August 13, 2024 • 5 mins
- Big news in energy markets this week with many of nzs largest industrial cutting back production
- Changes to welfare rules announced on Monday
- Lots of discussion about whether the Reserve Bank will cut interest rates next week
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Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Speaker 1 (00:00):
This is the Country Sport Breakfast with Brian Kelly on
Gold Sport. I know what you're trying to say.
Speaker 2 (00:08):
You're trying to say, Oh yeah, is business?
Speaker 3 (00:13):
Is business?
Speaker 1 (00:20):
Business of what you're trying to say, you're trying to
say business.
Speaker 2 (00:25):
Times home to catch up and talk business with Phil
O'Reilly from Undrew Partners, who's been around the world in
about eighty days, probably less than that morning.
Speaker 1 (00:38):
Phil, bit of travel, but they can use your firs
stretch Now. It's great.
Speaker 3 (00:43):
Well, there's a lot going on in our country, so
first off today, let's talk about that big news and
energy markets this week with many of New Zealand's largest
industries cutting back production now, lots of impact on the
primary sector here. What should government do about it?
Speaker 1 (00:57):
He had an extraordinary situation I think last week Ryan,
where for one or two days in New Zealand had
the highest energy prices in the world. I mean, that's
just extraordinary, isn't it. When you think about when you
and I were kids at school, we were told that
one of New Zealand's being advantages was cheap power because
we were all investing in hydro and all you know
what got us here, and we're going to all argue,
(01:18):
and I'll argue some of the last government's policies got
us here in terms of banning and guess exploration. But
we are where we are, and you've got now you've
got really large producers sawmills, methodics now and a number
of other major industrials all in rural and regional New
Zealand on the whole, and they are they're going to
cut back production or they're going to close plants for
(01:39):
a little while, and you've got to worry that's going
to cause potentially permanent closures. Now I work with a
few of these businesses just to full disclosure, and this
is existential for some of them, and it's really sad
that we've got to this point. And what are we
going to do about it? Well, you know, I think
essentially there you could argue the energy market needs some reform.
I think that's probably right, but that'll take you a while.
(02:01):
You could argue you could import gas because it's availability
of gas. It's a real issue. You could do that,
it's going to take a while. So what a mindset
government does need? A Vico Skuy, I'm off for free
enterprise and for markets to work, but clearly markets aren't
working when we've got these kinds of energy prices causing
closure amongst major sawmills and all the rest. So I
think it is inevitable government's going to have to step
(02:22):
in and do something here to reduce power prices in
the meantime, and hopefully that I'll have a not on
impact of course to mums and dads. But boy, it's
just causing carnage amongst the major manufacturers, and that really
impacts rural communities right now and causes job losses in
those rural and regional areas of New Zealand. So I
think we need to do something pretty quickly about it.
Speaker 3 (02:40):
Yeah, well, I think everybody would agree with you. There.
Changes to welfare rules announced on Monday include more penalties
for those who don't comply with the rules. So what
will employers make of all of this?
Speaker 1 (02:51):
Yeah, it's an interesting thing that I've done a lot
of work in welfare over the years, and obviously those
changes made by government on Monday. Course, a lot of
whopl are among to the left hand the right, of course,
the NAT's trumpeted all these new penalties and so on
because that plays to their base and labor and the
Green said this was cruelty playing to their base. Of course.
In fact, the reality, of course is somewhere in between.
(03:13):
You always want welfare restrictions and kind of sanctions to
sanction the person who's breaking the rules rather than their family.
And I think the government got that right in terms
of saying you'll still get your money, you just can't
spend on anything other than food and death and so on,
whijestly protects the kids and the family. So I think
they've got that rights. But employers, of course need to
employ these people. And one of the things I think
(03:34):
the government needs to concentrate more on is what are
they doing about making sure that those people sitting out
on the doll right now maybe getting an unemployment benefit
when the economy does start picking up and they might
be able to get a job. Employers just don't want
any old person to turn up. They want a job
ready person who's got a bit of skill and capable
of and a bit of attitude who might want a job.
(03:54):
And I think the announcements to the government's made fine
in terms of sanctions and so on. A bit of
community further announcements would be helpful. I think about how
we're going to make sure these people are work ready,
how we make how they how they might actually be
interested in the job that might be offered to them,
and how they might remain sticky in the jobs, and
no one's interest for them to get a job and
then spin back out to welfare because they didn't like it.
(04:15):
So I think a bit more work to be done
about joining up what's going on in the welfare system
with the world of work.
Speaker 3 (04:22):
We kind of watched the space, I think with that one,
and for lots of discussion about whether the Reserve Bank
will cut its interest rates next week. What are your
thoughts on that.
Speaker 1 (04:32):
Yeah, I think there'll be you know, we'll be able
to all of it this next week as well, of course,
as as those decisions might be made. But you know,
I think I was holding out for an interest rate
reduction next week. I think we'll be waiting for a while.
I don't think the Reserve Bank will do that. I
think they'll be waiting for at least a little the while.
You know, I'm still picking two reductions in the fourth quarter.
I think we will have reditions by Christmas, no question. Now,
(04:53):
it was a Reserve bank right to do that arguably
they should be cutting one now because anybody out there
in the real economy right now knows there's absolutely on
its knees right now, worst economic times i've seen for
well over a decade out there in the real economy
right now. So there's an argument that the RB should be
doing it, But I don't think they're going to. I
think they're going to hold the course. I think they're
going to hold their nose, and I think we're gonna
(05:15):
have to wait till October.
Speaker 3 (05:16):
All right, Phil, Hey, great to catch up mate, Good
to have your home, Have a great week, and we'll
catch up again next week.
Speaker 1 (05:21):
Thanks Bekay, Hello.
Speaker 3 (05:22):
Riley joining us here out of Iron Duke Partners will
know about those numbers today, I think this afternoon, fourteen
past eight here on gold Sport The Country Sport Breakfast
This is the Country Sport Breakfast with Brian Kelly on
Gold Sport. I know what you're trying to say.
Speaker 2 (00:08):
You're trying to say, Oh yeah, is business?
Speaker 3 (00:13):
Is business?
Speaker 1 (00:20):
Business of what you're trying to say, you're trying to
say business.
Speaker 2 (00:25):
Times home to catch up and talk business with Phil
O'Reilly from Undrew Partners, who's been around the world in
about eighty days, probably less than that morning.
Speaker 1 (00:38):
Phil, bit of travel, but they can use your firs
stretch Now. It's great.
Speaker 3 (00:43):
Well, there's a lot going on in our country, so
first off today, let's talk about that big news and
energy markets this week with many of New Zealand's largest
industries cutting back production now, lots of impact on the
primary sector here. What should government do about it?
Speaker 1 (00:57):
He had an extraordinary situation I think last week Ryan,
where for one or two days in New Zealand had
the highest energy prices in the world. I mean, that's
just extraordinary, isn't it. When you think about when you
and I were kids at school, we were told that
one of New Zealand's being advantages was cheap power because
we were all investing in hydro and all you know
what got us here, and we're going to all argue,
(01:18):
and I'll argue some of the last government's policies got
us here in terms of banning and guess exploration. But
we are where we are, and you've got now you've
got really large producers sawmills, methodics now and a number
of other major industrials all in rural and regional New
Zealand on the whole, and they are they're going to
cut back production or they're going to close plants for
(01:39):
a little while, and you've got to worry that's going
to cause potentially permanent closures. Now I work with a
few of these businesses just to full disclosure, and this
is existential for some of them, and it's really sad
that we've got to this point. And what are we
going to do about it? Well, you know, I think
essentially there you could argue the energy market needs some reform.
I think that's probably right, but that'll take you a while.
(02:01):
You could argue you could import gas because it's availability
of gas. It's a real issue. You could do that,
it's going to take a while. So what a mindset
government does need? A Vico Skuy, I'm off for free
enterprise and for markets to work, but clearly markets aren't
working when we've got these kinds of energy prices causing
closure amongst major sawmills and all the rest. So I
think it is inevitable government's going to have to step
(02:22):
in and do something here to reduce power prices in
the meantime, and hopefully that I'll have a not on
impact of course to mums and dads. But boy, it's
just causing carnage amongst the major manufacturers, and that really
impacts rural communities right now and causes job losses in
those rural and regional areas of New Zealand. So I
think we need to do something pretty quickly about it.
Speaker 3 (02:40):
Yeah, well, I think everybody would agree with you. There.
Changes to welfare rules announced on Monday include more penalties
for those who don't comply with the rules. So what
will employers make of all of this?
Speaker 1 (02:51):
Yeah, it's an interesting thing that I've done a lot
of work in welfare over the years, and obviously those
changes made by government on Monday. Course, a lot of
whopl are among to the left hand the right, of course,
the NAT's trumpeted all these new penalties and so on
because that plays to their base and labor and the
Green said this was cruelty playing to their base. Of course.
In fact, the reality, of course is somewhere in between.
(03:13):
You always want welfare restrictions and kind of sanctions to
sanction the person who's breaking the rules rather than their family.
And I think the government got that right in terms
of saying you'll still get your money, you just can't
spend on anything other than food and death and so on,
whijestly protects the kids and the family. So I think
they've got that rights. But employers, of course need to
employ these people. And one of the things I think
(03:34):
the government needs to concentrate more on is what are
they doing about making sure that those people sitting out
on the doll right now maybe getting an unemployment benefit
when the economy does start picking up and they might
be able to get a job. Employers just don't want
any old person to turn up. They want a job
ready person who's got a bit of skill and capable
of and a bit of attitude who might want a job.
(03:54):
And I think the announcements to the government's made fine
in terms of sanctions and so on. A bit of
community further announcements would be helpful. I think about how
we're going to make sure these people are work ready,
how we make how they how they might actually be
interested in the job that might be offered to them,
and how they might remain sticky in the jobs, and
no one's interest for them to get a job and
then spin back out to welfare because they didn't like it.
(04:15):
So I think a bit more work to be done
about joining up what's going on in the welfare system
with the world of work.
Speaker 3 (04:22):
We kind of watched the space, I think with that one,
and for lots of discussion about whether the Reserve Bank
will cut its interest rates next week. What are your
thoughts on that.
Speaker 1 (04:32):
Yeah, I think there'll be you know, we'll be able
to all of it this next week as well, of course,
as as those decisions might be made. But you know,
I think I was holding out for an interest rate
reduction next week. I think we'll be waiting for a while.
I don't think the Reserve Bank will do that. I
think they'll be waiting for at least a little the while.
You know, I'm still picking two reductions in the fourth quarter.
I think we will have reditions by Christmas, no question. Now,
(04:53):
it was a Reserve bank right to do that arguably
they should be cutting one now because anybody out there
in the real economy right now knows there's absolutely on
its knees right now, worst economic times i've seen for
well over a decade out there in the real economy
right now. So there's an argument that the RB should be
doing it, But I don't think they're going to. I
think they're going to hold the course. I think they're
going to hold their nose, and I think we're gonna
(05:15):
have to wait till October.
Speaker 3 (05:16):
All right, Phil, Hey, great to catch up mate, Good
to have your home, Have a great week, and we'll
catch up again next week.
Speaker 1 (05:21):
Thanks Bekay, Hello.
Speaker 3 (05:22):
Riley joining us here out of Iron Duke Partners will
know about those numbers today, I think this afternoon, fourteen
past eight here on gold Sport The Country Sport Breakfast
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