The politics of drainage in NZ – another failure of basic regulated capitalism!


In a recent column, Max Rashbrooke highlighted the horror of NZs under regulated market

The bad news is that, to investigate 200,000-300,000 terrible rentals, the Ministry of Business, Innovation and Employment (MBIE) has employed a frontline inspectorate numbering … 37. Each inspector will have to check somewhere between 5000 and 8000 rentals.

…there is only 37 inspectors of rental properties for 300 000 terrible rentals?

Similar poorly funded regulation is apparent in the 82 labour inspectorates who are supposed to police hundreds of thousands of migrant worker exploitations!

Time and time and time again in New Zealand we see an old boy matrix of vested interests who occupy market dominance and act like a monopoly, duopoly or oligopoly raking in vast wealth while leaving the local small and medium sized operators outside the cosy relationships!

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Up and down NZ, small and medium enterprises are unable to compete because of the lack of basic regulation in the market!

We’ve seen it with the Supermarket duopoly, the medicinal cannabis oligopoly, the Gib Board monopoly – each time under regulated and poorly regulated capitalism continues to screw over us the consumers at a time of a cost of living crisis!  

Frustration inside the drainage industry has reached boiling point recently with anti competitive practices and crony capitalism that would make your average South American Drug Cartels blush.

Local drainage industry sources tell of being blocked and unable to open accounts with large suppliers and when they can, they won’t give them anywhere near market rates.

A recent meeting with a Plastics manufacturer to get access to the plastics/PE market by local drainage contractors was a classic example of the problems to access fair markets.

It took months to get the meeting and was then told in no uncertain terms that they were protecting their relationships with Fletchers – Humes and Hynds.

The pricing that was then offered was designed to keep the local contractors uncompetitive – the pricing offered was not even close to market rates.

Local contractors try to buy Pipe off of another local supplier but their biggest customer is Hynds so the pricing they offer local contractors is more expensive – so again anti-competitive pricings designed to side-line small to medium drainage companies.

One industry source said,

“They have clearly done their homework to ensure that it is just too hard to get enough of the right products and compete against the existing system.”

“To be able to compete in the civil market where the serious dollars are, with the volumes required and the back up systems in place to offer the right service levels we must have fair access to NZ Suppliers.”

“However this access is being actively blocked as set out above.The other main problem from this lack of access to Civil Pipe is that it holds small / medium contractors out of the subdivisional market as we are unable to offer a package deal such as that proffered by Hynds and Humes leaving us feeding on the crumbs –  while the Cartel potentially overcharges the public and then rakes in a fortune.”

Comrades, I’m not looking for socialism, just basic regulated capitalism!

There needs to be an urgent investigation into the drainage industry to ascertain if market dominance is loading up costs to housing, local council and State Housing!

Have Labour dropped the ball again on properly regulating another market?

In this case we need to drain the swamp to see who is dominating the drainage market!

This could be adding enormous costs to housing and no none seems to have looked into it at all because it’s all under the ground!


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      • Did Labour drop the ball when they “let” John Key allow Fletchers to monopolize the gib industry, Bob? Most of these problems go back about a decade. The real root causes for the disfunction in construction stem from the nineties. Perhaps you should stick to eating soggy biscuits and not remark about shit you obviously don’t have a fucking clue about.

    • Agreed that cartoon of the big business man smoking his cigar saying let’s teach the masses identity politics is relevant. It plays into the hands of the few.

  1. I had thought Hynds was a reseller & did not know that they do contract installation as well? There will always be volume discounts for bigger customers although smaller good paying customers can get around this by getting quotes for large jobs although the discount would depend on what sort of relationship they have with the supplier. I did manage a plumbing warehouse in the 80’s & the difference between retail, trade & big trade customers was substantial then so I would imagine a similar situation exists today. While some products just had a normal sort of profit others were about 5-10 times the cost price (depending on the source) although business running costs have also increased.
    It seems obvious when comparing building costs in NZ to world prices that those at the top of the supply chain are making more of the margin than they deserve so it would be nice to see that change.

  2. “Have Labour dropped the ball again on properly regulating another market?”

    Comrade, Labour never picked the ball up in the first place.

  3. As Gerald Celente a trend forecaster from the stats says. ‘The Bigs are getting bigger and everyone else lives in slavelandia’. That’s where we are headed as the powerful consolidate their power with help from the politicians who they can buy off.

  4. This gets at the heart of NZ s problem. We must trade with each other for our needs. We must employ each other and make the money we have go round bringing the multiplier effect with every transaction sparking another smaller transaction. But we sell our businesses to other bigger businesses, often offshore, and offshore interests and big business with more profits will detract from ours, and our requirements get redirected elsewhere where there are more profits.

    Gib board not available. We need it – too bad, you have to wait on our convenience. Vertical integration, a company controlling every step on the way to retailing the finished article.
    I go to the New World supermarket – their brand Pam’s is increasingly blocking the shelves where other brands used to sell that same product. Pam’s is made to the same quality as others, but where is the opportunity for competitors?

    Labour committed treason against us when they allowed Treasury and capitalists to use us as a footstool. How we can get out from under this regime I don’t know. The middle class are all so unshakeable in their goals of conservative, materialistic thinking, so wise and capable; the others are all confused and project their fears onto everyone and then turn to amorality, and all tend to hedonism. We could all enjoy life in a better planned society, but we have to start up putting small businesses into local trusts which can buy out owners and sell to other locals, to allow freedom of movement to owners while we continue holding on to the basic working structure of our society, its affordable and available goods, its jobs serving the needs of the society, and respected by all. ‘Bob the Builder, Barbara the Baker’ or those roles reversed. And everyone would be putting in something and taking out; some would be seasonal workers with part-time work in between.

    Our society would be planned to have certainties and expectations, duties, freedoms, and opportunities – unlike the rigid callous, structure that Labour and Treasury have introduced, selling off the country that ‘Jack and Jill’ built to some prating fool, who models themself on Trump or Murdoch or wealthy ‘players and dealers’. These are headlines from Property Investor magazine June 2008 – ‘Angel of Harlem and Laurence Pope: 24years old 16 houses 1 street’ (in Paeroa I think). Now this might be good for Paeroa but we tend to lack balance in much that we do and we sure notice that in housing particularly.

    We have to face up to the self-centredness of humanity which seems to flourish in the children of worthy people who succeed in business or other ways. If they have made money then the children will ride forth on the proceeds looking for more. Advantages from the business then go to hands that had no part in working towards the success.

  5. 37 inspectors of rental properties – with 100 managers and support staff doing sweet FA and being paid twice as much.

    I’m tempted to vote ACT just to put a fire under the Public Service – heaven knows the left in their current state aren’t going to do it without some progressive revolt or uber socialist shaman of the highest order coming to power.

  6. FFS! Stop blaming Labour. Sorting this issue is the responsibility of the Commerce Commission which is run by, you guessed it, Martyn’s favourite people, Wellington’s public service galahs

  7. Labour did it! Now and when it all started in 1984 during the Lange,Roger Douglas Neoliberal Cabal takeover. Its happening again.
    The side show is the mental yoofs and identity politics by the neo fascist muddle class offspring moaning about how bad they’ve got it.

    Time for a government, governance by referendum. Cut out the middle men, woman and others.

    Because this shit is getting boooooooooring!

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