NZ POLITICS DAILY: Who really runs NZ?

The Establishment in New Zealand doesn’t receive much in-depth political analysis.

We don’t have an academic or journalistic tradition of focusing on "who runs New Zealand", but there are some interesting items today that give an insight into this neglected area.

Most notably, the ODT’s Dene Mackenzie profiles the new Minister of Local Government David Carter and his classic Establishment family background (with very strong links to local government in Christchurch) – see: Carter likely to push reforms.

Tracy Watkins shows why Mfat is able to fight back against downsizing proposals. Diplomats are more able than most to call on heavy-hitting industry groups to argue their case.

In this instance, Fonterra, the Dairy Companies Association and the Meat Industry Association – see: Diplomats take the gloves off. The Establishment also essentially puts its case in favour of Mfat via Richard Long’s Diplomats on cocktail circuit an easy target.

Radio New Zealand reports on some interesting changes in business directorships, with Fonterra’s Henry van der Heyden replacing John Spencer as chairman of the Waikato-Tainui iwi’s Tainui Group Holdings.

And with the growing power of New Zealand’s neotribal capitalist base also requiring greater examination, it’s interesting to note that "lawyer Donna Hall is facing a lawyer's disciplinary hearing in Wellington today over her roles in a land sale and purchase in 2007" – see: Prominent lawyer in disciplinary hearing.

This incident shows that recent ‘conflict of interest’ allegations aren’t limited to the National Party.

And for lessons on how powerful the Establishment is, read Chris Barton’s devastating critique of the telecommunications market in New Zealand, in which Sky TV dominates: Minister – open your eyes to what Sky is doing.

In this, Barton warns of the dangerous monopoly that Sky has become, and points the finger not just at National’s incumbent communications minister Amy Adams, but more significantly at Labour’s Commerce Act 1986 and Telecommunication Act 2001.

Barton’s article rings the alarm bells about Sky’s dominance in television being extended to online content. Barton says Sky is sitting on valuable programmes, therefore shutting out new competitors such as Quickflix by denying them desperately needed content. Sky TV is, of course, another large corporate that the Government has been accused of getting too cosy with.

Using the power and influence that comes from being in Government to smooth the way for private citizens and corporates is becoming a recurring theme for National. Changing the law to suit Warner Bros and kicking in millions of dollars in extra subsidies was achieved last term with little political damage – in fact, may have even boosted the Government’s popularity as they aligned themselves with Peter Jackson.

As the ACC scandal rumbles on, however, special deals specifically designed to advantage individuals or companies will be a lot harder to sell. Top of the list will be the proposed deal with SkyCity casino, which may allow 500 more pokie machines in Auckland. TV3’s Patrick Gower revealed last night that 265 individuals, barred last year from the casino because of their problem gambling, managed to get back in to gamble – see: Casino failing to stop problem gamblers.

This won’t help Key’s claim that the extra machines will not increase problem gambling. He has also argued that the increase at SkyCity will be more than offset by reductions in total pokie machines in Auckland.

However, Danya Levy reports that the government seemed unaware that machines in pubs and clubs return 37% of their profits to the community, but the casino’s figure is just 2.5% - see: Key defends casino deal.

The Problem Gambling Foundation is very clear that pokie machines are the problem and 40% of the money lost in the machines comes from problem gamblers. So, critics say that the Government will get a free convention centre but that the real price will be paid by volunteer organisations losing grant money and problem gamblers in Auckland.

Meanwhile, the juggernaut that is the ACC scandal lurches on. It has actually provided an opportunity for John Key to bring in some new faces as ministers – an important and long-term process that Labour neglected when in government, according to today’s ODT editorial, Shuffling the Cabinet pack.

Simon Bridges’ promotion is probably of most interest as he is a rising star for National. I interviewed Bridges last year in my Vote Chat series at the University of Otago (which you can watch here).

Audrey Young (see: Ministerial promotions leave way open for Smith's return to Cabinet) has a good summary of the changes in portfolios and positions, and makes an interesting observation that the reconfiguration would allow Smith’s return to Cabinet later in the year, particularly if David Carter takes up the Speaker’s role from the soon-to-depart Lockwood Smith.

David Farrar says there are actually a number of candidates in the running for Speaker, including Anne Tolley and Maurice Williamson, and he also points to the political risks of rehabilitating an errant minister – see: Will Smith return?.

Judith Collins has decided to pay her own legal bills from her defamation action, despite Key indicating earlier that she had his support and would have been entitled to taxpayer funding – see: Adam Bennett’s Collins to foot bill for court action - this article also includes the full leaked "Boag email".

The big question is: will dragging the saga through the courts be of any advantage to the government? Labour and Radio New Zealand will be entitled to call on relevant witnesses, including ministerial staff and ministers themselves, in a process that could literally go on for years.

Lloyd Burr and Tova O’Brien sum up the danger: "So Ms Collins now finds herself in an awkward position. Go ahead with proceedings which could cost hundreds of thousands of dollars and will keep the story in the headlines. Or drop it - and lose face" – see: Collins to fund own defamation case.

Key and Collins would do well to read Jonathan Milne’s article, Findings not quite Key's cup of tea, which puts the Herald’s side of the teapot tape story. The Herald went to the extent of commissioning an independent audit of its actions.

While Milne accepts criticisms of some of his subsequent reporting, if the account is accurate then John Key does indeed need to front up and, as the article suggests, "admit that, this time, he got it wrong".

Milne also confirms that Bradley Ambrose is considering legal action against the police and prime minister for what they have said about him, and he has the support of other journalists.

In other articles of interest, Pita Sharples publicly criticises the closure of some providers that he says are crucial to the Maori Party’s flagship Whanau Ora policy – see: Sharples critical of Whanau Ora cuts.

His public statements begs the question: as his party has made much of the advantages of 'sitting at the table", why he didn’t raise it with the Social Development Minister Paula Bennett when he was literally sitting at the table with her at Monday’s cabinet meeting?

Despite signals of a very tough zero budget the Government’s target of putting the books back into surplus by 2014 is looking unlikely. Audrey Young reports that Key is sticking to the ‘important’ target but is saying global economic conditions are making it harder to reach – see: Surplus date looks increasingly tough, says Key. The International Monetary Fund has also announced their assessment – see: Govt's budget plan ambitious, but not dramatic – IMF.

Other important items today include Bryan Gould’s Radical redefinition of roles, which argues that Murray McCully has made a hash of the Mfat reforms and "has revealed a complete ignorance of one of the basic constitutional principles of effective parliamentary democracy".

Chris Trotter also has two interesting columns: From Cock-Up To Conspiracy and Lies, Damn Lies, and Mainstream Media Polling.

Finally, there’s only about 48 hours to go before the first stage of submissions close for the Electoral Commission Review of MMP – to participate go here. For help on deciding on the issues, Graeme Edgeler is currently blogging some very thorough think-pieces about the most important issues. See his posts on The Party Vote Threshold and Dual Candidacy.

On both these issues, Edgeler puts forward interesting arguments, favouring reducing the 5% MMP threshold and banning dual candidacy.

Bryce Edwards

NZPD Editor (bryce.edwards@nzpoliticsdaily.co.nz)