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| Dr Eric Crampton | Chief Economist | eric.crampton@nzinitiative.org.nz | ||||||||||||
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They had been invited to register their interest in attending the briefing. For organisations that typically attend restricted briefings, registration has largely been a formality – though the number of analysts allowed to attend might vary. But this year, Treasury changed its guidelines. And their applications to attend were rejected. Treasury said the briefings provide time to consider materials before public release. The aim is more accurate reporting and greater “transparency and accountability to the public.” Those not considered to have time-sensitive needs are no longer allowed to attend. Those include representatives of peak bodies, professional bodies, unions, universities, industry bodies, industry information services, and advocacy groups, among others. But ‘lock-ups’ do not just provide early access to soon-to-be-released budget and fiscal documents. Attendees can also ask Treasury officials detailed questions about complex estimates. This encourages better-informed reports with fewer errors, and with fewer excuses for errors. Occasionally, discussions with officials at a lock-up can discover errors in the estimates. At the 2023 Budget lock-up, I found that Treasury had failed to tally or account for a substantial fiscal risk to the tobacco excise returns. I discussed the issue with officials in attendance to confirm that I had not misunderstood anything. The errors were corrected at the subsequent Pre-Election Fiscal Update. I will likely not be admitted to Budget 2025’s lock-up if Treasury’s guidelines for attendance stand. We can sympathise with Treasury’s predicament. When more people wish to attend restricted briefings than can be accommodated, Treasury must choose who to disappoint. However, the proposed guidelines for restricted briefings put little weight on analysts’ ability to discuss estimates with officials. Analysts barred from briefings could email Treasury for clarification after the event. But I had emailed Treasury long before Budget, warning them about the potential issue. Nothing was done until I found the right Treasury official at the lock-up. Groups affected by the new guidelines regularly provide analysis of budget figures to their own readers, who number in the hundreds of thousands. They also provide expert analysis for journalists attending the restricted briefings. Both functions assist in transparency and accountability to the public, which are purposes of the restricted briefings. We strongly urge Treasury to reconsider these guidelines well before Budget 2025. |
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| Nick Clark | Senior Fellow | nick.clark@nzinitiative.org.nz | ||||||||||||
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There is a disconnect between what voters expect of local representatives, and what they can deliver. Most New Zealanders assume that the mayors and councillors they elect will have the power to implement their promised policies. The reality is different. While mayors can make appointments and establish committees, their actual authority is constrained. Meanwhile, unelected chief executives wield considerable power over council operations and the flow of information to elected members. The consequences are visible across the country. Carterton District Council attempted to silence a councillor for expressing views aligned with her election platform. Waitomo’s mayor faced a similar situation. In Gore, relationships deteriorated to the point where both mayor and chief executive faced resignation calls. Wellington City Council now has a Crown Observer following an impasse over its long-term plan. The dysfunction comes at a significant cost. Core infrastructure like water and roading have been neglected while nice to haves like Tākina have been pursued. Rates increased by 12% in the year to September 2024 with more big increases to come. The government is pushing for councils to return to basics. But its reforms will struggle without addressing the core problem: the subversion of democratic accountability by council administrators. International experience offers some models for reform. The German state of North Rhine-Westphalia (NRW) faced similar challenges with their British-inherited system. Their solution was to combine the roles of mayor and chief executive. Twenty-five years later, these reforms enjoy broad support. They have delivered clarity and accountability. My report recommends considering NRW’s approach. Alternatively, Auckland's successful mayoral office model could be extended to other councils. This model provides the mayor with staff advice and resource independent of the CEO. The report also recommends:
The question is not whether New Zealand's local government needs democratic reform – it is whether we have the political will to make it happen. Nick Clark’s research report, Making Local Government Work, was published on 10 December. |
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| Dr Oliver Hartwich | Executive Director | oliver.hartwich@nzinitiative.org.nz | ||||||||||||
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The Guardian warned of “a victory that would undo 40 years of democracy.” The Nation warned of “Argentina’s Chainsaw Massacre.” Deutsche Welle declared Argentina would become “isolated in terms of foreign policy.” Curiously, many of these voices keep urging us to give socialism just one more chance. After all, the seventeenth time’s the charm. Venezuela wasn’t real socialism, you see. Neither was Cuba. Or Nicaragua. Or any of the other socialist experiments that demolished prosperity and liberty. The problem was simply incorrect implementation. But when Milei came to power, there was no room for such optimism about his free-market reforms. ‘Experts’ competed to outdo one other with predictions of calamity. A year on, these prophecies of doom have encountered an awkward obstacle: reality. The Economist just reported that monthly inflation has fallen from 13% to under 3%. Its risk index has dropped from 2,000 to 750 – the lowest level in five years. Who knew that stopping the money printer might slow inflation? Apart from, well, everyone who’s ever opened an economics textbook. And Argentina has achieved budget surpluses every month since January, the first time since 2008 of fiscal discipline. The promised diplomatic isolation has proven elusive. China, which Milei was supposed to alienate forever, is now “a fabulous partner.” It turns out nations prefer trading with functioning economies. Critics warned deregulation would destroy the rental market. Their definition of ‘destruction’ must be unusual – the market has doubled in size. And foreign investors would flee. If by ‘fleeing’ they meant showing increased interest in South America’s second-largest economy, investors are indeed fleeing – to Argentina! Oddly, economic freedom, sound money and fiscal discipline have led to economic improvement! Who could possibly have predicted that? Certainly not The Guardian. The Wirtschaftswunder in post-war Germany, New Zealand’s transformation under Roger Douglas, and Hong Kong’s economic miracle must all have been mere flukes. Pure coincidence that they all followed the same boring recipe of economic freedom. All those basic economics textbooks that suggest Milei might be onto something? Total fabrication. The so-called lessons of economic history? Capitalist propaganda. The pattern of free markets creating prosperity? Must be a statistical error. We know this must be so. Otherwise, those prophets of capitalist doom who keep telling us that socialism only needs one more try, and that free markets should never be given a chance must be wrong. And that just couldn’t be. Could it? |
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