As its future hangs in the balance a veteran EU trouble shooter weighs up the Union, past and present. Five questions now for Michael Lake.........
This email address is being protected from spambots. You need JavaScript enabled to view it.Few officials have been involved in the EU at such a high level for so long and in so many sensitive postings as New Zealand-born Michael Lake, former EU ambassador to Turkey and to Hungary. Along the way he served also in New York, Brussels, and Tokyo. He was witness to the EU and participant in its operations from the outset of Britain’s membership when he was literally drafted in to assist the UK blend itself into European institutions.
Looking back between the 1975 referendum, the one which saw the UK joining the EU, and now Brexit, what went right? What went wrong?
What went right? Where do I start? Seventy years of peace, democracy and stability in western Europe after France and Germany had been at war with each other three times during the previous 70 years, usually dragging others into their fighting, notably Britain twice. Also the achievement of common policies which run more or less successfully today on international trade and remember that the EU is the world’s biggest trading bloc by far. It has acted in agriculture (sometimes too protectionist), and over the years in several other areas where it is more effective to act together than alone such as in climate change and the environment generally, energy policy, consumer rights, social policy especially in workers’ rights, and in the 35 chapters of the body of EU law.
There is the single market of 500 million consumers, which Mrs Theresa May seems to want Britain to leave. There is expansion of the EU to 28 members (soon to be 27) by including those countries recently released from 40-50 years of Soviet rule. Then there is the EU’s status as a community of law.
What went wrong? Time and forgetfulness, and younger generations decade by decade who have taken it for granted and are unaware of its benefits. Too much regulation, certainly. Although what happened was that the EU regulations replaced national regulations in order to make a level playing field for trade. So the aggregate of regulations in this area has not changed much. A newish one is that such regulations forbid state aid for industries. State aid is a subsidy and thus unfair. It’s like doping. It is allowed in special circumstances such as in restructuring major basic industries like steel and coal which are now almost irrelevant anyway, but which require concomitant efficiencies, such as down-sizing and major investment.
Generally speaking, the EU has always had trouble communicating with the public, largely because it can be highly technical and very diverse, and because national media tend to concentrate on national stories, thus undermining the more general overview of Europe working on a daily basis. Britain is particularly bad at this and over 40 years the coverage has been on a win/lose basis. In fact Britain has won most of its disputes by far, whether they actually got to the European Court of Justice or not.
The European Parliament which has a far closer hands-on role in governance on EU matters than ordinary British MPs have on British affairs is nevertheless remote from ordinary people partly because constituencies are too big and the media coverage has always been scant. But the European Parliament has the power of co-decision on most things with the Council of (national) Ministers. It can vote against and thus wreck a Brexit deal with the UK.
You became the European Union’s ambassador to Turkey and as such point man for a policy to integrate Turkey into the EU. In the light of developments over the past year, how do you view this policy now?
I was EU ambassador in Turkey and then, as you know, in Hungary. Here I was locally in charge of monitoring Hungary’s “accession” or membership process covering the 35 chapters I referred to in your previous question.
I was also closely involved earlier with Turkey joining the EU customs union, the only country to be in the customs union without full membership. This had a huge effect in Turkey such as when. the first department stores opened, and the expansion of trade offered consumers better quality at more competitive prices. Turkey relies on the EU market for more than 50% of its exports. Turkey no longer qualifies for membership and would be blocked because of its moving away from the pillars of democracy such as freedom of expression, a free media, and an independent judiciary.
It still does meet the requirement for pluralistic elections. Erdogan is now in charge of a bitterly divided country which is not what he intended. He expected to win by 60 per cent. Turkey’s candidacy for membership has not yet been revoked. But if Erdogan goes ahead and reintroduces the death penalty it would be revoked by the EU. This would be highly unpopular amid large swathes of the Turkish population who are pro-EU and highly sophisticated.
The recent referendum was so close as to create a new situation - Erdogan not only lost in his home city, Istanbul, but in his own constituency, Fatih, which is very conservative and rife with burkhas. Watch this space...Meanwhile it’s a tragedy, but in spite of Erdogan’s dictatorial rule the country remains a very important member of Nato and largely western values on the edge of a region in turmoil. There is no appetite to cut Turkey off.
Many believe that the United States was behind the expansion of the EU. To what extent was/is this true?The United States has always, and now, even under a revised Trump II, been strongly in favour of the EU for the democratic and economic values it represents. The EU and the US are each other’s biggest trading partner. I have never heard of the US specifically interfering in EU policies except once which happened to be in my own case. This was when the US ambassador in Turkey came to me and said that the White House wanted to know how they could help get the fractious European Parliament to endorse Turkey’s membership of the customs union?
I told him how this could in fact be done. He followed my advice. Tony Blair and ( Spain’s premier) Felipe Gonzales personally gave instructions to their delegations which comprised the biggest political group in the European Parliament and the deed was done.
There was, however, a case where the US may have taken a discreet lead and must indeed have agreed. At the G-7 summit in Paris in 1988, which I attended along with the seven other G7 summits in which I participated, the EU for the first time ever was given a role in eastern Europe and thus the Soviet bloc which hitherto had been the sole policy preserve of Nato
As Poland and Hungary, and indeed even East Germany, were showing signs of relaxing under the Soviet governance of Gorbachev there was a role for the EU in economic and social development (including more openness) of the bloc. The US strongly supported the enlargement of the EU from 15 to 27 in 2005 for strategic reasons. We have to remember too that the US has many, many citizens whose families hail from central and eastern Europe.
How do you gauge the success or otherwise of the Euro currency?The adoption of the Euro has been a boon to ease transactions without exchange rate costs across most of Europe. Anyone travelling on the Continent or involved in cross-border trading, whether in goods or finance, realises this immediately. But the system lacks a unifying authority, such as a Federal Reserve Bank, able to take decisions and able to issue eurobonds. The issue of a federal Europe is still controversial, but there is still widespread reluctance to go further towards further union that the EU has done with the Treaty of Lisbon. So when the banking crisis hit the world in 2008 the euro system was unable to cope properly because it was still subject to a national decisions. The European Central Bank has coped by effectively printing money but this is ultimately not sustainable. This instability in the euro zone remains. And it has exacerbated a prosperity gap between the richer northern Europe and the poorer southern, Mediterranean countries
If you were asked for advice on the EU by anyone in the New Zealand diplomatic-trade sphere, what counsel would you proffer?Quite simply I would say this. Take any opportunity at all seriously and go for it. The EU should be seen as the land of opportunity from a national point of view and on an individual level, a career-enhancing prospect.
| From the MSCNewsWire reporters' desk || Tuesday 25 April 2017 |||
President of UK Football Foundation now takes Five Questions.....
Lord Pendry is familiar in New Zealand within sporting circles. He retains too a constant guardian-angel like role over the nation, most recently when in the House of Lords he challenged the Government over the need to control the validity of labelling for Manuka honey. He was for many years the Labour Member of Parliament for Stalybridge and Hyde. In 2000, he was appointed member of the Privy Council on the recommendation of Tony Blair. After the 2001 election he was elevated to the peerage as Baron Pendry of Stalybridge. An institution within the English speaking realm’s greatest institution, the Palace of Westminster, boxing buff Lord Pendry (above) has just seen published his autobiography, Taking It On The Chin (see below).
You began your career as an engineer. How important is a manufacturing-production base for a developed economy such as Britain’s or New Zealand’s for that matter?Although the service industries are increasingly the norm in Britain, manufacturing continues apace; the UK is currently the world's ninth largest industrial nation. I think it is important that the Government does more to support UK manufacturing industries despite fierce competition from other countries. The recent crisis with steel production in South Wales is a case in point.
As a British Member of Parliament you knew the Blair family, from Tony’s father-in-law, who lived in your constituency, and you were widely credited with opening the path to Westminster for Tony. His legacy?Yes, I introduced Tony Blair into mainstream parliamentary politics in 1982 when, following my introduction, he unsuccessfully fought a by-election before gaining a safe seat in the North East constituency of Sedgefield. In my view, Tony was an outstanding Prime Minister who achieved much, especially bringing peace to Northern Ireland, but many other good measures also—regretfully he will be remembered by many for his support of the Iraq invasion.
Your constant advocacy for sport is well-known. How important in the age of video games is organised sport for school age boys and girls?Sport within society is of great importance to both the health and morale of its people but also in its importance to the economy of countries like the UK and New Zealand. Sport is also a great leveller in terms of gender, religion and race, bringing together the best in humankind. In order to address the negative effects of children playing video games, it is important that sport facilities are provided and participation in sport is encouraged. A good example of an organisation in the UK which invests in local sport facilities is the Football Foundation, of which I am President; with funding from the Government, the FA and the Premier League, the foundation funds multiple projects across the UK which provide new and refurbished grassroots sports facilities, improving the quality and experience of playing sport at the grassroots level. Formed in 2000 they have supported projects worth more than £1.3 billion.
One sport you most definitely do not approve of is fox-hunting?Certainly I do not approve not only of fox hunting but of cruelty to animals per se. Fox hunting is now illegal in the UK but there is evidence to suggest that hunts continue to take place. The argument that fox hunting is about curbing the number of foxes in the wild—a form of pest control—does not stand up because there is strong evidence to show that foxes have been captured and bred by hunters purely to be used in hunts.
You have on several occasions registered your disapproval of hereditary ascendancy to your own House of Lords?I do not believe that because a person achieved greatness in his lifetime that should also necessarily be reflected in the shape of a family member years later, who may not be worthy of the honour himself. We have in the House of Lords many examples of such people not worthy of the honour which had been bestowed upon their ancestor. Fortunately some do make a notable contribution to the workings of Parliament. In truth, now the number of hereditary peers is limited to 92 so some progress has been made in the right direction.
Reinforces New Zealand connections with doomed Atlantic Liner
New Zealand’s connection to the world’s most famous shipwreck the Titanic has become reinforced with the entry by Ocean Gate into the passenger tour business starting next year with scheduled dive tours to the wreck.
Ocean Gate is organised by Stockton Rush (pictured above) who is part of the family of the late Stockton Rush 11 who invented the high end terrestrial tourist business in New Zealand.
United States oilman Stockton Rush 11 developed Takaro Lodge in the South Island southern lakes district as a conservation and tourist centre for the rich.
The problem for the Lodge was that Mr Rush’s development coincided with the Labour government of Prime Ministers Norman Kirk and Wallace Rowling.
At this time the Labour government was anxious to be seen to be returning to its working class roots.
The publicity surrounding Takaro Lodge and especially its bathroom fittings which were said to be gold plated, along with the moneyed celebrities who stayed there meant that the Lodge became a target for government-inspired obstacles.
The current Stockton Rush is similarly in the premium tourist business, though this time of an undersea nature, and based in the United States.
Round dive costs have been calculated on an inflation adjusted formula relating to a first class trans-Atlantic berth on the Titanic itself (pictured below), this being in the region of NZ$150,000.
A qualified aerospace engineer and commercial pilot, Mr Rush is supervising the construction of his passenger dive craft known as Cyclops 2.
The Rush family’s tourist-based connection with New Zealand and the Titanic supplements the better known one of film magnate James Cameron and New Zealand.
It was Mr Cameron’s film, coincidentally financed by Rupert Murdoch, a continuing New Zealand omnipresence, that re-ignited the curiosity about the disaster and its causes and effects.
Subsequently New Zealand relatives have been discovered of Frederick Fleet the crows nest look out who first sounded the alarm about the imminence of the iceberg.
Mr Fleet later testified at the court of inquiry that the absence of any binoculars at his post meant that his warning came too late.
Meanwhile the Stockton Rush of Takaro Lodge fame an imposing-looking man who resembled the actor James Garner died at the age of 69 in 2000.
Mr Cameron with his numerous projects with New Zealander Peter Jackson resides in the Wairarapa Valley in which he has established a health foods grocery.
Lookout Frederick Fleet died in 1965.
| From the MSCNewsWire reporters' desk || Tuesday 18 April 2017 |||
BNZ parent National Australia Bank is major force in introducing Islamic banking
Rugbyman Sonny Williams made it clear that he was no longer going to prance around pitches attired in kit promoting usury.
Rugby officials instantly kicked for touch. They heaped upon themselves sackcloth and ashes.
All Black branding sponsor Bank of New Zealand kept quiet.
It might have been viewed though as another publicity opportunity.
BNZ parent National Australia Bank is a major force in opening up Australasia to Islamic investors from the Gulf and Southeast Asia that seek to adhere to religious principles such as bans on interest and gambling.
If the BNZ had applied islamic banking principles in taking a share of ownership in the assets in which it had invested its clients’ money, it might still be owned in New Zealand.
Instead it charged interest on its loans. This was reinforced by seeking to impose penalties when the borrowers failed to pay their interest.
Interest and penalties are both taboo under islamic financing.
Islamic banking turns on joint risk-sharing as opposed to risk-transfer, which islamics describe as usury.
Islamic mortgages centre on the bank taking the responsibility of purchasing a property and then re-selling it to the buyer. This arrangement enables the buyer to repay the bank in installments in which process the bank receives also its profit.
This arrangement is designed to ensure that the bank takes its share of the risk, in this case owning the building, and recovering its profit, the installment payments, while shouldering its continued share of the risk.
The point being that at no stage is interest (usury) levied.
Nobody gets paid for renting out money. Islamic banking embraces risk-sharing as opposed to risk-transfer.
Islamic banking principles though continue to underpin Occidental merchant banking in which the bank takes on the risk of a venture by taking on ownership.
Money as money must not be used to make more money.
So why did islamic financing become sidelined by the Western model which centres on the diametric opposite practice of using money to make money via the charging of interest?
The problem was that the degree of concensus required to arrive at a common valuation of the asset to be financed and thus the proportion of risk involved began to become increasingly cumbersome in the face of the standardised model developed in the Occident.
In Europe charging a cut and dried level of interest regardless of the success of the asset or otherwise became so much easier to implement.
Curiously, the other two Abrahamist/book religions, Judaism and Christianity, have at one stage or another shaken from their shoes the dust of usury and tested instead the risk-balancing islamic system..
But the standardisation of administration and thus the efficiency inherent in the Western technique in the end compensated for its own drawback in which the advantages are seen to be weighted in favour of the lender, the bank.
It is said that Williams was converted in the French port of Toulon nearly 10 years ago while he was a local team member.
Toulon’s cathedral was once a mosque.
Pressure will now be being brought onto the athlete to lead by example.
The issue has so far been viewed exclusively in moral and/or sports gear outfitting terms.
It should also be seen, as perhaps Williams intends, as the start of a wider evaluation of islamic finance.
One such source of interest might be from those who have enlisted in class actions against banks over the bank infliction on them of penalties.
Islamic finance principals hold that penalties may not be levied.
Instead failures to perform to the original agreement require that donations be made to charities – and not to the bank.
| From The MSCNewsWire reporters' desk || Friday 14 April 2017 |||
Renting turned out to be as dangerous for production engineers as for families.
The putting into financial play in the late 1980s of the nation’s castings, forgings and machining engineers had the effect of stripping out their ownership of their own sites and thus leaving them prey to the real estate sector and its exorbitant demands.
New Zealand’s short lease regime and even shorter rent review periods effectively threw the nation’s medium to heavy production engineers into the hands of the non-productive property sector.
This bitter harvest coincided with the disappearance from New Zealand of its merchant banking capability. There is no merchant finance capability now in the accepted risk participation-ownership sense.
The fact that the engineers had been stripped of their site ownership meant that they had to turn now to the Australian commercial banks with their reluctance to lend on anything that was not backed by clear land title.
This did not become immediately obvious, however, partly because the tariff protection abolition that accompanied this boom-bust era took time to dismantle.
There was some good news too from Europe.
The events surrounding the fall of the Berlin Wall meant that Eastern Europe was identified as an important new market. Backed by the government, notably in the form of assistance from the New Zealand embassy in Moscow several engineering bi lateral trade deals were exploited within the old iron curtain.
Immediately after this there began the intensive trade with China.
This now allowed production engineers to start abandoning their sites, which they now did not own anyway, and focus on their design and brand work in New Zealand while farming out their production to Asia.
It was now though as the end of import restrictions began to finally melt away under accelerating globalisation that the remaining production engineers on leases began to feel the chill winds of change.
For the long established production engineers, the ones that had gone through the 80s property and credit bubble, and in the process had lost title to their yards and premises what had once been asset now became a big liability
Heavy engineers were historically positioned near to rail and ports and thus their now leased sites became attractive to the premium residential and leisure sector.
Which is what the property rotators had gambled on in the first place.
Another problem was and is that the once-forecast inland container depots never materialised in sufficient bulk to take the pressure off port land, the land that the engineers now leased and which became increasingly prone to lease rent hikes.
The engineer now became the industrial version of a fashionable restaurant. If they did badly- then they did badly. Should they do well- then their landlord was in for their share of the bounty, knowing too that if the tenant quit that there would be plenty of service sector takers for the site.
The point being that the speculators apportioned no value to the gantries, rolling beds, and other such fixtures other than scrap value
It is in borrowing though that the leased land problem is most evident for engineers. They cannot borrow on improved value. Machine tools of any value will be leased anyway, probably from UDC which, incidentally this year was sold to Chinese interests.
The tenancy position is not so critical for assemblers and process engineers who sell finished goods into retail with its accelerated turnover and thus returns based on measurable cash flow from consumers.
But for the heavy project engineering sector with its ever-extending payment times and attendant payment uncertainties the failure to possess the title to their own premises increasingly proved fatal.
Some lease booby trap fuses were longer than others. But in the end the results were the same. The sites leased out on a service sector rent level could no longer sustain their original purpose of production.
A curious difference between the New World and the Old World is that leasing and renting has never been accepted as an economic proposition in the new world.
We can see now that this applies as much to the industrial sector as it does to the residential sector.
This systematic undercutting of the nation’s productive capacity was widely applauded at the time by management theoreticians whose slogan was that production engineers among others should “stick to their knitting.”
In the event, and as we can now see, the loss of title to their own works meant that the engineers now became involved instead in the complex world of leases.
Especially and willy-nilly they found themselves in the sphere of the property management company with its attendant contract that ensures that whichever side wins or loses the possessor of the contract always comes out the winner.
| From the This email address is being protected from spambots. You need JavaScript enabled to view it. || Wednesday 12 April 2017 |||
Inquirers back off one step short of the Supercat Issuers
The arrival of Erin Brokovich (pictured) in Christchurch and her call for those at the wrong end of insurance compensation to “speak up” about the injustice of it all is a further reminder of the obscure role in the earthquake aftermath of the global re-insurers.
Among the most powerful forces force in reinsurance is Berkshire Hathaway. It is considered within the industry to be the leader in supercats which is the category of reinsurance involved in major disasters such as the Christchurch earthquake.
Berkshire Hathaway sells sell policies that insurance and reinsurance companies purchase in order to limit their losses when mega-catastrophes strike.
The company is therefore the major reinsurer of reinsurers.
Though Mr Buffett in New Zealand is frequently the subject of admiring, some might say, adulatory, media coverage the matter of his involvement in these supercats is ignored out of either ignorance or out of fear. Or both.
The matter has similarly been too complex for politicians to contemplate at least openly.
Hurricanes and earthquakes are the two primary factors in the probabilities of supercats.
It is said that Mr Buffett’s supercat exposure can weather at any given time the eventuality of the calculable risk of up to four such eventualities.
Supercat insurance shares with the rest of the insurance sector one quite literally priceless advantage. Payments are received prior to the issue of the policy. In other words, cash up front.
This payment-in-advance gives the industry its cash float which in the case of the supercat sector is immense.
Therefore the following questions need to be asked:-
1. Who are the Christchurch reinsurers?
2. Who reinsures them?
3. Are the ultimate reinsurers solvent?
4. If so why are they not compensating the Christchurch home owners?
Instead the various debates have circled around the role of the primary insurers, the known insurers.
Erin Brokovich, formerly a California legal clerk, and the centrepiece of the eponymous film that starred Julia Roberts is roving ambassador for an Australian-based legal compensation practice.
As an environmental advocate she transcends the routine geomantic abstract preoccupation with global warming/carbon levels and by her presence fixes it upon the unpleasantness of ordinary people in the face of ambitions of big business.
Can Miss Brokovich now force into the light the identities of the entity or entities that hold the supercats over Christchurch and who decline to pay out on them?
| FRom The MSCNewsWire reporters' desk || Tuesday 11 April 2017 |||
Better known today as an existential author and public ethicist John Wareham (above) originally burst upon the national commercial consciousness with a series of proclamations and books that explored the changing nature of New Zealand management techniques and attitudes that began to take shape in the later 1960s. He expanded his management consultancy into Australia and then to the United States. The onetime New York resident has returned to live in Wellington.
Five questions for John Wareham...
You once claimed that the unsuitability of a wife for an achieving careerist would become grounds for divorce. How do you see this statement in the light of today?Times changed. The subsequent Yuppie generations self-selected on the basis of earning ability, and then married, if at all, after living together and thus jointly accumulating their wealth. Since I originally made that statement familial capital formation has become shared.
John Maynard Keynes believed that the transfer of enterprise from industrial families to shareholders at large would engender a more compassionate era. He believed that the non-family professional managers would serve the wider community instead of just the whims and wishes of the ruling dynasty.On this point, Keynes failed to foresee the future. Sadly for us all.
In New Zealand especially there is this constant call from politicians for more people to become entrepreneurs. Universities have courses in it. Your opinion?It is difficult to distil entrepreneurialism to a formula. One can teach marketing techniques but the key to being an entrepreneur is the willingness to take a risk. The bigger the risk,the bigger the potential reward. Figuring out what one might do is not the same as having the courage to do it, and courage can’t be taught—and for over-anxious wannabe entrepreneurs, judgment goes out the window when risk enters the door.
In one seminar we attended you claimed that the truly successful entrepreneurs were the ones who loved the business that they were in – that this passion in fact counted for more than material success?Still true!
Can you now as the founder of Oceania’s first management selection organisation give us five tips on likely applicants who should NOT be hired for anything at all?Candidates who:
| From This email address is being protected from spambots. You need JavaScript enabled to view it. || Friday 7 April, 2017 |||
What a Difference three years has made to the Media Class
Out the book came on its triennial pre-election rotation shaming mission this time of the military. Broadcasters adopted solemn visages to hype the soufflé. Print columnists responded piously in their customary and secondary Pavlovian pick-up role.
The public responded. With indifference. The media class had flailed away at the usual levers. They were no longer connected.
Less than a year has passed since the two New Zealand newspaper chains first lodged their merger application with the Commerce Commission. Yet industrially it is an epoch ago. It is as if during these 11 months that the age sail had given way to steam which in turn had given way to internal combustion. Consider what has happened during this short space of time:-
What a difference three years makes. What a difference 11 months makes.
The free model meanwhile scythes at ever accelerating speed through the communications sector, notably books and newspapers.
In the sector at large there remains though some curious ironies. For example this week Spark’s Xtra subscribers found that accessing what they were paying for, their email service, was labyrinthinely complex, if possible at all.
While access to the Spark free news service was instantaneous.
| From The MSCNewsWire reporters' desk || Wednesday 5 April 2017 |||
Ground floor opening for the state to back IT manufacturing lost. Progeni’s Perce Harpham explains what went wrong...
During the 1980s Australasia’s version of Silicon Valley was New Zealand’s Hutt Valley. Here, a coalition of public and private enterprises had anticipated the screen graphic presentation techniques that would later become standard fixtures. At the forefront of these developers was Progeni led by Perce Harpham (above). Progeni had developed its desk top computer for the global marketplace. It needed just one thing which was a local user base in education. But Apple, whose Steve Wozniak was a constant presence in the Hutt Valley of that era, was also knocking on the class-room door...........Five questions now for Perce Harpham....
As you look now at the immense scattering of public funds in the general direction of encouraging technological innovation, you must feel increasingly disappointed at the failure of the government to encourage your educational application desk top computer, leaving the field open to Apple among others?
The development of the Poly computer system was disappointing on many fronts. The idea for a special purpose computer was conceived by two gifted lecturers in Wellington Polytech. It was accepted by the Education Department. The Government's Development Finance Corporation was charged with doing the sort of job that NASA does with space travel - namely bringing together New Zealand resources to make it happen. Just for once it appeared that NZ was going to do something right in the technology field by taking a problem which we had here and developing a solution for the world market.
The Development Finance Corporation invited us to form a joint venture with them to do the job. The idea was that the Joint Venture would develop the systems software and the hardware, the Education Department would develop the courses and use them in NZ while the JV would make the computers and market them with the courses overseas. DFC said they had cast iron arrangements with Government to buy 1000 machines per year for five years if they met the practical requirements of the Department.
My company, Progeni, then provided highly capable professionals to develop the system including all sorts of innovations, some 30 companies supplied parts and manufactured circuit boards, and the specially designed the moulded cases and the like. Some 60 teachers gave up their Christmas holidays to develop demonstration courses for mathematics, music and all sorts of things where there was a need. We made some 70 machines which were trialled in class rooms. Massey University evaluated the results. They were highly successful and more than met the conditions set down by the Department. The Government then welshed on the deal.
Warren Cooper later told me that he and his colleagues in the cabinet had decided that, and here I quote, " there was no point in spending Government money so that teachers could do even less work".
We bought out DFCs interest in the Joint Venture and tried to carry on. A number of schools then raised money and bought machines. I have been told that another cabinet minister had an investment in the Apple agency in NZ. Apple then was allowed to dump, and I use the word in its formal legal sense, its computers in NZ at about one quarter of their retail price. They targeted precisely our market and destroyed it for us.
We went to China and sold a few machines then built a new model handling Chinese characters. We were on the verge of some major sales when the Tiananmen Square incidents occurred and all the bankers suddenly thought anything to do with China was valueless. Our bank, the Bank of New Zealand, then twice had to be rescued from bankruptcy by the Government. We were the collateral damage. Almost a year after the receivers were appointed we had a major order from the Agricultural Bank of China. It had been delayed by Tiananmen and the company had been destroyed. But I managed to deliver part of the order from stocks that had been stored in China and purchased back from the universities we had given them to. But we were already dead.
Had the Government honoured its commitments New Zealand would have been a world leader in computer-based learning.
To what extent did the death of your chief technology officer Jean Claude de Verrier in the same Chicago DC10 disaster that took the life of Roger Estridge, point man for IBM’s pc development, harm the future of the Progeni desk top development?
Jean Claude de Verrier's (pictured below) death was a huge blow. It did not affect the development of the Poly computers. But it set back our US venture dramatically. Nonetheless it was going well before the receivers sold it to the management for a pittance. It has gone on to prosper as Progeni Inc with headquarters in Dallas. All of the people we transferred to the US who have not retired are still with it. See its website.
After your bid to persuade the Department of Education here to buy the Progeni desk-top, you turned to China. Were you worried at the time and subsequently about (a) copying, and (b) getting paid?
I can only add that one is always vulnerable to copying and you rely on staying ahead of the game so that your new innovations make the copies obsolete. There was never a problem about getting paid. When we went into receivership it was claimed in the press that it was because we had not been paid from China. This was completely untrue.
You pioneered in New Zealand the independent software development house, handling major governmental contracts along the way. How do you view nowadays public systems development and implementation?
I view Government handling of their computer developments as an unmitigated disaster. We formed a Joint venture with a US company to deliver the software for the Wanganui Computer System. We delivered it on time at the quoted fixed price, exceeded the specification, made a profit and paid tax on it. It lasted for 30 years.
In the meantime the Government let a contract to replace our law enforcement system. No NZ owned company made it onto the short list. It was let to IBM. The delivery was supposed to take about two years. After five years and $100,000,000 it was abandoned.
Many millions were spent having an American company develop a health system with no NZ input and it was then abandoned. I remember talking to the project manager nine months after they started. He had only just found out that we did not have the equivalent of the US Sprint telephone system in NZ and was having to redesign the communication system.
More recently Customs went to tender with a contract which essentially specifically excluded NZ companies. Companies like Orion have had to make major sales overseas before gaining any sales in NZ for their hospital systems. The payroll system let to an Australian company was a disaster. The IRD system, over $1,000,000, is being developed by an overseas company.
We are supposedly going to develop a high technology economy. Yeah right!
It is said within the IT industry that pioneers end up with arrows in their back. Is there anything you might have done differently, especially in regard to your international development which many, even at the time, regarded as audacious?
I would not chase Government work unless I was satisfied that we had a level playing field uncontaminated by a cringing belief that our New Zealand capabilities are necessarily inferior.
I would first work on local and overseas companies as well as overseas governments and state governments. The latter, like the NZ Government, want to know if you have delivered similar systems elsewhere but will look at your proposal in an unbiased fashion and the experience of your proposed project team. If this includes people (possibly one or two consultants) who have had the experience you lack as a company but are satisfied that your management is competent then you are in with a chance.
| From the This email address is being protected from spambots. You need JavaScript enabled to view it. | Monday 3 April 2017 |||
French Polynesia begins in New Zealand
He looks like the star of a television series set in the 1950s about British country doctors or family solicitors of those solid and dependable times. But former French premier Francois Fillon considered by the English-speaking world to be a shoo-in for his country’s presidency is now looking anything but a winner.
In recent weeks the Mr Clean of europolitics has found himself be-spattered in every variety of calumny and remarkable even for a country renowned for its political spoils system.
The hapless Mr Fillon is looking less and less like the fulcrum around which will rally the centrist forces in the event of a first round win by the National Front’s Marine Le Pen.
At the cusp of the 1960s/1970s France was the focus of New Zealand’s global trade interest for the way in which it was perceived to be throwing a spanner into the primary produce works as Britain made its transition into the Common Market, as the EU was then described.
Yet in a bizarre about turn France has now become as important to New Zealand industrially as Britain was in those days.
This is artfully concealed from public view though by a politico-media determination to keep the trade spotlight on Asia and the Middle East
Here though are just some of the French companies that dominate their sectors in New Zealand:- ‘
* Veolia Water and commuter transport in Wellington and Auckland. Controls Transdev * Axa Finance – (controls AMP) * Pernod Ricard Owns Montana * Lafarge Holcim Cement * Schneider Electrical manufacturer, formerly PDL * Accor Hotelier * Air Liquide Industrial n gases * Allflex Livestock management applications * Danone Dairy * Parmalat Dairy * Synlait Dairy * Alcatel Information technology * Thomson Air traffic control * Alstom Transport * Rexel Office supplies
This unacknowledged state of affairs took on a humorous form when one of the New Zealand government start-up technology incentive funds invested in what appeared to be a local computer games producer only to find out that it was in fact controlled by Vincent Bollore.
He is known as the Breton Raider, and who from his gigantic holdings in transport and commodities in Africa has devolved into the leisure-entertainment sector.
The officially encouraged focus on the East contains a romantic Prester John–like flavour in refusing to acknowledge how hard it is for anyone but the very biggest traders to actually get paid from anyone in these regions.
It also shrouds the mercantile dependence on a country such as France. This is demonstrated by a French trade deficit of $845 million in 2014. In France’s favour.
Back now to Mr Fillon who until a few weeks ago was considered the favourite for the Elysees and thus the man to usher in New Zealand’s EU trade agreement.
His role even as the rallying point as the second round coalition leader in the French presidential double is now being questioned.
The favourites now are the National Front’s Marine Le Pen head-to-head with the former Socialist Party economics minister Emmanuel Macron and his own personal party France on the Move.
For Mr Fillon trouble does not travel alone. Not only is he being charged with putting his family on his parliamentary payroll, and for influence peddling, which is all pretty much part of French political life anyway.
In the unkindest cut of all he is also being accused of receiving his fine-cut English style suits as gifts from wealthy benefactors.
| From The This email address is being protected from spambots. You need JavaScript enabled to view it. \ Friday 31 March 2017 \\\
Palace of the Alhambra, Spain
By: Charles Nathaniel Worsley (1862-1923)
From the collection of Sir Heaton Rhodes
Oil on canvas - 118cm x 162cm
Valued $12,000 - $18,000
Offers invited over $9,000
Contact: Henry Newrick – (+64 ) 27 471 2242
Mount Egmont with Lake
By: John Philemon Backhouse (1845-1908)
Oil on Sea Shell - 13cm x 14cm
Valued $2,000-$3,000
Offers invited over $1,500
Contact: Henry Newrick – (+64 ) 27 471 2242