In today's email we detailed the call by Winston Peters for an investigation into the background and activities of National list MP Jian Yang, we asked where to now for the WTO, and we reported from India about the boom and bust of our export education industry.
1. Peters wants Yang investigation
Foreign Minister Winston Peters yesterday attacked the National Party for its continued support of list MP Jian Yang over his historic connections to China's military intelligence apparatus and his activities as an MP.
Peters renewed his pre-election call for an investigation into the MP's activities and background, even going so far as to accuse him of being a 'Manchurian candidate' in the adjournment debate in Parliament.
The comments followed a report in the New Zealand Herald by Matt Nippert that documented Yang's involvement in an appeal by a Chinese-born New Zealand resident against a block by the Department of Defence from a sensitive job on security grounds.
The report detailed a letter from then Defence Minister Jonathan Coleman that showed Yang had approached the minister on the resident's behalf.
Yang has said through a statement that he did nothing wrong and was simply representing a constituent. He continues to refuse to talk to the English language media, having given no interviews since September 13, just after Newsroom and the FT published a joint investigation into Yang's background as a trainer of spies in China in the 1980s. Yang told reporters then that he had not disclosed the full nature of his background in his CVs because authorities in China had told him not to.
Peters was asked about the report and his views before entering Parliament yesterday.
"For a change, the Herald has got onto something and got it right," Peters said, adding he had never heard before of an MP trying to get a security block overturned for a constituent.
"I would have thought the National Party would have initiated at least defamation proceedings to preserve their MP's reputation. He has been seriously traduced and defamed -- unless it's fair comment," Peters said.
"I would have thought the National Party had a responsibility from the very leadership of the President himself down to inside this Parliament to clean this matter up now," he said.
"I'm putting it to the National Party. You've got yourself donkey deep into funding from offshore sources politically and allegations are being made about one of your MPs, which cannot be left where they are. Either front up with the courts with a defamation case or take some action. It's up to them.
"If you don't act on this matter, you've allowed your MP's reputation to be traduced. It spreads to all of the Party -- indeed to all of the Parliament. They surely understand that."
Asked if he believed the allegations, he said: "I'm the one at the word go who said these are allegations that need to be investigated."
Peters then went on in Parliament to make more critical comments about Yang and his role in enabling fund raising for the National Party. Here is the Hansard of his speech.
He couched his comments within a speculative set of predictions about who would be the next National leader. He suggested first Amy Adams, then Judith Collins, Jonathan Coleman, Simon O'Connor, Nick Smith, Steven Joyce and Simon Bridges.
"Which leaves only one. Given how much the National Party are easing the tank to the Chinese interests, there's a real chance that National's Manchurian candidate, Yang, will steal the leadership odds. I've got him up 2:1 to be the next leader of the National Party," Peters said, before holding up a copy of the New Zealand Herald, which had the report about Yang on its front page.
"It's all there, and the reason why, and they won't respond. It's sad about that, because a once great party called itself 'National' when they understood," he said.
Smith then accused Peters of Asian bashing.
"Oh, no, it's not. He who pays the piper calls the tune, and we know what tune National's calling these days."
Adams then asked who called the tune for Peters. Speaker Trevor Mallard then interrupted Peters and warned him to be careful when making allegations about the financing of political parties.
Earlier, National Party Leader Bill English had defended Yang's actions, although he also said he had not spoken to him.
"From what I've seen from the story, I think they've over-stretched it a bit. He's dealt with an inquiry from a constituent in a way that an MP is virtually obliged to and I think it's over-stretching it to say he tried to overturn a security classification, and in any case our security agency processes are much more robust than that," English told reporters.
"They would not be changing a security classification simply because of an indirect inquiry from an MP," he said.
"If any constituent asks an MP a question to do with Government process, an MP is obliged to find out how it works and that appears to be what Dr Yang did."
Yang issued a statement, but again declined interview requests.
The full statement under Yang's name is here: "In February 2012, a constituent contacted me regarding an employment decision made by the New Zealand Defence Force. My office forwarded the correspondence to the Minister of Labour, who subsequently transferred it to the Minister of Defence. The Minister of Defence replied to the constituent in April 2012 and copied me into his response. You have a redacted version of that letter. Once I had received the response, I took no further action. I had simply sought answers on the constituent’s behalf through the appropriate channels, as is the responsibility of every Member of Parliament. This is one of many constituent cases I have dealt with over the past six years. I did not know the family until they approached me in February 2012 and have spoken to them only once since, at a community event when they thanked me for my help and told me they had moved on. It wouldn’t be appropriate for me to name the applicants. MPs deal with constituent matters every day and constituents have a fair expectation of privacy."
Yang has not been interviewed by English language media since September 13. He has repeatedly appeared on Chinese language television and at events with Chinese embassy officials.
University of Canterbury academic Anne Marie Brady has documented the involvement of China's Government in the Chinese language media in New Zealand in this paper, including Panda TV Channel 37. It is affiliated with the state-run China Radio International.
Prime Minister Jacinda Ardern was also asked about the report of Yang's lobbying, and said: "As a general statement, it's inappropriate for MPs to lobby around security clearances."
2. Where to now for the WTO?
Newsroom's Foreign Affairs and Trade Editor Sam Sachdeva has taken a close look at the failure at the latest World Trade Organisation conference in Buenos Aires to come up with some meaningful action, despite a lot of talk.
Sam talked to Trade Minister David Parker and a variety of commentators, including Stephen Jacobi, Jane Kelsey and Chapman Tripp's Tracey Epps about the outlook for free trade within the WTO system at a time when the United States is openly hostile and other countries are doing bilateral and multilateral deals.
The three-day meeting ended in a widely panned stalemate, with no major agreements signed off by the group’s 164 members. As Stephen Jacobi, executive director of the New Zealand International Business Forum, notes: “Expectations weren’t high, but even then they managed to be dashed.”
Even Trade Minister David Parker was not in a mood to mince words, summing up the event as “a lot of money spent on not a lot of progress by a lot of countries that I think left plenty of people frustrated.”
With what is supposed to be the world’s premier trade organisation in a state of dysfunction, where does it go next - and what are the consequences for New Zealand?
With the United States continuing its attacks on the body and a lack of leadership from other countries, where does the WTO go from here?
Sam Sachdeva takes a detailed look in this analysis he published first on Newsroom Pro.
3. How capital values and notes on LIMs warp policy
Newsroom's Environment Editor Eloise Gibson has written a sensational step-by-step analysis of why it took a year for official advice on rising sea levels to be publicly released by the Ministry for the Environment to councils.
Read it and you will weep and rage at the meat grinder that is now our political economy, where capital values and fear about notes on LIMs outweigh the need to give solid scientific advice to councils to plan for climate change.
It is one of the best things we have published all year for those inside our world of the political economy around the Beehive, the ministries and the wider governance community in New Zealand. Everyone in councils, Government, the climate change community, banks, insurers and real estate agencies should read it.
During the 364 days it took for the Ministry for the Environment to get permission to publish new guidelines on rising seas, lobby groups for coastal residents’ succeeded in removing an explicit 1.9m test for large new housing developments. Meanwhile councils were pleading for access to the final guidance, Eloise writes in this piece first published on Newsroom Pro.
If you click on one link today, make it this one.
4. Tough road ahead for PTEs
The other must-read in today's email is a detailed feature from Newsroom's National Affairs Editor Shane Cowlishaw on the extraordinary boom and ongoing bust of our international education industry.
Shane traveled to Sri Lanka and India earlier this year to find out what was happening on the ground there.
He reports that opening the floodgates to students from India led to their exploitation both at home and in New Zealand. As the industry recovers and attempts to pivot to a high-quality model, he finds out where we now sit in the competitive international education market.
In 2013, with the approval of then Tertiary Education Minister Steven Joyce, NZQA made alterations to ‘Rule 18’ of its approval and accreditation rules.
Rule 18 may sound innocuous, but essentially it drastically loosened the English language requirements for Indian students leaving education providers free to enrol them using their own tests and criteria.
The damage was immense. Just how bad depends on who in the industry you talk to, but the blowback is still being dealt with today.
As the change was made, word quickly filtered through to the massive and unregulated agent market in India. unscrupulous agents realised they could send a huge amount of people through the door regardless of their intentions.
With promises of permanent residency and readily-available work, the student tsunami began.
From about 8000 in 2012/13, numbers surged to a peak of 29,000 in 2016, with most enrolments at private training establishments (PTEs).
With huge money to be made, both in India and in New Zealand, cases of fraud grew alongside migrant exploitation.
Stories of people being forced to work for as little as $5 an hour began to emerge, and investigations into the links between education agents, PTEs and employers exposed an underbelly of abuse.
It took two years for the changes to be reversed, with many in the industry criticising the slow response by NZQA before it began cracking down on shady providers.
See Shane's full report here on Newsroom Pro, where it was first published yesterday.
5. Briefly in our political economy
They're back - Finance Minister Grant Robertson yesterday announced the names of the rest of the Tax Working Group to join Chairman Michael Cullen in proposing changes to the way capital gains are taxed. They include a couple of veterans from the previous Government's 2009 Tax Working Group, including PwC's Geof Nightingale and former IRD Commissioner Robin Oliver (who acted as an official adviser). Others on the Group include Joanne Hodge, former tax partner at Bell Gully, Kirk Hope, Chief Executive of Business New Zealand, Nick Malarao, senior partner at Meredith Connell, Hinerangi Raumati, Chair of Parininihi ki Waitotara Inc, Michelle Redington, Head of Group Taxation and Insurance at Air New Zealand, Bill Rosenberg, Economist and Director of Policy at the CTU and Marjan Van Den Belt, Assistant Vice Chancellor (Sustainability) at Victoria University of Wellington.
In Savage's memory - Prime Minister Jacinda Ardern and Housing Minister Phil Twyford staged a joint announcement yesterday of the Government's long-promised decision to order Housing NZ Corp to stop the previous Government's policy of transferring or selling the ownership of state homes into the hands of community and other non-Government groups. The announcement coincided with the 80th anniversary of the building of the first state house at 12 Fife Lane in Miramar. They cut a cake at the home with Uinise Nysse, (pictured above) the home's resident for the last 26 years, who was in attendance with her daughters. The home is still in remarkably good condition and has been registered with the New Zealand Historic Places Trust as a Category I heritage item. It is iconic in the Labour movement because Michael Joseph Savage and half the cabinet of the first Labour Government helped carry furniture into the house in 1937 when it was completed. See this photo at nzhistory.govt.nz
Migration on high plateau - Statistics New Zealand reported yesterday that net migration in the month of November was unchanged at a seasonally adjusted 5,610 from October, but down from a high of 6,320 in June. Net migration in the year to November was also unchanged at 70,354 from the previous year, but down from a peak of 72,400 in July this year. However, it remains just below those record highs and is not falling quickly as many have forecast for the last two years.
In line - Statistics New Zealand published GDP figures for the September quarter this morning. Growth of 0.6 percent for the quarter was in line with expectations, but growth for quarter from a year ago of 2.7 percent was above the consensus forecast for annual growth of 2.4 percent because of upward revisions in previous years. However, growth per capita was 0.2 percent for the quarter and 0.6 percent from a year ago, underlining that much of the growth came from population growth, high workforce participation and extra hours being worked, rather than productivity growth. Economists noted the revisions showed the economy had greater capacity for growth than previously estimated, again calling into question the Reserve Bank's measures of of potential output that govern its view about future inflation (ie the Reserve Bank could have run the economy faster with lower interest rates and not generated inflation).
6. Briefly in the global political economy...
A changing climate - BHP Billiton, which is one of the world's largest coal miners, announced it would withdraw from the World Coal Association and review its relationship with the US Chamber of Commerce because of their advocacy against policies to reverse or mitigate climate change. "This is a message that even organizations, like B.H.P., with large coal assets, do not value aggressive anti-climate lobbying,” Brynn O’Brien, executive director of the Australasian Center for Corporate Responsibility, said. (New York Times)
US$1.5 trln tax cut - Donald Trump got his first major legislative victory this morning when Congress passed a bill to cut taxes by US$1.5 trillion. Most of the tax cuts go to companies and those on higher incomes, which its proponents argue will boost GDP growth and 'pay for itself' by increasing revenues. Most economists forecast the tax cuts will instead just increase deficits and debt by the same amount. (Reuters)
7. Coming up..
Newsroom Pro's last daily email for 2017 will be on Friday. We resume on January 22. Yay for holidays and summer, which we're seeing plenty of in Wellington at the moment (Hope I haven't jinxed it).
8. One fun thing
When your Secret Santa is the Prime Minister...
Rebecca Terry: "It's here!!! Thank you so much #nzsecretsanta I love it all, I've wanted this book for my girls for ages especially! Oh and to those interested, the pin will give away who my santa was......Thank you so so much @jacindaardern I am so happy, and will treasure the pin too Merry Christmas to you and yours "
Jacinda Ardern sent Rebecca a book called 'Good night stories for rebel girls' and a pin she received at APEC.
The Prime Minister also visited the Newsroom office yesterday afternoon. We got some cookies and some peanut brittle, which will go down very well. Many thanks Jacinda and we wish you and all the politicians and public servants in Wellington a great summer break. A final thanks and best wishes for the year will come in the final email tomorrow.