Today's Top 10 is a guest post from Kelly Gregor.*
As always, we welcome your additions in the comment stream below or via email to david.chaston@interest.co.nz.
And if you're interested in contributing the occasional Top 10 yourself, contact gareth.vaughan@interest.co.nz.
See all previous Top 10s here.
1. Southland’s rural economy on the up
Prime Minister John Key said from the Fieldays in the Waikato he’s confident in the agricultural industry's ability to grow the country’s economy. And the attendance numbers from the Southern Field Days seem to back this confidence.
The long-term benefits to Southland's rural economy should be felt in the coming months with a record 38,500 people flocking to Southern Field Days.
Despite three days of unseasonable weather at Waimumu, near Gore, exhibitors spoken to were generous in their praise for the event, saying deals were done and handshakes exchanged.
Traders enjoyed strong sales, with "sold" signs in car and 4WD windscreens suggesting vehicle dealers were doing good business.
2. Chocolate manufacturers fight about cats
Nestle and Mars are known for their chocolate bars, but have been embroiled in a dispute regarding the protein content of their pet foods.
The claws are out between two pet food giants and one has gone to the High Court alleging some of Whiskas' packaging is misleading.
Nestle and Mars - better known for their chocolate products - also manufacture a string of other items, including pet food.
Nestle owns the Purina brand and Friskies while Mars owns the Whiskas brand.
3. Interest rates are going up, Kiwis still keen on credit
An increase in consumer confidence means we’re eating out more, and population growth is the reason we’re spending more on groceries, according to an ASB economist who commented on the increase in credit and debit card spending for May.
New Zealand retail spending on credit and debit cards rose at its fastest pace in seven months in May, with gains across all six retail industries measured.
The value of retail spending on electronic cards rose a seasonally adjusted 1.3 per cent in May from a 0.4 per cent pace in April and no change in March, Statistics New Zealand said. That was the fastest pace since a 1.8 per cent increase in October.
4. Ethical seafood, such a thing?
Should governments step in and ban products that could be sourced from slavery?
That’s the current debate going on between David Cameron’s coalition and the British Labour party regarding UK supermarkets selling Thai seafood allegedly sourced from slavery.
Labour has called on the government to stop UK supermarkets stocking food produced by slaves, after a Guardian investigation into forced labour in the Thai seafood industry.
Yvette Cooper, the shadow home secretary, said the coalition's modern slavery bill did not go far enough to turn up the pressure on UK retailers to shun products linked to forced labour. The opposition is pushing for new requirements on firms to declare any use of slavery in their supply chains but the government prefers a voluntary approach.
David Cameron's spokesman said on Wednesday it was up to consumers whether they choose to eat prawns that had been produced through the work of slaves.
More of this story: http://www.theguardian.com/world/2014/jun/11/slavery-prawn-shoppers-boycott-unethical-seafood-greenpeace
5. Housing not only out of reach for Kiwis
We’re constantly told that housing is becoming out-of-reach for the average Kiwi and especially young Kiwis trying to get a foot on the property ladder. Latest statistics out of the UK indicate the trend is similar around Britain.
Concern has been growing over rising house prices, with the business secretary, Vince Cable, and Bank of England governor, Mark Carney, among the latest to express fears that recent increases may be a risk to the economy.
This map (sourced from the Guardian), based on data from the department for communities and local government, shows how English house prices have risen since 1997 relative to earnings. At the beginning of the period the average house in most areas could be bought with six years' average earnings. By the latest figures, the multiple was 10 times or more in large areas of the country. Click here for the interactive map;
6. Would you like guacamole with that?
More than $100 million worth of New Zealand avocados were exported this season, with $33 million worth sold domestically. It seems people can’t get enough of Kiwi avocados.
New Zealand avocado sales hit $136 million in the season ended April 30, double the previous season's, and setting new records in the export and domestic markets.
The return eclipsed the previous sales record of $84.1 million set in 2009-10 and was far in excess of the $60.4 million worth of avocados sold last year, NZ Avocado said.
Jen Scoular, chief executive of the industry group, said the Australian and New Zealand markets had performed very well, and discipline by the market players to match supply and demand had played a big part in the industry's success.
7. Luxury car maker losses out in Airbus deal
It’s been a rough week for Rolls-Royce who lost a jet engine contract worth NZ$5 billion after Emirates cancelled a planned purchase of 70 A350 aircraft from Airbus. Rolls-Royce is the sole manufacturer and supplier of engines for the Airbus A350.
Rolls-Royce has lost jet engine orders worth £2.6bn after Emirates airline cancelled a planned purchase of 70 A350 aircraft from Airbus.
The Dubai-based airline had ordered the planes from Airbus in 2007, due for delivery in 2019.
Rolls-Royce is the sole manufacturer and supplier of the engines for the A350, seen as Airbus's answer to Boeing's Dreamliner.
The British engineering firm, which has bases in Derby and Bristol, said the cancellation would shave 3.5% from its order books, but was hopeful that other airlines would fill the delivery slots.
8. Kiwi kids winning balm
The cosmetic market is a competitive one and a hard one to crack, but Kaikoura-based students have made an impact on the industry with their multipurpose balm.
A student-run business producing and selling an all-natural kawakawa based balm has scooped the first prize in this year's Young Enterprise Scheme (Yes) Dragon's Den Competition.
Kawa Care, run by five Kaikoura High School students, created a multipurpose balm strictly made from local Kaikoura ingredients.
The runner-up team, Chariot Brothers from St Thomas of Canterbury, have developed a lightweight, portable and collapsible stretcher to carry injured people in difficult to access areas.
9. Mortgage going up, reduce KiwiSaver contributions
One of the benefits KiwiSaver is becoming famous for is the first home deposit option.
But if you’ve already got a mortgage and interest rates on your loan increase, is it worth decreasing your contributions?
The Reserve Bank is expected to increase the official cash rate again tomorrow putting more pressure on mortgage holders budgets.
But should you cut your KiwiSaver contributions and divert the money into paying for higher loan costs?
Absolutely not, if you can afford it, says Nigel Tate, a Waikato based financial adviser and president of the New Zealand's Institute of Financial Advisers.
"For employees it's a no brainer to keep going with KiwiSaver," he says.
10. Small business to get a break?
Good news could be on the horizon for small businesses – the arduous and often cash-flow inhibiting provisional tax could be on the way out. The system that enforces small businesses to forecast their tax liabilities and therefore their earnings could be one less headache for New Zealand’s small to medium sized enterprises.
The much-hated provisional tax system that forces small businesses to forecast their tax liability a year in advance will be overhauled, Revenue Minister Todd McClay has all but confirmed.
McClay said he did not believe the provisional tax system was "fit for purpose". A "business transformation" programme under way at Inland Revenue, which the department expects to cost up to $1.5 billion, could allow firms to pay tax on their income in, or closer to, real time, he said.
It would be "wonderful" if Inland Revenue could get to a point when income was taxed only when it was earned, but any changes would need to be balanced against the Government's needs, he said.
*Kelly Gregor is a former business journalist currently working in corporate communications within the banking sector.
10 Comments
Any KiwiSaver member who's been in the scheme for more than a year can go on a KiwiSaver holiday for up to five years (and they can then go on another one, and another, and another); they don't have to give reasons, nor do they have to use the money to pay for their mortgages. Obviously they will not get their employer contribution during that holiday, although they can still get the Government contribution by making one-off voluntary payments.
I am a bit surprised by the financial adviser's comment that it's a no-brainer to stay in KS rather than divert the money to your mortgage. I would have thought that would depend on the individual circumstances - how big is the mortgage, how much are you putting into KS, what will you have to give up in order to be able to afford the extra mortgage cost, what your KS is earning etc.
The Funds Industry are front-footing this as they are expecting a percentage of home owners doing the household budget sums and deciding to cut off their Kiwisaver contributions by going on a KS holiday thus finding the $150 or $200 etc for the increased mortgage repayments.
Maybe this is what got David Parker, Labour thinking about this.
Well I know it's a bit unlikely, but supposing the interest rate rise added $200/month onto your mortage repayment cost and your employer subsidy was worth $100/month? Or supposing you could negotiate with your employer that he would pay you the extra $200/month directly instead of putting it into your KiwiSaver account? Wouldn't cost him any more than he's paying already, and it's quite legal.
In practically all matters financial, the best course depends on the individual circumstances.
... it would be wonderful if businesses had to pay tax only after they'd made a profit ...
Provisional tax is an absolute disgrace ... these anti-business policies cost us jobs and production , all in the name of feeding money more quickly into the coffers of greedy finance ministers ...
We welcome your comments below. If you are not already registered, please register to comment.
Remember we welcome robust, respectful and insightful debate. We don't welcome abusive or defamatory comments and will de-register those repeatedly making such comments. Our current comment policy is here.