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Australia’s Prime Minister Scott Morrison waves to his supporters following a victory speech with his family after winning the Australia’s general election in Sydney on May 18, 2019. (Photo: SAEED KHAN/AFP/Getty Images)
Australia’s Prime Minister Scott Morrison waves to his supporters following a victory speech with his family after winning the Australia’s general election in Sydney on May 18, 2019. (Photo: SAEED KHAN/AFP/Getty Images)

BusinessMay 12, 2021

ScoMo’s conservatives are relaxed taking on debt to pay for what matters. Why is NZ so tight?

Australia’s Prime Minister Scott Morrison waves to his supporters following a victory speech with his family after winning the Australia’s general election in Sydney on May 18, 2019. (Photo: SAEED KHAN/AFP/Getty Images)
Australia’s Prime Minister Scott Morrison waves to his supporters following a victory speech with his family after winning the Australia’s general election in Sydney on May 18, 2019. (Photo: SAEED KHAN/AFP/Getty Images)

While Labour frets about debt of 32% of GDP and a ‘tight budget’, Australia’s conservative government has embraced major deficit spending on poor, infrastructure and aged care, and is relaxed about 50% debt, writes Bernard Hickey.

This story was originally published in Bernard Hickey’s email newsletter The Kākā and is republished with permission.

It’s a remarkable thing to see. Our Labour government is talking about the need to reduce debt within a couple of years and is restricting infrastructure, housing, welfare and public sector pay in its budget next week, even though net debt is just 32% of GDP.

Meanwhile, the ostensibly more conservative Liberal-National coalition in power in Australia last night unveiled a A$107b deficit spending plan for 2021/22 and expects to run deficits for the rest of the decade, building up a debt load of a trillion Australia dollars by 2024/25 or around 50% of GDP.

The Liberal-National plans unveiled last night included another A$1,080 worth of tax breaks for low-income individuals and A$2,160 for couples, an extra A$17.7b over four years on aged care, an extra A$2.3b on mental health, an extra A$13.2b on disability insurance (a bit like ACC) and A$15b extra on infrastructure.

Australia has the same AAA credit rating as New Zealand and Standard and Poor’s has put Australia’s rating on a negative watch, but that hasn’t deterred it. Australia expects to run deficits for the rest of the decade, while finance minister Grant Robinson has already pivoted to spending restraint and debt reduction within two to three years.

So why is New Zealand being so paranoid about high debt and restricting spending on families with poor kids, transport infrastructure, housing and health-care? Why is our government choosing to use the $30b improvement in tax revenues and spending from the better-than-expected economic recovery to reduce debt, while Australia has decided to spend A$94b of its A$100b improvement.

Aussie business leaders happy

“Our recovery needs to be secured,” Treasurer Josh Frydenberg told ABC television last night. The expected deficit of A$107b for 2021/22 was A$40b more than economists expected because of the extra spending.

“They’re the initiatives that we put in place designed to boost aggregate demand, overall economic activity, and create more jobs, because we cannot take the gains that we’ve made for granted,” he said.



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Australia’s deficit is on track to still be A$57 billion in 2024/25, while Robertson is expected to target surpluses from then in next Thursday’s New Zealand Budget.

Business groups in Australia welcomed the looser fiscal stance. “We are on the right track,” Business Council of Australia chief executive Jennifer Westacott said.

“The budget builds on the significant gains we’ve made to create jobs, get people and businesses back to work, rebuild confidence and fire up economic growth,” she said.

To be fair to our business community, there have been no calls for the fiscal stringency talked about by the government in recent weeks.


Bernard Hickey hosts When the Facts Change, a weekly podcast exploring the intersection of business, politics and economics in Aotearoa. Subscribe and listen on Apple Podcasts, Spotify or your favourite podcast provider.

Keep going!
Image by Alice Webb-Liddall
Image by Alice Webb-Liddall

Pop CultureMay 11, 2021

Eight important business lessons from The Apprentice Aotearoa

Image by Alice Webb-Liddall
Image by Alice Webb-Liddall

As The Apprentice Aotearoa choppers onto our screens, Alex Casey witnesses a masterclass in business prowess. 

Yes, the timing of The Apprentice Aotearoa could not be any weirder. A reality series that played a huge part in giving Donald Trump the profile that would see him become president, now hosted by a property mogul in the middle of a housing crisis? The gall, the gumption, the audacity, the chaos. It’s me, bringing potato salad to a finger food shared lunch and having to sheepishly shame-eat it in fistfuls. It’s John Travolta, saying “Adele Dazeem” straight down the barrel of the camera. It’s Mike Pero, boarding his chopper in a crisp pair of Ray Bans. 

But what do I know? Certainly nothing about business. I did go to a Girl Boss conference once and drank a lot of charcoal. Otherwise, the closest I have ever got to a winning business concept was when I invented a gear stick-like attachment to help people hold onto their keys when I was 12. I used bright green Fimo, shaped it to fit the grip of my hand, and won distinction at a South Wairarapa innovation fair. After seeing the photographs and realising that what I had made was, in fact, Shrek’s schlong, I retired from the world of business to find myself. 

So, what can The Apprentice Aotearoa teach a business novice like me about business in 2021? Is it worth your time, if time is money? What is money? Who is money? Where is money? Allow me to dust off my loafers, fold up a giant pocket square, and crack open my suspiciously empty leather portfolio in an attempt to find the key lessons from week one.

Lesson #1: You catch more flies with honey

Unless, of course, the flies can’t taste the honey at all. The first challenge for our budding business-folk was to design a brand new popcorn brand for kids. Drawing upon his childhood in Afghanistan, Bari reminisced about a cart that sold honey-covered popcorn balls. From there, he was cooking with gas. This is what mentor Cassie described as “a brilliance bomb”. 

The big problem was that, due to teammate Stephen’s enthusiasm for cacao during the flavouring process, the honey taste was non-existent. They took the product to some kids:

And then to some potential supermarket suppliers:

Lesson #2: Dress for the job you want

People always say dress for the job you want, not the job you have. We already know that mentor Cassie Roma has “cut her teeth on the cutting edge of technology” so, based on her rakish indoor hat, and the fact that her teeth have grown back, we can make some guesses about her next career move. I predict: either a relaunch as the lead singer of The Veils, a contestant on The Bachelorette, or the star of a feminist Jeepers Creepers reboot, wherein she skins men alive for interrupting her in the boardroom. 100% would be in the audience for all. 

Lesson #3: Brainstorm like nobody’s watching

Because the chances are someone is always watching, and it’s probably going to be mentor Justin Tomlinson, whose ongoing silent presence in people’s kitchens is absolutely not terrifying or weird in the slightest. 

Lesson #4: Lean in, always

Team Tahi came away with the win this week after wooing Countdown with a heavy sprinkle of supermarket-based sisterhood. Team leader Kyria began to tear up as she described how giving back is really important to their team, which made the Countdown lady start to tear up and say “don’t you make me cry”, which made me start to tear up from the couch at home for literally no reason. “Ngā mihi, wāhine toa,” said the Countdown lady. “Go the girls.” I don’t fully understand late-stage capitalism but I do know this: popcorn is officially feminist. 

Lesson #5: Sex sells

Tfw you want a fun kids’ tagline about “treasure” and you accidentally write “pleasure” and then you go to say “corn” and you accidentally say “porn”. 

Lesson #6: Price is just a number

First of all, I have never heard someone pronounce GST like “gist” in my whole life, so to hear Bari throw it away so casually was a rush I haven’t felt in years. Confusing their “kid” market with “kids on the rich list”, Bari managed to convince Michael to walk back their price from $8 A BAG (including gist). Team Tahi took an even more risky approach and decided to just… not price their popcorn at all. Pay what you like, love who you love, just don’t forget the gist. 

Lesson #7: Play to your strengths

In a competitive business environment, never forget the strengths that you bring to the table as an individual. Even when team Mana were left bereft in their man cave waiting for someone to be fired, they were quick to remember the strongest elements of their pitch. “I think Buzzy was a huge strength for us,” someone said, without laughing even a little bit. Reader, this is Buzzy: 

Lesson #8: If all else fails – that’s moot

Perhaps the most salient message of all came from Michael, who rolled up his sleeves and his many, many beaded bracelets to go into bat for his vegan honey product that was definitely not vegan. “Vegans don’t actually eat honey,” said a Countdown rep. “So, that’s a moot point – it’s actually honey powder.” The Countdown gods looked puzzled. Michael doubled down. “We haven’t claimed it’s vegan friendly on there, because it is a moot point.” New World didn’t fare much better: 

It wasn’t actually Michael who got fired this week but, fortunately, that’s a moot point.

The Apprentice Aotearoa airs on TVNZ1 at 7.30pm on Mondays


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