I'm afraid I can't be bothered trying to hold a discussion with children so Bye Bye Benny

Partial asset sales will do nothing to curb New Zealand's growing debt problem, a new report by economic analysts Berl says.

The Berl report, commissioned by the Green Party and released today, says the Government's partial asset sales programme to build new assets would leave the Crown accounts ''permanently worse off''.

Government debt, the ratio of debt to assets, net worth and total assets would all be worse off after the programme was carried out, Berl found.

''The interim loss of earnings resulting from reduced dividends and the period of time before the new assets reap benefits is never recouped,'' the report said.

''Subsequently, the option of asset sales can only significantly improve the Government's accounts if a set of assumptions are adopted that are at the extreme ends of plausibility.''

With reports like these coming out no wonder National's popularity and support is going down.

Cheers

Nighty Night Brian it is one less to try and fathom out.

And now we see just how the Government are treating our opinions.

Read the sad truth about the government's attitude to the submissions delivered to the select committee here:

http://www.stuff.co.nz/national/politics/7059546/Opposition-takes-aim-at-asset-sales

In a blogged response to Economic commentator Bernard Hickey, 'Leon Dale' wrote the following:- C&P

"...why nz is on a economic time bomb.
" is all about the catastrophic failure of a currency union to deal with differences in the structures of economies within that union."

How many Banks has nz got in oz earning $3 - $4 Billion profit a year? None.
(Taking way more profit over 25 years than the losses made by nz owners in the 87 crash as the reason rogernomics sold them to oz banks. How foolish)
Does a nz bank have the contract to run the oz Government Accounts, ? No.
Does an oz bank run nz Government Finances $70 Billion a year to clip the ticket on. Yes? Why?

This is why nz is on a hiding to nothing. We lose $14 Billion profit to Foreign Owned Co's a year.

Nz scratches a $1 Billion trade surplus a year from Exporting.
Nz is a Greek economy, because of Rogernomics selling soe's to Foreign Owners.
Nz has gained none of the profit from the efficiency gains of privatising.
All soe assets must stay in nz ownership so profits remain in our economy.
The sale proceeds to Foreign Owners are worthless to nz after 5 - 6 years of profit removal from the economy."

This point, that NZ has gained none of the benefits of selling our State Owned Assets to private ownership, must be re-iterated, over and over again.

That the profit or the excess of our Export Trade is $1 Billion and the profit taken out of the country by overseas owned companies is $14 Billion should make all of us sit up and take note. There is no way, no matter how hard we work, how much we save (with often foreign owned providers investing in foreign owned companies), that we can become a high wage productive economy while we are owned lock stock and barrel by foreigners.

Well, arandar, as according to you, no matter how hard we work and save, we can never become a high wage country because our savings are managed by foreigners primarily for their own benefits - then what is the answer?

Why can't we do what Singapore did, a foreign capital ruled former colony building itself up from "3rd world" country to the "1st world" within 1 generation, through a universal savings effort into their "Providential Fund", similar to our NZ Super Fund when allocated to Personal Accounts?

What else can you suggest ?

Why exactly do you oppose allocation of the NZSF to Personal Accounts so strongly, when that would prevent being done what Mr.Muldoon did with our nominal Universal Super Fund in 1976(?), and could help towards first home ownership?

And we don't have to start from such a low poverty level as they in Singapore!!!

I've told you I don't oppose personal NZSF accounts many times Jens.
Neither do I particularly support them.
I do support the NZSF and strongly support government surpluses being invested in it. Unlike Labour, I'm not sure it would have been wrong to borrow, now with interest rates so low, to invest in NZSF, and to use those funds to buy more profitable assets with which to benefit our economy and our infrastructure plus our need to support an increasingly aging population.

I haven't seen the sums - what would the cost of ring fencing of all GST mean to the general fund from which comes almost all government spending - and I recall asking you to provide those figures to better inform us all but you haven't done that as yet, I think?

If I knew that, I would be better able to judge whether it was THE answer or a part answer or might make the situation worse for too many people, that is poor families and children.

I am not against compulsory retirement savings either, as I have said, though I don't particularly support compulsion since I worry about how it would be invested and, as illustrated by what's happening to investments around the world, what happens to people's savings if/when there are downturns.

I do support personal savings accounts in the form of KiwiSaver where people who decide they have some disposable income (albeit at the expense of other spending/investment like paying off their home mortgages for example or starting up a business or buying shares) may choose to invest.

Why can we not be like Singapore? Well, there are some very obvious similarities and some equally obvious differences. Theirs is a very small island nation with a population just a little larger than ours but with a huge market for their products and services right on their doorstep. They import almost all their basic needs, food, workers even, and export value added.

They are not and could not be self sustaining - they are densely populated, their birth rate is not self replacing, and is rapidly aging, they are a city-state which is a very cost effective thing to be, I imagine, but imposes its own limitations.

We are the opposite; we are a big farm with a small population, concentrated in one large population centre and many much smaller ones, exporting our workers o/s, and commodities to trading partners far away and we are price takers.

To change either Singapore or New Zealand into duplicates of each other would be an enormous task; one with consequences we would certainly find hard to deal with.

Their dollar is almost the exact equivalent of ours. Their mid-range salaries are comparable. Their lowest wages are lower than ours - about half in fact - to wait tables, flip burgers, clean offices and so on. Those jobs are mostly done by migrant workers.

Oh, and they compulsorily take 20% of a worker's wage for superannuation, employers contribute 15%, (on top of wages not included in an employment package), and general taxation is very low. So about 35% of a citizen's salary is saved for retirement.

I can imagine how popular that would be here! Employers and employees alike would be squealing like stuck pigs I reckon. Oh, or employing more migrants who don't have to compulsorily save for their retirements in Singapore since they'll be heading off back to their home countries long before then.

arandar - now you have given me quite a lot to explain - but since this morning's NZ Herald is full of superannuation sustainability concerns with no mention whatever about child poverty (don't blame me for that) - and no answer on retirement prosperity other than the usual of higher taxation, means testing, and putting up the NZ Super entitlement age either - (with not even mentioning a higher savings rate, even though the daily press has beeen full about the need of a higher savings rate for NZ for ages) - I am busy now attempting again a contribution to the dialogue page, in the hitherto unsuccessful effort to raise public discussion on amending the NZ Super Fund and resuming savings contributions to it through our universal taxation system..

Since that arguably promises not only better retirement welfare security, but also accelerated economic growth and general (including child) poverty elimination (and alleviation potential), it is inexcusable not to discuss the pros and cons of it without at least showing it is economically unachievable, unrealistic "pie in the sky".

Cheers - unitil next time - Jens.

Jens,Arandar, What about this new clause in the Asset Sales Bill which returns the companies to public status with the flick of a pen after a Labour=Greens Government comes to power in 2014.or National inserting this as they may need to cancel the deal as numbers don,t stack up.!

Yes.
Excellent.
I confess I was surprised that the F&E Select Committee with its majority of government members actually decided to insert this clause into the Bill but I absolutely commend and congratulate the Committee for doing it.

The sums don't stack up. We all know it. We all fear the extent of the damage that will be done to our economy and our people in general by even partial privatisation of these particular assets.

I am delighted that this now gives us a way back from the brink.

arandar - on your post #283, my answers are numbered for easy comment on each point directly, whether fair and acceptable or not,and why.
1. There is no need for "ring fencing" GST coming into the Consolidated Fund - the CS - , as the mathematics involved is simple:
The extra 2.5% of GST - estimated at $2billion per annum - goes into the CS together with all the other Govt. revenue - and from there $2 billion - regardless of its origin - goes into the NZ Super Fund - the NZSF.
There - if $2billion is about 2% of total taxation revenue - 2% of each individual's taxes paid accrues to his/her Personal Account - PA - including 2% of the estimated average of total GST paid by those without taxable income.
The extra GST is being paid now - and your opposition to it because it reduces the consumption ability of those close to genuine hunger - can be overcome by targeted support - which makes ethically more sense than taxpayer subsidies to KiwiSavers, which mostly help the better off already to become more better off more easily - subsidised by taxpayers including poorer ones, who for whatever reason do not participate in KiwiSaving.

2. Regarding securithy of NZSF savings, it has been mentioned several times:
Because of the wide investments diversification of the eventually huge NZSF, they would be statistically possibly even safer than home ownership exposed to the vagaries of nature, as even the smallest PA participates in the ownership of thousands of assets.
Allocation to PAs legally protects the NZSF from what politicians (e.g. National under Muldoon) did to our nominal (but wrongly "invested" Universal Super Fund savings of 1/6in the pound 32 years ago.
If market prices of assets fall, there is no personal loss to a PA, because the taxpayer commitment still stands to guarantee the same NZ Super to all regardless of the value of a PA at any time.

3. I also support KiwiSaving, although I consider its taxpayer subsidies "perverse" (as at point 1).
I strongly support it remaining voluntary in principle, because if it is compulsory, then as you mentioned, demands for taxpayer backed investment safety guarantees might emerge, encouraging more speculative investment choices at taxpayer risk. Yes, and it would be a "pain in the neck" for those with investment priorities in their own entrepreneurship.

4. Of course, NZ and Singapore are differnt and cannot be the same - but the physical laws of economics are the same regardless of locality, Govt., and monetary system.
Singapore had an even more urgnt need than NZ to create wealth through saving at the expense of not consuming all the fruits of their labour, because apart from location, they had hardly any tangible wealth (like say our Kauri trees) at all. And we - even though blessed with adequate land - have also the need to save and invest more than say the average American, because of our isolated location, and higher cost to reach a bigger market.

5. Well, apart from reversing to the local culture before European arrival, we also , like Singapore - are not, and cannot be self-sustaining, if keen to maintain the living standard we have now - the maintenace of which requires more capital saving and investment than traditional Polynesian culture, or our own many hundred years ago.

6. No,we cannot become a duplicate of Singapore - except in applying in principle (not detail) the same universally valid saving and investment rules without which higher productivity, earnings and security wealth creation just does not happen - by itself.

7. Since we at present can start from a much higher prosperity base than Singapore 60 years go, there is no need to start with the saving rates figures you mention.
The trouble you are concerned with most, is poverty amidst relative plenty, because a substantial section of our population saves inadequately for prosperity maintenance and growth.
Let us not blame anyone for that, because it was, and still survives - as part of our culture, of which I can relate examples based on personal experience.

That's what defines an ethically and economically worthy mission for all of us socio-economically concerned - to build into our welfare ideals a systematic universal personal savings, investment and at least a minimally meaningful personal wealth ownership tradition.

No one felt bad enough to squeal as if close to starvation when the 2.5% increase of GST was introduced, which could have been the beginning of a more vigorous economic recovery already now.

Thanks, Jens, I can see now how that could work. I have a couple of questions.

What about the claiming back of GST by businesses? And the running of businesses at a loss in order not to pay income tax? And what of Trusts which hide so much of people's incomes?

And if all are entitled to a guaranteed universal pension through this scheme what is the advantage of PAs? Some will pay more in, some will pay less, but all will get back the same?