Embrace change

Everyone is talking about it and if they are not talking about it, they at least know someone who has done it. It’s all over the press and even my kids are doing it.

The press is running around telling us that there is a great exodus to Australia and record numbers of skilled workers are leaving our shores for greener pastures, well at least, desert-colour pastures. After a bit of research it was easy to see why, apart from what the press are saying ie better wages, cheaper housing, better weather and a working health system.

These reasons are probably all true, however there are larger forces at play and large shifts or trends can only get momentum if the powers-that-be want it that way (1).

The recent flee of the kiwi numbered about 15,300 in 2023. This is well short of the numbers that escaped to our neighbouring Nirvana from 2009 to 2013, however I do believe the 2023 number will continue to increase through 2024.

In the graph above it shows a massive wave of people leaving to Australia and then it came to a screaming halt in 2014. The weather didn’t change significantly, there were no significant changes in wages or living conditions, what did happen was the Government in Australia decided to make some changes. These are a few of them:

2011 – Nzers not eligible for disaster relief payments

2012 – NZers were not able to claim as victims of terrorism

2013 – The National Disability Insurance Scheme would no longer apply to Kiwi’s.

2014 – No more subsidised study placements for you if you come from NZ. Further adverse law changes concerning ‘character’ as it related to kiwis in the Migration Act. This put any kiwi who was not born in Australia in danger of being deported (2).

The attitude of our Australian brothers and sisters were obvious, they figured that we may be taking advantage and they didn’t want us there any more. In turn, NZ, feeling the cold shoulder, changed the ‘down time’ for Australians applying for a student loan from 2 years to 3 years.

The results of these government changes can clearly be seen in the graph above. As kiwis saw the rumbling clouds in the distance, they decided to stay home.

With a change of government in the election of 2015, the Australians took a U-turn in how they viewed kiwis; student loans were granted and then in 2016 the Prime Minister in Australia, Malcolm Turnball created ‘A new pathway’ to make it easier for New Zealanders to become Australian Citizens. As long as you had consistently earned over $53k per annum, the skills test didn’t matter anymore. This, of course pricked the ears up of forlorn kiwi’s that had longed for greener shores and no written invitation was needed, they were off! Slowly the numbers exporting to Australia began to increase.

If there is one major truth in this world, it's that people do business with other people that they like and after John Key had a sleep over at Malcolm Turnball’s house, the scene was set. Breaking all the visiting dignitary moulds, the pair went kayaking the next day in Sydney and became good friends (3).

We can’t state for sure that this bromance had anything to do with the U-turn on how the Australian government treated wannabe Ausi’ Kiwi’s, but it certainly didn’t hurt!

A further look at the graph above will show that the turn around was short lived when the gnarly creature called Covid moved in. Lock-down froze all migration to Australia for a couple of years and the stats were put on hold. When we all came up for air, we found we had to face the predictable crash after we let inflation off the leash following the quantitative easing. And down we went.

Australia took a dip, but then started to jump straight back up, riding on the buoyancy of its strong exports and, as it turns out, immigration. Australia continued to supply China their coal and Iron Ore and is reaping the benefits with a positive GDP.

The irony here cannot be ignored: Australia is sending its largest trading partner, China, fuel for the production of products, including the production of weapons. One of Australia’s largest expenses will be in defence where they are spending millions of dollars that they received from China to protect themselves from China.

We can see below the comparable house growth path of Australia compared to NZ. The average house price in Australia has equalled it’s post-covid boom already and headed north while NZ is still uncertain where it is headed.

Stats NZ data shows the cost of building a house has increased by 41 per cent since 2019, making housing even more unaffordable for Kiwi families (4). This is not a welcome statistic when we are in a position where the government is doing everything it can to build more houses. The National government do not typically build state houses, they prefer to hand that problem over to private industry. Private Industry are turning their backs, because there is no money in it for them due to the high cost to build and the flattened sale prices. So here we stay at a standstill.

We need to look at what we can do to fix this situation and a big part of it relates to foreign investment.

Although the country is divided politically, as many countries are, what most will agree with is that bureaucracy can do more damage by slowing progress than it will benefit whoever or whatever it was designed to protect.

There are many kiwis that have the attitude of wanting to conserve what we had, to keep or even turn back the clock to where we were in the 70’s. You know, back then, ‘the good ole days’ when Simon & Garfunkle, the BeeGees or Elvis would be played daily on the wireless. Where we could play on the street after dusk and we would go visit friends on our push bikes. This is never going to happen as the only constant is change, continues to be and always will be.

Kiwi’s are not unique in this situation, in 2024, 46% of London is Ethnic, 33% of Paris is African, a third of California is Hispanic and many other countries are changing in a similar fashion (5). There seems to be no other way except to open the doors like other countries have done. David Seymour, the Associate Finance Minister, noted recently that when advised of how thick our bureaucracy had become, he made a directive.

This directive was given to LINZ (the regulator of the Overseas Investment Act) to half the time taken to approve OIA consents and to concentrate more on protecting infrastructure when it comes to allowing the sale of sensitive property (6). The Directive provides a message to leave smaller investments alone, those investments that are not attached to our infrastructure and provide less risk.

This is in response to finding out that NZ is the most bureaucratic country in the world when it comes to ‘screening and approvals’ of people that want to give us money (7) and we are not going to grow until will pull that stopper out of the proverbial.

In summary, I think we are now on the right track, cutting back unnecessary expenses in the Public Sector (although this needs more consideration) and opening up the doors to foreign investment. To the nay-sayers who want the world to stay as it was, that is like telling the possum he can remain in his tree as a motorway gets built in the same location.

We can’t stop change and progress, whatever form that will take, the demographic is going to change and so is the landscape. We are unlikely to ever be self-sufficient, so we will always need other countries to help prop us up. If we stay the way we are, all the skilled workers will continue to leave and all the unskilled workers will continue to arrive on our doorstep. Production will drop and we will no longer be able to compete. No sales equals no jobs and the unskilled will go on the dole. Taxes will increase to help pay for the growing welfare state. The rich will leave due to high taxes compared to what they would have to pay next door (Ausi) and there will be no money to fund the welfare system. We will then become a third-world country and survive on donations whoever is left will slowly starve to death.

But, it doesn’t have to be that way. As mentioned before, let the investors in, join with them, embrace the different cultures and then we will not only survive, but we will prosper.

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Embrace change

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