Agenda Transcript: Chester Burrows & Sue Bradford

AGENDA Saturday March 17 Chester Burrows, Sue Bradford, Lynne Pillay, Barbara Stewart TO SMACK OR NOT TO SMACK?

And Bridget Liddell on NZ businesses in the USA

©Front Page Ltd 2007 but may be used provided attribution is made to TVOne and “Agenda”

Part 1

LISA Green MP Sue Bradford's anti smacking bill is expected to pass into law, but last minute stalling tactics by her opponents this week succeeded in delaying the vote. The controversial bill would make it illegal for parents to use any kind of physical force against their child unless the child is in danger of hurting themselves or other. Critics say it will criminalise good parents as well as bad. Sue Bradford and National MP Chester Burrows who has proposed an amendment to the bill join me now.

Sue if I can come to you first how are you gonna hold together your support in the next few weeks seeing as you have this hiatus as such?

SUE BRADFORD – Green MP In fact I never expected the bill to be finished this week, it's a bit of a misapprehension because on controversial bills like this it's almost inevitable that the committee stages of the bill are gonna take at least two or three sessions.

LISA So how are you going to hold your support over that time?

SUE Well so far we're doing fine, I think the MPs that have made up their mind to support this bill are pretty staunch in that support now and of course I'm hoping we might win one or two more over over the next couple of weeks.

LISA But there has been talk in the media about some Labour MPs who aren’t exactly 100% behind it, who might waver within Labour, who do you need to keep an eye on and keep talking to?

SUE I think you'd be best placed to ask a Labour MP that question but I'm also aware of the other side of the coin is that there are National Party MPs who strongly support what I'm trying to do and who are as concerned as the Green Party is about the level of violence against children in our community, so I think it goes both ways and in fact I'd love to see the National Party MPs who support my bill freed up to give their vote as well, so it works both ways.

LISA Should this be a conscience vote do you think?

SUE I think that it's up to each party to decide.

LISA You don’t think that it's such a personal issue that people should be able to cast their vote as their conscience directs them?

SUE Well I think it is up to each party, in our party it's a party vote because our party has such a clear policy of non violence and belief in what we're trying to do here, so I think it's up to each party to make that decision.

LISA Okay let's bring Chester Burrows in here. Any particular Labour Party MPs that you're gonna be chipping away at over this time Chester?

CHESTER Well I'm not gonna name them here because that would be contrary to my purpose, but if you look at the voting history of about eight or ten of their conservative MPs you'll know they're unhappy and when they’ve been asked on television they’ve been obviously unhappy.

LISA So what discussions are you having with those people?

CHESTER Just restating the position and I think that the moves from the Prime Minister this week has sort of changed all that, well the revelation of the pre 2005 election comment shows that it's a whole new game as far as the Labour Party caucus goes.

LISA So in your mind that comment you are talking about is some people would suggest that Helen Clark has flipped in her support.

CHESTER Well it's quite obvious that she has, she's said she wouldn’t vote for a piece of legislation that prohibited smacking all the way through this debate, Sue has agreed that her bill does prohibit smacking.

SUE Can I just make a point on that, but it's actually illegal now to smack your child. This point seems to have been missed throughout the debate that under Section 194 of the Crimes Act an assault on a child under 14 is actually a crime and what my bill is attempting to do is to get rid of the defence of reasonable force for the purposes of correction which provides a defence under law for people who assault children under 14. I'm not creating some new offence of smacking which seems to be the implication of some of my opponents.

LISA Look obviously there's much debate over this so arguably you could say that neither side has a clear mandate, this is so hotly debated by the public, so why legislate why not just educate?

CHESTER Well the fact is the legislation is there, at the moment you're looking at removing it, so that’s part of it. I believe the mandate is there and if you look at public opinion the way that that’s been gauged nearly 20 times over the last two years it's about 80% of New Zealanders think that parents shouldn’t be liable for prosecution for smacking their kids, that’s the way it is.

LISA So do you think you're still in realistically with a chance when it comes to the vote?

CHESTER Very strongly, you know there's a few people in the middle, we know there's more than enough people who are unhappy. If this was a conscience vote right across the parliament I'm absolutely convinced that my amendment would win.

LISA Why isn't it a conscience vote for National then?

CHESTER Well we're in exactly the same boat as the Green party here funnily enough. I put up my proposal, 48 people in the caucus agreed with it, not a single dissenting vote as far as my amendment goes, so that’s why it's a party vote.

LISA But you're still gonna have MPs if your amendment's not successful who are gonna back Sue Bradford.

CHESTER Yeah and our party position is that we are voting against it, those who want to exercise their conscience are able to do that, and there's indications that they will.

LISA Let's bring our panel in on this discussion let's go to Bernard Hickey, who is father of two, are you a proponent of smacking or not?

BERNARD HICKEY – Managing Editor, Fairfax No, no. I'm pleased to see the bill go because as much as anything it creates a debate about this in New Zealand. I think the mood is shifting particularly after the Kahui twins, I personally think it's wrong to smack my children and I sort of can't understand why people are so aggressively campaigning to retain the right to hit their kids.

CHESTER But that’s because the bill isn't about that, I've never been a proponent of smacking either, I've never made the stupid comment that you know it never hurt me or never did me any harm. This is purely about whether parents who do smack should be rendered liable to prosecution, it's not about whether smacking is good or bad or good parents smack or good parents don’t.

BERNARD Has anyone actually been prosecuted for smacking their kids?

CHESTER That isn't the point. What your saying if you go along that track is well you know parliament doesn’t make the law the Police do or the courts do or whatever, in actual fact it's our job to make the law and if we don’t like it we should go somewhere else.

BERNARD And do you seriously believe that Police will prosecute parents for smacking their kids?

CHESTER Some will and some have been prosecuted for similar acts especially in the middle of a sort of custody dispute where there's been estranged parents and access visits and I've got people in my electorate who have been in that position, you know we are getting a lot of anecdotal stuff.

LISA Let's bring Richard Long in here, is this muddying the waters do you think for Sue Bradford's bill?

RICHARD LONG – Columnist Well I mean nobody likes smacking but it seems to be this has created an almighty row and divided everybody including parliament and it could have been solved so why on earth not have accepted Chester's amendment which seems to me to have proved what a trifling or transitory impact of a smack, like the kid throwing a tantrum in a supermarket, or deliberately smashing an ornament, some mild touch like that, and then parliament would have been totally united if that had been accepted.

SUE To accept Chester Burrows amendment would be the worst possible thing we could do for the kids of this country it would make the situation worse than the status quo we have now because what it would mean would be parliament and the state legitimising the level and degree of violence that it's okay to use against children. What people keep forgetting in this debate is it's about kids, about our babies, our children and young people, we have such high levels of violence against kids in our country as a result of this legacy of a culture of violence we've brought with us in the 19th century and to turn that around we've got to give kids the same protection under law that adults have. At the moment if a husband beats his wife we wouldn’t say well it's okay to beat her in a trifling and transitory manner, what Chester's saying is that if his amendment went through it would be okay to beat our kids in this manner. So if you put a child's hand on an electric fence for a moment that’s okay, that’s transitory, so it's actually – it's the State legitimising the use of violence against kids and that’s even worse than what we've got now.

RICHARD It can't be worse than it is now, that woman got off for horse whipping a child for goodness sake, that’s really bad, so that wouldn’t take place under your bill or under Chester's amendment, but it wouldn’t provide the rather silly situation that we have now where someone could report a mother for giving a child a mild slap in the supermarket for kicking down a display, or deliberately breaking an ornament.

LISA So do you argue that that’s not the case that you can actually use a light smack, let's be clear on what your position is.

SUE Should my bill go through in its current form using physical force for the purposes of discipline there will no longer be the defence of reasonable force, but that does not mean that every parent who ever smacks their child will suddenly be prosecuted and taken to court for doing it.

CHESTER That’s not what the words of your bill say.

SUE That’s the myth that’s been put out there in the community and has unnecessarily terrified tens of thousands of ordinary decent parents.

RICHARD Can I focus on that one? I mean can you imagine the Police in this day and age with their call centre that’s always under criticism not responding to a complaint, they'd have to?

SUE They're obliged to respond to complaints of assault on child and don’t we all think that’s a wonderful thing, every time we hear of a child death we say why didn’t the Police do more, so of course they should investigate, that does not mean that they arrest and prosecute, they look at the Police prosecution guidelines how trivial the offence was.

LISA Let's bring Chester in on this, are the Police going to actually follow up all those calls?

CHESTER Yes they are and if you look at the Police family violence policy it says that if there's an offence disclosed the Police must investigate. Now what's going to happen in an investigation, well the Police come in are they going to allow the accused parent then to remain in the house with a child who they consider a victim at that stage while the investigation goes on – the family violence policy says at the moment that when someone's going to be prosecuted it should be processed by an arrest and the arrested person should stay overnight in a Police cell, so you could look at an investigation being worse than the prosecution when it eventually comes and parents being taken out of a house or children being removed from the house for instance if the mother supports the father who gave the smack the child could well be removed from the house during the course of the investigation. It's huge, you have to look at the black and white stuff that’s in Sue's bill and what that says, not say well we're just gonna hand this over to CYFS and the Police to decide where the law is on this.

LISA So can you overturn it then?

CHESTER Yeah I think we can, it depends on what support we get, who's prepared to stand up and be counted and if the Prime Minister really wants to achieve what she said in 2005 she'll be voting for my amendment and not Sue's bill because my amendment does what she said she wanted to achieve.
Part 2 – To smack or not to smack?

LISA Well this morning we're discussing Sue Bradford's anti smacking legislation and to carry the conversation on we're now joined by Lynne Pillay from Labour and Barbara Steward from New Zealand First. If I can start with you first Lynne, why can't Labour MPs vote according to their consciences on this?

LYNNE PILLAY – Labour MP Well we discussed it in our caucus and in fact the discussion happened just after the UNICEF report that very clearly showed our appalling statistics actually around violence against children.

LISA This is the one that showed New Zealand was in the top three for child deaths under the age of 14, violent child deaths?

LYNNE That’s right, and so there was a lot of discussion on it and we decided as a caucus that we couldn’t and that it wasn’t really a conscience issue it was an issue, a party issue about violence against children in our society, and in terms of Section 59 the bill isn't about anti smacking it's about the instances where Section 59's been used when children have been literally thrashed and their parents have got off and Richard referred to before with riding whips with blocks of wood and also instances where children have been chained to their parents. We as a caucus don’t think that in this day and age that’s acceptable behaviour for parents to get off on.

LISA Alright let's bring Barbara Stewart in, you voted for the bill on its second reading, you support Chester Burrows' amendment, why is that the way to go?

BARBARA STEWART – New Zealand First MP I believe that that will allay the fears that the parents of New Zealand actually have, I think there's been a lot of misinformation about this particular bill and parents are quite worried about the legalistic cloud that’s actually hanging over their heads at this particular point in time.

LISA So do you seriously believe if Sue Bradford's bill went through that good decent parents would be dragged off from the supermarket if they smacked their child, they'd be going to court?

BARBARA Well no not necessarily but that is the perception that the parents have and of course we're here to represent people and the other side of the coin has never ever been explained in the media or to parents.

LISA Let's bring our panel in here, Lynne Pillay has brought up the point that in the past Section 59 has been used as an excuse for rather vicious beatings, but does anyone here believe that Sue Bradford's bill is going to stop that kind of abuse of children, would the Kahui twins still be alive if we had this law?

RICHARD It seems to me it's totally unfair to link the two, I mean New Zealand is in a very bad way, every report that comes up says just how bad we are, there's a certain – and it's non confined to the underclass out there, but there's a lot of beating of children and a lot of killing of children and just this week we had a father gaoled what 17 years for drowning his baby and another woman in court for bouncing her baby off the kerb, but this bill's got nothing to do with that, that’s a particular violence that’s part of New Zealand society and it's not confined to the underclass.

LISA So how is this bill going to stop that?

LYNNE It has everything to do with it because Section 59 is about a defence it's not introducing a prosecution, the only time the defence is used is when parents' behaviour has been so abhorrent that they have been prosecuted and they have got off under that defence, the very case you referred to, so the message to society is it is okay to hit your child with a riding crop because parents got off. Now when the Police are considering prosecution at the moment they have to look at the likelihood of the prosecution succeeding. The benchmark is that because some of these cases is that well it's not going to succeed because we've had successfully defended cases where it has been deemed okay to hit our children with blocks etc.

LISA I see Barbara shaking her head here.

BARBARA Well I believe that the Police are obliged to investigate any complaint that is made to them, that is what they're there for, so if somebody phones up with a case or an example they're obliged to follow it through.

LISA Is it all about though Bernard Hickey, is this all about saying we have zero tolerance for violence?

BERNARD It's great that we're having this debate and that we're saying to people it is wrong to hit your kids and to raise the level of focus on this horrible record we have with killing our kids, it's perhaps the Kahui twins is a case that’s separate from this it would have obviously not applied here, but when people are using a defence to allow them to hit their kids with a horse whip and we're allowing this law to stay on the books, that should be changed.

RICHARD But then why not have a compromise which would – I mean if parliament is at loggerheads on this so is the entire community, so a compromise along the lines of the Chester Burrows thing would have brought parliament together as well as the community.

LYNNE Well I think in fact Plunket, Barnardoes, all the credible organisations said exactly as Sue did, please don’t introduce an amendment that prescribes how to hit our children, because the SKIP programme which is very successful in educating parents about alternative ways, it will undermine that education process that you spoke about before, so this is actually, the amendment to section 59 is actually about protecting children in extreme situations. As Sue said before, every time a parent actually takes their child out of school not for illness but if they're going to go and see granny for the weekend in Tauranga and they leave on Thursday or Friday, technically they're breaking the law, are the Police marauding in and arresting them for that, of course not. When high profile rugby players hit their mate in a bar with a handbag do the Police maraud in and arrest them, of course not. Commonsense prevails and it will continue to with guidelines.

LISA Barbara I just want to bring you here into the conversation again. Phillip Field and Tariana Turia have both expressed concerns at various points that this bill could criminalise good Maori and Pacific Island parents, are those legitimate concerns?

BARBARA Well I believe they are because once the Police are phoned they are obliged to come along and investigate, that is what we expect the Police to do. There mightn't be a prosecution but your name perhaps would be down there on the files and I believe that good parents don’t want that to happen, we all try our best as a parent.

LISA Richard how much do you see this as Labour paying back the Greens for their support with the coalition?

RICHARD It's not in the formal understanding for support, but a lot of people are thinking that maybe there is something particularly now that Helen Clark's comments from pre the election or during the election campaign have come out where she said she's absolutely against smacking, and now maintains there's not change of stance, well demonstrably there is a change of stance, so there may be a lot of people are thinking that there's an understood arrangement between the two even though it's not part of the formal agreement for confidence and supply.

LYNNE Lisa can I respond to that? That is absolute nonsense, and in fact to do the right thing is not always the popular thing and as I said before there was a bit discussion around it in our caucus and our position is still the same. Parents will not be – I'd love to get this group together in six months time and see how many parents have been prosecuted for lightly smacking their child at the supermarket, it simply won't happen. Every prosecution, any government intervention always has to be in the best interests of the child.

LISA Let's bring Bernard in here because he is an anti smacking proponent. Do you think Lynne Pillay is saying that sometimes you have to do the right thing even if it's hard but does this go far enough, could it be argued that Labour is sitting a little on the fence with this as are the Greens they're trying to soften it a little bit to make it acceptable for people?

BERNARD I think it's perfectly reasonable to remove that Section 59 which gives support to those people who are hitting their kids in a way that the Police recognise is a problem and the prosecutors have taken them to court.

LISA But this bill still would, according to Sue Bradford allow you to give a light tap or a smack, so does it go far enough?

BERNARD I don’t think that’s an issue, we're really talking about people who are abusing the law to abuse their kids, and I don’t think it's a problem that the nation's parents are afraid that they're gonna be dragged out of their homes, that’s simply not true, and anyway we have a Police Force and a legal system which on the whole is sensible and I don’t think we're gonna have you know marauding bands of policemen raiding people's houses.

LISA I want to bring Richard Long in here just for the final word. You don’t believe in smacking either but you just don’t think this is gonna work do you?

RICHARD I don’t think this is the right bill no, but I would go along with the Chester Burrows amendment and the problem that we're also having to address, okay Police are not gonna go around grabbing parents for smacking and throwing them in gaol or taking them to court, but they're going to have to investigate if they get complaints, but it's the waste of time, the waste of resources.

LISA Well will leave it there.

LISA In 2003 the Knowledge Wave Leadership Forum was held to focus New Zealand's business talents for the future. One of the driving forces behind the forum was Bridget Liddell, a woman with a long list of directorships to her name, including Sky City and Fisher & Paykel. Now based in Seattle Ms Liddell advises Australian and New Zealand businesses looking to break into the American market, she joins me now.

Good morning, to being with can you tell us how the Knowledge Wave changed New Zealand and New Zealand's approach.

BRIDGET LIDDELL – Business Advisor Well I think the Knowledge Wave was about bringing new ideas, having a spectrum of different opinion, it's all about connectedness and about learning from others and about thinking about what's relevant to New Zealand in the context of what others are doing elsewhere and taking from the best of the learnings elsewhere to make our own policies and so looking back it was a chance to reflect and a chance to pick up on some of the thoughts at the time.

LISA Is there a lasting footprint from it do you think?

BRIDGET Well I do in lots of different ways and hard to put your finger on exactly this or exactly that, but it's about an openness and a receptivity to international thinking and you know we are a small country, we're a long way away and it's important to be very aware of what's happening in the rest of the world because there's always something we can learn.

LISA Alright we'll let's get down to the nitty gritty then, how do New Zealanders become more competitive in a globalised world, how can they be competitive?

BRIDGET Well I think New Zealand has a wonderful base to build on, we've a very very strong brand, the New Zealand DNA the way that we do business is very different, we're very lateral the way we approach things, we take creative approaches to problems, we have some excellent products that are different that can break through the clutter in the US market, it's a very bland offering often in many sectors and a fresh approach makes a huge impact.

LISA People say those things about the Kiwis that they have ingenuity, they have different approach, but what does it take say for a New Zealander to succeed in your market in the States, how do you get your foot through the door?

BRIDGET Well I'm in conjunction with NZTE, New Zealand Trade and Enterprise, we have a network of advisors in the US, in fact we've got a lot of evidence that if you can access good networks in the market that can give you good advice and open doors for you, point you in the right direction, that it makes a massive difference.

LISA So do you have to be there to press the flesh, somebody from your company has to be in the States do you think in order to succeed?

BRIDGET In many cases that’s true and of course that’s expensive and you need to have the resources and the people, the types of skills that are suitable for that situation.

LISA So can big ideas alone without the big money get you success?

BRIDGET It's not big money necessarily, no, the answer is no, you need a combination of a whole lot of different things to succeed in any business but particularly in something like going global from a country like New Zealand, it's a big step and it needs to be taken very seriously but it does not necessarily need to be big money, it needs to be adequate money.

LISA Who would you hold up as an example of a company that’s done well say in your market?

BRIDGET You know we have some amazing success stories in the US, Fisher & Paykel Appliances, Antells Care, Pumpkin Patch, Glide Path, the baggage handling company is just massively successful, Orion Health Care in healthcare IT, Peace Software.

LISA But something say like Pumpkin Patch if we can look at that as an example, that’s not necessarily a distinctively New Zealand product as such, it's children's clothing so what makes them special in that market?

BRIDGET Interestingly the colours, the designs, the materials, are just – you go into the average department store and look through the children's range….

LISA So it is innovation, must maybe not as we know it.

BRIDGET Oh it's innovation and colour and combination of fabrics, it's great, really great.

LISA Alright let's bring our panel in here, Bernard Hickey, a subject close to your heart.

BERNARD Yeah what I'm curious about, these success stories, is there any one common factor which seems to have helped them succeed in the US market which is a really tough one to get in.

BRIDGET It is very tough and I think going back to the point you need – you must have a serious commitment and a high aspiration about the market, this is not something you do between you know two and five on a Friday, this is a really serious project. It can of course if things don’t go right it can be very detrimental, so you need to take it very seriously, prepare the strategy, prepare the financing, adequate resources, and especially as what often happens you get up there and you find you are massively more successful than you expected and then your working capital is all under strain and your people are pressured because there's inadequate resourcing. So it's very important to be ambitious, to be aggressive about what it is that you want to achieve and to be very very committed to the market and then there are these other issues about really understanding the market place, putting a lot of work into thinking it through and using the networks that we have, that we can offer to all New Zealand companies and of course your own networks which you should be building all the time in preparation.

LISA Tell me there's been some talk about a free trade agreement between the United States and New Zealand, how important would that be in improving the links because one of the things I've seen is that the lobbying from the special interests in the States can sometimes make it incredibly difficult for the New Zealanders to get into that market, is it an irrelevance or would it actually be useful?

BRIDGET It depends entirely on the sector some of our biggest areas of our economy are every affected by trade agreements and by tariff barriers and the like. In lots of other sectors especially you know apparel, the food, there are sometimes small trade disadvantages but they're not of the nature that would prevent you from making a good fist of an entry strategy.

LISA On that theme then obviously Helen Clark is going to be meeting George Bush, does that kind of thing do us any good, is that going to do New Zealand business any good that face time?

BRIDGET Oh massively, I mean the first thing is that New Zealand's brand is extremely strong in the US, it's hard to over emphasise how much of a positive image New Zealand has there, and some visibility by the New Zealand Prime Minister spending time with George Bush will add to that brand image and you know we are a serious country, we have global intentions for our businesses and that is part of what she I'm sure will be conveying.

LISA Thank you very much Bridget Liddell for joining us this morning.

MICHAEL WRIGHT presents – 'Economy – reason to change government?

LISA Now on our show last week panellist John Roughan pointed out the increasing similarity between Labour and National and that the public needed a reason to change the government, well this week we went in search of that reason, the plight of the economy has been the subject of much debate recently but a lucky few in New Zealand are simply too rich to care. Michael Wright with this report.

"The Reserve Bank has this morning decided to increase the official cash rate to 7.5%."

MICHAEL It's been a tough couple of weeks for the economy, the official cash rate is up and inflation won't go away. Apparently this is all our fault for spending too much money and especially for buying too many houses, but as one social commentator once put it, we don’t know how lucky we are in this country, so are things really as bad as we keep being told?

Consider a couple of things for a moment, there are enough red Ferraris in Auckland to spell Ferrari. If you bought a house in Gisborne last year it's value now will be about 27% higher, property investment is the main culprit according to Reserve Bank Governor Alan Bollard, but in the upmarket Auckland suburb of Remuera things are progressing nicely without him.

Can we come through to your formal lounge, formal area…. and it's nice sitting there in winter like even if it's raining you could sit there and eat, you’ve got the big gas fire and then you’ve got your open French doors into the grass through here.

Can I ask how much a house like this would be on the market?

Looking around the four and a half.

Four and a half – million ?

Yeah. So it's very reasonable. I mean what we've sold around the area is even more than that.

Four and a half million is reasonable?

Very reasonable.

Very reasonable yeah.

Auckland real estate agent Laila McDonald says the official cash rate means nothing and demand is far outstripping supply.

We don’t listen to the economy what they say, when people want to live in this area they won't come to listen to what they're being told to do or not to do.

The same goes for property developer David Henderson, it seems interest rates don’t rate on the top floor of the Hilton.

Oh it's just absolute crap you know, why we put interest rates up in New Zealand heavens knows you know, housing isn't the only thing in New Zealand, and in fact this housing is a product of supply and demand, putting interest rates up for housing isn't going to slow down people buying housing.

And you'd better believe it's not slowing down.

A million dollar doesn’t buy you anything, it doesn’t even get you a piece of land now really, either from the million up to the 20 million.

So if Doctors Bollard and Cullen can't make a difference surely it doesn’t matter who's in power, but David Henderson says that’s not entirely true.

That’s a very very interesting question because normally when people make money under Labour governments everybody makes money under Labour, moreso than what they do National, and in fact that just seems to be the way it is. The government that we've currently had I think it's been around for eight or nine years you know that’s a pretty major stretch in New Zealand for a government and I think the only reason that they'd ever get replaced is out of shear boredom, not lack of performance.

So despite the heat the economy is taking investment opportunities remain – as long as you’ve got a spare four million that is. If Harold McMillan was here he might revise his famous appraisal "some of us have never had it so good".

LISA Well let's see what our panel has to say on that, coming first to Richard Long, one of the people in that piece there was saying economic performance is not going to be what gets the government kicked out, it'll be shear boredom is he right.

RICHARD Well I think it'll probably be a bit of both in the end but you have to sympathise with poor old Dr Bollard the official cash rate's just not simply working and whenever he puts it up it hits exporters, there needs to be another mechanism to supplement it but they can't really work out what and when poor old Michael Cullen comes up with an idea Helen Clark shoots him down, but talking about differences, John Key has actually come up with some interesting stuff in speeches that I've seen where he's saying look why not cut the taxes on other investment such as investment in shares.

LISA As he was saying last week on the show …

RICHARD That’s right, it's always Agenda that brings these things up isn't it? Yeah so therefore you get return on that, your return on that is better so therefore you're less likely to stick all your cash into the biggest growth area at the moment where you make huge capital gain which is housing, so that may be an option which is more realistic.

LISA I know Bernard has some views on this.

BERNARD This all seems very comfortable everyone seems happy their house prices are rising but this is actually a hot political potato particularly amongst those groups who simply can't afford to buy into housing and particularly the young, what we've seen is a huge shift of wealth really but from the young to the old. Anyone who was owning property around 2002 is now rich, anyone who isn't can't get into the market, there is a whole swathe of voters who are now locked out permanently. If you have a look at the numbers, if you're on an average wage in New Zealand, to buy the average house and to get the average loan to do that you're spending 65% of your average salary on the interest and that means you just can't afford it, it's impossible, and there is a growing feeling that there is a whole generation of New Zealanders who will be locked out of housing, out of what is the New Zealand dream.

LISA What is the solution then?

BERNARD Well that’s a tough one and it is a tough one for everyone including Alan Bollard who was right to increase interest rates last week. We've written in the Independent Financial Review in an editorial that he had to do it, but he needs some help, he needs some help from the government.

LISA Extra tools in the toolbox, that’s what you're voting for is it Bernard?

BERNARD Well the government could simply just reduce its spending, 17% spending growth in three years.

FINAL THOUGHTS – GUEST COMMENTATORS Comments on 'Dairy Diary' – Prison at Te Kauwhata

LISA Let's go to the panellists now for their views and Richard Long you have some strong ones on corrections there, new prisons, growing population of prisoners, you're gonna need more of them.

RICHARD Well if the really bad guys, if the really bad murderers and rapists are going to be locked up for longer then there simply has to be the prison space to accommodate them, so we're going to have put up with that, but the problem is building the prisons has been yet another corrections debacle because the cost overruns have been absolutely vast and that’s just one of the many things as we know that have gone wrong, in fact in about 30 years in covering politics I don’t think I've seen an department in such disarray over the whole range of things that corrections have been handling and I frankly can't see them getting away without either a couple of sacrificial heads, the Minister and the Chief Executive.

LISA So you don’t think that the Minister and the Chief Executive can ride this out really?

RICHARD Well they're attempting to at the minute but ultimately I think there has to be an example made.

LISA Bernard Hickey obviously you noted the issue that this is rural land that there's quite a market in lifestyle blocks.

BERNARD That’s right this really is about real estate as we referred to before, everyone now is saying not in my backyard because that backyard is so valuable and personal wealth is so tied up in the value of that backyard. It's interesting just not far from Te Kauwhata we've got the power pylons going through, that is not really a debate about power policy it's a debate about real estate and what this says is that actually the fabric of New Zealand has changed in the last six years or so and now because real estate's such an important part of people's wealth, net wealth, over 90% of our net wealth is now tied up in our real estate, it has warped the public policy debate in many different ways, like for example this prison. The real reason they didn’t want the prison in their backyard is cos they knew it would reduce their property prices.

LISA But then when you talk about economy we had that piece earlier in the show where the estate agent commented you know what the incentive to change the government when we're all doing so well.

BERNARD We're all doing so well – well anyone who's owing property, it's the property owning class who are doing well, if you're an exporter you're not because Mr Bollard is pushing up interest rates, pushing up the currency, exporters are struggling, it was interesting to talk about how to get into America, our exports have basically stagnated in the last three years, you wouldn’t believe it but two years ago our exports to China fell, and that actually says a lot about the structure of the economy, we've become a property owning, property investing consumer of local services, but as an exporting nation a productive nation we have shrivelled.

LISA Is that going to be the toe in the door for National, Richard?

RICHARD Well there are many toes in the door.

LISA Thank you very much for joining us this morning, that’s Richard Long and Bernard Hickey.

ends

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