P U B L I S H E R ’ S D E S K WHEN STATISTICAL AND POLITICAL TRANSPARENCY IS AS CLEAR AS MUD www.engineeringnews.co.nz 3 quarter, taking annual growth to 3.6 percent, driven by strong demand for exports and the largest quarterly rise in two decades. There’s also been an increase in investment in residential building and construction-related investment. GDP per capita rose 0.5 percent in the June quarter, up from a 0.3 percent increase in March. Finance Minister Bill English says the annual results puts us in the top three in the OECD in terms of high growth rates. But international economist Ann Pettifor, live on the Paul Henry Show, says New Zealand’s economy is “hugely imbalanced” (If the mud in your eyes becomes too much, I advise a water bath). “In Auckland, banks are lending crazy money on speculation - speculating that property prices will rise,” she said on the show. “It’s overvalued bricks and mortar and speculating that that price will continue rising forever and of course it won’t and when it starts falling then the debt has to be re-payed and the equity in the property falls.” ‘Rockstar’ economy, she says, has been heard plenty before, particularly at the times of the last Global Financial Crisis. “But what’s interesting about New Zealand is that inequality rose in this country more than in any other developed country in the world.” She says those levels of inequality led to political instability which has led to the rise of the likes of Donald Trump and “fascists in Europe”. Back to Mr Robertson who then says everyday Kiwis won’t be feeling the benefits of GDP growth “because on a per person basis our economy is barely moving. “We have seen enormous population growth in New Zealand in the last year and that generates economic activity. But what these numbers show is that we are not getting the increased economic value from that to mean real sustainable growth. This adds further to the need to review and adjust immigration policy to ensure it contributes to real growth,” Newshub was reported as saying. He says real disposable income per capita fell in the past quarter, meaning Kiwis “don’t feel they’re getting ahead”. Mr Robertson says the economy is being kept afloat by population growth and an unsustainable housing bubble. That last comment from Mr Robertson doesn’t need data associated with it: all you have to do is walk the streets of Auckland, drive (or sit) in the traffic, or go to a house auction. Now my concern isn’t about what’s being said as much but more that Government, opposition and leading economists are so polar opposite in their views. Remembering these aren’t future, yet-to-happen financial directions being debated, and political parties clashing on policy, but instead what is actually going on right now with our economy. I’m no economist by any stretch, but that has to send red flags. To go forward with confidence, greater transparency is needed. Just like Gilbert Ullrich of Ullrich Aluminium is asking for on page 6. I’m just hoping the mud hasn’t been mistaken for quicksand. – Greg Robertson greg@hayleymedia.com Oh yeah. Recognised (sort of), at last. The local manufacturing industry – one in which the engineering industry fits smack within – has finally stepped out of the shadow of the allpowerful, headlining big brother exporter that is the see-saw dairy industry. Manufacturing has finally got some great publicity, albeit in what must have been the only form to garner such wonder-lust; as commentary in the New Zealand Herald by executive director of ManufacturingNZ, Catherine Beard. Self propagation perhaps, but column-inches nevertheless. It’s no secret that the figures released mid-month showing a spike in New Zealand’s GDP can, in solid-part, give kudos to a buoyant manufacturing economy. Brilliant stuff, eh? Or is it? As a journalist for some 20 years, massaged figures is something that I’m used to receiving across my desk. And this is in no way waging in on the recent war between Statistics New Zealand, Labour’s finance spokesperson Grant Robertson and our prime minister, John Key. It’s just fact. As a very brief background, Mr Key is hot for an apology from Mr Robertson (no relation) after comments indicating that Statistics New Zealand was politically motivated – something strongly refuted by the independent organisation. That aside, but in mind, its necessary to show how data can paint a completely different picture to a reality… in this case an average wage. Here’s a simple example involving just three pieces of data and how they can be massaged. John is an executive earning $250,000 per annum, Sarah is a sales rep on $50,000 and Tony is just out of school and earning $28,000. Imagine then a press release: 'Average wage nearly $110,000 in New Zealand!' It amazes me how the average is used instead of a median, and in this case the headline bellies the reality that two-thirds of ‘this New Zealand’ are in excess of $60,000 below that $110,000 headline average. It happens all the time and it’s this type of information that makes things as clear as mud. Now, with the aforementioned again in mind, here comes the real mud, as reported on the morning Paul Henry Show. The ‘facts’: GDP grew 0.9 percent in the June
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