Fallout from the Hisco affair is bound to spread to RBNZ moves to regulate bank capital

Pressure may be mounting for  a  broad  inquiry into  the banking industry following recent incidents involving  the biggest trading  bank in NZ.

Agriculture  Minister  Damien  O’Connor  said this week  banks  are  “bullies”  (according to a  Radio NZ report).  It’s a  sentiment shared  by  many  New Zealanders.

This  sentiment has  been rekindled by the departure  of ANZ’s CEO  David Hisco  who, it had been found, passed off charges for chauffeur-driven cars and the cost of storing his wine collection as business rather than personal expenses.

ANZ suffered a couple of regulatory blows last month with the Reserve Bank forcing it to hold more capital against housing and farm lending from June 30 and to use the standardised model for calculating its operational risk capital (ORC) rather than its own internal model.  That’s because it had been using a modified internal model for calculating ORC since December 2014 without first getting RBNZ approval. Continue reading “Fallout from the Hisco affair is bound to spread to RBNZ moves to regulate bank capital”

Yes, there’s lots of money in the PGF – but keep an eye on all the other troughs

The Point of Order Trough Monitor has drawn attention to a fresh batch of handouts from the public purse, reminding us that the Provincial Growth Fund isn’t the only trough in the capital.

Fair to say, in the case of Education Minister Chris Hipkin, the press statement which triggered the trough monitor related to the government’s spending on tertiary fees in the past year.

The statement was deftly crafted to camouflage the cost to taxpayers.  Rather, it brayed that first-year students have been spared the repayment burden that would have resulted from hundreds of millions of dollars in loan borrowing.

On the other hand, Winston Peters unabashedly has announced fresh handouts from a fund in his Racing ministerial bailiwick and encouraged racing clubs to apply for a place at the next serving from this trough. Continue reading “Yes, there’s lots of money in the PGF – but keep an eye on all the other troughs”

PM announces a wellbeing fund for Rainbow people while greenies splash into an established fund

The Point of Order Trough Monitor has drawn attention to the creation of a brand-new fund.  How rich will be the swill is still under consideration, it seems.

In the opening sentence of the announcement, the PM says improving the mental health and wellbeing of young members of the rainbow community is at the heart of the establishment of the Rainbow Wellbeing Legacy Fund.

Further down, she says the government is “proposing” to establish a charitable trust with a one-off endowment of $1 million.

It is unclear from this whether the matter proposed is the establishment of the trust or the size of the endowment.

The monitor was triggered again when Associate Environment Minister Eugenie Sage announced a handout from the Community Environment Fund, set up “to empower New Zealanders to make a positive difference to the environment”. Continue reading “PM announces a wellbeing fund for Rainbow people while greenies splash into an established fund”

Cabinet reshuffle is promised but the PM is limited in which cards to play

Prime Minister   Jacinda  Ardern is  promising  a  Cabinet  reshuffle  later this  month.

Not  before  time,    given the   piles of   deadwood    revealed   so far in the  ministry’s make-up.

Or,  more significantly,  in the failure to  deliver  “transformation”, as   with  KiwiBuild.

With  the  high  poll ratings  of the government, largely as a  result  of her  own  performance,  Ardern in  theory  should  be  able to deliver, without any  political  qualms,  rejection  slips to  those  who  are  a  drag  on the  coalition

Yet  she  is  severely  constrained in  any changes   she contemplates. Continue reading “Cabinet reshuffle is promised but the PM is limited in which cards to play”

Setting a suicide-reduction target might have been detrimental to the govt’s wellbeing

The headline on a statement released from the PM’s Office on the eve of the official release of the Wellbeing Budget tells us the government is Taking mental health and addiction seriously.

To demonstrate this, the government has accepted, accepted in principle, or agreed to further consideration of 38 of the 40 recommendations in the report of the Inquiry into Mental Health and Addiction.

This raises an obvious question:  which two recommendations have been rejected?

The press statement gives the answer:

  • The Directing the State Services Commission to report on options for creating a ‘locus of responsibility’ for social wellbeing within Government; and
  • Set a target of 20% reduction in suicide rates by 2030.

Continue reading “Setting a suicide-reduction target might have been detrimental to the govt’s wellbeing”

Businesses seem gloomy but health-sector companies are in good heart

The PM, Jacinda Ardern, received what her handlers would have perceived  as  unexpected  criticism  from the  media   after   she gave  a pre-budget speech to an Auckland business  audience.  One of those  in the  audience  was   said to  have   described   it  as  an   “ideological fairytale”;  others   apparently  were  disappointed   it had  “nothing for business”.   

Given   she  did list  as   two of the five priorities  in the budget as   being “creating opportunities for productive businesses, regions, iwi and others to transition to a sustainable and low-emissions economy; and supporting a thriving nation in the digital age through innovation, social and economic opportunities”,  the criticism itself  could be  regarded as  a    bit  “ideological”.

Surely   business  doesn’t  expect   government hand-outs,  even if  it  is labeled  a  “well-being”  budget?

But  there   seems  little   doubt    that   the   mood of  business  is downhearted   these  days.

Or is it  really?  Continue reading “Businesses seem gloomy but health-sector companies are in good heart”

Muzzling the hate messengers seems easy enough (but not for legislators bound by the US constitution)

Let’s make it clear: Point of Order is not serving as a proselytiser for the United States, when we observe the constraints under which the US operates through its constitution which dates from September 1787.  Reflect on our earlier posting on gun laws.

By way of diversion, this is an example of why NZ might avoid the tendentious enthusiasm for a written NZ constitution from the likes of Sir Geoffrey Palmer, a short-term former prime minister.

The hands of the US are tied securely by the founding document.  Imagine the Treaty of Waitangi being capable of amendment. Continue reading “Muzzling the hate messengers seems easy enough (but not for legislators bound by the US constitution)”