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Hi Friend,

Next week the Labour and National Parties have their respective caucus 'retreats' before Parliament resumes the week of the 27th. And it's all bad news for Christopher Luxon, according to the latest Taxpayers' Union-Curia Poll.

NEW POLL: 📊 Nats fall behind Labour for the first time since April 2023 ⏰

Summer BBQ season is a time for reflection, including on the Government. It seems the economic headwinds, and December's series of bad economic/fiscal news, is doing the Government no favours.

The poll sees National tumble 4.6 points to 29.6 percent and Labour up 4.0 points to 30.9 percent.

The ACT Party are down 2.2 points to 10.8 percent, whilst the Greens are up 1.2 points to 9.5 percent. New Zealand First is up 2.7 points to 8.1 percent, while Te Pāti Māori is down 0.2 points to 5.3 percent.

Converting the results to seats in Parliament, National and ACT would need NZ First to form a Government. The total number of seats for the Centre-right is 62 (-6), while the left has has 58 seats (+6).

Majority now say country headed in 'wrong direction' 👎

More concerning for the Beehive than the party vote numbers will be the sharp rise in the proportion of voters saying the country is headed in the "wrong direction".

Country direction (sometimes referred to as "right track/wrong track" polling) is a barometer of the national mood and tends to be a leading (as opposed to lagging) indicator of a Government's prospects of re-election.

The net country direction is down a whopping 17 points to negative 14 percent. 39 percent of New Zealanders think the country is headed in the right direction (down seven points), while 53 percent say the wrong direction (up 11 points) and 12 percent unsure.

The clear message from voters on what's concerning them 📣

Each month our pollsters ask the 1,000 respondents for their most important issue that would influence their vote.

The results are loud and clear: cost-of-living and the economy are on voters' minds, with the poll suggesting that New Zealanders are not backing Nicola Willis' softly-softly approach to tackling the country's economic woes or the Government's overspending.

Despite the media's attention on Māori / Treaty issues, just eight percent of respondents cited it as their major voting issue (compared to a combined 40 percent who said the economy or cost of living). Note too that the December poll (which these results are compared to) was just a few weeks after the high profile hīkoi.

For many families, Christmas has been a painful economic mirror, and this poll appears to reflect it – or as Bill Clinton's campaign strategist, James Carville, famously said: "It's the economy, stupid".

More information about the poll and how to get your hands on the full results can be found here.

Willis out-Mao-ing Mao? 😳 More mandarins than Communist China 🇨🇳🍊

Thanks to the supporter who flagged this Spectator UK  "Steerpike" piece (requires sub) which outlines how, incredibly, on a per capita basis the UK has more civil servants than communist China. 

Here at the Taxpayers' Union, we wanted to see how New Zealand compared to both Britain and our buddies in Beijing. 👀

To clarify: we're only counting actual mandarins (i.e. bureaucrats) not front-line personnel like doctors, nurses, and teachers – or those working for government-owned businesses.

China’s 8 million bureaucrats work out to about 0.56 percent of the population. Far too many if you ask me. 😉

Incredibly, the UK has more. Some 0.8 percent of the UK population are bureaucrats.

So how do we compare? Well, with nearly 63,000 taxpayer funded bureaucrats (even after Nicola Willis’ so-called ‘cuts’) that's some 1.18 percent of the population.

That's right Friend, on a per-person basis, New Zealand employs twice as many bureaucrats as Communist China.

It's not often the Taxpayers' Union holds [checks notes] Communist China as the better model of government efficiency, but here we are! Time for some reining in, Comrade Nicola?

More seriously though, no one could accuse the UK Government of being lean. The short point is, Wellington needs a proper clear out if the Government is to get on top of its fiscal mess.

New Public Service Commissioner talking truth about the bloat 📈

Nicola Willis might not be taking matters seriously, but good news from the Public Service Commission, with its new head Sir Brian Roche now publicly questioning the state of Wellington's bloated bureaucracy.

In a letter to public sector CEOs, he called out endless meetings, too many management layers, and bureaucrats’ obsession with internal paperwork over actual outcomes.

Roche says he wants fewer excuses and more action. Cutting to the heart of the issue, Roche reminded chief executives “[w]e are funded by one source of money — and that is the taxpayer — and…we need to try to simplify and streamline, not fragment and complicate.”

Could Roche be the taxpayer champion we’ve been waiting for? 🦸🏻‍♂️

Not since the valour of Sir Roderick Deane (in the mid-1980s) has New Zealand seen a State Services/Public Services Commissioner show real leadership and slim the size of the public service while improving performance.

So if Sir Brian means what he says, and can survive its toughest challenge yet (the bureaucracy itself!) he's worth every penny.

Your humble Taxpayers' Union has approached Sir Brian's office to ask him onto our Taxpayer Talk podcast. If he agrees, it'll be a good sign that the new public-service-Sheriff is indeed the champion for taxpayers we've been hoping for. On the other hand, if he's just another insider whose actions won't reflect the talking points, we doubt he'll accept.

We'll keep you posted...

Are the lights out? Revenue Minister won't intervene despite new tax laws costing Crown revenue 🤦💰

Despite popular belief, in most international comparisons, New Zealand's tax system is one of the best in the world in terms of efficiency and cost of compliance.

This is why we so often rank very well in 'ease of doing business' and other international league tables.

And the costs to the Crown are cheap too. Inland Revenue reports that it costs just 4.5 cents to collect a dollar in tax (although, their measure does not include the administrative cost to the taxpayer in compliance).

So it's pretty disappointing to see that the Revenue Minister, Simon Watts, is ploughing ahead with an ideological and out-of-date OECD-led "minimum corporate tax rate" framework targeting large companies that's so complex, nearly all of the additional revenue will be gobbled up by the costs of administration.

On 1 January changes to New Zealand’s company tax regime came into effect that will see New Zealand resident multinational companies (think Fonterra and Mainfreight) and foreign-based multinationals with operations here face enormous disclosure and compliance costs for almost nothing.

With New Zealand's company tax rate being one of the highest in the developed world, the idea that any multinationals are using New Zealand as a tax haven is a ridiculous.

Inland Revenue estimates this new law will generate just $24 million in revenue, affect no more than 25 companies, but will cost $11 million for IRD to build systems to monitor and administer the tax, and an annual $3m to operate them!

And here's the thing, the OECD was driven on this by the Biden administration – and given the change in situation over in the US (the Trump administration is expected to pull out of the scheme) the key sponsor of the initiative won't even be applying the rules!

But instead of rejecting these changes brought in by the last government, Revenue Minister Simon Watts' is missing in action.

Say, Waaaaaatt? 👀

We'd love to give you some answers on why the Minister isn't putting the kibosh on this backward step (and answers to other questions – such as what Ministers are doing to rein in IRD leaking taxpayers' data) but this Minister's phone is off the hook.

Last year, your humble taxpayer advocates asked to meet with Minister Watts (as we have with loads of other Ministers). But, the Minister's office said 'no' – the only Minister to date who has refused to meet with our friendly team. 🤷‍♂️

Not a good sign, is it Friend? Even Nicola Willis will take a meeting (and credit to her).

$35k of taxpayer money propping up race-based ticket pricing event 🤯 🎶

A music event down in Christchurch has been charging racially-tiered ticket pricing. And here's the kicker - your money is footing the bill.

The event charged three tiers of tickets: $15 for early birds, $20 for Māori and Pasifika attendees, and $30 for everyone else.

"Browntown" received a $35,000 grant from Creative NZ last year, supposedly to promote wider community involvement in the arts. But should your hard-earned taxpayer money be supporting events that charge more or less depending on the attendee's race?

The real issue here is that taxpayers are still being lumbered with the costs of Creative New Zealand bureaucrats supporting their pet projects (even if they breach anti-discrimination laws).

As long time readers of Taxpayer Update know full well, it's long past time some of Creative New Zealand's ridiculous funding handouts were scrapped.

That's all for this week, have a great weekend.

James Ross Policy & Public Affairs Manager New Zealand Taxpayers’ Union