All Episodes

May 22, 2025 • 11 mins

Tonight on The Huddle, CTU economist Craig Renney and Phil O'Reilly from Iron Duke Partners joined in on a discussion about the following issues of the day - and more!  

The 2025 Budget was unveiled today - what did we think of it? 

Do we agree cutting down Government KiwiSaver contributions was the right move?

LISTEN ABOVE

See omnystudio.com/listener for privacy information.

Mark as Played
Transcript

Episode Transcript

Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Speaker 1 (00:00):
Now, by the way, I was confused earlier with Nikola
about why the Prime Minister is calling Chippy bow Jangles.
And I've had our text from the highest levels of government.
I don't want to say who, but the highest levels
of government to try to clarify it. And it's bo
Jandals bo jandals because he's flip flopping. That's what the
Prime Minister said in parliament. Here it is and of course,

(00:21):
mister speaker, the worst thing of all is the constant
flip flopping from the man that I call mister bo Jandals,
mister bo jendles on the huddle of me this evening,
Craig re Any of the Sea to you and Philo
Riley of Iron Duke Partners, and Craig, you had your hands,
your head in your hands. This is just too lame

(00:42):
for you.

Speaker 2 (00:42):
Yeah, it's not really the kind of high level discourse
that we'd helped to find in post.

Speaker 1 (00:46):
Well, listen, when you get into Parliament, I'm gonna hold you.
I'm going to hold this as your standard and if
you do lame dad jokes, We're gonna put do same
thing to you. Okay, deal, I love it. What did
you think phil of the budget is.

Speaker 3 (00:58):
She business us. You on use the word credible, and
that's my old almal matters, you know. And I thought
there was actually a pretty good, pretty good description of
that to thread the needle between fiscal consolidation, start to
get that debt being paid down all that's going to
be a year or two away, and at the same
time stay true to their growth agender. I think they
did a reasonable job of that. There will be some complaints,
but certainly I think business people would be.

Speaker 1 (01:17):
Prety supportedl I think that tax incentive thing is enough
for growth.

Speaker 3 (01:20):
Yeah, it's actually quite good because it's not just the
challenge with a depreciation just on capital is if you
only put the depreciation on things you can hit a
handle with, like a machine or a car or a
truck or whatever, that misses out quite a bit of
the economy. Now, so the fact that they're also doing
it on software and it and stuff, that that really
makes the difference.

Speaker 1 (01:38):
Well, I mean, you talk about growth, what she said,
half of it is super charged in the first five years,
so that means we get point five percent of growth
over five years. So it's point one point one point
that's nothing.

Speaker 3 (01:47):
But it is it'll actually help build confidence that people
can investment. I was just thinking, I was just talking
to my staff today, what can we now buy? You know,
because what's going on. All these policies have an impact
on it for a short time because eventually starts to
become just what we do around here. So what if
I was a sensible government, you'd had that, you'd have
it for four or five years, and then you change it,
you do something else.

Speaker 1 (02:06):
Only reason I'm picking it this is because Trump and
Rishie Sunk both went one hundred percent time limited apparently right.
So it just caused everybody to feel like they had
to invest immediately while their option was open for that
financial year, and they really got significant growth.

Speaker 3 (02:19):
Yeah, you'll also get pointless growth. Someone on want of
it is just because they can get one hundred percent back.
So you want you want to incentivize growth, but you
want to make that a logical pathway so that I
just don't go and buy five new computers because that's pointless.
That's not productivity growth. That's that's actually a very fair point.

Speaker 2 (02:32):
We saw during COVID there was a very similar type
of project in order to encourage business confidence. What you
saw was businesses bringing forward investment that would have happened
anywhere just simply to get ahold of the tax benefit.
So if you if you allow it over a longer period,
but it actually does that. The challenge I have is
whether or not it's really going to shift the needle.
As you see in terms of our productivity and our

(02:53):
growth problems, it's quite small levels of change. Yes, it's
an encouraging sign. We want to see more in investment
in plant and equipment and productivity, but that also means
more investment in skills. Yeah, it also means more investment,
you know, in the population. And we've just increased tuition
fees by six percent. We've just made a bunch of
other changes that have made it slightly harder to get

(03:14):
into education. And so that's the challenge is to get
all those settings right at the same time.

Speaker 3 (03:18):
And they didn't induce much in science, for example, which
is another one. There was actually nothing just paying for
CALA and changes and so on. So no real new investment.
So hopefully that's next year. Hopefully. But yeah, I mean
it's a use for what I'm not criticising, it's usefuy for.
It's bigger than I would have expected, but to Christ's point,
that could be more and I hope they do.

Speaker 1 (03:35):
OK. And what do you think of the bout the Crist?

Speaker 2 (03:37):
Well, obviously from the ctu's perspective, our big concern was
the taking of the pay equity money. You know, there's
twelve point eight billion dollars being taken from that constant,
from that contingency. You know that that works out at
about three hundred and sixty thousand dollars a day or
six thousand dollars essentially at how being taken from those workers.
We wanted to see that if it was going to

(03:57):
be taken, then expensed in things that would make a
real difference to the affected workforces. Instead, we didn't see that.
We saw benefits being taken from eighteen nineteen year olds. Fine,
but there's no clarity as to what parental levels of
responsibility look like. It looks like decisions are yet to
be made.

Speaker 1 (04:15):
Yes, that was weird. I thought that was weird. Did
you not think that was It was very strange to
have made. Can you go and announce that you're going
to take the doll off eighteen and nineteen year olds
and it's going to say you what was it? One
hundred and sixty three million dollars a year or be
four years. Sorry, but then you don't know quite how
the package wire.

Speaker 2 (04:29):
And from a technical perspective, in order to be able
to forecast the saving, you need to be able to
know how many people are not going to receive that benefit.

Speaker 1 (04:37):
Yes, now, Craig, you've worked on badgets, right, So what
happened here? Let's just make this up at the last minute.

Speaker 2 (04:42):
Honest answer is I don't know. My guess is that
they've made an assumption about the number of people who
won't be receiving that benefit, but they've yet to make
final decisions.

Speaker 1 (04:51):
But why would you not have made final decisions? Quest
somebody genuine don't know, genuinely don't know.

Speaker 2 (04:57):
My guess is that the politics of that is that
there's working out exactly how they're going to do that
and how they're going to communicate it, and they probably
didn't want that to be a side show when they
were making the decisions today.

Speaker 3 (05:09):
Yeah, Now, what's a bit with lots of governments that
where you make a bit of a budget statement. It's
a bit of hooplar and clouds.

Speaker 1 (05:15):
He had the time to finish it is that what
it is.

Speaker 3 (05:18):
Well, it's also because it is a bit complicated to
try and work it out, and you're also working with
a set of officials with incomplete data and trying to
shift a big ship around to say what would this mean.
I mean, amst's got a lot on so it's I
think it's a forgivable thing, and it will hold them
to account if it's utterly wrong.

Speaker 1 (05:33):
Of course.

Speaker 2 (05:33):
The other thing is that there were a number of
other savings and changes in sad MSD, you know, the
welfare systems, and these are complicated systems that work together,
and so you need to make all these You should
make all these decisions at once so you can work
out what's really happening. As Phil said, tame will tell
whether or not we actually see some real unintended consequences
of that decision.

Speaker 1 (05:51):
Yeah, all right, we'll take a break. I want to
talk to you about key. We save an exit. Right
it back with the huddle, Craig, Grinnie and Phil O'Reilly. Craig,
what did you make of the key We say changes.
I reckon they don't go far to cap them for everybody.

Speaker 2 (06:02):
The concern I have for the qisaver stuff is that
it really impacts low income New Zealanders. Einstein famously said
the most powerful force in the universe wasn't gravity, it
was compound interest, And even small amounts of change for
low income groups can make a real difference to the
amount that they get to save over time. The extension
to seventeen sixteen seventeen year olds, that's good, but the

(06:24):
challenge we have is that even small changes make big differences,
and we end up paying for it anyway later on,
because we pay for it, either through additional support or
housing support or other things.

Speaker 1 (06:33):
But the thing about it is we are actually giving
these people the pension right. We're all going to get
the paintient hopefully whenever we hit sixty five, so we
basically we're double subsidizing this now.

Speaker 2 (06:44):
But the more we can make savings now, the more
that we can encourage a culture of saving now, the
more sustainable the pension system will be in the future,
and importantly, the deeper the capital we'll have in New
Zealand to support businesses to support other investments. You only
need to go to Australia, where they've got enormous pension
industries and they've got great public transport and how much how.

Speaker 1 (07:04):
Much government contribution is there in Australia.

Speaker 2 (07:06):
So there's there's a government contribution to employers pay twelve
percent overall. If you want to move to a system
where in New Zealand where employers are paying twelve percent,
I'm thoroughly behind you, and they don't pay anything at all.
But in terms of the but also we only have
a three percent currently rising to four percent of a
time employer contributions, so they can offset that on that site.

(07:31):
But in terms of New Zealand where even those small
changes I worry for low income groups. For other income groups,
I think you know it makes pretty marginal differences, but
for low income workers it really does make a difference.

Speaker 3 (07:42):
In Australia, you get lots of text benefits by the way,
so that's the way the Australian government leans into it. Well,
I'm interested by the fact I agree with the means
testing of it. How goodly you could have taken it
all away, but by by Craig's point, for the time being,
at least until the til the overall till those co
payments come up a bit, so I think they've probably
got there outright. If you'd asked me this question ten

(08:03):
years ago, would employers support gone from three to four?
I would have said no when I was a business
New Zealand. Right now, actually you didn't see any comment
from them today actually because the employers now kind of
buy it. They've seen the benefit of it. They really
like the fact that they can have a conversation with
the new people about that. They feel as though they're
helping provide. So I actually think employers will support four

(08:23):
and four, and I think they'll actually support more than
that over time if it's well signals. So actually, I
think the whole debate is changing. Where we've still got
it wrong is not means testing national super But that's
a debate that we'll have to have some of the
big Right, I can be so old because I don't
have to worry about that, because I'm old enough to
get it with that worry about. But I think we
do have to have a conversation about rebalancing that whole issue.
And I think we've just started to do that today

(08:45):
because we've unfrozen kiwisaver as a public policy debate. And
if I was the finance and super sector, I'd be
now saying, well, what else can we do about super?

Speaker 1 (08:54):
The one thing.

Speaker 2 (08:55):
I really want to as I support you in that
because I think you if businesses are going to invest more,
that's fantastic. There is a loophole in the current proposals
which does have my concern, which is that an employee
can choose he says with air quotes to go back
to three percent, and if they do, their employer gets.

Speaker 1 (09:11):
To go back to that. Do you think they'll be pressure.

Speaker 2 (09:13):
I think you'll see a lot of contracts pre written
seeing I agree to only go to three percent and
as a consequence, the employer only gets to go to
three percent.

Speaker 3 (09:22):
Yeah, I actually make that compulsory. I actually said that
the employers. It's for For the first time it's voluntary,
but a year after that it's compulsory. I actually do
that because, as I say, I think the employment now
employers will abuse me all night, no doubt, but I
actually think employers are up for this. And when I
talk to them, they see the Australian situation and they
see exactly what Craig's talking about this and vispent an
infrastructure that comes from the stuff and that and the

(09:43):
kind of the national security and feeling of well being
that comes from it. So I think they're up for it,
and I think we shall push it.

Speaker 2 (09:48):
Hit because one of the things we really need to
do in news in with our key receaver scheme is
eighty percent of our key receiver funds are actually invested overseas.
Oh yeah, And one of the things we should be
looking at is if funds are going to become more mandatory,
if there's going to be more it in, how can
we make sure more of that is being invested in
New Zealand, so where benefiting from that growth and helping
having a vistable proposition.

Speaker 1 (10:08):
You have agreed so much with each other that I
think feel that when Craig becomes an MP, you should
become his electrity, just as a side housele I might
even for little I mean, would you know, okay, very quickly,
because I've only got about a minutely, welcome you to this.
He's getting the labors. I haven't got very long. So

(10:31):
just give me your stupid little names for the budget please, Craig.

Speaker 2 (10:33):
You first, the reverse robin Hood budget. It's taking from
the taking from the poor and giving to the rich.

Speaker 1 (10:39):
Well, the rich is not feeling it because the rich
just got their key. We save and contributions cut off.

Speaker 3 (10:43):
I think it's treading the needle. I think they've done
a good job of trying to thread that needle between
growth and consolidation. So good for them.

Speaker 1 (10:49):
Thank you both, really appreciate it. I'm enjoying this marriage,
this political marriage, exceptin right now. Craig Renny the CTO
and Fillo Raleyvine Duke partners. For more from Hither Duplessy
Alan Drive, Listen live to news talks it'd be from
four pm weekdays, or follow the podcast on iHeartRadio.
Advertise With Us

Popular Podcasts

Stuff You Should Know
Amy Robach & T.J. Holmes present: Aubrey O’Day, Covering the Diddy Trial

Amy Robach & T.J. Holmes present: Aubrey O’Day, Covering the Diddy Trial

Introducing… Aubrey O’Day Diddy’s former protege, television personality, platinum selling music artist, Danity Kane alum Aubrey O’Day joins veteran journalists Amy Robach and TJ Holmes to provide a unique perspective on the trial that has captivated the attention of the nation. Join them throughout the trial as they discuss, debate, and dissect every detail, every aspect of the proceedings. Aubrey will offer her opinions and expertise, as only she is qualified to do given her first-hand knowledge. From her days on Making the Band, as she emerged as the breakout star, the truth of the situation would be the opposite of the glitz and glamour. Listen throughout every minute of the trial, for this exclusive coverage. Amy Robach and TJ Holmes present Aubrey O’Day, Covering the Diddy Trial, an iHeartRadio podcast.

Good Hang with Amy Poehler

Good Hang with Amy Poehler

Come hang with Amy Poehler. Each week on her podcast, she'll welcome celebrities and fun people to her studio. They'll share stories about their careers, mutual friends, shared enthusiasms, and most importantly, what's been making them laugh. This podcast is not about trying to make you better or giving advice. Amy just wants to have a good time.

Music, radio and podcasts, all free. Listen online or download the iHeart App.

Connect

© 2025 iHeartMedia, Inc.