WHAT I CONSIDER OUR COMMUNITIES CRITICAL ISSUES TO BE

The critical key points made in a recent review of local Government activities were:

• That local body politicians do not stand on a fiscal responsibility platform
• The cost to local government and therefore to ratepayers of additional regulatory responsibilities
• Councils should focus on core business
• Services should be targeted at those who benefit most as some of their services benefit a limited number of people but of which the whole community pays

Local Government NZ is the authority that works to help councils carry out its responsibilities.  In its current review of Local Bodies activities, it identified that politicians do not stand on a fiscal responsibility platform.

“The Rates Control Team,” has 4 elected members in Environment Waikato.  Our stated position in our manifesto pledges the team to raise rates no more than the rate of inflation.

Our team understands its regulatory responsibility as passed down from the government.  Any Standard set by the government must be achievable and affordable for us to action it in full.

Water quality is a key concern as voiced by our community, but the Government has not set clear guidelines and, confusing this issue comes the “Waikato River Authority”, whose vision and strategy has not yet been enunciated clearly, along with its regulatory framework.

ETS. What does the ETS stand for? Is it the Emission Trading Scheme? or is it; Essentially Tax Scamming?

Beneficiary of the ETS

You can fill in the anagram for yourself.
Send me your ideas.

Here are some of mine…
Emperors Theoretical Shorts
Essentially Trees Stolen
Embryonic Tax System
Essentially Tree scheme
Enforced tax System
Essentially Terrible Story
Effectively Transferable Subsidy
Evergreen tree Subsidy
Economically Terrible Subsidy
Eclectically tricky subterfuge
Economically trying sustainable
…

Why Farmers Won’t Invest in Forestry to Offset Their Emissions

• Our average age is 58 and we are not keen on taking on new debt having just spent 100 yrs clearing the land.
• Once planted, there could possibly be legal restrictions to changing land use.
• Income falls in proportion to area planted, farm values also fall proportionately, as value is based on income.
• Forestry plantation areas fell by 12,000 Ha in 2007, with a plethora of mill closures, there are virtually no seed nurseries and there are reduced numbers of willing, skilled loggers, so, along with low returns and ever increasing costs, the message to avoid forestry investment is loud and clear.
• Under certain circumstances Regional Councils will insist that forestry be planted in their catchment, small blocks for forestry offsets in intensive farming regions will be difficult and expensive to find.
• Isolated farm forestry blocks in low value catchments may find selling carbon credits risky and an unprofitable way of earning an income.
• The math dictates that the size of the plantation required to offset the liability will, unfortunately, need to continually increase.
• It will be costly for the farmer to set up; approximately $250,000 over the 30 yr cycle.
  • Verification @ $500 per annum: $15,000
  • Planting 6 Ha @ $5000 per Ha: $30,000
  • Fencing 2,120 mtrs @ $13 per meter: $27,000
  • Land: Per 6 Ha minimum: $30,000
  • Insurance: $300 per annum: $9,000
  • Pruning/cutting /clearing: $60,000
  • Lawyer/Accountant/Govt/Surveyor: $3,000
  • Admin/Rates: $20,000
  • Admin/pest /Pest control: $15,000
  • Opportunity costs/ interest: $?

Total Approx costs over 30 yrs: $250,000+

Note also that an isolated small plantation will not return any money from the wood.

Selling Carbon Credits: Farmers will decide not to sell carbon credits to supplement their income, as they realise that carbon values could fluctuate violently and so too would their annual tax implications.  Selling at $15 a tonne and ten years later having to buy back at $150 a tonne, makes no sense.

• A business would logically question why spending hundreds of thousands of dollars more in order to make less than the business is now!
• There appears to be no realistic agreements in the market place.

Finally:

• Govt have unrealistic expectations of the 630,00 farmers producing food and contributing to the NZ standard of living
• Govt have a biased assessment of the risk associated with this investment.
• Govt setting policy that may encourage borrowing or investment in the wrong places is questionable.

An E.T.S. Fairy Tale, Once Upon A Time…

The G-Man Cometh

A little ETS Story.  A scary and upsetting story about the stealthy theft of your house, bit by bit, your property stolen from right under your nose.

Once upon a time I had a house,( bugger, I mean farm) anyway.  One bright warm day, I remember it vividly, it was January the 1^st 1990 the Govt. dressed in pure white with a shining halo came into my garden and said abruptly, “All the native trees in you garden are now ours.  There are a few rules that go with this gift, you so kindly agreed to.”

I was gob-smacked.  They had gone before I could utter a word.  No consultation, no nothing after uttering these few curt words.

• The trees are ostensibly no longer yours
• You are not to touch them
• They have to stay in place for ever
• By inference we own the land
• You still have to pay the rates
• We have taken the carbon credits locked up in your trees
• But we will still add in some energy costs
• No compensation

I felt aggrieved, no acknowledgement for all those years of tending the garden, clearing the weeds, shooting those pesky possums, protecting it for the grandchildren.

This year they were back again, with a grander plan.  “Aren’t they satisfied with my free labour? What can they want now?”

This time they were dressed in black.  “Appropriate,” I thought in retrospect.

“The cunningest plan.” He continued, “That will save the whole world”.

I thought, “It must be really well thought out to achieve that goal.  “Prey tell me about it”.

The man in black, “Well, first we don’t need to bother you about the detail, because it is already organised.  We have not bothered that neither of us know how much it will cost.  In essence there are some choices”, the man in black went on to explain.

• To live and work in your house you could choose to close up 20% of the property. He continued to explain.  “We all have to make sacrifices. Administration cost to check you have closed up that room will be approximately $3000 pa.”

I thought, “The kids have left home, I’ll use that room.  I know it is the office but if I have to.   “Unfortunately, that room does make 20% of our income”, I protested vehemently.  I was beginning to get a bit miffed.

“O.K.”, the man in black came back smoothly.  “There are other choices”.

Me, “There must be a better way, mutter, mutter,  mutter.”

The man in black,

• “You can keep the room if you are prepared to pay the rent that the govt sets at the end of each year.  However, we will base it on the price of carbon as set by the share market.  Unfortunately we cannot predict the rental charge.”

Me, “What do you mean? Might I have to pay 3x my current rent?  Would I loose the house if I can’t pay?”

“Yes and yes”, came the muffled response.  Then, more urgently, “Which choice, come on.  The unknown rent or loose your room?  By the way, the pet sheep over there is going to cost you somewhere between $4 and $44 each year if you don’t make up your mind pretty soon, mate!

Me, “##****!”  I add, calculating quickly, “Uncle Jock has 10.000 sheep.  At $44 each per year, ##***!  That’s going to cost him $440,000 just for the pleasure of having a sheep farm.  They’ll be gone by lunch time.  Then where will we buy the Christmas Hogget.”

“Have you made up your mind yet?” The govt man insists.

Me, I start weighing up my options.

• I’ve lost my native trees.
• I could loose my income from the spare room which is all my profit and lose 20% of my houses value.
• I could buy a tin shed at mega bucks and put it in the garden and use it as an office to earn some extra money.
• I could take a punt and hope the price of carbon that I would have to buy off the share market to pay the rent on the spare room that I don’t really use anyway doesn’t send me bankrupt.
• Lock the house up and go and live at mums.

Here ends Chapter one.  The saga is episodic.  Please tune in next month, it may all be different.

Written and directed by Tony Armstrong.

Rates Control Team “I’LL GIVE IT A GO”

When asked if you might stand as a local body councillor, your answer may as well be, “I’ll give it a go”.

As one persons influence is as strong as one vote in the debate over an issue.  A sensible outcome relies on the majority being in line and that is not always the case as we have seen in Auckland, as each council pushed their own agenda too vigorously.  The result, a frustrated Government could not stand by and watch prevarication any longer.  Result in Environment Canterbury’s case: frustration leading to disestablishment!

There are several changes that could be taken on board to enhance the competency of an elected council.

First, why not, at least in some DCs (District Councils),  increase the remuneration of councillors.  Most work a full week representing their constituents, try and manage their business and sacrifice their family life for something under $30,000 per year.   An increased salary would offer financial security so their time was less divided.

Second, a mayor would be better selected by the councillors, who arguably know the best person within the group to lead them.  The celebrity with the thickest wallet is no way to select a community leader, as it’s their skills and their ability to work well with others that the council needs.

Third, a team/party approach where a group positions themselves and the community chooses the bias as they feel fit. Even better still, a region with teams with aligned views.

It is necessary that all councils understand the roll of the other council and this is not happening well.

The first and second points are the government responsibility to change.

The third point is where “The Rates Control Team “is offering an alternative to electing 12 unknown players .

Anthony Armstrong

A Team Approach To Local Body Politics

Team Spirit: Individuals working together

The Rates Control Team is bringing a team approach to the local body election in 2010.

The motivation that set this team in place was the dissatisfaction with the incremental increases in our council rates and the continual expectation of raising its revenue.

Politicians find it difficult to have a close relationship with their community, perhaps because our community is not interested.  So we are trying a new approach.

Our team approach is to gain support/endorsement through groups such as Hamilton Grey Power, Hamilton Citizens and Ratepayers (which we now have), and Waikato Federated Farmers, which we are seeking.  This then gives those people not directly involved in such groups, but identify with their core values, confidence in our approach.  The security that endorsements give is the confidence of having a team that  takes out the extremist views, the bullies or those who have just a high profile but skills that may not be that useful.

It’s an honour to represent the community and I see many fine people standing and serving our community.  But when you look through the constraints put around every person and ask why many very competent don’t stand, you may come to the conclusion that they are not getting the appropriate support.  A team can support and give confidence to those unsure.

As our team is more recognised as a viable option to the stand alone candidate, we can approach people whose skills will compliment and strengthen your council’s governance arm.

A team like this is very accountable as the media is quick to pick up on any indiscretions.  We ride or fall on the behaviour of one member.  In contrast an individual councillor will not often be taken to task in the same way.

We can work together to solve the communities problems with a centrist cooperative stance with fiscal responsibility being our core pledge.

Anthony (Tony) Armstrong
11/11/09