The Mike Hosking Breakfast

In a week, 230 New Zealanders were given confirmation Kinleith Mill was over.  The Australians facing the same scenario at a place called Whyalla in South Australia did something completely different.  The steel mill is owned by a British billionaire and it's in a world of financial trouble. It may well go to the wall.  It employs 1000 people in a town of 22,000. So the state Government, backed by the Federal Government, has bought it.  Even for a Labour Government in Australia it is an extraordinary move.  But the assessment is, in a small town, you can't afford to lose that many jobs.  They will look for a buyer, they will look for finance and they will look to rejig the place to solve the problem. But in the meantime, the place is open and the jobs are saved.  The first question you ask, of course, is would this decision be made if it was not about a month or so out from an election, which is an election the Government who just bought the steel mill is in serious danger of losing?  The precedent is also shocking. If you save one, surely you save them all? And if you don’t, because you can't, the locals will, quite righty, ask why not?  Also, the Government owning things in the long term has never really been a recipe for efficiency or success. As much heat as Labour got in the 1980's for selling the railways here, Helen Clark buying them back has hardly been one of life's great business decisions.  In a small town though, at the pub or the dairy or the sports field, who cares? They've got jobs, the bills get paid, and the kids stay in the local school. They'll take it. Where the money came from doesn’t really matter.  As much as Shane Jones espouses the value of the regions, the region here still lost its mill.  We still have the problem that is the price of power. It still hasn’t been addressed as an issue, and we go into another winter with a mess of a system.  In Australia the place is open, the jobs are saved and no one's leaving town.  So, which approach is better? See omnystudio.com/listener for privacy information.

Councils are planning for the long term, so should the Government be doing the same?  The Auditor-General's Office has compiled a report into 58 councils’ long-term plans, and found they made a “significant achievement” meeting their requirements on time in uncertain circumstances.  However, they found the Government lacks comparable planning requirements.  Deputy Auditor-General Andrew McConnell told Mike Hosking they’re raising the question of how much the central government understands about its future infrastructure costs.  He says most government agencies have a form of infrastructure they’re relying on, so they think that question needs some serious consideration.   LISTEN ABOVE See omnystudio.com/listener for privacy information.

On the Mike Hosking Breakfast Full Show Podcast for Friday 21st of February, the Daman Kumar case is over and he’s been granted residency – does this set a precedent?  According to our listeners, Air NZ CEO Greg Foran has plenty to defend after the airline released its disappointing half year results.  Kate Hawkesby and Tim Wilson play a new game that may have to become a regular segment: Is Mike a Snob?  Get the Mike Hosking Breakfast Full Show Podcast every weekday morning on iHeartRadio, or wherever you get your podcasts.  LISTEN ABOVE See omnystudio.com/listener for privacy information.

Friday has come once again, and Kate Hawkesby and Tim Wilson joined Mike Hosking to Wrap the Week that was.  They discussed rising crime, Air New Zealand, and which overstayers should get amnesty.  Plus, they played a new game: Is Mike a Snob?  LISTEN ABOVE See omnystudio.com/listener for privacy information.

Air New Zealand expects to be short of planes for at least another two or three years.  Our national carrier's recording an 18% drop in half-year profit.  That follows a 65% in full-year profit last year.  Chief Executive Greg Foran told Mike Hosking they're going into a period when up to 11 aircrafts will be out of action.  He says it's a bit like playing a rugby match without the front row.  LISTEN ABOVE See omnystudio.com/listener for privacy information.

It's thought the Government is unlikely to grant a wide scale amnesty for overstayers.   Daman Kumar, who was facing deportation to India even though he'd never visited, has now been offered residency.   The Greens want his parents to be granted an exemption, as they have been overstayers for 24 years.  Into NZ Immigration principal consultant Katy Armstrong says the Government won't want to grant amnesty because it could be seen as unfair to legal migrants.   She told Mike Hosking there needs to be support for those who have done the right thing.  LISTEN ABOVE See omnystudio.com/listener for privacy information.

A lack of competition in the banking sector is being blamed on poor regulation.   Financial experts believe a fundamental change to the Reserve Bank and the Council of Financial Regulations is required.  Andrew Body, one of the experts, told Mike Hosking the regulators have created a “moat” around the large banks in New Zealand.  He says the capital requirements, the Reserve Bank’s outsourcing requirements and branch policy, as well as the conduct and disclosure regulation and costs of operating all favour the big banks.   Body told Hosking that RBNZ Governor Adrian Orr has completely “overcooked” the regulation.  LISTEN ABOVE See omnystudio.com/listener for privacy information.

The Pope's sense of humour is well and truly intact, even as it's expected his funeral preparations are underway.  New medical tests reveal the 88-year-old pontiff has developed bilateral pneumonia.  Italy's Prime Minister Georgia Meloni has visited the Pope in hospital, where she was happy to find he hasn't lost his sense of humour.  Rome Correspondent Jo McKenna told Mike Hosking she expects the Vatican would be going through standard funeral arrangements.  LISTEN ABOVE See omnystudio.com/listener for privacy information.

The name of the game for the government this year is economic growth and increased productivity.  For that, what New Zealand needs is successful businesses.  One of New Zealand’s most successful entrepreneurs believes more can be done to grow business confidence and the economy alike.  Rowan Simpson, one of the founding members and investors in TradeMe and Xero, is releasing ‘How to Be Wrong’, a book that details the unique position New Zealand is in to grow businesses.   He told Mike Hosking that while there are plenty of ideas that are not investable, there’s more than enough that have great potential.  LISTEN ABOVE See omnystudio.com/listener for privacy information.

Given the issues around KiwiSaver, it’s a miracle any of us save anything to become remotely independent in retirement.  Last week we told you about the Morningstar rankings and how the biggest operator in the market was performing so poorly, and now we have yet another crack at where the money is actually invested.  Mindful Money is upset over the increase in funds going to fossil fuel producers. We have a 20% increase in the last six months.  That's despite the amount of new money flowing into KiwiSaver only being 7%.  Mindful Money is clearly of the view that the whole transition away from fossil fuels is still an urgent and present thing, when clearly, it's not.  What we have here is a clash of reality vs ideology.  The reality is KiwiSaver funds look for returns. The ideology is that no matter how unrealistic it is to run the world on sun and wind, we still need to sacrifice more to get there.  If there has been one crushing realisation this past year or so around that, it is the simple truth that the transition to renewables has been found out, and badly.  Genesis has half a million tonnes of coal standing by for this winter to keep the lights on. They have another half million tonnes on order, with a backup order for another 200,000 tonnes.  Someone mines that coal. That's good business and good business pays dividends.  If you hate coal don't even look at India and China. Coal is booming. It doesn’t make it nice or palatable, but it's real and investment is about reality.  We are in a time where the cold, hard truth of what we thought was going to be easy, isn't. It might not even turn out to be real.  The last thing we need is KiwiSaver funds playing dumb games like the banks and looking to deny legitimate activity, the financial life blood, it needs to produce goods and services people actually want.  What we want in KiwiSaver is a pool of money that grows. That happens by investing in relevant activities that turn a dollar and pay a dividend.  Morale indignation doesn’t fund retirement. See omnystudio.com/listener for privacy information.