Paddock Talk: Time to improve our productivity

Various governments have differing agendas for the high country.

The main agenda for the previous government was the establishment of up to 22 high country parks. However, there was never a clear enunciation of why these were necessary, what was the plan for their future management and how this management was to be funded.

The present government has an agenda of optimising economic use of the high country while protecting environmental values.

This agenda is a good fit with the objectives of high country farmers.

While positive moves are being made in this direction, the outcome lies in the detail of how this is to be achieved, and much of this has still to evolve.

A current buzz word among officials is setting high-level objectives. This is good; we need to have goals and targets to work towards.

However, we also need to clearly establish how we will achieve these targets.

I believe that as a nation, we are not good at establishing just how we will achieve our objectives, especially if it involves a longer time frame and hard work.

Many seem to believe we are automatically owed a high standard of living, but forget that we first have to earn it.

In recent years, average Kiwi households were spending more than we were earning. This was clearly unsustainable.

We talk about achieving income parity with Australia, but the latest figures show a reduction in labour productivity, the first time in 20 years.

We simply cannot regain our previous high standing in world economic standings unless we improve our productivity, both in labour and capital.

Local and territorial authorities need to greatly improve their efficiency. I recently read in the media the chief financial officer for Queenstown Lakes District Council saying the proposed 7.95% increase in rates was a good result, down from the originally proposed 11.9% increase.

How can this be so? The latest annual inflation figures came in at 2%.

How can an increase of four times the annual inflation rate be quoted as a good outcome?In the past four years, our farm rates demand has increased from $5521 to $8275, an increase of 49.9%, averaging 10.9% per year - this while inflation has been running at 2%-3%.

Part of the reason is a large increase in spending by Lakes Leisure, another example of spending on leisure before we have earned it.

I won't go into detail here but could quote numerous examples of inefficient spending by both local and national government agencies.

I expect people spending my rates, taxes and levies to do so as judiciously and efficiently as I spend on my own farm. It makes me angry when I see this is not the case.

Elected decision makers are good at surveying constituents on what they want. But they seldom ask the counterbalancing question of how much they themselves are prepared to pay.

It is only when you balance these two answers that you can make rational decisions.

To conclude, it is very necessary to have high-level goals and aspirations.

But to achieve these we also need a high level of community commitment to plans which can realistically achieve these goals.

And to achieve them we have to improve our productivity, both of labour and capital, and within government and non-government sectors.

 

- John Aspinall

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