Treasury's Half Year Economic and Fiscal Update shows more delay to getting the books back to black.  

The deficit's expected to deepen to a depth of $16.9 billion and not narrow to $60 million dollars until 2029-30. 

Economic growth is expected to be just 1.7% next year. 

NZ Herald Business Editor Liam Dann told Kerre Woodham that the problem isn’t in how much we borrow, but the efficiency of government spending.  

He says there's a big lack of trust in the government, as people would be able to cope with higher borrowing if it was going towards amazing infrastructure projects, but we haven’t seen that over the last decade.  

LISTEN ABOVE 

Treasury's Half Year Economic and Fiscal Update shows more delay to getting the books back to black. &nbsp;
The deficit's expected to deepen to a depth of $16.9 billion and not narrow to $60 million dollars until 2029-30.&nbsp;
Economic growth is expected to be just 1.7% next year.&nbsp;
NZ Herald Business Editor Liam Dann told Kerre Woodham that the problem isn’t in how much we borrow, but the efficiency of government spending. &nbsp;
He says there's a big lack of trust in the government, as people would be able to cope with higher borrowing if it was going towards amazing infrastructure projects, but we haven’t seen that over the last decade. &nbsp;
LISTEN ABOVE&nbsp;

Join Kerre Woodham one of New Zealand’s best loved personalities as she dishes up a bold, sharp and energetic show Monday to Friday 9am-12md on Newstalk ZB. News, opinion, analysis, lifestyle and entertainment – we’ve got your morning listening covered.

Kerre Woodham Mornings Podcast

Liam Dann: NZ Herald Business Editor on the state of the Government's books

https://api.omny.fm/orgs/7784f840-c291-422a-924b-ad9000bbad71/clips/5d1935ac-d1bb-48a3-8289-b3b501763735/transcript

I've been saying every morning to Helen, God, would you look at what's happening in Wellington? Look at what has oh! Like one of those people, usually men, watching the television going, look what she's wearing, come here and have a look at this. Have a look at that. God. Oh, but I'm like that about the waste going into the ocean off Wellington. That's far more important than what a reporter may or may not be wearing.

It is hard to comprehend the sheer amount of waste being pumped into Wellington's ocean right now. Who knew humans could produce so much? What does 70 million litres of waste per day look like? Helpfully, the Spinoff broke it down. Moa Point, the writer writes, is sharting out 28 Olympic pools of pure uncut human waste every 24 hours and will be doing so for months.

If you want to have an Auckland analogy, the total tank capacity at Kelly Tarlton's Aquarium is 18 million litres. Moa Point is divesting itself of nearly four Kelly Tarltons worth of poos, wees, toilet paper every single day. Cool. You get the picture. Thank you Spinoff.

It's an absolute disgrace. And yet really, Auckland can't talk. Every time it rains our beaches are closed. You know, where you hear the sound of rain on the roof, you used to think, oh, how lovely and relaxing. Now I think landslips and I think beach closures. Every year the joy of summer's blighted by beach closures.

I mean, we do have help on the way. Helen and I have walked the poo tunnel and that was amazing to see and that's going to be open at the end of the year. But even then they said they're not going to be able to prevent all beach closures. They're not going to be able to say hand on heart it will never happen again because nature does what nature does and if there's an absolute torrent and a deluge they won't be able to cope even with that enormous pipe, but it will certainly mitigate a lot of the damage done.

So there has been chronic underinvestment in our infrastructure around the country for decades, but nowhere is it more exemplified than Wellington. On the 27 th of May 2021 remember those times, Wellington City Council's long term plan committee faced a fork in the road.

Officers presented councillors with water investment options, including one, water option three, that contained a $391 million wastewater renewals programme. It was designed to reduce sewage pollution, starting with the central city and South Coast catchments that are now making headlines. At the same meeting, officers recommended cycleways option three, a staged programme set out in the consultation document presented to councillors.

This is from Peter Bassett in the blog Breaking Views. And as he writes, what happened next is the hinge moment of Wellington's current disgrace. An amendment was moved by then councillor, now MP, Tamatha Paul, seconded by Jill Day, now Labour Party president, to adopt cycleways option four, expanding the programme to 226 million over 10 years compared with 120 million under option three. That amendment passed. Accelerated wastewater renewal did not. Simon Woolf was one of the councillors who voted against cycleways over water.

There's been no cognisance of reprioritising. It's just gone down an ideological line. The city's going to suffer for years and years on the back of this underinvestment.

Which is putting it mildly. He's ropable. He and the other councillors who voted against it. They could see what was happening. They knew it was imperative and it wasn't one or the other, it was a matter of priority.

You could say sure, let's do cycleways, but shall we sort out the wastewater first because that is that's verging on catastrophic. No. No, let's go with the cycleways and what's more, let's spend more money on the cycleways than was recommended and let's not do the wastewater. It'll be fine. Just hold on. It's not fine. It couldn't hold on.

To be fair, the previous Labour government understood that the country's infrastructure for the most part is in crisis, hence Three Waters. But yet again they were let down by their own execution of a plan to revitalise New Zealand's waterways. They failed to get the public behind Three Waters.

National has come up with its own plan. Three Waters has become Affordable Water Done Well and there seems to be a growing understanding that we just can't kick the can down the road. All councils around the country are going to have to bite the bullet. Some have done, only a few, some have done so.

Are you willing to see a rise in rates to clean up our waterways? Do you understand the urgency? Does Wellington's infrastructure crisis underline the urgency and the need to undertake the water reforms? And if we have to pay more in our rates, so be it.

LISTEN ABOVE

I've been saying every morning to Helen, God, would you look at what's happening in Wellington? Look at what has oh! Like one of those people, usually men, watching the television going, look what she's wearing, come here and have a look at this. Have a look at that. God. Oh, but I'm like that about the waste going into the ocean off Wellington. That's far more important than what a reporter may or may not be wearing.
It is hard to comprehend the sheer amount of waste being pumped into Wellington's ocean right now. Who knew humans could produce so much? What does 70 million litres of waste per day look like? Helpfully, the Spinoff broke it down. Moa Point, the writer writes, is sharting out 28 Olympic pools of pure uncut human waste every 24 hours and will be doing so for months.
If you want to have an Auckland analogy, the total tank capacity at Kelly Tarlton's Aquarium is 18 million litres. Moa Point is divesting itself of nearly four Kelly Tarltons worth of poos, wees, toilet paper every single day. Cool. You get the picture. Thank you Spinoff.
It's an absolute disgrace. And yet really, Auckland can't talk. Every time it rains our beaches are closed. You know, where you hear the sound of rain on the roof, you used to think, oh, how lovely and relaxing. Now I think landslips and I think beach closures. Every year the joy of summer's blighted by beach closures.
I mean, we do have help on the way. Helen and I have walked the poo tunnel and that was amazing to see and that's going to be open at the end of the year. But even then they said they're not going to be able to prevent all beach closures. They're not going to be able to say hand on heart it will never happen again because nature does what nature does and if there's an absolute torrent and a deluge they won't be able to cope even with that enormous pipe, but it will certainly mitigate a lot of the damage done.
So there has been chronic underinvestment in our infrastructure around the country for decades, but nowhere is it more exemplified than Wellington. On the 27 th of May 2021 remember those times, Wellington City Council's long term plan committee faced a fork in the road.
Officers presented councillors with water investment options, including one, water option three, that contained a $391 million wastewater renewals programme. It was designed to reduce sewage pollution, starting with the central city and South Coast catchments that are now making headlines. At the same meeting, officers recommended cycleways option three, a staged programme set out in the consultation document presented to councillors.
This is from Peter Bassett in the blog Breaking Views. And as he writes, what happened next is the hinge moment of Wellington's current disgrace. An amendment was moved by then councillor, now MP, Tamatha Paul, seconded by Jill Day, now Labour Party president, to adopt cycleways option four, expanding the programme to 226 million over 10 years compared with 120 million under option three. That amendment passed. Accelerated wastewater renewal did not. Simon Woolf was one of the councillors who voted against cycleways over water.
There's been no cognisance of reprioritising. It's just gone down an ideological line. The city's going to suffer for years and years on the back of this underinvestment.
Which is putting it mildly. He's ropable. He and the other councillors who voted against it. They could see what was happening. They knew it was imperative and it wasn't one or the other, it was a matter of priority.
You could say sure, let's do cycleways, but shall we sort out the wastewater first because that is that's verging on catastrophic. No. No, let's go with the cycleways and what's more, let's spend more money on the cycleways than was recommended and let's not do the wastewater. It'll be fine. Just hold on. It's not fine. It couldn't hold on.
To be fair, the previous Labour government understood that the country's infrastructure for the most part is in crisis, hence Three Waters. But yet again they were let down by their own execution of a plan to revitalise New Zealand's waterways. They failed to get the public behind Three Waters.
National has come up with its own plan. Three Waters has become Affordable Water Done Well and there seems to be a growing understanding that we just can't kick the can down the road. All councils around the country are going to have to bite the bullet. Some have done, only a few, some have done so.
Are you willing to see a rise in rates to clean up our waterways? Do you understand the urgency? Does Wellington's infrastructure crisis underline the urgency and the need to undertake the water reforms? And if we have to pay more in our rates, so be it.
LISTEN ABOVE

Kerre Woodham: Are you willing to see a rise in rates to clean up our waterways?

https://api.omny.fm/orgs/7784f840-c291-422a-924b-ad9000bbad71/clips/e401c861-ebe6-4c3a-a3d5-b3ef01774f80/transcript

After pouring more than $11 million into a Rotorua motel complex for the homeless, Kāinga Ora has decided to tear it down and put the Fenton St site on the market.

One year on since Kainga Ora began its turnaround plan, and it's now exceeding its saving targets.

Tenancy satisfaction is rising, vacancy rates are lower, fewer tenants are in rent arrears, and Kāinga Ora is doing a better job of managing its tenants to support safe, respectful communities.

Associate Housing Minister Tama Potaka joined Kerre Woodham to discuss the successful changes. 

LISTEN ABOVE

After pouring more than $11 million into a Rotorua motel complex for the homeless, Kāinga Ora has decided to tear it down and put the Fenton St site on the market.
One year on since Kainga Ora began its turnaround plan, and it's now exceeding its saving targets.
Tenancy satisfaction is rising, vacancy rates are lower, fewer tenants are in rent arrears, and Kāinga Ora is doing a better job of managing its tenants to support safe, respectful communities.
Associate Housing Minister Tama Potaka joined Kerre Woodham to discuss the successful changes.&nbsp;
LISTEN ABOVE

Tama Potaka: Associate Housing Minister celebrates exceeding saving targets in Kainga Ora turnaround plan

https://api.omny.fm/orgs/7784f840-c291-422a-924b-ad9000bbad71/clips/3f2ced4e-7b4d-462d-992c-b3ef016fa91d/transcript

For those of us with PCT, post Covid trauma, I've just given it a name and an acronym, the news that Nicola Willis is launching an inquiry into the actions of the Reserve Bank during Covid is going to bring back some bad memories, but I guess that's what National's relying on. During the pandemic, you'll recall the Reserve Bank cut the Official Cash Rate to a record low and for the first time printed about $55 billion worth of digital money – $55 billion that was pumped into the economy to keep it afloat. Many other countries did that too. Most didn't do it to the same extent we did, but most countries, most Western economies did the same thing. But they, like we, found that there is a cost to free money. High inflation, massive increase in house prices, businesses struggling to pay the money back. Was the hangover worth it? That's what Finance Minister Nicola Willis wants to find out. 

“I think this is about the future. It's less for me about who was to blame and who we can tell was wrong. What it is about is saying, well, if you were doing it again, how would you prevent some of the overspending? How would you prevent some of the overuse of this money printing tool? How would you make sure you got it right? And so actually this is about the future and doing it better in the future. If we were to repeat the mistakes of Covid and just blindly ignore the lessons of history, I think that would be a major failure. 

“I fully acknowledge support for the economy was required. And so the question that we are asking is, well, the benefits that occurred because there was this money printing and this borrowing are known, but let's examine what the costs were and then do a weigh up of the benefits of the costs and ask ourselves, did we just maybe go a bit too far? And in future, how would we calibrate that better? And look, I think the idea that New Zealanders shouldn't have this information before the election is really wrong because actually it does have a bearing on the democratic process. It does have a bearing on the way that people position themselves for the future.” 

The timing is interesting. Reminding everyone of the Covid experience just before the election – who's that going to work for? You'd have to ask yourself. National promised during the last election campaign that they would order an independent review of the actions of the Reserve Bank and that review did not happen until now, and that's the start of the next election campaign. Willis says, oh come on, it's not about that. I was just really, really busy doing other stuff. I had a lot on my plate, I had a lot to deal with, which is true. I was updating the Reserve Bank's mandate to a sole focus on fighting inflation. I've had a lot on my plate. I'm only just getting round to it now.  

Still and all, I am not averse to an inquiry and I don't want it to be a witch hunt. And I think it would be really, really, really good to have a truly independent and dispassionate look at decisions made in the heat of the moment and weigh up whether you would make those same decisions next time. Obviously there'll be slightly different circumstances, but if people have to stay home and businesses have to shut down, how do you manage that? How do you manage that over the short term? How do you manage that over the long term?  

I would have really liked to have seen that happen with other decisions made during Covid, like having a long hard look at the way health and Covid health was prioritised over everything else. The decision makers at the time said the hospitals would have been overwhelmed and therefore all health would have suffered. You look now at the cancer waitlists and the deaths from people who weren't picked up while the hospitals were in shutdown mode and you say, okay, alright, so that happened, as a result this happened, was it worth it?  

I would love to see a dispassionate, cool, clear-headed look at the decisions that were made and bring into account everything that happened during that time and say was it worth it? I know we've had the Covid inquiries, but I don't really, I don't feel that we've had a clear, concise, dispassionate report. Yes, we would do this again. No, we wouldn't do that. Maybe we'd do this. I'd just like to see it set out a little bit more clearly, a blueprint, because what caused so much pain last time was the fudging and the decisions on the fly and not fully formed decisions. If you're able to get a really good analysis of the decisions made with a cost benefit factor weighed up, an emotional cost, personal cost, as well as the dollar figure, and if you broke it down to the Reserve Bank, to health, to employment, to housing, I think it would be really helpful for future generations to see, okay, they did that, let's not do that this time. It might look like a good idea, but ultimately the cost was just too great. When you look at the children and education and schooling, what was the cost there?  

It might have been worth it – that's what we might find. I might have to agree that for all my moaning and bitching and railing under the restrictions, they were the right decisions to make and I might have to accept that, but I don't really feel we've got a clear analysis of the decisions made and whether they were worth it. I mean, perhaps there has been and I just haven't been willing to hear them, but I can't recall seeing anything set out, laid out, simply, clearly, concisely, critically, and coolly. And that's what I'd really love to see. I bet there are some of you, probably in the South Island, who think, oh for God's sake, what a waste of bloody time. This again. And I don't blame you. I'd love to be in that position. I really would. So you might think it's a complete and utter waste of time. If so, I'd love to hear your thoughts too. 

For those of us with PCT, post Covid trauma, I've just given it a name and an acronym, the news that Nicola Willis is launching an inquiry into the actions of the Reserve Bank during Covid is going to bring back some bad memories, but I guess that's what National's relying on. During the pandemic, you'll recall the Reserve Bank cut the Official Cash Rate to a record low and for the first time printed about $55 billion worth of digital money – $55 billion that was pumped into the economy to keep it afloat. Many other countries did that too. Most didn't do it to the same extent we did, but most countries, most Western economies did the same thing. But they, like we, found that there is a cost to free money. High inflation, massive increase in house prices, businesses struggling to pay the money back. Was the hangover worth it? That's what Finance Minister Nicola Willis wants to find out.&nbsp;
“I think this is about the future. It's less for me about who was to blame and who we can tell was wrong. What it is about is saying, well, if you were doing it again, how would you prevent some of the overspending? How would you prevent some of the overuse of this money printing tool? How would you make sure you got it right? And so actually this is about the future and doing it better in the future. If we were to repeat the mistakes of Covid and just blindly ignore the lessons of history, I think that would be a major failure.&nbsp;
“I fully acknowledge support for the economy was required. And so the question that we are asking is, well, the benefits that occurred because there was this money printing and this borrowing are known, but let's examine what the costs were and then do a weigh up of the benefits of the costs and ask ourselves, did we just maybe go a bit too far? And in future, how would we calibrate that better? And look, I think the idea that New Zealanders shouldn't have this information before the election is really wrong because actually it does have a bearing on the democratic process. It does have a bearing on the way that people position themselves for the future.”&nbsp;
The timing is interesting. Reminding everyone of the Covid experience just before the election – who's that going to work for? You'd have to ask yourself. National promised during the last election campaign that they would order an independent review of the actions of the Reserve Bank and that review did not happen until now, and that's the start of the next election campaign. Willis says, oh come on, it's not about that. I was just really, really busy doing other stuff. I had a lot on my plate, I had a lot to deal with, which is true. I was updating the Reserve Bank's mandate to a sole focus on fighting inflation. I've had a lot on my plate. I'm only just getting round to it now. &nbsp;
Still and all, I am not averse to an inquiry and I don't want it to be a witch hunt. And I think it would be really, really, really good to have a truly independent and dispassionate look at decisions made in the heat of the moment and weigh up whether you would make those same decisions next time. Obviously there'll be slightly different circumstances, but if people have to stay home and businesses have to shut down, how do you manage that? How do you manage that over the short term? How do you manage that over the long term? &nbsp;
I would have really liked to have seen that happen with other decisions made during Covid, like having a long hard look at the way health and Covid health was prioritised over everything else. The decision makers at the time said the hospitals would have been overwhelmed and therefore all health would have suffered. You look now at the cancer waitlists and the deaths from people who weren't picked up while the hospitals were in shutdown mode and you say, okay, alright, so that happened, as a result this happened, was it worth it? &nbsp;
I would love to see a dispassionate, cool, clear-headed look at the decisions that were made and bring into account everything that happened during that time and say was it worth it? I know we've had the Covid inquiries, but I don't really, I don't feel that we've had a clear, concise, dispassionate report. Yes, we would do this again. No, we wouldn't do that. Maybe we'd do this. I'd just like to see it set out a little bit more clearly, a blueprint, because what caused so much pain last time was the fudging and the decisions on the fly and not fully formed decisions. If you're able to get a really good analysis of the decisions made with a cost benefit factor weighed up, an emotional cost, personal cost, as well as the dollar figure, and if you broke it down to the Reserve Bank, to health, to employment, to housing, I think it would be really helpful for future generations to see, okay, they did that, let's not do that this time. It might look like a good idea, but ultimately the cost was just too great. When you look at the children and education and schooling, what was the cost there? &nbsp;
It might have been worth it – that's what we might find. I might have to agree that for all my moaning and bitching and railing under the restrictions, they were the right decisions to make and I might have to accept that, but I don't really feel we've got a clear analysis of the decisions made and whether they were worth it. I mean, perhaps there has been and I just haven't been willing to hear them, but I can't recall seeing anything set out, laid out, simply, clearly, concisely, critically, and coolly. And that's what I'd really love to see. I bet there are some of you, probably in the South Island, who think, oh for God's sake, what a waste of bloody time. This again. And I don't blame you. I'd love to be in that position. I really would. So you might think it's a complete and utter waste of time. If so, I'd love to hear your thoughts too.&nbsp;

Kerre Woodham: I would love a dispassionate, clear-headed analysis of the Covid response

https://api.omny.fm/orgs/7784f840-c291-422a-924b-ad9000bbad71/clips/5e5de309-bd4c-4c74-870b-b3ef0002f286/transcript

Liam Dann: NZ Herald Business Editor on the state of the Government's books

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