Customers frustrated by the service they get from the big banks might have got some satisfaction out of the Government’s announcement this week.
On Monday at his post-Cabinet news conference, Prime Minister Christopher Luxon was joined by Finance Minister Nicola Willis as they talked tough about the four Australian-owned banks and said they would enable Kiwibank to raise another $500 million in capital to compete in the banking sector.
Luxon had a clear warning. “This is our opportunity to power up Kiwibank to take on the Aussies and we are up for it,” he said.
The Aussie banks have become a convenient whipping boy for politicians and the coalition Government is making the most of public antipathy towards the banks – fueled by an ongoing campaign from Federated Farmers – to take some political advantage.
As well as powering up Kiwibank the Government is also directing the Reserve Bank to make it easier for other competitors to enter the market.
Willis is particularly frustrated the big banks have not moved fast enough to introduce open banking to make switching banks and comparing mortgages much easier.
Kiwibank is being set up to be the disruptor to challenge the four big Australian-owned banks.
Winston Peters’ turn
Next day, it was New Zealand First leader and Deputy Prime Minister Winston Peters’ turn. Peters, who is also Racing Minister, held a news conference to announce the end of greyhound racing. The sector will be given 20 months to close.
It came as a shock to the sector but should not have been. As Peters pointed out, there have been three reviews of greyhound racing in the past decade, with all of them raising worrying concerns about the safety of the dogs.
He said while the sector had made improvements, and the fatality rate had fallen, too many dogs were still being injured, and the Government could no longer tolerate it.
Such was its view of the industry that the Government pushed legislation through Parliament under urgency to prevent greyhound owners killing their dogs, now they know the industry is coming to an end. Instead, it is setting up a process for rehoming the 2900 greyhounds currently racing in this country.
Not all will be rehomed in this country, with some likely to go overseas, mostly to the United States.
Peters had another opportunity in the limelight on Wednesday when he accompanied Willis to announce the Government’s decision on what would replace the Cook Strait ferries following the coalition’s decision a year ago to scrap KiwiRail’s iRex project.
Well, that was certainly the media expectation after Willis had promised earlier in the year that she would announce a decision in December. But what she delivered was an announcement that she would announce next March how the Government would acquire two new medium-sized ferries.
It might not even do that, if the private sector can come up with a better idea.
New Zealand First leader and Deputy Prime Minister Winston Peters.
Unanswered questions
A Crown-owned company is being set up to investigate the procurement of two new ships and will report back to the Government on that by March, as well as provide advice around port infrastructure.
But the announcement left as many questions unanswered as it answered, including what this would all cost. While the Cabinet has agreed on an envelope for the project, neither Willis nor Peters – who is the new Minister for Rail – was prepared to say how much it had put aside, for fear of signaling to shipbuilding yards just how much the Government would pay. It hopes it can do a deal even better than that.
Then, in an extraordinary day, Act Party leader and government minister David Seymour let slip the cost would be about half the proposed $3.2 billion of the now abandoned iRex project. While he did not put a specific number on it, he gave more details about the costs than either Peters or Willis disclosed.
It prompted Peters to correct Seymour on RNZ’s Morning Report the following day. “He’s wrong on the figures that he’s used, he’s wrong on the question of privatisation, and he’s wrong on the question of what it’s going to cost,” Peters said.
Indeed, Seymour appears to have breached protocols by discussing as much detail as he has when the responsible ministers have been much more circumspect. But no-one is holding their breath that Luxon – as prime minister – will pull him into line.
The cost to replace existing Cook Strait ferries is still not clear.
Parliamentary spat over fast-track legislation
The Labour Party also believes Parliament’s Speaker Gerry Brownlee breached protocol when he ignored the advice of the Clerk of the House and overrode the ruling of Deputy Speaker Barbara Kuriger on the Fast-track Approvals Bill.
When the bill came to its committee stages in Parliament, Kuriger initially ruled – on the advice of the Clerk – that a late government amendment listing projects that should go straight to the fast-track process should stand apart and not be voted on because it could be considered to be in the nature of private legislation.
Opposition MPs argued it did confer benefits on private individuals and companies so should not be considered as part of a government bill. But Government MPs argued there was no benefit because those on the list did not get any preferential treatment in terms of having their proposal approved. It simply meant they could go through the fast-track process.
Government parties voted to bring Brownlee back to chair Parliament so he could adjudicate. After hearing from both sides, Brownlee ruled that, while it was “finely balanced”, his view was that the minister’s amendment was admissible.
Labour no longer has confidence in Speaker Gerry Brownlee.
“However, on account of the potential beneficial effects the amendment may confer, the chairperson would be justified in allowing a more considered and lengthy discussion in the committee stages,” he said.
Labour, however, was not happy and its Shadow Leader of the House Kieran McAnulty put out a statement the next day saying the party had lost confidence in Brownlee as Speaker.
Gloomy news next week?
Meanwhile, next week, Parliament sits for the last time this year before MPs break for their Christmas-New Year holidays. While the Government will be putting the finishing touches on its legislative programme, most focus will be on Tuesday’s release of the Half-year Economic and Fiscal Update and the Budget Policy Statement.
Then we will find out just how gloomy the Treasury thinks things are, as it revises down its economic forecasts. Presumably it will also forecast a more pessimistic outlook for the public finances. The Government’s path back to surplus appears to have got more difficult.
Beehive Banter is hosted by Simon Shepherd, with NBR’s political editor Brent Edwards.
