Thursday, May 04, 2006


A jewelled brooch attached to a Madagascar hissing cockroach.

By Ana Samways

Salt Lake City fashion designer Jared Gold recently began offering jewelled brooches with brightly coloured crystals affixed to live, 7.5cm Madagascar hissing cockroaches that the wearer can allow to roam a short distance around her dress or jacket via a silver chain attached to the roach's back. The roaches used are male and live up to a year if fed (fresh bananas) and hydrated properly, says Gold's website. The brooch sells for $80. According to the News of the Weird website, the New York Post reported an animal-rights spokesman as calling the bauble "just the gift" for the "person who doesn't mind a small animal excreting on them throughout the day".

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In an interview this week with Angelina Jolie on NBC's Today show, anchor Ann Curry got all deep and meaningful and said what she liked best about being pregnant was the feeling of never being alone. Cool as a cucumber, Angelina politely said she hadn't felt that at all. (Source: the Scanner blog at

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A reader would like to thank roading company Fulton Hogan and the North Shore City Council for a wonderfully orchestrated event outside his house. "They managed to spend an entire weeknight, from 9pm till 7am, re-sealing a residential street in Northcote using the largest and most obnoxious machinery known to man. Every house on the street had its light fittings and dentures shaken to destruction, as rollers drove up and down repeatedly. The road workers didn't care, and blamed the council for choosing the time and place, while the council guy (at 4am) volleyed the blame back at Fulton Hogan."

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Remember the days when fundraising kids would be collecting bottles, selling biscuits or chocolate? Now, with the pandemic of child obesity bearing down on the middle classes, sensible schools like Mt Albert's Gladstone have opted for a healthy school fundraising product : dinky six-packs of bottled water. (Thanks kids, I have plenty in the tap, but there's a garage that needs a sweep ... )

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Sideswipe has discovered yet another Ahmed Zaoui unauthorised diary.

Thursday, May 4:

10am: Must ring Dave Dobbyn re, new single, Free Ahmed Zaoui (Love the lyric: "His freedom fettered by the shackles of the State/His body hounded by the harbingers of Hate").

11.30pm: Change library books.

12.30pm: Meet Keith Locke to hang out in the University of Auckland Quad.

2.30pm: Present the Fair Play award at the Students Against State Tyranny soccer tournament. Give usual speech: "Islam is a religion of tolerance and respect".

4pm: Deborah says court looming again so we need me back in the media. Phone friends in the media. Must call Finlay. Haven't heard from him recently; I like our chats on "the myth of impartiality in the Western media". Wise head.

5pm: Check with Deborah re Legal Aid.

7pm: Must watch Campbell Live so I can tell JC tomorrow how much I enjoy his work.

John Armstrong: Labour must be feeling relief after extracting sore tooth

The "unbundling of the local loop" - the quaint euphemism for forcing Telecom to allow competitors access to its home and business phone lines - has been the political equivalent of extracting a very sore tooth.

The issue has been nagging away at the Government for so long that there must have been a sense of relief among ministers around the Cabinet table yesterday at actually having done the deed, at least as far as broadband is concerned.

There is still going to be a lot of squealing. Sizeable shareholders in Telecom will be spitting. Market purists will be bleating about what they will decree to be a raid by the state on private wealth. There will be predictable warnings about sending the wrong signals to foreign investors.

Labour should hold its nerve. Long-time Telecom shareholders have benefited financially many times over from the shambolic privatisation of the former state company in 1990.

Not only was Telecom sold too cheaply, it went on the block without a proper regulatory framework being established first to ensure the telecommunications industry would be truly competitive.

The Government can justify the opening up of Telecom to more competition on simple, common-good grounds.

Ministers will rebut criticism of "regulatory creep" by arguing the new regime will still be less interventionist than regulatory frameworks in other countries and that the move will increase competition, not limit it.

The biggest political danger is that the policy will not work. Officials have warned that it will take "some time" to create a more competitive market for broadband and that there might even be a short-term dip in the sector's performance.

However, that is also an argument for delaying no longer.

Labour's longer-term difficulty is to find additional but not so immediately obvious policy gems to make good on its promise of "economic transformation" - the key thrust of its third term.

Yesterday's announcement is the first element of that agenda to see the light of day as frantic policy development continues to find more such initiatives to lift the New Zealand economy out of reliance on high international prices for agriculture-based commodities.

However, improving broadband uptake had been foreshadowed by the Prime Minister for months. The announcement begs the question "what next?"

It also appears the announcement was to have been showcased in the Budget, now just two weeks away. That was kiboshed by the leaking of a Cabinet document within hours of the Cabinet decision, which forced the Government's hand late yesterday afternoon.

Michael Cullen had been warning it was going to be a boring Budget. But then he always says that. There will now be a mad scramble in the Beehive to find something to fill the vacuum and prove him wrong.

Editorial: PPTA must take long, hard look

The Post-Primary Teachers Association has reacted with remarkable equanimity to alarming findings on the state of the teaching profession. Teachers, the Massey University report concludes, comprise a fractured workforce, with some decrying their colleagues as lazy, incompetent and uninterested while others buckle under workloads and unruly classes.

That verdict does not faze Debbie Te Whaiti, the association's head. Any workplace would, in her view, have similar fractures when it came to feedback on colleagues' performance.

To some degree, that may be true. But not to the extent outlined in the report, which was commissioned by the Teachers Council and the Ministry of Education. It uncovered a catalogue of woes. Teachers felt "overloaded, inadequately rewarded, undervalued and insufficiently supported". Perhaps most worryingly, the report forecast recruiting difficulties as the next generation spurned a career in teaching, seeing it as "underpaid, stressful and too ordinary".

If, as seems to be the case, the PPTA construes all that as normal, it will be doing teachers a gross disservice. Instead, it should be pondering the reasons for this crisis in morale. And the fact that any objective analysis would conclude that the union's own policies have played a major part in creating, and perpetuating, the situation.

At the seat of the teachers' grievance is the fact that the present system of national pay bargaining denies schools the opportunity to reward those who distinguish themselves in the classroom through excellence and hard work. The same arrangement pays poor teachers too much. Unhindered by appraisal systems, they coast on the coat-tails of better colleagues. It is no wonder many in the latter category feel aggrieved.

The solution lies in payment by performance, through workplace bargaining and individual contracts. While that is the norm elsewhere, it has been thwarted by the PPTA, which foresees, and fears, a greatly reduced influence on the fabric of education. The same impulse prompted the union to oppose the trend to greater autonomy for schools. Once that included bulk funding, the vehicle which allows schools to tackle the workload of teachers by paying staff salaries out of their bulk grant.

The introduction of the National Certificate of Educational Achievement, in place of an examination-based qualification, has undoubtedly placed far more pressure on teachers' time. The report confirms, unsurprisingly, that it has become a significant source of discontent. Reducing the workload hinges on schools being able to employ more, and better quality, teachers. Freedom to pay by performance, and no longer be shackled by a system that sponsors mediocrity, would allow that.

The Government, unfortunately, seems as reluctant as the PPTA to acknowledge as much. The startling message of the Massey report seems barely to have registered with the Education Minister. Steve Maharey says the formula for raising professional standards will centre on "increased salaries, professional development and awards for excellence". In other words, nothing will change.

That approach has led to the present crisis in teacher morale. It is time the Government and the PPTA acknowledged that, and the fundamental reason for it. Teachers may also be demoralised by having to battle what they see as an accumulated lack of respect from the Government, pupils, parents and the public. But the best of them are more aggrieved that their excellence and diligence is going unrewarded. Pay by performance would explicitly recognise their value and their important contribution to society.

Peter Nowak: At last, a bold plan for better broadband and cheaper calls

After years of ineffectively regulating telecommunications and allowing itself to be hoodwinked by Telecom, the Government has finally got it right. For consumers, its plan to break the company's monopoly is monumental, bold and far-reaching, and it should do much to erase New Zealand's international reputation as the developed world's backward country cousin.

The Government blundered in 2004 when it decided against allowing Telecom's competitors access to its network, and the country has suffered from high prices and slow broadband ever since.

Yesterday's decision rectifies that error. Not only will competitors such as TelstraClear, ihug and CallPlus be able to offer their own services and actually make a profit, prices should come down drastically thanks to the ensuing competition.

The unbundling decision will include a regulated price that will force Telecom to demonstrate the actual cost of providing internet services. Sources have indicated this could be as low as $8 a customer, but probably somewhere around $15, which means that competitors should be able to offer broadband for between $20 and $30 a month.

These won't be at the dreadfully slow speeds on offer today. The Government is also forcing Telecom to offer the fastest speeds its network is capable of handling, which has been found to be 7.6 megabits per second download - or twice what is now being sold.

Competitors will also be installing equipment capable of providing 24 megabits just as soon as the legislation comes in. New Zealand's internet is about to become a whole lot faster and cheaper, for real this time.

But the Government didn't stop there. Telecom will also be required to split its phone and broadband services from one another - a rare phenomenon known as "Naked DSL".

Broadband customers will no longer be forced to buy a phone line if they don't want one, and can instead use their mobile or a host of emerging internet-based calling services - which are either free, or practically free.

Only five other countries in the OECD have Naked DSL, but it is an emerging trend. The Government should be applauded for taking this forward-thinking and somewhat unexpected step.

The Government has also taken solid action in ensuring transparency at Telecom by demanding accounting separation, which will allow the public to see just how much money is being made off its network.

Garth George: Civil unions fuss turns out much ado about nothing

It is inevitable, I suppose, that the matter of civil unions will continue to crop up from time to time, but the manner of the latest eruption of discussion is extraordinary, to say the least.

It began a week ago today when Hugh Kempster, parson of St Columba Anglican Church in Grey Lynn, wrote a letter to this newspaper which, probably because of its oddity, was made the lead letter of the day.

In it he complained, bitterly and emotionally, that although he was both a priest and a civil union celebrant, he wasn't allowed to perform civil union ceremonies in his church.

Unsurprisingly, Mr Kempster's letter generated a gaggle of responses, mostly from others who are entitled to the honorific "Rev", and the vexed question of civil unions vis a vis the Church has once again been aired.

And so far every single one of them has missed the point.

Which is that the whole idea of having civil unions was to give people, mainly male and female homosexuals, the chance to enter into a recognised union - a marriage in all but name - in which the Church had no say or involvement.

The law was intended to give legitimacy to same-sex unions simply because no church in New Zealand will have a bar of them, even though there are persistent movements in a number of mainline denominations- Methodist, Presbyterian and Anglican in particular - towards that end.

So what on earth is an Anglican priest complaining about because he can't carry out civil union in his church? For that matter, what is an ordained priest doing being also a civil union celebrant?

It seems strange that a priest forbidden by his church to indulge in unifying same-sex couples should become a civil union celebrant and thus become entitled in the eyes of the state to do exactly what his employer has told him he cannot.

Is it any wonder that the word has come down that these ceremonies are not to be held in his church?

To read Mr Kempster's letter you would think that this is a big issue for a lot of people. It isn't.

In the first year of the Civil Union Act, a mere 460 couples - 178 male, 199 female, 81 opposite sex, plus two who changed from marriage to civil union - have availed themselves of the opportunity.

And since there are some 600 marriage celebrants in New Zealand, Mr Kempster's share must have been minuscule, even taking into account that a disproportionate number of same-sex couples probably live in Grey Lynn and its environs.

(By comparison, incidentally, there were some 22,000 marriages conducted in the first 12 months of the Civil Union Act.)

The 2001 Census recorded that there were 5070 same-sex couples living together in that year (0.6 per cent of the number in some form of couple relationship).

There will be more by now, so it appears that less than 6 per cent of same-sex couples have bothered with a civil union.

The experience in other countries which have similar law - Holland, Denmark and Belgium, for instance - is that the first year for civil unions is the big one then they taper off.

United Future MP Gordon Copeland, who has made a study of the European statistics, reckons that once our New Zealand backlog has been dealt with, we'll be looking at about 55 civil unions a year.

So much for those politicians who insisted that this law was so vital for so many people and rammed it through despite widespread public opposition.

Nor is it surprising that many civil union celebrants, who went to considerable time and expense to get "qualified", have packed it in, and that a number of websites set up to self-promote homosexual celebrants have abruptly disappeared from cyberspace.

Says Matthew Flanagan, an ethicist, moral philosopher and theologian who is spokesman for the conservative think-tank, the Locke Foundation: "I remember Tim Barnett saying that multitudes of New Zealanders were suffering a huge injustice and were being prevented from expressing the commitment they so desperately wanted to.

"They have now had the opportunity to affirm that, and they haven't."

Greg Fleming, CEO of another conservative think-tank, the Maxim Institute, says the low number of registered civil unions shows that the existing law is not meeting the needs of many New Zealanders and should be amended.

"The Civil Union Act discriminates against people in committed but non-romantic relationships who want the legal certainty of registration but not the marriage-like ceremony of a civil union," says Mr Fleming.

"Maxim Institute firmly believes that clarity around next-of-kin status is important for all people, not just romantic relationships."

He says neither the Civil Union Bill nor the Relationships Bill attended to the issues of next-of-kin status or hospital visitation rights and "there is a need for an opt-in relationship which has clear legal rights but does not mimic marriage as the civil union does, because this is inappropriate for many people".

Mike Petrus, president of the Society for Community Standards, points out that the tiny number of homosexuals who have entered into civil unions since the act was passed proves that legislators were conned by all the hype and rhetoric generated by a tiny group of vociferous homosexual activists and their supporters.

And that, judging by the genesis of the latest discussion, is still going on.

Michele Hewitson: Bad Jim, worse gymslip

Michele Hewitson: Bad Jim, worse gymslip


What a nice email I had from a lady, who is obviously not psychic, about something I wrote some time ago about some silly show on psychics and unsolved murders.

That she is not psychic is an assumption, of course, but it is based on the fact that it took her such a long time to read the aforementioned review. Surely she should have been psychically outraged as soon as the thing came out?

This is silly, but not as silly as such shows. Apparently I am a nasty horrible cow for saying such things. But perhaps I will revise my opinion of people who think they can sense creepy stuff because you will hardly believe this; I can hardly believe it - I seem to have come over all psychic myself.

Because there we were, the girls talking over coffee about Bad Girls and how glad we were the really nasty Fenner had met a nasty end at last. "He'll come back," I said.

Nah, they scoffed, not even on a show as mental as Bad Girls would they attempt that stunt. Not even in the series finale.

Well, ahem, ladies. He did. In the series finale. This was during an exorcism which, by the way, I believe in - in the same way I believe in crystal balls, shows about psychics and that anyone looks good in those long shorts worn with high heels.

Fenner came back as a ghost. Well, of course he did. There has never been anything as bad on Bad Girls as the plots. Except, perhaps, the acting.

I could also have predicted, if I hadn't been so busy putting my powers to greater uses, that Rodney Hide would be appearing in the second series of Dancing with the Stars.

I could have achieved such dizzying psychic heights by concentrating very, very, hard on a recent photograph of him.

This concentrating very, very, hard on photographs is a psychic trick. Sometimes, the really good telly psychics don't even have to turn the photograph over. No, they can feel ... stuff emanating through the photograph.

It is true that I am envious of such a trick. Think what a hit you'd be at parties.

Anyway, had I concentrated not very hard on a photo of Rodney, I might have been able to tell you that he was going to appear on Dancing with the Stars because he has lost so much weight that even his head seems to have shrunk. (Also, it was the telly world's worst-kept secret.)

This is a strange phenomenon in itself, given that to go on a show with a name which includes the word star must mean that you think a bit of yourself. Either that or your party's profile is shrinking along with your waistline.

That is not a very respectful thing to say, and no doubt somebody will write in to say I should have more respect for the living, the dead and for alleged stars.

But I can't help but say something quite rude about Top of the Class in which we are subjected to the spectacle of Louise Wallace in a gym frock.

"That's the most stupidest idea of the century, voting for Matthew Ridge," said one of the "celeb's" little buddies. No, Louise Wallace going on telly in a gym frock is one of the most stupidest ideas of the century.

Peter Lyons: Murder points to system failure

The murder of Wan Biao, whose body was found floating in a suitcase on the Waitemata Harbour, highlights New Zealand's failings in its duty of care to young overseas students studying here. Unfortunately, the attitude of many New Zealanders to the influx of overseas students over the past decade has been ambivalent and in some cases verging on inhospitable.

The huge growth in the export education market in the late 1990s led to a proliferation of education providers, some primarily concerned with profit rather than the well-being of their students. It is an industry where growth has been tumultuous and poorly managed from a national perspective.

The police officer responsible for investigating Wan Biao's death said Asian students studying in New Zealand should be wary of fellow students, particularly those who are failing or have dropped out of formal study. While this is sound advice, the industry itself should bear responsibility for ensuring that vulnerable students are provided with a greater and consistent degree of protection and support.

The pastoral support available to overseas students varies considerably depending on the institution they study at or their living arrangements.

Wan Biao's death and the anguish of his parents highlights the inadequacy of New Zealand's approach to international education.

The industry grew dramatically with the huge influx of Chinese students in the late 1990s. The development of this industry was largely self-regulated, particularly in terms of student welfare. The decline in the industry in recent years can partially be attributed to some shoddy practices with students being treated as little more than cash cows. The miserable experiences of some students in New Zealand are the worst possible form of advertising.

My first experience of the international student market was while teaching at a secondary school in the early 1990s. Like many secondary schools, it needed to generate additional revenue to subsidise inadequate government funding.

There was much variability in how different schools administered their fee-paying student programme. Some schools paid lip service to meeting the pastoral and educational needs of these students. Students were dumped into classes with little support under the guise of the benefits of immersion.

Local students resented the sudden influx. They had little awareness that the new sports facility, swimming pool or computer suite was a direct result of the large fees these foreign students were paying. They were criticised for congregating with each other and failing to make the effort to integrate with local students. There is a rich irony here that should be evident to any Kiwi who has spent time in London on their OE.

In 2001 while at the University of Otago, I was fortunate to be involved in the establishment and management of several student hostels catering primarily to Asian students. It was an immensely rewarding experience and provided a fascinating insight into the experiences of many of these students in embarking on study in a foreign country.

Many are desperately homesick when they arrive in an alien environment. It also became apparent that though the vast majority of these students were motivated and eager to succeed, a small percentage were sent here to prevent them from causing embarrassment to their families at home. It is these students who are most likely to prey on their fellow pupils.

The vulnerability of adolescents from other countries studying in New Zealand is enormous. Imagine 17- and 18-year-old New Zealanders being sent to Beijing for several years to study in a foreign land and language. It says a lot for their tenacity and work ethic that so many of these foreign students succeed and, in many instances, surpass their Kiwi counterparts. They do this in spite of the language barrier. They are also paying enormous fees for the sometimes dubious privilege of studying here.

Complaints by Kiwi students that foreign students are obsessive in their study habits are more a reflection of our own lack of appreciation of the value of education. Most are well-balanced individuals and are eager to learn more about their host country and to fit in, but are denied the opportunity because of a reluctance of locals to bridge the gap.

Unfortunately the export-education industry has become entangled with the political bunfight over immigration. There is a lack of appreciation that the exporting of education services is a major earner for this country and the benefits accrue across a wide section of New Zealand society.

The death of Wan Biao highlights a systemic failure in our approach to international education. To rely on individual institutions or accommodation providers to ensure the protection of these students is too haphazard. At the very least, all students should have access to a nationwide network of support in their own language and should be made aware on arrival that this facility is available.

* Peter Lyons is a former international hostel manager who teaches economics at Wanganui Collegiate.

David Pang: Students' safety a shared obligation

The latest "body in the suitcase" is a tragic case. The death of Wan Biao once again raises the now habitual questions concerning New Zealand's safety record for foreign students.

As expected, there is a tendency to engage in fault-finding, blaming and being defensive: Should it be up to the system, the school, the parents, or the students themselves to provide and exercise the necessary care?

Are these students adequately prepared to study in a system so different from what they are used to? Who should make the adjustments?

Make no mistake, educating students from non-traditional nations in a Western country like New Zealand does present challenges to the educational institutions and the community.

Besides coping with the normal growing up issues, young Asian students have the additional burden of confronting "culture shock" and "academic shock" in the West.

But this is not to say that the problems that they have encountered are solely due to the conflict and stress of the acculturation processes.

Asian (read Chinese) students themselves can be perpetrators of their own misfortunes. Some students come to New Zealand with pre-existing negative attitudes. Others have conducted themselves more foolishly or even wantonly in New Zealand than they would in their own country.

It is accepted that health and safety are a prime concern for Asian parents - any parents for that matter - when sending their children abroad.

It would be a mistake for anyone to suggest that the "body in the suitcase" incident is statistically insignificant because it was one of very few occurrences. The fact is that one death is really too many.

As a "service" industry, New Zealand simply cannot allow a single incident to exert a disproportionate pressure on what is otherwise a good reputation. There is a link between market share and the wellbeing of foreign students.

In recent years, several studies funded by the Ministry of Education, Education New Zealand, Asia New Zealand and research centres at universities have aimed at issues relating to foreign students. The authorities concerned have introduced a Code of Practice, International Student Homestay Guidelines, and the International Education Appeal Authority.

There is a Chinese version of a guide to living and studying in New Zealand for students.

What unites these initiatives is a recognition that providers and operators have the obligations and ethical responsibility to provide high quality support services.

With 100,000 foreign students in the country, responding to their health and security needs is a formidable task. The reality is that it is not possible to anticipate all problems that foreign students may encounter.

Managing foreign students should be regarded as an evolving process, not a fixed, one-off event and some steps can be taken towards this.

Develop an international education clearing house to compile and disseminate information about good practices concerning health, safety and other issues; strengthen international education advising and student learning centres; encourage and promote inter-agency cooperation; develop crisis management skills in a cross-cultural setting as part of professional practice; and conduct regular reviews so that the experience gained is incorporated into programmes and new initiatives are undertaken.

* David Pang has a PhD in education from the University of Auckland. He is an academic learning adviser at the university's Student Learning Centre (Epsom Campus).

Christopher Niesche: Worse could still be on the way for telco as separation threat looms

Things could get even worse for Telecom.

As the telco's stock plunges on the local sharemarket, another threat looms over the country's largest listed company.

The Government had been widely expected to force Telecom to open its network to competitors - unbundling the local loop - but the surprise lies in what it is considering next: structural separation.

This would break the company into two separate arms, one which owns the phone network and the other to sell phone and internet services. Telecom would lose control of its most valuable asset, its network.

Communications Minister David Cunliffe said the Government was studying the desirability of structural separation and this was no empty threat. Yesterday's decisive action showed that the Government has completely lost patience with Telecom.

The company's fate was sealed last year when Helen Clark attended an Apec meeting in South Korea. A demonstration of the latest communications left the Prime Minister feeling as if New Zealand were the "country cousin".

New Zealand is ranked 22nd of the 30 OECD countries in broadband uptake - South Korea is second - and if uptake doesn't improve, the Government will take further action.

If Telecom chief Theresa Gattung and her executives try to stall local loop unbundling - as Telstra has been accused of in Australia - then the Government will break the company apart.

The changes will ensure that Telecom's profits drop, and probably sharply, though it's too early to guess by how much.

Telecom now faces the challenge of trying to get its profits growing again under the new and tougher rules.

These rules should ensure that the telecommunications market in New Zealand flourishes. Telecom should embrace the change and try to get as big a slice of the larger market as it can by providing the best and most up-to-date products and services it can.

Its other option is to continue with the strategy that failed it so miserably yesterday - digging its heels and fighting any change.

If it does that, things will get worse.

Brian Fallow: Oil putting heavy pressure on Bollard

Will Alan Bollard trust us to trust him to keep the lid on inflation? As much as anything that is what will determine how long we continue to labour under a policy interest rate of 7.25 per cent, exceeded within the OECD only by Turkey and Iceland.

It's all about inflation expectations.

In his review of the official cash rate last week, the Reserve Bank Governor said the drop in the exchange rate and the rise in world oil prices would keep inflation above 3 per cent for longer than previously projected.

He would not try to counteract the one-off boost to prices from the exchange rate and oil price shocks.

"However, monetary policy must remain vigilant against these price shocks spilling over into inflation expectations and price and wage-setting behaviour."

Resisting that spillover is a bottom line for any inflation-targeting central bank.

There is a justified dread of returning to the bad old days of the wage-price spiral, the cost-plus mentality and the self-fulfilling expectation among businesses that their costs would keep rising relentlessly, so their own prices had better too.

Squeezing that mindset out of the system was a painful business. No one wants to go there again.

But how much risk of that is there, really?

True, confidence that we live in a low inflation environment is being sorely tested.

Annual consumer price inflation has been above the top of the Reserve Bank's 1 to 3 per cent target zone since the middle of last year.

In a recent Reuters survey of 10 economic forecasters all but three expect it still to be over 3 per cent at the end of this year - and two of them have it at 2.9 per cent. Indeed two forecasters expect inflation still to be outside the bank's comfort zone at the end of 2007.

Which raises the question of what it takes for the Governor to be in breach of his job description - the policy targets agreement with the Government. The problem is he is judged by an elastic tape measure. The agreement was amended in 2002 so that the target is no longer to keep inflation under 3 per cent in any 12-month period but only "on average over the medium term".

If "the medium term" is long enough, or if inflation is really low the rest of the time, then even 18 months or two years outside the zone can be arithmetically consistent with that.

And Bollard has another out: oil.

Without the increase in petrol prices, inflation would be 2.5 per cent not 3.3 per cent.

Ever since the inflation targeting regime was introduced in the late 1980s it has been clear that the bank should be allowed to disregard the direct effect on prices of supply shocks, such as a sharp rise in the international oil price.

Such a rise sucks spending power out of the economy.

First NZ Capital economist Jason Wong has calculated that if petrol and diesel prices stay where they are for the rest of the year then an extra $1.5 billion will be spent on those fuels compared with last year, and all else being equal $1.5 billion less will be available to spend on everything else.

For the bank to raise the cost of borrowing as well, in response to an oil-fuelled rise in headline inflation, would perversely compound the activity-sapping effect of the oil price hike.

So although Bollard has some explaining to do, to his board in the first instance and then the rest of us through monetary policy statements, he is unlikely to lose his job.

Don Brash, after all, spent two years at or above the top of the inflation target range, then 2 per cent, with impunity.

But there is perhaps a deeper sense in which Bollard has departed from the spirit, if not the rather fuzzy letter, of the policy targets agreement.

The charge is that he runs monetary policy in a manner more reactive than pre-emptive, basing decisions on current conditions when he should be focused on a medium-term horizon.

In theory he should focus on the likely balance of supply and demand in the economy two years ahead, since that is what he can influence through interest rate moves now.

In practice, the official cash rate tends to rise and fall closely in step with the headline inflation rate - the consumers price index (see graph above). When inflation is high, so is the policy interest rate.

This suggests the Reserve Bank is not so much looking ahead as looking sideways.

What might account for this is a preoccupation with inflation expectations and the need to keep them "anchored".

Some recently published research by senior Reserve Bank economist Bernard Hodgetts on the way the inflation process has changed notes that inflation expectations two years ahead have remained relatively stable over the recent economic cycle. They did not for example jump in response to the steep drop in the exchange rate in 2000, as the bank might have feared.

This makes the bank's task much easier.

"However we have been extremely wary of simply assuming that inflation expectations are 'anchored' and taking policy risks based on that assumption," Hodgetts wrote.

Bollard's warning to wage-setters last week is also somewhat at odds with the bank's own research, which suggests that the days when wage rises drove inflation are long gone.

While wages led prices in the 1980s, the relationship reversed in the 1990s, with wage movements tending to scamper along behind inflation, struggling to keep up.

Adjusted for productivity, wage settlements were often lower than inflation over much of the past 10 years, and rarely exceeded significantly, Hodgetts said.

But again the bank seems reluctant to trust this conclusion: "Helpful as this has been ... we have remained wary of the potential for wage inflation to reassert itself as a direct driver of inflation."

Which begs the question: why would Bollard expect business people setting prices to be any less wary than he is?

Bank of New Zealand economist Craig Ebert says that when firms ask him and his colleagues what inflation they should be budgeting for, "The academic reply is that we should all trust the Reserve Bank when it says don't worry, inflationary pressures will be drifting back down again before too long. But we can understand the disbelief of companies, employees and savers alike already burned as inflation has risen above the 1 to 3 per cent target band."

Businesses are dealing with real inflation pressure and their expectations inevitably reflect this, Ebert says.

Their inflation expectations right now, as recorded in the National Bank's monthly business outlook, average 3.07 per cent.

It is still above the top of the Reserve Bank's target band, of course.

But historically those expectations are closely aligned with actual inflation at the time or in the previous quarter - and no guide at all to inflation a year to two ahead.

Both Bollard and the companies themselves can take comfort in that.

Talkback: A plan to avoid fear and loathing

By Robert Bree

Given the option of accompanying an axe-murderer on a camping trip or running the annual marketing plan "summit", just about everyone I know would start shopping for those little strap-on head-mounted torches.

No-one doubts the importance of the marketing plan, so why do we loathe doing it so much and, more importantly, how can we make the whole exercise more rewarding, painless and efficient for everyone involved?

Attitude is very important. If senior management present the plan requirement as a burden, then so will the marketers. I personally recommend treating it as a great creative opportunity to bring the wider team together on a regular basis to objectively evaluate how we're doing, discuss our problems, opportunities and aspirations, agree on our goals and "create" strategy - i.e. awesome brand marketing.

One problem I frequently observe is the "popular" burden of form filling. Every multinational and increasingly more of our local companies are becoming obsessed with planning templates, standard operating procedures and global uniformity of planning systems. So let's get real. A marketing plan is simply an assessment of our market and brands, pending market opportunities, and current company or brand performance married to an assessment of our intended future capabilities. Once agreed, we then compile a set of activities that will result in improved appeal, activation, penetration and adhesion of our brands.

I recommend a four-step process from where we are now to where we plan to be:

* Current situation analysis/brand review leading into key issues by market, segment and brand;

* Overview of growth opportunities including assessment of various best-case/worst-case market scenarios;

* Confirmation of strategic/brand priorities including objectives, brand strategy, customer plans and financial forecasts (including any capital investments);

* Key programmes/tasks including tactics, timeframes, budgets: what we'll do, how we'll do it, what it will cost.

Do it in stages, maybe spreading those four meetings or steps over four months. Using this approach you can test your team's thinking at each step and agree on key decisions before moving on.

At this rate, you should be able to reduce pressure and still complete the plan by the end of the third quarter.

Start your planning around five months into the financial year with a business or brand review. For the brand review I recommend you pull last year's plan out of the drawer and take a day out reviewing the predictions you made, performance vs the targets you set, progress on any key initiatives identified.

Get your wider team involved at the relevant points. Not only the agency, but your research partners, your sales managers, maybe even one or two of your key accounts.

Treat the plan as a team effort, that way everyone will feel committed to it and its results.

Finally, put someone in charge. Alternatively, check out those strap-on head-mounted torch dooberees. Pronto!

* Robert Bree of Viso Cognito is a growth solutions consultant. You can contact him at