Card surcharges to be scrapped
To embed this content on your own webpage, cut and paste the following:
See terms of use.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
1News
3 hours ago
- 1News
Cabinet Ministers defend hiking board fees for Crown bodies
Cabinet ministers are defending a move to hike board fees for Crown bodies by up to 80%, insisting those in the roles are overseeing billions of dollars — not just "beer and skittles." Labour says the decision proves the Government is out of touch with the cost-of-living crisis and has accused it of trying to sneak the news by the public. A Cabinet document, quietly uploaded online on Monday, shows ministers agreed to lift the maximum annual fee for chairs of governance boards from $90,000 to about $162,000. The "Cabinet Fees Framework" is not binding but provides guidance to ministers when deciding compensation for those on a range of bodies, such as royal commissions and ministerial inquiries. Speaking today, Prime Minister Christopher Luxon said public sector fees had become completely "out of whack" with private sector rates and needed a reset. ADVERTISEMENT "We need to make that a little bit more competitive, so that we can actually attract good talent," he said. Luxon said paying more to ensure "really good governance teams" could save billions in the long run. New Zealand currency. (Source: Finance Minister Nicola Willis echoed the point, stressing that New Zealanders deserved value for money. "This isn't beer and skittles. This is billions of dollars of public money. We need the very best people making governance decisions about it." Public Service Minister Judith Collins told reporters that the updated fees still fell short of private sector rates — around 80% of the going rate. "A lot of people who are experienced directors don't want to do these jobs in the public sector because they know they're going to lose money," she said. ADVERTISEMENT Judith Collins. Photo: RNZ / Samuel Rillstone (Source: Collins said she did not think the public would be worried by the news. "One of the problems is that we've had an underperforming public service that's taken a hell of a lot of taxpayers' money, and so it is very important that we have the right people in charge of that." Hipkins accuses government of 'twisted priorities' Labour leader Chris Hipkins said the decision revealed the Government's "twisted priorities" at a time when households were doing it tough. "They're saying that board members can get up to 80% increases in their pay, whilst nurses and teachers are being told to settle for 1% or less," he said. "They've said everyone needs to tighten their belts — apparently except for the people who they hand-picked to put on public sector boards." ADVERTISEMENT Hipkins rejected the idea that higher fees were necessary to attract quality candidates, calling it "absolute nonsense." Chris Hipkins. Photo: RNZ / Mark Papalii (Source: He said many public appointees had altruistic motivations and were already sitting on "very well paid directorships" in the private sector as well. "They're not doing it for the money," Hipkins said. Hipkins accused the Government of trying to "slip this [announcement] out quietly" without scrutiny. But Luxon denied any secrecy: "It's normal practice... how it's been communicated." Hipkins does not appear to have issued a media release as Public Service Minister in 2022 when the then-Labour Cabinet agreed to a smaller 10% increase in fees. In November, State Owned Enterprises Minister Paul Goldsmith published a release about a similar but separate move to increase director fees for 22 Crown-owned companies.
Otago Daily Times
4 hours ago
- Otago Daily Times
Poll: Should Paywave costs should be passed on to customers?
The Finance Minister says when a ban on contactless card payment surcharges comes into effect, businesses should pass on the cost to customers as they would any other business cost, if they can't absorb the bill. The government plans to ban surcharges on contactless card payments no later than May 2026. Commerce and Consumer Affairs Minister Scott Simpson announced the change on Monday afternoon, declaring: "That pesky note or sticker on the payment machine will become a thing of the past." "Shoppers will no longer be penalised for their choice of payment method, whether that's tapping, swiping or using their phone's digital wallet." The ban builds on the Commerce Commission's recent decision to reduce the interchange fees imposed on businesses for accepting Visa and Mastercard payments. Finance Minister Nicola Willis told RNZ that change has led to an average reduction in costs for a typical retailer - a small business - of about $500 each week. "So our concern has been, now that reduction has happened, how do we make sure that gets passed through to you, when you're at the shop. What's to stop the retailer just charging you the same fee even though their costs has dropped." Banning the paywave fee was the simplest and most transparent thing to do, Willis said. Businesses need to treat the interchange fee like any other cost in their business "and just include it in the price tag on the shelf", she said. "It'll make it easier for people to compare what they're really having to pay. Just think about how many times you've been at the counter and then suddenly you learn that it's a 2.5 or a 3.5 percent surcharge and that gets added to the price of whatever it is you're buying. That's not very transparent." The sector is warning prices may need to rise at restaurants and cafes due the ban. Retail New Zealand chief executive Carolyn Young told RNZ retailers were not happy with the change and have told them they will increase prices as a result. More people will use contactless payments as a result of the change, she said. "It means that a retailer, a higher percentage of their transactions will incur a fee so any savings that they may have seen from the interchange fee, they'll be countered by the fact that a higher percentage of transactions will incur a fee anyway." Young said retailers were already having a hard time trying to stay open. Matthew Lane is the general manager of 54 Night 'n Day shops around the country and has never put a surcharge on payments. "We fold it into the... overall cost of business, we never charged it... we like to keep things consistent to the customer," he told Nine to Noon. While Lane welcomed the ban on paywave surcharges, he said it was the interchange fee which was a massive cost to business. "For context, one of our stores paid over $80,000 to the merchant provider over the last year and that's just a massive cost to business for simply a set payment in store." Paywave being used more as a result of a surcharge ban would further diminish savings, he said. He questioned whether the reduction of the interchange fee went far enough and said it was likely some businesses would revert back to offering only Eftpos for transactions. Asked if she thinks the ban will lead to inflationary prices, the minister said "I think that overall, people will charge the price that they think they can get away with". The change doesn't include international credit card payments or online payments. Willis said these payments were usually much more expensive to process and people using these systems have to pay a bit more because they are protected from things like online scams and fraud. Commerce and Consumer Affairs Minister Scott Simpson told RNZ the interchange fee was a cost of business. "I think that the price you pay at the tills should be the same price that's on the shelf when you go to buy something." The "vast majority" of businesses don't currently charge surcharges, he said. When questioned on that statement, the minister said this was something he knew from his personal experience when shopping and information from the Commerce Commission. Consumer NZ chief executive Jon Duffy told RNZ with a reduction in the interchange fee, businesses would be making a profit off the surcharges if they remained in place. "Retailers still pay a small amount ot offer those services, we think that once... the decrease comes into effect it will be less than 1 percent of the total cost of the transaction," Duffy said. Many businesses would absorb this into the prices though there may be some who need to increase prices to cover the cost, he said. "But it would be just the same as if their... power bill or their rent went up." Consumer NZ was a bit disappointed online transactions were not included but it was understandable for now, he said.
NZ Herald
5 hours ago
- NZ Herald
Government eyes more spending cuts as patience with economic strategy frays
Seymour said the Government was getting a few 'whispers' about the next Budget. 'Last year, we saved $115 million. [The] year before that, half a billion,' Seymour said, referring to the savings attributed to him personally. 'Let's see if we can't save more next year,' he said. Seymour said Budget 2026's savings exercise would not be 'radically different'. He said there was still wasteful spending to be found, noting the last Labour Government had inherited core public spending of about 28% of GDP and left behind a state spending about 33% of GDP a year. Even accounting for increases in superannuation spending and debt servicing for the pandemic, Seymour reckoned there was still a large portion of spending that could be trimmed. Seymour said Finance Minister Nicola Willis had put pressure on Treasury to 'upgrade the supply of information', allowing better quality budgeting. Finance Minister Nicola Willis said more savings could be found. Photo / Mark Mitchell Willis said funding new spending initiatives by cutting spending the ministers deemed less essential was important, given the size of the Government's deficit, which Treasury forecasts to be $14.1b this year, or 3.1% of GDP. 'The Government's got a great track record of reprioritising funding so that we can put more investment into the things Kiwis care about: schools, hospitals, roads, police,' Willis said. Willis said the Government's first Budget found $23b in savings and the second found $21b. These figures are calculated over multiple years. 'What the number will be in our next Budget is yet to be worked out,' Willis said. When asked whether a similar dollar figure of savings could be found for the 2026 Budget, Willis said, 'we'll see'. Willis said she did not think all the low-hanging fruit had been found when it came to savings. 'There are always areas where we should be demanding better value for taxpayers' money and I always ask myself, 'can I really justify spending that money when a New Zealand household could probably do with it in their wallet?'' Willis said. Willis said each Budget approach was similar. She sat down with the Prime Minister and her associate Finance Ministers, Seymour, Chris Bishop, and Shane Jones. 'We sit down together. We identify key themes where we think that there is room to find value. We also identify programmes of work that we think ministers should undertake to find savings,' she said. Willis said it was 'far too soon' to describe the nature of the savings programme. It is not uncommon for a Government to cut spending it no longer thinks is valuable, to pay for something else. The last Finance Minister, Grant Robertson, also undertook reprioritisation exercises prior to his budgets although these were far smaller in quantum. In 2018, word of Labour's Budget 2019 reprioritisations exercise leaked to National, who accused Labour of covert spending cuts. Asked whether three successive savings programmes in a row risked prolonging negative economic sentiment, Willis accused people who made that argument of being 'fiscally and economically ignorant'. 'We have one of the largest deficits in the OECD, which is to say we are spending billions more than we are earning as a country. Compared to many countries around the world, we are in a more deficit position than they are. 'To say that when we are running a deficit ... is economically ignorant. I have heard that ignorance from our political opponents. They need to get a maths textbook,' Willis said. Labour leader Chris Hipkins compared Luxon and Willis to a washing machine. Photo / Mark Mitchell Earlier this year, the Herald spoke to the big three ratings agencies for their view on the public finances. New Zealand maintains a high credit rating. While the agencies said they were not alarmed with the fiscal situation at the moment, they wanted to see evidence of improvement. S&P's primary analyst for NZ, Martin Foo noted that NZ's general government balance, his company's preferred metric for whether the Government was in surplus or deficit, showed a deficit greater than 6% of GDP - putting NZ in the realm of France and the United States, countries known for running huge deficits. The Government's fiscal and economic strategy is partly to reduce the deficit to help put downward pressure on inflation and interest rates, stimulating confidence and economic recovery. Month after month of gloomy economic data, only partly offset by a recovery in the primary sector, has frayed voters' patience in that strategy, polling suggests. The most recent Ipsos Issues Monitor Poll found voters trust Labour more on the cost of living, the first time Labour has come ahead in that poll since before the last election. Voters still trust National more on the overall economy, according to that poll. In a speech ahead of his post-Cabinet press conference on Monday, Luxon said the Government needed to 'double down' on its economic strategy. 'The most important thing we can do to make you better off is to double down on our economic plan,' he said. 'Spending more, taxing more and borrowing more as Labour and other parties advocate for didn't work in the past and it won't work in the future,' Luxon said. Labour leader Chris Hipkins shot back, noting the length of Luxon's post-Cabinet speech, which he gave alongside Willis. 'I think we should start calling them Fisher and Paykel because they've got more spin than a front-load washing machine,' Hipkins said, referring to Luxon and Willis. Hipkins has come under pressure from the Government for Labour not releasing policy of its own. He defended this on Tuesday morning, saying 'we will be doing policy'. 'But some of those bigger issues around spending, borrowing, taxation, many of those will have to wait until closer to the election,' he said, noting National finalised its tax policy less than two months before the election date in 2023 - although it published a version of its tax policy about a year earlier.
