An example of why NZ will never catch Australia

Yesterday I saw a friend link to an advertisement for a full time graduate programming job on Student Job Search. The employer is seeking someone who is competent in C#, ASP.NET, HTML, CSS and Silverlight.

None of these skills in particular are very difficult or uncommon but what got me was the pay rate. $20/hour at 35 hours/week. On the surface that doesn’t look that bad and probably a lot better than the $12.75/hour most people are getting working in retail, but lets do some maths.

$20/hour * 35 hours/week * 48 working weeks/year = $33,600 NZD per annum.

Now lets convert that to AUD (using xe.com) we get just under $26,000 AUD per annum.

Now the minimum full time wage in Australia is $27,355 per annum (based on 38 hour week).

So a full time graduate job in a growth sector in New Zealand pays lower than the minimum full-time wage in Australia.

So this got me thinking, what is the minimum full-time wage in NZ, converted into Australian dollars?

The minimum is $24,480 NZD (based on 40 hour week), which converts to just under $19,000 AUD per annum.

To put it simply at the minimum wage level in Australia you earn 44% more for two hours less work per week.

Now of course none of this takes into account tax differences, superannuation, living cost differences etc. But it is still a remarkable gap.

Prime Minister John Key may talk about a goal of catching Australia but I don’t believe it is possible. Politics can’t fix the problem, only business paying their employees more can, and of course this idea flies straight in the face of capitalism.

In the meantime it is little wonder why so many young people are leaving when a graduate job is paying less than the equivalent minimum wage of the next door neighbour.

There is something wrong with an economic system that tolerates beggars

Today marks four months since I moved to Sydney. To date Sydney has been awesome, I do have a few moans about it, mainly around its sheer size, my lack of a car, and unfriendliness of people, however these points are minor compared to one thing I am still failing to understand.

Sydney is a rich city, it has been blessed by money, looking at the CBD there are an uncountable number of buildings over 200m in height, looking at the news you seen rich people complaining they are being taxed too much, every mall has a many designer fashion stores, and one thing you don’t see much of is poverty. Except in one place. Street corners in the CBD. On almost every corner there is a beggar, some young, some old. There is one question that screams out from this: How can a city that is as big and as rich and is blessed as Sydney have people on street corners having to beg for money to survive?

I am informed that Sydney beggars are not as bad as other big international cities, and when I have raised this point with locals in discussion their reply is often runs along the lines that the beggars should just get off their lazy arse and get a job. Sure there are probably a few young beggars who could and should do this, but what about the older generation the people who have been on the streets for years? Surely this problem is a failing of the underlying social system than that of solely their own doing.

And the problems in the social system must lie on the shoulders of the government. It is the government’s duty of care to look after its citizens in particular the vulnerable and the disadvantaged in society and the homeless must be some of the most disadvantaged people in Sydney. I have yet to meet a rich beggar.

However, the failings of the government must lie back in a lack of tax revenue being raised from the people who are blessed, those who are earning money and are wealthy enough to be demanding tax cuts so they can buy their sixth holiday home. But can we really blame or attack people for being rich or blessed? People often work extremely hard to get ahead so who are we to bring them down for it?

Ultimately the issues of wealth, poverty, tax and a failed social system lie with the failure of our economic system, capitalism. A system that in its most fundamental form demands that in order to make a profit another must make a loss and those who make the largest profits win. And that is seen in its raw form with bankers walking past beggars at rush hour every morning in central Sydney.

In a column in today’s NZ Herald union activist Matt McCarten writes:

The left intellectuals we used to rely on to challenge ideas have retreated into academia. The staunch left survivors parroting on about an economic system built around the needs of people, rather than the needs of some to make profits, is rather quaint and eccentric.

The fight between socialism and capitalism isn’t over yet.

I was challenged last week to put this to the test.

So we organised a left versus right debate on Wednesday at Auckland University on the question, “Is Capitalism working?” Unashamed right winger Matthew Hooton, aided by the NZ Herald’s Fran O’Sullivan, with liberal conservative cover from National’s Nikki Kaye, agreed to give us the reasons why capitalism was better than socialism. Unite’s Mike Treen and NDU union leader Maxine Gay joined my team.

The auditorium was standing room only, overflowing in the aisles and outside. We won the overwhelmingly majority of the nearly 400 students present. When the right has to justify its dogma it doesn’t stand a chance with a thinking audience.

It is no surprise that the socialists won in a debate at a university, in the same way the capitalists would win if the debate was held in the middle of the stock exchange floor. However, I do believe that capitalism is not working, and it is not an academic argument, it is an argument that can be shown through beggars on street corners, pensioners who can’t afford the necessities of life, or a decent health system, or the young people of today who are being lumped with huge student loans to be able to get a qualification, a ticket to compete in the corporate world where capitalism turns people into cannibals who will stop at nothing to get to the top of the cooperate jungle.

A new system of economics and life needs to be developed, one that does not tolerate beggars, one that values education and our young people, a system where taxation is fair and leaves no one behind. People can become rich and can be blessed but not at the expense of others. I don’t buy the argument that it is just a fact of life that there will be rich and poor. Sure there will always be unbalances in life, but as socially advanced, aware, and intelligent beings we need to start acting intelligently and ensure that everyone in society is guaranteed shelter, food, health, education and employment.

This is not a left verses right political argument. This is a societal argument. I have no issue with people working for the dole, and I certainly do not like the idea of tax money being given freely to those sitting around watching TV all day. This is an argument about how terribly broken our economic situation is, and how we need to change it before our entire world collapses, the global financial crises was only a small warning sound to a much bigger societal collapse – are we intelligent enough to listen and react to the warning? Or are we truly just deaf, blind, dumb and stupid?

Do your own own bloody tax return

Okay, this is one of those rants that I have been planning for a while but have only now decided to piece it all together and type it out.

Firstly, check out this nonsense that appeared in the Sunday Star Times a week ago: http://www.stuff.co.nz/business/2585853/Tax-windfall-awaits-thousands

It is blatant advertising for a tax agency not a real news story.

The tax refund season has begun and thousands of Kiwi workers could find themselves with a nice big present.

Now workers can check to see if they are owed any of the estimated $100 million in overpaid tax for the 2009 tax year. And it could be more likely than you’d think.

At this point the story is reading like a nice ad for ird.govt.nz, okay good.

TaxRefunds.co.nz, a business that helps people file refund applications online, has calculated the chance of getting money back from Inland Revenue (IRD). For example, the table shows a worker on the average wage of $48,000 has a 20 percent chance of getting a payout with the average payment close to $245.

What! Advertising some dodgy company… hmm…

The probability climbs or falls depending on how much was earned. TaxRefund director Geoff Matthews said those hovering around the different tax brackets scored highly with those on $38,000 having a 55 percent chance of getting money back from IRD.

This is probably true.

“It’s like having a lottery ticket at the bottom of your drawer of course you’re going to check it,” he said.

Since when did filing a tax return turn into playing lotto? Unless you spend all your refund on lotto tickets.

… (5 more paragraphs of dribble, go read it on the link above if you have to)
If someone decides to go ahead and file the claim with the IRD, the company charges 12.5 percent of the rebate amount, up to a maximum of $500. The minimum fee is $12.50 per return.

Is there any news at all in this story? I don’t see any. All I see is advertising for some dodgy company and lotto. And lets make one thing very clear. Go to www.ird.govt.nz and do your own tax return there. You will get it all back and not give up 12.5% to some dodgy internet site.

Speaking of dodgy sites taxrefunds.co.nz seems to be getting dozens of complaints as highlighted here: http://tvnz.co.nz/business-news/ird-warns-online-tax-return-services-2706304

The Inland Revenue Department is warning people to be wary of online companies offering free tax return services.

This follows a number of complaints from people who say they didn’t realise what they were getting themselves into.

It’s ads like the current tax refund ones that Donna DeCleene thinking she was in for a windfall.

“I thought I may as well register and see if I have any money owed,” DeCleene says.

She went to taxrefunds.co.nz and typed in her IRD number to find out more about claiming back taxes.

But she was surprised when she received a letter from the Inland Revenue informing her that taxrefunds.co.nz would act on her behalf on all future returns.

“They were telling you to apply for old refunds not saying that they would then act for you in future years for any tax refunds,” she says.

The IRD says its received dozens of similar complaints about tax refund companies

“Read the fine print so you know what you are committing to before you do it. Or alternatively come to our website directly and you can do it for yourself anyway,” says Charles Ronaldson, Inland revenue.

When logging onto taxrefunds.co.nz you can see in the fine print that the company takes 12.5% on any refund, a commission that is also paid on things like family assistance credits and they will continue acting as your tax agent until you tell the IRD otherwise.

“It tells you on the site and you have to tick a box that accepts the conditions that we will be your tax agent like any chartered accountancy,” says Geoff Matthews, taxrefunds.co.nz.

Taxrefunds.co.nz was set up seven months ago and has already processed $62 million worth of returns

“I know I get a tax return through family assistance si i know i didn’t need them helping me because it’s all automated through IRD,” says DeCleene.

However Matthews says, “if we weren’t in the market nobody would know that they were due tax refunds”.

Mr Matthews people have been getting tax returns for much longer than the nine months you have been in the market. All it appears is that you are a very cunning scam artist giving people a service that they already had access to for free. It isn’t very impressive.

Finally be aware that IRD do seem to be on a go slow at the moment as highlighted here: http://www.nbr.co.nz/article/ird-go-slow-tax-refunds-angers-firms-102459 and http://www.gpforums.co.nz/showthread.php?s=&postid=6194020

I filed my tax return for 08/09 on May 12 and it took 9 weeks for them to process it, however, eventually I did get a refund and a nice big one too. So go and do your own. You will get more money and not get into bed with a dodgy company trying to take your money for doing nothing.

Thoughts on McDonalds

Does anyone else find it ironic that McDonalds can see a global increase of 7% in customers over the last twelve months but at the same time cannot afford to increase their workers wages by 50c keeping them on the minimum poverty wage?

Is anyone else able see through the PR spin and spot the irony and the hypocracy in their statements. Just proof that poverty wage are paid in New Zealand by a profit loving multinational.

I doubt they will cease to build new Restuarants and if they did it is a good thing, the less fat making fast food places the better. Bring on more Subways and Burger Fuels.

Massey University dumps on International Students

Press Release: MASSEY UNIVERSITY STUDENTS’ ASSOCIATION FEDERATION

Massey University dumps on International Students

From 2009 all new International Students studying at Massey University will face an immediate 6 – 7% average increase in tuition fees and ongoing annual tuition fees increases due to a removal in fee Grand-parenting for International students.

Fee Grand-parenting of tuition fees for International Students ensures that students do not face tuition fee increases throughout their course. Massey University introduced fee Grand-parenting in 2005 to give International Students stability in their finances while they study.

“The decision by the Massey University Council last Friday to remove these protections for students’ financial wellbeing will severely hurt international students” says Albany Students’ Association (ASA) President, Brad Heap. “This decision was made entirely behind closed doors; students had no knowledge of this move and the University did not consult with a single student on the changes.”

“Massey University has decided to put profits before pastoral care of students and I find this disgraceful. You would expect the University to have a social conscience and protect their students not dump fee increases on them without consulting them,”said Heap.

MUSAF is committed to ensuring that the University treats all students as individuals and does not treat its International Students as ‘cash-cows’. MUSAF will continue to work with students across Massey University’s three campuses to ensure that the University actively consults with students and in the meantime urges Massey University Council to reverse its decision.

ENDS