So much for seeking a mandate

Written By: - Date published: 10:56 am, May 26th, 2011 - 15 comments
Categories: budget 2011, election 2011, kiwisaver, privatisation - Tags:

Remember when John Key was promising that he would seek a mandate from the people at the election before starting to sell public assets and cutting Kiwisaver. It was only a week ago. And he’s breaking his promises already: the Kiwisaver cuts actually kick in on July 1, and the privatisation process is underway.

The law that National slammed through Parliament last week making the Kiwisaver changes law means that your tax credits from this July will only be paid at half the old rate. National claims its OK because we won’t actually get the diminished payments until next July, after the election. What rubbish. You see, your Kiwisaver member tax credits are accumulated throughout the year when you make contributions, but only paid out after the end of each financial year in July. It is this year’s tax credits you’re losing, even if it won’t be paid until next year. Your Kiwisaver has been cut without mandate.

You can hear Bill English making a poor attempt to excuse all this here.

Then there’s privatisation. It’s already underway with Genesis being forced to borrow half a billion, which ended up as a special dividend from Meridian to the Crown – like an asset sale but we get to keep the hollowed out company. National has promised not to begin selling assets in earnest unless it is re-elected but Treasury is already advertising for staff to start organising sales and this table from the Budget documents shows that National intends to have everything ready to go for sales starting from Feburary next year, if we are so foolish as to re-elect them.

15 comments on “So much for seeking a mandate”

  1. queenstfarmer 1

    You contradict yourself. You say “your tax credits from this July will only be paid at half the old rate”, but then acknowledge they are “only paid out after the end of each financial year in July”. So which is it?

    Well, it’s the latter of course. Until then, it’s just an accounting change, but one which the voters get their chance to have a say on. Sure the change itself is debatable, but then the solution is easy come this November.

    • MikeG 1.1

      It’s both!
      1. Contributions from 1 July 2011 will only gain credits at half the old rate.
      2. The tax credit is paid into an individuals account in July each year, for the preceding 12 month period (1 July – 30 June). So the payment in July 2011 will be at the ‘old’ rate, and the payment in July 2012 will be at the half rate.

    • Eddie 1.2

      they are earned in the 2011/12 year. they are paid in july 2012

      • queenstfarmer 1.2.1

        Exactly. So it’s just a book entry, which is of no practical consequence, until AFTER the election – IF the people return the current Government.

        • Colonial Viper

          Sorry, you’re saying that a visibly increased liability on your books is of no consequence to a business?

          Interesting take.

          Bottom line is that John Key promised not to change KiwiSaver, but has actually forced through changes in law under urgency.

          National: No plan but plenty of Broken Promises.

          • queenstfarmer

            No, but it is of no consequence if Labour is voted in and reverses the change (which no doubt it would). In other words, if National does not get a mandate for its change. Pretty simple stuff.

            • Pascal's bookie

              This is queen of hearts material.

              Seriously, the argument that National haven’t broken their word is that they will seek a mandate to change things and if they get that mandate they won’t do anything because they’ve already done it, and if they don’t get the mandate to change things then Labour must change things so that nothing changes.

              That’s simply barking stuff.

              They said they wouldn’t change it, they have.

    • It will cost my relatively small business $2 to $3k a year because I had all staff on the maximum rate of Kiwisaver.
      I then get the satisfaction of voting against the bugger but this is not the point.  Key said he would not change Kiwisaver this term.  He has.
      Guilty … as … charged.

  2. Jim Nald 2

    Labour: Mandate
    National: Manipulate date

  3. fizzleplug 3

    I would have thought that seeing as the government rebate is paid out at the end of next (Government financial) year, then Labour can clearly stand up and say they will reverse the KiwiSaver changes if they win the election, with the net result being that no-one notices anything different.

    The cuts may have been legislated for, but they are part of the election manifesto for National and provide a clear area of distinction for Labour (not that they seem keen to go there).

    • Eddie 3.1

      it would have to be retrospective legislation. And National has already booked the gains from these policies it will supposedly be seeking a mandate for at the election. That means reversing any of them means more borrowing, cuts elsewhere, or more tax. I imagine Labour and the Greens are going through those options.

    • Pascal's bookie 3.2

      A manifesto is a list of things you are going to do if elected. They aren’t going to do this if they get elected, they’ve already done it.

      • Jim Nald 3.2.1

        Is Shonkey playing something like an electoral ponzi scheme on us ? ?

        • Draco T Bastard

          Capitalism is a ponzi scheme and National are it’s champions (Not that Labour are much better).

  4. vto 4

    It is clear again that the politicians simply cannot be trusted.

    And so I don’t trust them.

    Or believe them.

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