OLD AND WORTH THEIR WEIGHT IN GOLD

We were not surprised to see that Steven Joyce is looking to review the free travel for pensioners that was championed by Winston Peters.

Now we are all for making the lot of oldies as comfy as possible. But its about time we redefined old.

Now we went to lunch with a bunch of 60 - 65 year olds earlier this week. They aren't old. Definitely showing signs of excessive wear and tear but not old. One was some computer guru and was flat out on his iphone. The other was an ex merchant navy captain. One was ex PR and the birthday boy was a landlord and book keeper. They all have lived a bit and by hell they still are.

Now BB's ma and pa are closing in on 70 and 70 plus. Are they old? hmm probably best described as oldish. Rickety Hoons who sleep a bit more than they used to.

Now Joyces dilemma is that due to the popularity of the travel subsidy of $18 million and the growing numbers of those eligible, the budget is about to blow out like a fat girl after a feed of cabbage.

We reckon its about time to up the ante on the eligibility.

To 70.

Nice round figure and for some reason the age where people get oldish.

Now according to statistics there are abut 384 thousand people older than 70.

And there are 173 thousand between 65- 69.

But the really scary thing is there are 226 thousand between 60 and 64. And other big dollup between 50 and 60.

So its pretty obvious the budget will be blown to smithereens if the criteria stays the same.

But there would be big savings if they shift the criteria out to 70. Its time we, as a nation, recognised that old isn't old anymore - 65 is still pretty young and 70 is just getting oldish.

We are currently riding the Wairarapa train and as its an off peak its full of cottontops and we overheard a few talking about the possible changes. Those who are eligible dont want it to go but those who havent got it yet can see the sense in it being raised. Its easier not to give than take away.

So those who are already eligible should retain that eligibility but those who are not yet 65 should now have to wait till they are 70.

Its a big change but one we have to make in light of the big bubble of an aging population that will impact on the countries economy soon.

However, we think that the subsidy is a great thing. We have seen people widen their horizons with a bit of free travel. The 65 plus demographic have seen out wars and paid their taxes with the full expectation that those taxes would provide a goodly sum to live on in their dotage.

And we owe it to them to ensure that they can.

BIG TICKS FOR GROSER AND JOYCE

Tim Groser and Steven Joyce have been star performers for the government and both have been given the recognition they deserve by the Prime Minister. We are pleased that Tim has been given the chance to lead the weighty and complex job of International Climate Change. His wisdom and pragmatism will give New Zealand the chance to optimise any trade gains that can be made from world wide rush to Emissions Trading. We need to ensure that international policy does not impact negatively on the backbone of our economy - dairying.

As for Joyce - it's well known that he has the capacity for a heavy workload and a head for long term strategy - his sector relations are also superb. The education portfolio will benefit from his helicopter roll.

The lack of large changes to Cabinet will dismay Labour who will have been looking for blood. While they will be able to make some mileage out of Anne Tolleys demotion, there is little else wher Labour can gain any traction.

Key has put his two "fix it" men in charge of the areas that are the two biggest risks - that type of decision making just underscores the PM's growing reputation for pragmatism.

EXCLUSIVE - TRANSMISSION GULLY TO GET GO AHEAD FROM FROM JOYCE

We are expecting the Minister of Transport Steven Joyce to make an announcement tomorrow (Tuesday) that the Transmission Gully roading project is going to get the go ahead. Apparently Joyce let it be known that was what he was supporting at a Rotary meeting.

And try as we might we cant access Transit NZ site about the project - they must be updating the site.
We think its a great news for Wellington, jobs and better infrastructure.

JOYCE - THE DE FACTO DEPUTY???

We have spent the afternoon lounging about in the provinces, checking on the lamb chops, and the river, as you do in the provinces. And we got to thinking.

We think that while Bill English is doing okay as Finance Minister, it is clear that Joyce is the De Facto Deputy Prime Minister. We haven't seen a bad word written about him or his policy decisions and strategies for some time. He is setting the economic transformation agenda. Patrick Gower says he is Keys right hand man but we think that he is more than that. He is a leader. He is inspiring many business leaders by his pragmatic approach and easy manner. He is not just a politicians politician , he is a businessman's politician. And he is not a gloaty noter. Just a very smart, slightly nerdy good bugger. He, like Key know all about the real world and business and it has created a very strong bond between them , on an intellectual, social and political level. And they like each other. Partnerships like that are rare.

We reckon odds on, he will one day lead the country..

KEY JOYCE AND ENGLISH

Patrick Gower wrote an interesting yarn his morning on the rise and rise of Steven Joyce. He is on the money. As is Fran O'sullivan. And is Transtasman. Keys appears to be about to line this country up for some big changes. He relies on Joyce. Joyce has delivered as we have seen with broadband and transport. English has since the election stumbled here and there and many party insiders question his absolute loyalty to Key.

Labour sees English as a wounded animal after the Ministerial Housing debacle. He did himself no favours..

So with the governments rise in popularity will we see Key and Joyce along with Brownlie, Groser, McCully, and Finlayson who all understand the transformational changes required to get this country moving at pace, starting to rev things up a bit?

If they do, we think that English's long term position is at risk as he does not have the same strategic sense as Key and Joyce and there is still the question of his loyalty that currently rests on a sand wall built by the the promise that he keeps finance and the Deputy PM positions.

The cynics would say that if Labour continue to pick on English then that could ultimately speed up the transformation agenda.

The tranformational change we need is Keys game to play. He needs to start playing it soon.

JOYCE SHOWS SOME WELCOME PRAGMATISM

Someone we know well has a bit of an audience with Steven Joyce the other day and was pretty impressed. Yesterday we bumped into someone else who has had a bit to do with the greenhorn Minister and again we only heard good stuff.

So we were delighted when Joyce's well known level headed pragmatic approach to stuff shone through on the Road User Charges issue.

Transport Minister Steven Joyce today released the report of the independent review of road user charges (RUC).The report was commissioned by the previous government in August 2008.

Mr Joyce says there is significant industry interest in the RUC review and its release will ensure affected parties are able to consider it fully and make their views known."There are some 32 recommendations. A number are very significant and it's important to ensure any changes are workable for affected road users."

A key recommendation is that the current RUC system is retained for diesel vehicles, rather than moving to a diesel tax, because of costs that a diesel tax would impose on non-transport users. In concert with that, the review group advocates moving towards an electronic RUC collection system and making other administrative changes to reduce compliance costs.Mr Joyce says some recommendations require more work, including those around delineation between road related costs and non-road related costs."Other recommendations - like the proposed road network access fee (which would replace the annual licence fee) for all vehicles - are simply not tenable and are unlikely to proceed."

The proposed road network access fee would treble the cost of licensing vehicles over time, with some off-set in user charges and petrol tax.Mr Joyce says the charge would be an unfair imposition on those who drive only a small amount each year."Overall, the report covers a complex area of the transport system and the recommendations of the review would significantly change the way costs are allocated between heavy and light vehicles.

"I've asked officials for further advice on the workability of the recommendations and expect to receive this by June."

Mr Joyce says any significant changes will need to go through the Cabinet and legislative processes which means they will be some way off.The report also recommended six weeks notice is given for any future increases in RUC rates. I agree with this in principle and will be working to see this recommendation implemented."

Bloody good stuff we say.

RUDD FOLLOWS KEY

Now there was a bit of talk a few weeks back of Key stealing ideas from Rudd.

However today our Aussie mates have borrowed one of our best ideas and called it their own.

They have largely replicated Steven Joyces forward thinking broadband proposal

Good Stuff

BROADBAND - 101 - WHAT ARE THE POSSIBILITIES

This article was published by David Ware the Managing Director of Teamtalk - a listed Telco that also owns CityLink and Araneo. It sets out the possibilities of Broadband and the pitfalls of some of the options and gives a glimpse of the future.

Sick of hearing about the government’s broadband strategy yet? Well you had better brace yourself because there is a lot more to come. Given that there is one and a half billion dollars of our money up for grabs and the possibility that the Telecommunications industry is going to be stood on its head we shouldn’t be surprised that every lobbyist, every so-called industry expert and every economist worth their salt is coming up with an opinion. It’s a feeding frenzy out there with the telecommunications companies throwing money at these bottom feeders like drunken sailors on shore leave.

The problem is that this stuff really matters. If the government gets its right it will do far more for our economy than all the investments in roads and other infrastructure put together. If they screw up, well they might as well have flushed the $1.5 billion down the toilet.

The broadband zealots will have us believe that putting broadband everywhere will transform our economy, we’ll fly back up the OECD league table and we will all live happily ever after. They tell us we’ll be working in a weightless economy producing software and ‘content’ (to you and me that means making movies, video games and the like). And we will all be video conferencing al the time They quite correctly point to countries like Korea where this transformation has happened.

In the opposing corner you’ll hear luddites shouting that the only thing that this investment will do is make it easier for folks to download pornography.

If the government gets it right then the reality will be somewhere in between. If we screw up the luddites will have the last laugh and will be saying “I told you so”.

So lets take a look at some of the benefits that we can reasonably expect from this investment..

Peter Jackson spent a small fortune getting super high speed Broadband out to his Miramar campus. Its how he links Miramar with Hollywood and it makes it that much easier for him to make his make movies here. Now just imagine if everyone involved in the video production businesses could have access to similar services? The dream that our ad agencies have of producing television commercials for Singapore for example would become a reality. There’s no question that this industry, and web design etc would get a massive boost. The benefits will extend to all sorts of business that use the internet – and unless your are involved you’d be amazed at how much business is dependent on the internet these days.

But what’s in it for the rest of us other than faster access to Trade me?

In the US President Obama wants to make US healthcare more efficient by computerising all health records – we can’t even begin to think about getting these benefits until we’ve got this broadband stuff sorted.

Properly implemented this broadband investment will drive down all telecommunications costs. It’s not just your internet charges that will go down. Cell phone networks for example are built on top of broadband so lower cost broadband will lead to lower cost mobile calls.

The impact on how we educate our kids could be massive. Get it wrong and we could be consigning our economy to a rural backwater.

So this is a big challenge for our government and one they’ve got to get right. Unfortunately its not just a question of deciding where to invest the money. There is a whole bunch of regulatory stuff that needs to sorted at the same time.

The first decision the government will be making is should they invest with the incumbent telecommunications companies or do they look elsewhere. An investment in Telecom for example is the fastest way to get broadband out there but it would do little for price and nothing for innovation. Its simply locking in the status quo and would probably harm us all in the long term.

But if you’re not going with the major operators where do you turn? This stuff isn’t simple, its not like running a bit of water pipe or power cable? Can the small broadband operators be trusted with such a big investment?

The previous government was keen for local government to take a big role in all of this. But not all councils are renowned for their commercial acumen and their ability to innovate and move fast; traits that are essential in broadband operators.

Getting the regulatory scene correct is absolutely vital. Everyone agrees that just tossing in $1.5 billion isn’t enough to make this happen by itself, so the government also needs to clean up the regulatory environment. For example its simply to expensive to dig up every street in the country so accommodations may need to be made with the existing utilities so that operators can run their cables through the pipes that are already in the ground. To date the incumbent telco’s have done a pretty good job of ensuring that the myriad of little regulations that make the telecommunications industry tick are firmly weighted in their favour. Making changes in this area isn’t going to be easy.

So how is the government going so far? Well the good new is that they haven’t tried to shoot from the hip and rush this one. They’ve given the role to Steven Joyce - one of the most commercially savvy ministers we’ve got - and Bill English who is as pragmatic as you can get, and they’ve been doing a lot of listening and little talking. So far so good.

At $1.5 billion, you’ll have to agree its one hell of a role of the dice. And given the importance of this stuff it really is something that everyone needs to get to grips with. This stuff is way to important to be left to the geeks and the spin doctors.

JOYCE SIGNALS CHANGE OF DIRECTION FOR BROADBAND

While in principle we think that this is a good decision we don't want to see the governments thinking hijacked by Telecom. Joyce is wise to relook at what is needed to give the country the information artery that it needs. There are many smaller players who had built some very good strategic alliances and partnerships that will deliver on the government's aims. Joce should recognise and relate to them easily. What he did in Radio, they have done in the IT community.

We have already posted on the dilemma that has faced the US on this issue and the very good analysis in the New York Times. It is time to think smart, not big, and its time for the government to listen to new voices.