes night (Sat 5 Nov) is running out of room with McCully’s effigy riding on donkey and the humongous effigy of Gerry Bullee crowding out Double Dipstick.

  5. curious 5

    I’m curious as to what you base this supposition on: “set up the mysterious new ‘Health Sector Forum’, which looks like a stalking horse to get more publicly-funded work handed to private providers.”

    Simply a wind-up for the party faithful?

  6. Lanthanide 6

    “people were jumping into the sea to escape the crush on the wharf”

    How many people actually did that? I haven’t seen this mentioned anywhere else, either.

    • bbfloyd 6.1

      it’s been mentioned in a few places… i had friends there who corroborated this and much more… it was the closest auckland’s come to a riot since the queen st riots of the eighties….. and with the huge numbers involved, would have been much worse…

      everyone i know who was there talked about how scary it got as the afternoon wore on…. and now the govt is unloading on to len brown at a hundred mph……. now that’s what i call real leadership….

      • Lanthanide 6.1.1

        Wonder if this will show up in the polls?

        Also Labour could capitalise on it: vote us for trains in Auckland.

  7. Macro 7

    How many will go???
    Don’t hold your breath!
    My pick is none.
    “Accountability” is not in this showers dictionary..

  8. big bruv 8

    Lol….you expect the Nat’s to behave at a standard higher than the previous corrupt Labour government?

    Anyway, the only resignation this week will be Goofs.

  9. Ianupnorth 9

    Another thread bereft  of Tory comment – where are Chris73, Higherstandard, QSF – all gone missing – AGAIN!

    • tc 9.1

      Big bruv’s drawn that short straw today and doing it in the usual over the top not even attempting credibility style we’ve come to know and love.

      • Ianupnorth 9.1.1

        And he has no ability to construct a reasoned argument; all he can do is spout the media perspective of alleged corruption; he is blind to the facts, that people are worse off under his mob, that people are leaving in their droves, that unemployment and debt are both rising, but hey, John Key is a nice guy, far better than nasty corrupt Helen Clark – seriously, BB is a fucktard, best ignored.

    • mik e 9.2

      Ianupnorth.The right wing politicians that use those sud o names are in the corporate box’s enjoying the national religion at the expense of the big banks no doubt.

    • chris73 9.3

      In no particular order: watching the world cup, visiting family, working and celebrating my birthday

      However I don’t think anyone is going to get fired, Gerry survives because he apoligised and admitted he stuffed up (theres a lesson there somewhere)

      also regarding the trains I think blame can be aportioned to the govt, the council and the management

  10. Marjorie Dawe 10

    Why does the buck stop with MCCully? Have a think about who the idiot was who decided and who bullied Auckland into agreeing that party central should be on the wharf where all the ferries come and go, just across the road from the rail station and buses.

    This same idiot said this morning that we shouldnt point the finger. John Key doesnt want to point the finger at himself because he has been caught out going with his emotions rather than making a sensible and considered choice. They also contributed to the oversubscription of party central by telling everyone that it would be the place to be. Talk about a one horse band.

    • aerobubble 10.1

      Over many years the Sydney Opera House has become a stage for outdoors events. It
      didnt happen over night, but then there is a large park next to it, does afford great
      respect an mana by being a stunning building, on a stunning harbor, which over
      time the residents have removed the worst architecture.

      However party central was a dream, on a old car park, bare of public transport
      solutions and experience, hacked onto the back of a new Stupid City Council.
      All I might add the dreamt up under the present National Government, in
      a ad hoc fashion to show how innovative we could be in a short time.

      The only good thing to say is it could have been so much worse, so easily,
      lucky we have no mad righwing extremists who like to kill children, bomb
      the central district, etc.

    • Jum 10.2

      Marjorie Dawe,

      This is another example of Key’s lack of gravitas – you can make jokes and mince about but always, at the back of your mind, you must understand that as the leader of a country your words will be taken as meaning something (why, in his case, I have no idea). When he said come and join me/us at the party people actually thought he meant them. Silly buggers. He meant the 12,000 that were allowed, not the rest of the people trying to join him.

      Joyce and McCully know already what a shallow windbag Key is; they should have known, if they had any sense, that Key would incite chaos without even considering his actions. His minders – how many minders does Key have now – about 50 as leader of the opposition must be trebled by now and still this government bombed.

  11. hellonearthis 11

    Seems like business as usual for National.

  12. Jum 12

    Sack Key – he’s more dangerous to our country than any of the other bozos.

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