Airfares & Napier Mayor

Published HBT 9 Sept 2014

Napier Mayor Bill Dalton must explain the source of his information that Air New Zealand are not gouging Hawke’s Bay travellers as he so confidently claims, and how does he support his suggestion we risk losing air services altogether if the airline takes offence at our criticism. Has he actually be told this by the airline? 

The chances the airline might flag away nearly half million passengers and hand an estimated $100 million a year piece of business on a plate to Jetstar is simply not credible. 

Many organisations including Mr Daltons own Council are criticised for what some people at least think are excessive charges, and all deny the allegations. That Air New Zealand deny price gouging is irrelevant. No business, especially one half owned by Government would admit to excessive pricing, because it would immediately attract the attention of regulatory authorities. In fact there is antidotal evidence to the contrary. 

Are we to assume Mayor Dalton does not intend to protest at the possible loss of 36 local Air New Zealand jobs when he meets with Air New Zealand Regional Services Manager Ian Collier this week because of the risk of offending, or is this issue somehow exempt from the threats to leave Hawke's Bay.  

Surely he is aware of the anaemic state of our local visitor industry and perhaps would be doing the people and businesses of Hawke’s Bay a greater service if he were to add his voice to those claiming unfair treatment, rather than helping a business preserve the damaging monopoly it currently enjoys.

Amalgamation conflict

Published June 2014

Local MP Chris Tremain's apparent suggestion that Hawke's Bay will be better off if hundreds of skilled and well paid Hastings council jobs are transferred to Napier seems more like shuffling the deck chairs on the Titanic than a plan to improve our performance. Obviously he believes Hastings should play no part in the future under one council despite most of the  growth,  in population, industry and employment happening within the Hastings District Council. Such a move could be catastrophic for Hastings retailers.

As the former Minister of Local Government I would have expected Chris to be able to provide very specific details on the savings and how they will be used, details of past problems caused by our multiple councils, and exactly what opportunities we have missed in the past, because of our divided councils.  

Also his slagging opposition to the objections by three of the areas four Mayors accusing them of patch protection seems somewhat contradictory since he was a party to his governments rejection of all suggestions for reform of the MMP system, including the elimination of coat tailing. Surely one of the best examples of patch protection seen in recent times. 

Whilst many of us share concerns about our multiple council structure, the disunity currently evident within the HBRC suggests that one council may be no more unified than several. Each of our four territorial councils appear surprisingly unified within themselves if often not in agreement with each other, but if the divisions within the Regional Council were to spread into a single unitary council, the situation might be very much worse. 

It is unrealistic to blame every aspect of our poor performance on local government and the supposed differences between our councils. Perhaps some of the problem is the effectiveness of our representation within central government. 

Amalgamation

Published HBT June 2014

The slanging match over debt is sidetracking the amalgamation debate. In the end debt will have very little impact on whether or not Hawke’s Bay will be better off with a single council. If amalgamation turns out to be wrong there will be no chance of going back to what we have now.

Is surely the supporters who must prove their case because it is they who are agitating for change and their motives are questionable. Some may be bitter because they have already been rejected as representatives by the community.  Others are members of the wealthy and influential provincial elite who crave more power than they already have, while others appear to be seeking a way to continue holding office without seeming like stale bread.

Will it save money?

Where is the proof amalgamation is going to make us more efficient?  Centres with comparable populations to the proposed Hawke’s Bay Super Council such as Hamilton, Tauranga, and Dunedin have debt levels that are multiples of our combined debt, plus their rates are higher. 

The Winder report claimed at least 100 jobs could be eliminated with one council but similar staff reduction claims were made about Auckland, though these seem to have been conveniently forgotten now our largest city employs over 1000 more staff than before amalgamation, while salary levels have exploded with over 1500 staff earning more than $100 000. If this was the private sector such expectations would be realised, but in Local Government such savings are unlikely. For example we could see five chief executives being replaced with one earning double the present highest salary, plus four additional lieutenants each earning at least as much as the people they are displacing. 

Cost reductions in other areas such as roads, and the three waters are also unlikely because most of the spending in these areas by the existing councils is awarded by competitive tender meaning there is little if any opportunity for further cost reductions. 

How exactly will we be better off ?

Those claiming the Hawke’s Bay economy will perform better under one council need to provide evidence to support their position. Yes we have lost businesses and jobs. Yes our wages are low and unemployment high. But can those proposing amalgamation provide a single verifiable example of a business that has decided not to come here, or one that has left because of our Local Government structure?

The Local Government Commissions had a myopic view of the issue. Both Winder and the Commission seemed interested only in proving a predetermined outcome and in doing so completely ignored the concerns of the four councils opposing amalgamation. It is loss of control  over funding arrangements and spending priorities that that people are worried about not who actually does the work. The present structure actually has some advantages. We now have an element of competition( rare in local Government), and each area is able to concentrate on their strengths and needs. Perhaps it was this concentration of effort that made the difference in helping attract Kiwitbank to bring over 100 jobs to Hastings. 

The Local Government Commission and Winder could have looked at the possibility that poor quality investment decisions by our councils is a better explanation for Hawke’s Bay’s anaemic economic performance. The $18 million museum upgrade with $4 million annual running cost, plus the nearly $30 million( total cost to date) poured into Opera House are costly spend ups that have contributed very little to our economic performance. If we add the Art Deco Buses plus the cost of the proposed Civic Square upgrade it’s not difficult to tote up nearly $100 million of wasted opportunity. 

Is it possible we will be worse off? 

It’s actually possible many things could get worse with a single Council. We have only to look at Auckland to appreciate the sort of things that might happen here. The people who have been running our affairs for many years have the best chance getting elected to any amalgamated Council and If that happens why will the outcomes be any different?  

Hastings cavalier takeover attitude could also backfire. It will have a maximum of just one third of the representatives on both the Transition Board and the merged council and its representatives will easily be out voted by those whose concerns have until now been ignored.   

Amalgamation will be expensive and disruptive. We need to make sure it is worth it. 

Gaza Update

Published HBT 16/08/14

Hamas cannot win the military battle they have bought with Israel, so why do they bother with their continuing rocket attacks, that actually cause little real damage?  It's not clear how much support Hamas has, but In what other country are the people condemned to die because of the actions of their government? Perhaps Israel has fallen into a trap set by Hamas to provoke a military reaction so as to motivate a whole new generation of militants, suicide bombers, martyrs and others willing to perpetuate the fight. With 50% of the population of Gaza 18 years old or under there may be no shortage of volunteers for decades to come. 

The first casualty of war is truth. Initially Israel claimed Operation Protective Edge that started on 8 July was a response to the rocket attacks from Gaza,. Then they claimed it was the tunnels built to allow insurgents access to Israel. Possibly the real reason is retribution for the murders of the three Israeli teenagers. Israel may have an advantage with its confident english speaking spokespeople but Hamas have the evidence of destruction and hundreds mutilated and dead children. 

Few dispute Israel's right to protect itself. However many are questioning the killing of nearly 2000 people, 73% of them civilians including nearly 500 children, injuring over 10 000 more, driving hundreds of thousands from their homes, destroying the only power station including fuel supplies, wrecking sanitation and water reticulation systems, and ruining untold livelihoods. Rebuilding is estimated cost at least $6 billion.  It is the rest of the world who will eventually foot the bill, not Israel who caused the damage, or the USA who supplied the weapons.   

Israel's battering of Gaza repeats the 1998/99 invasion and the 2011/12 bombing. Despite having every conceivable weapons option including tanks, drones, precision guided bombs plus troops on the ground, the Hamas rocket attacks have not stopped. This military option may eventually fail despite overt support from Egypt and Saudi Arabia who view Hamas as akin to the Muslim Brotherhood, Isis, and Iran, a view supported by many Western countries especially the USA. 

This is different from the previous wars Israel has fought successfully with hostile neighbors because it is essentially a guerrilla campaign where the combatants are indistinguishable from the general population, and hide amongst them. As the USA and French discovered in Vietnam, America, Britain and Russia found in Afghanistan, and again by America in Iraq,  military might does not necessarily produce a successful outcome when the enemy is so elusive. Even the Hamas tunnels have a similarity to Viet Kong tactics that helped wear down the USA in Viet Nam. 

Also time may be running out for Israel because both the UK and Western Europe are becoming increasingly Muslim as a result of both a huge influx of refugees fleeing various Islamic countries, plus their higher birth rates. Muslims already number nearly 3 million( 4.4%)  in UK and are increasing 10 times faster than non Muslims. In the Western European Union 19 million (3.8% )are Muslims and estimates suggest over the next 15 years 85% of population growth will be Muslim This could mean in the not too distant future this group will acquire the political clout to force governments to cease their support for Israel.  

Killing so many non combatants is seem by many as immoral, inhumane and totally excessive, and matching evil with evil will not bring peace or prosperity to the Middle East. Whilst Israeli Prime Minister and hard liner Benjamin Netanyahu has the support of a majority of Israelis they may be loosing the moral high ground. Netanyahu seems incapable of developing a non military solution and his approach has also cost the lives of over 60 Israeli military personal, a terrible price to pay for pandering to public opinion. The Iron Dome missile defense system has ensured Israel was never seriously threatened by primitive Hamas rockets . Whilst the destruction of tunnels was clearly justified it is unlikely they have all been found. Israel is going to have to yield some ground with a political solution and find a way to convince Palestinians they can have a better life without Hamas who for now are the elected legitimate government of Gaza. 

Gaza & Israel

Published HBT 25/07/14

Whilst the totally unjustified shooting down of MS 17 in the Ukraine has grabbed the headlines we should not ignore what is happening in the Middle East  where Israel is engaged in a one sided clash with Palestinians in the Gaza Strip, home to nearly 2 million people and one of the most densely populated parts of the world. 

Israel claims to be trying to stop the thousands of missiles being fired by Hamas militants but these are are unsophisticated unguided limited range weapons and their inadequacies combined with the effectiveness of Israel's Iron Dome anti missile system means minimal damage and only one death. The disproportionate Israeli response from land sea and air has so far killed and maimed hundreds, mostly civilians including women, children, non combatants and old people. People who there have little option but to continue doing so. 

The abduction and murder of three civilian teenager's was totally wrong and the perpetrators must be bought to justice. Whilst Israel felt quite entitled to barge into the Gaza arresting and beating up dozens in their search for the culprits, (which they failed to find)  the Palestinians apparently had no such rights to do the same to solve a retaliatory crime committed against one of their own.  

Israel  should remember their own violent history including terrorist acts and murder. This includes killing 91 people with the terrorist bombing of the King David Hotel in Jerusalem in 1946, numerous instances of attacks on British forces, and the massacre of many non jewish settlers.  

Israel has successfully defended itself on many occasions from neighbors bent on her destruction. These threats have not disappeared but this is not the situation today in Gaza. Certainly most living in Gaza would like to see the demise of Israel but they lack the means and ability to do so. Whilst dealing to those responsible for the rockets is justified, deliberately killing and maiming innocent civilians is criminal. In fact it has a certain similarity to the treatment of Jews prior to WW2.  Even the total blockade of Gaza seems reminiscent of the containment of Jewish ghettos by the Nazies.

Jews (or Israelites) have been persecuted for most of history especially by the German Third Reich and their determination to create a safe homeland is entirely understandable. However at the time of the official formation of Israel jews were a minority in the area and others who lived there have been systematically and driven out. For instance Israel regularly bulldozes the homes of non Jews in the West Bank to make room for its own settlements even though the area was annexed in 1967 and not originally assigned to Israel.  Its little wonder so many hate the Jewish state. 

Israel is creating a dispossessed people who have no hope of escape or a better future. Their highly effective  PR machine is trying to convince us their brutality is justified. This is not collateral damage, Israel is committing atrocities and its actions are unacceptable.These are not the actions that create peace and harmony but the conditions that will create terrorism. One day as a  consequence of this wholly one sided conflict something may happen either by intent or accident  that will impact on the rest of the world. If for no other reason Israel must be made to stop these excessive attacks or the rest of us will eventually pay the price. Meanwhile Israel seems determined to make the place as miserable and dangerous as possible and appears intent on totally annihilating Gaza and its people if at all possible.  

It is wrong that the world at large is doing nothing to stop Israel's barbaric actions and one day there may well be consequences that may affect us all. The downing of flight MH17  by either Russia or pro Russian separatists demonstrates graphically just how quickly and unintentionally and tragically innocent people can become involved in issues not of their making. 

Hero's of the rebuild

There are plenty of hero's in the community including sports, business, and  arts people, philanthropists and volunteers, all making an invaluable contribution to society.

I personally have huge admiration for those who succeed in business  because although they are driven by personal ambition, they also create real prosperity, and opportunities for others.

They take huge chances often risking everything including their homes as they battle against all the obstacles imaginable. I can attest to the many challenges business people face having managed myself to survive the downturns of both the 1980's and the past few years.

For some the rewards are huge as evidenced by local businessman Rod Dury's topping the Hawke's Bay rich list with his IT company Zero, but for most its pretty much just working extremely hard often for little more than an average wage.  

Two individuals presently stand out because they are having, or are about to have,  a profound impact on our city centers, especially in Hastings. 

The Hastings CBD has been a pretty much static scene for decades. The old Power Board, State Insurance, Wattie Industries and three bank buildings all date back to at least the early 1970's.

Now suddenly we are seeing a massive rebuild thanks primarily to two entrepreneurial individuals, Jonathan Wallace and Michael Whittaker.

The renaissance started when Wallace Development Company built the new Farmers Store on Heretaunga Street west which happened to incorporate Hawke's Bays first escalator. Next was the rebuild of the old Woolworths building one block nearer town across from the clock tower. Completing the trio and now apparently nearing completion is the rebuilt for Power Board building in Heretaunga St East, soon to be occupied by Hawke's Bay Today.

Now Michael Whittaker son of the former Mayor of Havelock North has purchased the derelict old Albert Hotel and is developing ideas for site. Whilst many of us had a nostalgic hope the oldest commercial building in town could be saved, it has become increasingly clear the choices were to demolish and redevelop or wait until it collapsed in a cloud of borer dust and rat droppings. At the same time he has purchased the old Bon Marche building on the opposite side of the street.

Whilst his plans are uncertain at this stage, it is clear he has the vision and the financial clout to do something worthwhile.

Following the hammering we received  from rodgernomics  in the 1980's Heretaunga  St has been at a standstill. Successive councils have tried  to change the situation including turning part of it into a mall,  then when that didn't work,  abandoning that idea and opening it back up to traffic. The outcomes have been far from successful despite the considerable cost to ratepayers .

So now, at no cost to ratepayers we have two individuals with the confidence necessary to rescue our CBD. I am confident they will succeed if only because they are taking on the risks, and that is always a major incentive to get it right.

It couldn't have happened a moment too soon. The impact of the Christchurch earthquakes is the realisation many of our buildings  would not stand up to a similar seismic event. 

I love old architecture. It  has a grace and elegance that is mostly missing from today's structures. The jewel in the Hastings crown has to be the Opera House and adjacent Civic Chambers, but there are plenty of other great examples of Art Deco and Spanish Mission structures, and most are likely to need work to bring them up to even the minimum 33% of code.

This could have resulted in wasteland  as owners decided strengthening or rebuilding was just not financially viable. We might have ended up with large areas demolished and used for  car parking or even abandoned. In a worst scenario the  CBD could have been deserted in favour of a full migration in the direction of the old Nelson Park. Have a look at Market St North without Farmers, The Warehouse and Stationery to see where we might have been headed.

Its impossible to see that happening now. With Farmers anchoring the redevelopment of Heretaunga St and  many other new developments in the pipeline we seem to have turned the corner. 

Hastings history is full of other visionary people including Francis Hicks, Thomas Tanner, the Williams and the Chambers, but in the decades to come we  are likely to be thankful for the vision and enterprise shown by Michael Whittaker and Jonathan Wallace because they started the rejuvenation of Hastings .

We need more people

It's official, we are shrinking. The most recent population estimates from Statistics New Zealand reveal we have fewer people living in Hawke's Bay than a year ago.

Population growth is a major driver of economic activity. More people means more houses, more tradesmen, more appliances, more roads, in fact more of just about everything.

For many decades we have rated as the 5th largest population  centre in the country, but this may no longer be the case. Almost certainly Tauranga has eclipsed us and Dunedin is not far behind. Less people means contraction, and lets not fool ourselves, that is where we are heading unless we find ways to turn things around.

Generally anyone setting up new businesses need to be where the action is. Big cities are huge magnets dragging in even more people, more jobs more everything. If we shrink we will not only fail to attract new employers, we will likely start loosing some of those we have.

Already Auckland is ten times larger than all of Hawke's Bay. Projections of another million in our largest city when we are expect to remain static means in just a few decades Auckland will be nearly 20 times larger.

Already our best and brightest young are being sucked out at an alarming rate, attracted by educational opportunities jobs and the lure of the bright lights. We will never match Auckland for size or growth but if we allow ourselves to start contracting we will soon find ourselves in deep trouble.

For a start we will loose what little political bargaining power we still have. Suddenly services we take for granted will be sourced elsewhere. Areas such as specialist medical services and education will likely be early casualties. This already happens but it could be very much worse.

Last month the city of Detroit, once home of the automobile industry, declared itself bankrupt owing $US 18 billion. Between 2000 and 2010, the number of residents declined by 250,000 continuing a pattern that has seen the city population decline by some 60% from it's 1950's peak.  

I take some small comfort in the fact that the Mayor of Hastings agreed with me when he recently wrote  “Hawke's Bay needs to wake up to what is happening to our economy and region.” (HBT 2/7/13) Sadly though, I have to point out that we are in this sorry state after he has spent nearly two decades on council, twelve as Mayor. 

Hawke's Bay's leadership has been too engrossed for far too long with building monuments such as Splash Plant, the Opera House, the Aquarium and Museum. Looking at all the concrete and glass knowing it was “their baby” makes them feel good . The problem is the economic justification has been weak, so inevitably these structures have become a burden on ratepayers. In Hastings this has been especially severe because the projects have been debt financed.

Such projects may have served political objectives but have done nothing to improve economic performance, and it is the latter we badly need.

There is an unwillingness by our leadership to acknowledge the true state of affairs. I was told recently that we must be positive. My response is we must acknowledge our problems if we have any hope of solving them. So how are we to turn things around?  

Tourism a mainstay of our economy struggles as visitor numbers decline according to the Statistics New Zealand Commercial Accommodation Monitor.

We need to do something about the inadequacy of our air services. If we were as close to Auckland as Hamilton and other places are, it would not be an issue, but many of the destinations we compete with are much closer to our major cities, and/or have more affordable air connections. The tyranny of  Air New Zealand's  monopoly position must be broken if we want Hawke's Bay to be an attractive place to visit.

Better air services will also help us retain and attract businesses. Any  organisation trading with the rest of the country or the world needs to travel, and if we are more expensive or difficult than elsewhere then we will be less competitive.

To cap it all off, yet another independent report, the Winder report stage 1 tells us that our work force is under qualified and we have only half the national average percentage of university graduates.

Huge amounts of money are being sucked out of our economy so our young can receive the education they need. We need more of this money to stay here and we need the job opportunities a bigger and more diverse education offering would provide.

We all know we have a great climate, an enjoyable lifestyle, and fairly affordable housing. That's why so many of us came and stayed. Whilst we are attractive to those at, or approaching the end of their working lives it is clear people are leaving in droves, and these are the young, the brightest, and the most motivated. 

This sorry state of affairs has not just happened. It has been clear for for many years that Hawke's Bay was slipping behind. If our leaders have failed to see the signs and develop growth policies, there is little chance they will do so if returned to office in the forth coming elections