Hide on government being the worst at spending public money


Why is it government is always and everywhere so universally bad? It’s not the people. Those in government are smarter than average and better qualified.They also mean well. Well, I suppose they do. They tell us so. Their mission statements are always wonderfully public-spirited.

But no matter: their efforts sum to rubbish.

Not sure if Rodney is blind to the irony or has gone through a process of self-acceptance, but let’s enjoy his train of thought nevertheless.

The entire government could not turn out a decent hamburger.

The problem is not the people, their ability or intentions. The problem is information and incentive.

In Christchurch, we have the just-completed Margaret Mahey playground. It cost $41 million. Is that a good use of money? For a playground?

I have no idea. And neither does anyone else. There’s the information problem.

People say they love the playground. But so they should: It’s free.

People like Rainbow’s End, too but taxpayers didn’t stump up with $40 million for that. And I am sure people would like Rainbow’s End even more if it were free.

We can evaluate the use of resources at Rainbow’s End. People pay to go. The company must balance that return against the costs, which is what other businesses could do with the land, the plant, the people, that make Rainbow’s End.

That all summarises to Rainbow’s End’s profitability. It’s a private accounting that serves a very social purpose.

Government’s information problem is the lack of any willingness to pay for its services. We don’t know with any numbers how much people like the new playground.

I doubt a family of five would stump up $600, which is their share of the playground’s capital cost.

No need to doubt.   It is more expensive than Dreamworld and hardly the same value.

Then there is the incentive problem. There’s no incentive on government to reduce costs. Or provide revenue. How about a playground that’s half the size? What about providing a concession?

And no one is bothered that there’s 24/7 security and now a guard posted at the Tower of Terror to ensure no one gets hurt. The playground didn’t just cost a lot to build. It is also costing a lot to run.

There’s no concern for the expense of any of this. It’s all other people’s money. The easiest money to spend.

Christchurch has a Labour mayor.   Soon Auckland will have another one.   Collectively, we do continue to vote in those people that give us ‘free’ stuff at the cost of everyone else.

A private operator would have built the Margaret Mahey Playground at no charge. And made the council money. It could have been extremely good with cafés and shops, bright lights and activities every day.

Shopping malls and McDonald’s provide great children’s playgrounds. And they’re indoors. They’re also not a burden on those of us who don’t use them.

On a cold day the brand new Margaret Mahey playground already looks like exactly what it is: a state-built playground. I fear in a few years it will look even more so.

Where’s the incentive to keep it fresh? Where are the numbers to justify the new structures? The politicians and bureaucrats will have moved on to the next shiny thing.

Christchurch, be glad it topped out at $41m.  $41m isn’t even 10% of the budget blowout of Len Brown’s train set that isn’t even half-way to being built.

Other people’s money.  If only there was a party that would introduce a strong privatisation drive…

…yet over 95% of New Zealanders don’t vote for it.   They too want to be looked after with other people’s money.


– Rodney Hide, NBR


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