Business commentator Calida Stuart-Menteath
Halter completes what is considered one of the biggest Series D raises in New Zealand, and Calida discusses the risks to New Zealand of the Middle East conflict. Two chief financial officers leave NZX companies this week at Comvita and Ryman Healthcare.
Craig Piggott
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Calida Stuart-Menteath is co-editor at the National Business Review
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RNZ News
32 minutes ago
- RNZ News
Government begins Te Pūkenga disestablishment despite last year's $16.6-million surplus
Savings came from winding down its Te Pūkenga's head office and regional campuses. Photo: supplied The New Zealand Institute of Skills and Technology, Te Pūkenga, finished last year with a $16.6-million surplus and $382m in the bank. The super-institute's annual report was tabled in Parliament on Wednesday, showing a profit just as work accelerates to disestablish the organisation and return to a system of stand-alone polytechnics and work-based learning organisations at the start of next year. The report showed income increased $68.4m or five percent last year, much of it from growing international student enrolments, but it attributed much of its surplus to cost-cutting rather than increased earnings. "The financial result, showing a 144 percent improvement on the previous year, is the outcome of focusing on addressing financial performance through an intensive cost savings exercise across all divisions, structural changes, vacancy management, lease reduction, property sales and programme rationalisation," chief executive Gus Gilmore said in the report. Gilmore told RNZ the surplus was "a fantastic result" for the institute just two years after it was created to take over 16 polytechnics and nine industry training organisations. He said Te Pūkenga had budgeted and was on target for a break-even result this year. Vocational Education Minister Penny Simmonds. Photo: RNZ / Samuel Rillstone Last week, Vocational Education Minister Penny Simmonds told the Education and Workforce Select Committee that Te Pūkenga's result did not prove it was viable , and was possible because it had wound down spending on a centralised head office. Gilmore told RNZ some of this year's savings came from winding down its head office, but a lot also came from its regional campuses. "We had some 200 FTE's two years ago. That number is down to 52 during 2024, which is the period in focus. "We made a $6.5 million cost saving in the national office and overall we've seen steady reductions across a number of our business divisions as we reviewed the demand for some of the less profitable programmes," he said. "Yes, there was some cost reduction in the national office but there was also cost reduction within the the 25-odd business division. So we took a holistic approach right across the whole network. It wasn't simply about the national office. The national office isn't the greatest proportion of our cost. The greatest proportion of our cost is the delivery across the country." Gilmore refused to be drawn on whether the report showed that Te Pūkenga would have been financially viable had it been allowed to continue. "I don't have obviously those numbers in a hypothetical situation. What I can say is we've been really focused on revenue growth and cost reduction, obviously the two most important ingredients of returning to surplus," he said. He also would not comment on the scale of cuts recommended by financial advisers and how much remained to be axed. "In the low hundreds was the number of of redundancies in our 2024 report, we reported 288 redundancy payments, that is $9.5 million, which is similar to the number in 2023," he said. "There will be more this year, although I can't give you an exact number, but it's going to be in the magnitude of low hundreds." Asked if Te Pūkenga had sufficient reserves to recapitalise its polytechnics, Gilmore said that was a decision for government and last year's Budget had included a contingency for that purpose. The report included a $9.6m provision for an "onerous lease" on the Weltec and Whitireia downtown Wellington campus. It showed "impairment" of the Taradalde campus due to flood damage of $21.3m in 2023, $13.8m in 2024 and elsewhere showed a $15.5m insurance payment for work on Taradale campus. The report said the institute had ring-fenced cash reserves totalling $63.4m from five former polytechnics and eight former ITOs, as well as $51m in other financial assets from four former polytechnics and two former ITOs. It said Te Pūkenga's top-tier management of 5.1 FTE were paid $3.99m last year. However remuneration information elsewhere in the report said one employee was paid in the range of $470-479,999, three in the range of $380-389,999, and one in the range of $370-379,999. "Cessation payments" were made to 353 staff and totalled $10.77m, an average of $30,497. Sign up for Ngā Pitopito Kōrero , a daily newsletter curated by our editors and delivered straight to your inbox every weekday.
RNZ News
an hour ago
- RNZ News
Minister Shane Jones accuses council of being 'iwi back office'
The Minister for Regional Development Shane Jones wants politicians to ask ratepayers if regional councils are value for money. Photo: RNZ / REECE BAKER The Minister for Regional Development Shane Jones says problems in regional councils are "hobbling" economic progress. Last week, Jones told a forum New Zealand First did not see a compelling case for regional government to continue to exist after changes to the Resource Management Act came into effect. However, Bay of Plenty Regional Council chair Doug Leeder says scrapping regional councils is not in the interest of the wider community or the environment He was reacting after Jones told Morning Report regional councils such as Otago and Waikato were standing in the way of mining and marine farming permits. "In 2012 the Waikato Regional Council itself made a submission to the Productivity Commission and it identified that co-ordination and a host of other problems was actually hobbling its ability to contribute towards productivity. "If we don't have mining, if we don't have marine farming then a lot of the regional areas of New Zealand they're going to be blighted," Jones said. The councils represented a small part of a case for a "broader rationalisation" which he intended to put before his party in the lead up to next election. "New Zealand politicians should ask the public: Do they feel that the current system, is it generating ratepayer value? Is it actually delivering economic growth at a time where the narrative we have - as a government - is to boost economic growth, to generate the surplus so we can afford the services that we take for granted," Jones said. The influence of iwi and the creeping scope of co-governance initiatives had extended beyond initial intent. "I'm deeply concerned that the Waikato Regional council is turning into some sort of iwi back office. "I think that there's a host of other challenges though where [council] staff are hobbling economic development such as an unwillingness to support mining in Otago where they've dredged up some dead moth," Jones said. Minister for Resource Management Act Reform Chris Bishop said the changes the government was making will look at the functions and responsibilities of regional councils. Bishop said the reform process has implications for regional councils, as they do a range of things such as public transport, natural hazard management, and environmental monitoring and planning. He said Jones was giving his party view but he could understand his frustration with regional councils. Doug Leeder Photo: NZME Bay of Plenty Regional Council chair Doug Leeder says passing off regional council's responsibilities onto another agency will not alter the challenges associated with their functions. Councils gained a raft of important responsibilities from regional catchment boards in the late eighties. "They include really important functions such as the stewardship of land, water and air, therefore the environmental issues. There's rivers, drainage, flood protection schemes, you've got public transport delivery, emergency management functions, regional planning functions, bio-security, bio-diversity as a starter. "So when we understand those and we understand how they are best delivered then that's the start of the conversation rather than the unilateral just getting rid of councils," Leeder said. Councils were open to discussions on streamlining those functions if the tasks were underpinned by good, solid governance. "Let's be upfront, some of the consenting processes across the country in terms of the RMA [Resoruce Management Act} and getting infrastructure and delivery of services are really complex, they are really expensive and they need review. The regional sector of Local Government New Zealand has been advocating for this for a significant period of time," Leeder said. Scrapping regional councils and their associated functions was not in the interest of the wider community or the environment, he told Morning Report . Sign up for Ngā Pitopito Kōrero , a daily newsletter curated by our editors and delivered straight to your inbox every weekday.
RNZ News
2 hours ago
- RNZ News
Luxon's China visit receives mixed verdict
Prime Minister Christopher Luxon promotes New Zealand meat in Shanghai. Photo: Supplied / Prime Minister's Office and Nancy Lu MP Business leaders have delivered a mixed verdict on Prime Minister Christopher Luxon's three-day trip to China in terms of its immediate impact of trade, tourism and education. A range of business agreements as well as 11 new government-to-government deals were signed on Luxon's first official visit to China. Lisa Li, managing director of China Travel Service New Zealand, said the twin tweaks to immigration settings should be a shot in the arm for New Zealand tourism and business. China Travel Service New Zealand managing director Lisa Li Photo: Supplied She said replacing transit visas with an electronic travel authority for Chinese nationals would bring additional tourism traffic to New Zealand. "We understand that passengers who visit South America are either businesspeople or high-net-worth individuals," Li said. "They are very valuable potential customers for us." Luxon delivered a presentation in a live-stream with Chinese travel agency Ctrip on 18 June, a popular mid-year shopping date in China. His appearance on the platform would also attract people to New Zealand, Li said. She applauded Tourism New Zealand's 100% Pure New Zealand campaign event in Beijing, as well as the deals reached by the two countries' airlines. The prime minister' visit was a high-profile event for the community, Li said. "Once you turn on your mobile phone ... the [many] posts that have been shared will come to your eyes," she said. "You don't have to search for it. It just keeps coming." Prime Minister Christopher Luxon attended a signing ceremony between BeauEver and its Chinese partner. Photo: Supplied Cosmetics company Global Empowerment NZ was one of several companies to have signed an agreement with businesses in China during the visit, inking a deal to facilitate greater cooperation between its skincare brand, BeauEver, and a Chinese partner. Luxon also announced a new government certification scheme that cleared the way for Kiwi-made cosmetics to be sold on Chinese shelves. Consumers in China can currently only purchase New Zealand cosmetic products via online channels that don't require regulatory animal testing. Tera Zhou, marketing manager of Global Empowerment NZ, said Luxon's visit would benefit trade, tourism and education as well as enhance "friendship" between the two countries. "The prime minister's announcement of replacing animal testing with new technology is a great help for the New Zealand beauty industry to enter the Chinese market," Zhou said. "BeauEver has long insisted on no animal testing, so it has ... been conducting business through cross-border e-commerce," Zhou said. "After the implementation of this new ... [certification] method, it will be a great help to our business in China." Immigration advisor Peter Luo Photo: Supplied Luxon's whirlwind visit also resulted in agreements between New Zealand education providers and Chinese universities and schools. The visit could help build political rapport and enhance bilateral relations, which could be beneficial to New Zealand's education industry, licensed immigration advisor Peter Luo said. However, wooing Chinese education officials and institutions wasn't the solution, he said. "There is a Chinese saying that 'a blacksmith must be strong'," Luo said. "Tertiary education in New Zealand should improve the quality of education." Luo said the Chinese government had invested a lot into education and top Chinese universities were far ahead of these in New Zealand academically. "Chinese parents value this very much. [New Zealand universities'] ranking is worse than their Chinese [counterparts]. Why should I send my child to study here?" Luo said. "If we don't invest in tertiary education but rely on exports of our agricultural products ... the gap between us and ... other developed countries and Australia will become larger and larger." Economics professor Robert MacCulloch Photo: Supplied Robert MacCulloch, an economics professor at the University of Auckland, said he did not think Luxon's trip would yield a lot of economic benefits. "China has for a long time been the biggest buyer for our agricultural products and I don't think there's anything particularly new in that," he said. "I think it's more on the political side that probably the visit is meant to have some significance. "It was just a traditional trade trip," he said. "For 50 years, Kiwi prime ministers [have been] trying to flog our lamb off overseas." MacCulloch also questioned New Zealand's "trade equilibrium with China". "The deal is that we sell them unlimited amounts of dairy powder agriculture, and we import all of their IT and tech at sort of relatively low prices into this country, which almost guarantees that we'll never have serious industries in that space," he said. The New Zealand Customs Service and the General Administration of China Customs have also agreed on a new pilot to trial speedier border clearance for airfreighted fresh foods.
