The case for unilateral recognition

Bilateral, plurilateral, and multilateral are words that New Zealand's civil service love. There is nothing that can't be improved by doing it in concert with others. 

Sometimes there's good reason for just doing stuff. 

New Zealand made the right decision when it unilaterally slashed all of its tariffs. It also progressed all the other trade agreements that helped make trade easier. But it didn't wait for those lengthy processes. Just cutting tariffs earlier was just fine. 

A couple of weeks ago in Newsroom, I made the case for doing the same thing with standards recognition. We already do it with automobiles. We don't need bilateral or any other agreements between New Zealand and other places to make sure that the cars we import are safe. Instead, there's a long list of standards that New Zealand considers to be good enough, whether the standard-setting countries like it or not. Pretty unlikely that they'd object though. 

New Zealand is part of FSANZ - a bilateral standards-setting body for food-labelling. NZ and the Australian States jointly set the product labelling rules. But it also means that imported foods that aren't labelled for the NZ-Oz market have to carry the stupid little stickers that add cost but no real value. 

Like it did with cars, New Zealand could unilaterally say that products labelled for the American, Canadian, Singaporean, UK, Irish, or EU markets (so long as the labelling includes English) is good enough for here too. We don't need bilateral, multilateral, plurilateral, or any other kind of -lateral agreements to do it. We could just do it. 

Sure, it would be even better if those countries all said that FSANZ labelling is good enough for their markets. But getting that agreement seems impossible for Canada, and probably hard for the rest. And much of the market-access benefit can be achieved through unilateral recognition. If NZ unilaterally said that products labelled to Canadian standards were good enough for NZ, then a NZ producer targeting the Canadian market could just label everything to the Canadian standard and sell that version here and there. 

First best would be everyone just agreeing that everyone has been stupidly precious about all of this, and that the labelling for any of these markets is good enough. Then nobody would have to set country-specific labelling runs. And if it were likely that NZ could have agreements with piles of countries to accept each others' labelling, then an NZ producer wouldn't have to decide which of those markets it was targeting. NZ labelling would be good enough for all of them. 

But bilingual labelling in Canada is best viewed as a religious commitment. 

MinReg this week put up an excellent report on the costs of this kind of labelling nonsense. It makes the case for, among other things, mutual recognition of international labelling standards with trusted jurisdictions. 

I don't disagree, conditional on those agreements being feasible to achieve in finite time and not precluding NZ acceptance of other country standards as well. 

But unilateral recognition should also be on the table. Having UK-labelled stuff on the shelves here would be just fine. And it'd make it easier for a UK-based supermarket to open stores here, if it wanted to.

Potential deregulations

Cato's Handbook on Affordability provides a set of policy recommendations for reducing unnecessary government-imposed costs. 

There's the usual stuff you'd expect, much of which is US-focused.

But a few bits are worth thinking about here too.

In the chapter on healthcare, Cato suggests automatic removal of prescription-only requirements from medicines. They write:

• Eliminate prescription regulation. The FDA makes medicines less affordable by requiring patients to obtain unnecessary and costly prescriptions. Adults can safely self-medicate with many medicines—including birth control pills, HIV prophylaxis, and GLP-1s—for which the FDA currently requires a prescription. Overall, prescription regulation increases prices, increases the nonprice costs of obtaining medicines, reduces access, and ironically reduces patient safety. While direct-to-consumer platforms such as TrumpRx, Cost Plus Drugs, Amazon Pharmacy, and GoodRx can theoretically reduce prices by injecting transparency and competition, the more effective reform would be to strip the FDA of its power to require prescriptions. 
• Remove unnecessary prescription requirements. If Congress cannot take prescription regulation power from the FDA, then Congress should enact rules that automatically remove prescription requirements after a certain period of time, which would allow consumers to purchase more medicines directly. Greater over-the-counter access would reduce the price and nonprice costs of medicines. 

John Key made pseudoephedrine-based cold medicines prescription-only. It seemed unlikely to substantially affect access to methamphetamine. Within about four years it was very clear that the policy failed. But it took about a decade more before that prescription-only status was removed. 

New Zealand could schedule review of longstanding prescription-only classifications, with a presumption favouring equivalent access where trustworthy overseas jurisdictions allow non-prescription access. Maintaining prescription-only status would require published justification that takes into account the added cost and burden imposed by prescription requirements.

In the chapter on childcare, Cato recommends expanding the supply of au pairs on the J-1 visa, simplifying the administrative burden facing households employing in-home care, broadening visas for childcare more generally (noting that a 10 percent increase in low-skilled immigration may reduce childcare costs by 2 percent), easing degree requirements for childcare workers, and subjecting car seat mandates to cost-benefit review.

A lot of those recommendations could carry over to here. 

The benefits of car seats for older kids aren't that big, and the costs are real. 

Immigration NZ guidance says that a niece or cousin visiting for six months to help with childcare is likely to count as working, with consequent need for a work visa. And if that work tallies to more than 30 hours per week, the relatively-simple IR56 isn't available. Surely a simplified visa and tax process could apply. 

The rest of the report's worth looking at - but mainly focuses on US issues or things that I've already covered otherwise. 

Disappointing - Updated

The ACT Party has announced a new policy that would:

• Remove the existing Permanent Resident visa category;
• Require all Resident Visa holders to receive a 5 year travel facility, replacing the current two-year initial travel condition;
• Require all Resident Visa holders to be physically present in New Zealand for at least 730 days within any rolling five-year period, with exemptions for those working overseas for NZ employers, accompanying family-members, military personnel serving overseas, those with a citizen-spouse, or other compelling humanitarian reasons.

I have questions. 

• Are existing Permanent Residents to be grandparented to that status, with the category only closed to new entry? Or do we all lose Permanent Residence?
• If existing Permanent Residents lose that status, are we punted into the resident category or does something else happen?
• Many countries forbid dual citizenship, or make dual citizenship really hard. Some will withdraw your existing citizenship if you take up citizenship in a second country. Anyone who is a citizen of one of those countries and is resident in NZ would be forbidden from splitting time between the two countries without taking up NZ citizenship, which would mean the loss of that other citizenship. Would this count as a humanitarian reason for an exemption? How much red tape will be involved in getting that kind of exemption? What would be the associated regulatory burden both on those required to jump through the new hurdles, and those required to process the paperwork?
• The Active Investor Plus visa provides a path to residence in which those investing at least $5 million can be eligible for residence with 21 days' presence over three years, or by investing $10 million and spending 105 days here over five years. Investors in that pathway, who will have invested millions of dollars, are promised that they can obtain Permanent Residence after meeting those requirements. They are not listed as an exemption. And you have promised to abolish the category that formed the basis for their investments. Many of them will be managing investments across multiple countries, and New Zealand's general not being giant jerks to migrants pitch has been part of the deal. Will you provide them with a grandparented right to the Permanent Resident visa category? If not, will you compensate them for any losses if they liquidate NZ investments where you've broken the deal? 
• To what actual problem is your proposed policy the most cost-effective solution, and do you really think the benefits exceed the cost? There are going to be a whole pile of unintended consequences if you go ahead with this. 

Update:

An ACT Party spokesperson has provided a few additional details. What they have in mind is not as bad as the worst-version.

The policy is not retrospective, so existing Permanent Resident Visa holders would not be affected.  Nobody who already holds a Permanent Resident Visa would be moved onto another visa, required to reapply, or subjected to the new 730-day requirement. ...

The Active Investor Plus Visa is exempt, so the existing arrangements for those investors, and future ones in the same category, would remain.

I still really do not like any of this. But at least it is not retrospective. And at least those coming through the Active Investor Plus category will not be affected. I don't know whether they'd achieve that by voiding the days-test for residents who came through that pathway, or by closing the PR pathway to everyone but those coming through specific channels. 

Conditional on there having been some decision to create a wider differential between residence and citizenship, I think it would have been better to also maintain a PR channel for residents whose passport-country forbids or makes dual-citizenship onerous. 

Around the traps

A few bits I've neglected to blog.

• My chat with Adam Jarvis on datacentres. 
• A follow-up chat with RCR on the same thing, as well as a couple of bits on the India Free Trade Agreement. 
• The RBNZ's Keeping Cash Local consultation was just atrocious. The Bank threatened commercial banks via a consultation document. OIAs showed that the Bank knew it did not have the power to  just go ahead and do what it threatened to do. There ought to be an inquiry on how that consultation document got out the door. My submission on the debacle. And my piece at Newsroom.
• Bit at The Post on some very fun AI textual analysis quantifying cultures of innovation going back over a thousand years. 
• The UK's Andy Burnham promises more localism, and the policy document looks decent! My piece at The Herald.
• Treasury knows the ethnicity of 97.5% of its staff; the remaining 1.5% didn't answer the question. By contrast, Treasury does not know what proportion of its staff have qualifications in economics. And it earned a big red "weak" grade on the quality of its economic analysis in the latest PIR. My piece in The Post. I also chatted with Sean Plunket about it. 
• And, over at Newsroom, a bit on the coming FSANZ rules that add more new NZ-Australia labelling requirements for alcohol. I thought that National had promised that we were going to stop doing this and shift instead to QR codes on store shelves to make it easier to enable imports and new grocer entry. 

Let them build: electricity and datacentres edition

New Zealand's electricity companies know how to stick a pipe into the ground in the Taupo Volcanic Zone and generate electricity. They've been doing it for decades, and there is enormous untapped potential. 

America's hyperscalers are currently willing to pay a large premium for immediacy. They are sticking expensive off-grid generators beside datacentres that would have to wait years for a connection. 

If NZ could be the place where decisions on whether a power company is allowed to stick a pipe into the ground are made in weeks/months rather than years, and a similarly fast decision on whether a datacentre is allowed, tens to hundreds of billions of dollars could drop here in a very big hurry. 

My column at Newsroom this week suggested NZ should consider being that place. And that the window of opportunity will not be open forever. 

[As always, I didn't pick the headline]

Kalshi, and the case for bigger sandboxes

I've been following Kalshi for a while. 

I remember back in the iPredict days, Matt Burgess figured prediction markets were a billion-dollar idea.

Kalshi's now attempting a capital-raise at a $40 billion USD valuation. 

Incredible.

But it never could have happened here. Not at the sandbox-level scale authorised by the Securities Commission. 

I had a piece in the Herald on it a couple of weeks back. I'd there cited Kalshi's Series F that had a $22 billion valuation - and they're now pitching for $40b. Amazing. 

Ungated version of the piece is here. Our country's regulators need to allow a bit more ambition. 

When Victoria University of Wellington’s great little prediction market, iPredict, announced that it would be shutting down back in 2015, it had a couple hundred thousand dollars of traders’ deposited funds in the bank. It was a very small, very limited, academic enterprise.

Kalshi is a US-based prediction market. It is regulated by America’s Commodity Futures Trading Commission, the CFTC, which fully authorised it in 2023.

It is identical in principle to what iPredict was. But Kalshi’s Series F funding round raised a billion dollars at a $22 billion dollar valuation earlier this year. Their annualised trading volume recently hit $178 billion, generating annualised revenue of around $1.5 billion.

The difference between iPredict and Kalshi does not come down to the difference in scale between the US and New Zealand – though that certainly matters. The scale, the ambition, and the permissions differ considerably.

iPredict ran as a futures exchange authorised by the Securities Commission, able to quickly define contracts and let traders figure out what they were worth. Contracts like, “Pays $1 if National forms government after the next election, pays $0 otherwise.” Prices on those contracts tell you traders’ expectations about probabilities – and they were highly accurate.

Anyone could sign up to trade, and many people did – at very low stakes. Accounts with five or ten dollars in them were common.

It was small because New Zealand’s regulators wanted it that way. They were happy to let iPredict play in a small regulatory sandbox with laudably liberal rules on how it operated because nobody was allowed to put very much money into it.

And because nobody expected anyone to authorise anything more ambitious, there was no point in even asking.

At first, traders were allowed to deposit only up to $2000. That limit later increased to $10,000. If traders had larger accounts with more money on the line, regulators would not have felt safe letting iPredict run as it did. Regulation around how it defined contracts would have hardened. It may have had to start issuing a full prospectus on each one.

Issuing a full prospectus for a prediction market contract would destroy the real value that a prediction market can bring: quickly establishing new markets when they are needed. Jeremy Maletz is head of Prediction Markets at Susquehanna International Group – a substantial American market-maker in equity options. Maletz argues that where it can take a year to create a new hedging contract on traditional markets, prediction markets can do it in a day.

Suppose that your business depends on trade with Taiwan. If China blockaded Taiwan, you’d be in trouble. It’s always possible to diversify your business. But it should also be possible to hedge against that risk more directly. A prediction market could quickly list a contract that pays out if that event happens before a set date, and doesn’t otherwise. Traders on the contract set the price; organisations like Susquehanna prepared to take on some risk provide liquidity.

Being able to set contracts quickly, when they are needed for hedging, is valuable. But that value is small if deposit limits are tight.

iPredict consequently ran on the smell of an oily rag, barely able to wash its own face, and certainly unable to cover the cost of meeting anti-money-laundering regulations imposed by the Key-led National Government. Somewhat ironically, the constraints under which it operated meant it was nigh-impossible for anyone to ever really try laundering money through it. It simply did not have the trading volume to bring that risk.

The deposit limits didn’t just mean that iPredict could not afford those kinds of costs. They also meant that the thing was hamstrung from the outset. It could never take up the kind of role that Kalshi is quickly moving into in making financial markets simply work better.

Kalshi is innovative. Last month, they were authorised to launch America’s first perpetual futures contract. Normal futures contracts come with expiration dates. A perpetual futures contract simply tracks the value of a defined indicator.

Perpetual futures contracts on house prices would be immensely valuable. Contracts could track the value of the median home in our major cities. People could save for their first home by buying the relevant house price index. No matter what happened to house prices, your progress toward a deposit would be locked in.

New Zealand’s Department of Internal Affairs decided that, because Kalshi had not been authorised by the Financial Markets Authority, it must be gambling. So they sent a letter to Kalshi demanding that it not let Kiwis trade there. And Kiwis can no longer set accounts.

It does not just stop Kiwis from trading on the outcome of the next American election. It also will substantially hinder financial market innovation and hedging options. Our regulators ensured that no Kiwi Kalshi could ever emerge and now ensure that foreign innovation cannot reach our shores.

The regulatory attitude is hardly limited to prediction markets. And it is stifling.

It is very small thinking from a country that can ill-afford it.

Another non-tariff barrier

I do not see the problem here. I do see a lot of ways of creating a problem though.

Andrew Bevin writes for Newsroom:

Ministers were warned of trade implications relating to mandatory Health Star Ratings before choosing to vote against the development of the scheme.

If Health Star Ratings are made compulsory by Australasian food ministers, and New Zealand manages to opt out, Australia would likely block imports of non-compliant food.

That’s according to advice given to the Cabinet Economic Policy Committee ahead of New Zealand’s vote against developing a mandated Health Star Rating system earlier this year.

If NZ made the FSANZ health-star ratings compulsory, Kiwi firms would have to comply. So would anyone else wanting to sell food in NZ. International outfits would then either eschew our market as not being worth the hassle, run limited production runs meeting the FSANZ standard (at higher cost both because of the smaller run and because they'd lose flexibility to shift products across markets as market conditions change), or make Kiwi retailers put stupid little stickers onto everything manually. 

All of those would limit competition here and push up costs. 

If NZ did not make the health-star ratings compulsory, Kiwi firms wanting to export to Australia would have to comply. And that's fine. They can do that. They could even sell the same version of the pack in NZ. And product from other countries could come in too - if they met our biosecurity standards. 

Why create another non-tariff barrier?  

Medsafe Delenda Est

Excellent news out of the UK. Abrysvo, a vaccine for RSV administered to pregnant women, reduces infant hospitalisation by 80%. 

From the BBC:

A vaccine during pregnancy which protects newborns against nasty chest infections is cutting hospital admissions of babies by more than 80%, UK health officials say.

A virus, called RSV, affects many babies in the first few months of life and can leave them gasping for breath and struggling to feed, with more than 20,000 babies ending up seriously ill in hospital in the UK every year.

Since 2024, women have been offered a vaccine from 28 weeks of pregnancy to protect their newborns.

A new study analysing the impact of the vaccine shows it gives "excellent protection" to babies when they are most vulnerable to RSV, the UK Health Security Agency (UKHSA) says.

RSV (respiratory syncytial virus) is one of the main reasons young babies are admitted to hospital before the age of one.

The UK govt website provides a few more details (alas, the link to the paper is broken).

The vaccine here is going to have been Abrysvo; it's the one that England rolled out against RSV.

Last year, I noted Abrysvo in a Post column on the proposed Medicines Amendment Bill. 

I'd written:

New medicines are slow to be authorised for the New Zealand market.

Even if it a medicine has already been approved by many other trustworthy overseas regulators like those in Canada, the UK, Australia and the EU, Medsafe can take a very long time to evaluate a medicine.

But pharmaceutical companies are not quick to get their medicines into our approval process. New Zealand is a tiny market. We are not at the top of anyone’s priority list. Medsafe will not assess a medicine without an application.

Consider RSV – the respiratory virus whose name is utterly unpronounceable when it isn’t an acronym. It is highly contagious. Pregnant women, infants, and some young children are more at risk from it – at least according to the Immunisation Advisory Centre.

Vaccination against RSV is available for New Zealand’s elderly. But while 40 other countries allow access to Abrysvo, a vaccine administered to pregnant women to protect their infants, Medsafe’s database shows no evidence that its manufacturer has applied for New Zealand approval.

New Zealand researchers helped with the clinical trials that proved its safety and effectiveness. But the vaccine is not available here. Simply being good enough for 40 other countries and tested here isn’t sufficient.

I noted that the Bill's proposed fast-track approval process for medicines wasn't what had been promised in the Coalition agreements. Those promised automatic approval if at least two trusted overseas regulators had approved a medicine - regardless of whether anyone got around to applying for Medsafe authorisation. 

And I worried that the fast-track would not solve the problem if the underlying problem is pharma companies not seeing NZ approval as being worth the time. We're an afterthought. 

The FDA and EMA authorised Abrysvo in pregnancy, to protect infants against RSV, in 2023. 

When I made my submission on the bill last year, a search of the Medsafe database showed no evidence that application for NZ approval had been made. 

As of this afternoon, the same search yields the same result. 

If you're pregnant or are thinking of becoming pregnant, talk to your GP about s29 access to Abrysvo. It might be tough. There might not be anyone importing it. And a lot of doctors don't like using s29. 

It is approved in Australia. I don't know whether Australian doctors are willing to dispense for Kiwis willing to pay. 

This is so stupid. 

Medsafe authorisation stands between pregnant women and this vaccine, approved in dozens of countries, and well-proven in the UK. 

Fingers crossed that Pfizer is just holding off until the 'fast-track' verification process is live, and that it goes live fairly soon. 

A closing snippet from the BBC piece. Delays can be costly. 

The vaccine didn't come in time for Laine Lewis's son Malachi, now 12 years old. He developed a cold as a baby which deteriorated so much that he was taken to hospital, diagnosed with RSV and put on oxygen. Malachi later stopped breathing and a scan soon after revealed brain damage.

His mum has said it's important his story "doesn't scare people" because what happened to Malachi was very rare.

But she added: "I'd encourage people to take the vaccine for RSV because it will help their child."

Dr Watson said the vaccine could "make a big difference to keeping babies safe" through the winter.

"I would strongly encourage any pregnant woman to discuss it with their midwife, other health professionals, and be ready to have the vaccine at their week 28 appointment, or another vaccine appointment arranged soon after that."

Latest figures show around 64% of pregnant women in England are getting the RSV vaccine, but that falls to 53% in London.

Addendum: Nothing here argues a case for government funding. That would require its own more rigorous case. I do not know why anyone would read the above as arguing a case for funding. It is only arguing a case for authorisation, so those willing to pay can have that's choice, whether or not it would be sufficiently cost-effective to warrant funding. And remember that some medicines get pulled from Pharmac's evaluation queue for want of a NZ sponsor for Medsafe authorisation. 

I find it difficult to ignore the role of stupidity in human affairs

Adam Thierer points to his favourite Ronald Coase quote:

my favorite Ronald Coase quote: "I find it difficult to ignore the role of stupidity in human affairs."https://t.co/VkrTfmmppu pic.twitter.com/UjHgK2Eu75

— Adam Thierer (@AdamThierer) February 18, 2026

With that in mind, a couple of things have been bugging me. 

Item the first. 

The government of New Zealand is exercised about supermarkets and supermarket competition. It simultaneously wants supermarkets to pay higher prices to their suppliers while reducing costs to consumers. It has established an entire regulatory agency whose job is to force supermarkets to pay more for inputs while reducing prices on outputs. At the same time another part of the Commerce Commission is trying to prevent Foodstuffs North Island from merging with Foodstuffs South Island on a very dubious theory of harm: the back-end efficiency benefits of merging two supermarket cooperatives that operate on different islands would be less than the harm to competition in the supplier market, which ComCom claims would wind up having longer term harm to consumers. 

It is not coherent.

But it gets worse.

One coherent part of the government's approach is a desire to make it easier to import food products. It would help reduce costs to consumers directly, and indirectly by easing a barrier to entry. I support that initiative. 

New Zealand has signed onto FSANZ, a joint approach to food product regulation with Australia.

FSANZ has proposed making bespoke Australia-NZ 'food-star' healthy food ratings compulsory. They are currently voluntary. 

Let's think this through. 

A store wanting to sell grocery products from outside of Australia-NZ would have two options for each product.

It could put the product up for FSANZ assessment and put a sticker on each and every packet before putting it on the shelf.

Or it could ask suppliers to provide production runs specific to the requirements of the New Zealand market. 

The former would have fairly high per-unit cost: a sticker has to get added to every product. 

The latter would also be expensive. It would mean limited production runs at higher cost that also limit flexibility to shift product across different markets in response to changing circumstances. 

It would disproportionately burden stores that stock foreign-sourced products - like the Asian grocers that provide fringe competition to the main supermarket chains. 

And it would increase the cost of entry for any overseas supermarket that wanted to bring its supply chain with it. 

One part of government wants to improve competition in supermarkets and bring costs down; another part of government wants to push up the cost of groceries while impeding competition.

Item the Second

Earlier this week, I received an email. 

I'd put $200 in there mainly to test their trading interface. I love prediction markets. I missed them. New Zealand had been truly world-leading in this area, then FMA/DIA/Justice/Simon Bridges killed the sector here. 

My submission to the CFTC on Kalshi from 2022 is here. I'd there concluded:

What experience we had with iPredict suggests CFTC really doesn't have anything substantial to worry about in allowing contracts on political events. If anything, they heightened voter engagement. The CE of iPredict even featured on the nightly news during the election, giving the latest on election market prices. And for that brief period, whenever blowhard partisans insisted that some outcome was going to happen, people could just point to the iPredict price on the event and ask them why they thought that price was wrong, and whether they'd actually put their money where their mouth was. It was a remarkable era. iPredict inflation forecasts (they also had markets on inflation going out several years - it was so very good) wound up being noted in our Reserve Bank's Monetary Policy Statements. I desperately miss it. I envy the opportunities Americans could have if CFTC takes a sensible approach to regulation.

And now they've taken Kalshi from me too. 

Newsroom has the detail on what happened, along with some pretty misleading nonsense from the Department of Internal Affairs.

Before we hit the Newsroom / DIA stuff, here's the defensible case. Or, well, defensible given the constraints.

The government auctioned off a monopoly to run sports betting in New Zealand. It is consequently obliged to protect that monopoly on behalf of the licensee. Remember that cartels and monopolies are only bad if they aren't government-authorised. In that case they are wonderful things. 

Kalshi is a CFTC-regulated exchange. It trades event contracts in the same way that iPredict did. It runs AML/KYC; I had to go through it to trade there. It's safe. It's fine. But some of its contracts are on sporting events, which in the US are treated as futures derivatives rather than sports betting. That provides Kalshi with a few advantages that Matt Levine has had an awful lot of fun discussing. 

And, at the same time, New Zealand Members of Parliament have become very exercised about online gambling full-stop. Their proposed solution is not very good. They want to license online gambling operators, which can be okay, but they also want to set tight limits on the number of operators. That's neither here nor there in this context, but it's part of the moral panic in the general area. 

Now. If you were the regulator charged with defending the monopoly provided to the sports betting licensee and if you viewed Kalshi's sports contracts as sports betting, the obvious thing to do would be to ask them to segment their markets such that NZ-based traders could not trade on the sports contracts but could trade on other contracts. 

It is entirely possible that Kalshi would prefer to close off access than so-segment its markets. But that would be a defensible position for DIA given its role as monopoly-enforcer for the company to which the New Zealand government auctioned the right to run sports betting. 

Instead we get this:

Polymarket, Kalshi and similar prediction markets are illegal under New Zealand’s gambling laws, the nation’s gambling regulator has decided.

Polymarket and Kalshi are online markets where users can place bets on future outcomes, ranging from New Zealand provincial cricket results to what phrases Donald Trump will use next month.

Whether the Reserve Bank of New Zealand will increase, decrease or hold the official cash rate when it meets on Wednesday has had over $127,000 placed on it.

...

Department of Internal Affairs gambling director Vicki Scott tells Newsroom it believes they are illegal gambling platforms.

“We consider platforms such as Kalshi and Polymarket to be gambling under New Zealand law,” Scott says.

“Since they aren’t authorised operators, they are prohibited from offering their gambling products to people in this country.”

“To the extent these platforms are taking bets from New Zealand customers, they are breaching the law here and can expect to hear from us.”

The event contracts on things like the OCR are very obviously financial derivatives. iPredict offered them as an exempt futures exchange in NZ a decade ago. DIA always hated iPredict and viewed it as treading on their turf - maybe they want the whole stock exchange to come under their authority as a gambling operation. 

This is not the 'online casino gambling' that is subject to the NZ gambling licensing regime. It's a CFTC-regulated futures exchange. 

And this part seems particularly off:

While these websites are still technically accessible, Scott says using unlicensed sites is risky because there are no guarantees to ensure they pay out as promised or take action to minimise gambling harm.

Does DIA have any credible reason to believe that Kalshi and Polymarket welch on bets? 

In a better world, DIA would have asked Kalshi to exclude Kiwis from its sports contracts (which I think is stupid, but that stupidity is imposed by Parliament) and if Kalshi either could not or would not, they would have put out a statement blocking Kalshi on that basis without insinuating that they're dodgy online casinos. 

Item the Third

Sam Bowman writes in the Washington Post:

By some measures, teenagers’ mental health does seem to have gotten worse over the past 10 years, and this does coincide with widespread adoption of smartphones. But that is where any clear correlation between the two ends. Multiple studies have either shown that smartphone and social media use among teens has minimal effects on their mental health or none at all. As a 2024 review published by an American Psychological Association journal put it: “There is no evidence that time spent on social media is correlated with adolescent mental health problems.”

You can also catch The Studies Show on the topic. If there are effects, they are very small.

Overseas jurisdictions implementing social media age limits are, predictably, now looking to regulate access to VPNs as complement. 

And so the government of New Zealand is rushing to have legislation on it through before the election. As it is going through as a member's bill rather than a government bill, there won't be much accompanying assessment. The Prime Minister is 'deeply supportive'. 

Sigh.

There was another good line in that old Coase piece, quoting Axel Oxentierna, a 17th Century Swedish Chancellor. "You do not know, my son, with how little wisdom the world is governed."

Alas, it was not to be

It would have been just one bad part of an overarching very silly policy. Exempting it from the policy regime I suppose makes the policy a bit more tractable. But it also makes it a lot less potentially funny.

New Zealand's government supports the creation of cultural content by paying for it through various grants. TV stations and streaming services can then run it, or not, as they want. 

Canada does things the dumber way. I'm sure they also have direct subsidies. But they also have Canadian Content regulations that prescribe the proportion of each day's broadcasting that must be Canadian content.

It was bad enough in the linear TV era. The ridiculousness of it all had the excellent SCTV pad out the extra couple of minutes of the Canadian version of the show (fewer ads than on the US side) with a very explicitly Canadian segment: the most over-the-top CanCon possible. Bob and Dough MacKenzie - the hosers.

The first segment including them had a lengthy scroll after the segment explaining how the segment meets official Canadian guidelines for what counts as Canadian content and was almost as funny as the MacKenzie brothers.

That was fifty years ago now - or thereabouts.

Times change. 

A decade ago, Canada decided that its regulatory reach extended to the entire internet if the internet could be viewed from Canada. If you wanted to stream to Canada, you'd have to meet CanCon rules. Quite how to make that work when people choose what they want to watch and plenty of potential platforms might not really care what Canada things about anything - well, they've been taking a while figuring out how to apply the principles. 

And they've finally decided that, despite or perhaps because of the uniquely Canadian content that might be created, to great hilarity, to meet the rules, the CanCon rules will not apply to pornography streamed in Canada. 

This has long been one of the more onerous demands of the CRTC, given the relative dearth of erotic media that would meet their terms as “Canadian content.”

Article content

Under the CRTC’s definition of the term, it’s not enough to have a Canadian performer or a Canadian setting.

Article content

Rather, it’s determined via an elaborate “points” system that, among other things, requires the producer and at least one of the lead performers to be able to prove Canadian citizenship.

Article content

At least three quarters of the financing must also come from “Canadians or Canadian companies.”

Article content

In extreme cases, this means that a video of a Canadian couple having sex in Canada and directed by another Canadian would not qualify as Canadian content if only 74 per cent of the financing was provably Canadian.

Whenever one despairs about policy in New Zealand, Canada and the UK provide superb reminders that the rest of the world generally remains even worse. 

Meanwhile, Australia's looking to impose Australian-content mandates on streaming services. 

The federal government has put laws requiring streaming services to produce Australian content back on the table after postponing them due to concerns about how they would interact with Australia's trade agreement with the United States.

The government has confirmed it will introduce legislation this week to mandate that any streaming services with more than 1 million Australian subscribers must produce Australian drama, children's, documentary, arts or educational programs.

I wonder whether there are enough subscribers to any single platform for Australia to run into Canada's difficulties here. It would be very funny if there were. 

Gating speech

Being able to speak online freely, under a pseudonym, is an important backstop for freedom of speech.

If government turns repressive, or bans some kinds of speech, or locks you out of some kinds of employment for having used the wrong words, at least you can online under a pseudonym. 

Well, unless you're only allowed online after logging into a government app. Then it's game over. 

Nevertheless, some in Wellington are itching to follow Australia’s lead. 

While legislation is in its early stages in Parliament with Catherine Wedd’s Member’s Bill, Education Minister Erica Stanford is leading cross-agency work to explore viable legislative options and practical implementation.  

The Prime Minister has publicly supported moving ahead.  

Paul James, the Government chief digital officer, told me on The Business of Tech podcast last week that the digital identity verification system underpinning the upcoming all-of-government app and digital wallet could offer the age verification needed to support a ban – if the Government seeks to enforce one.

I've suggested before that a trilemma applies here, or something like one. Online age gating requires adults to prove that they're not kids. 

And that means at least one of three problems.  

A system could be easily worked around by kids.

It could be very cumbersome for those over the age limit.

Or it could be the end of online pseudonymity and privacy.

Suppose that the government-app runs a zero knowledge proof solution. You log into the app. It generates a key verifying that the person logged into the app is over some age. You use that key with your favourite social media app. It verifies the key's authenticity anonymously, so the app doesn't know which platform is checking. And you're set - privacy maintained. 

But that's easily worked around if a sixteen year old logs into the government app on his fifteen-year-old friend's phone. 

And enough kids doing that means the Before 16 lobby group will characterise it as a loophole that must be closed. And then the verification is no longer done through a ZKP, ending online privacy, or we have to do daily re-verification to impose a differential cost on under-16s, making things cumbersome for other users. 

I do not like where this is heading. 

The case for optimism

Kerry Howley has a superb piece in New York Magazine on the kids in San Francisco building the future.

Houses and motels turned into dorms for kids in their late teens through mid-20s, building everything from brain scanners through to an AI VC that evaluates funding pitches - with the AI having hired a person to be its real-world presence.

We head downstairs to a dark basement attached to a garage. A slight, long-haired man, a paid test subject solicited through Craigslist, sits before a computer screen, wearing a white cap that looks like a medieval linen coif threaded with wires. The screen flashes images — basil, a blazer, Parmesan cheese. With unsettling clarity, the computer will be able to resurrect the image from electrical signals in the subject’s brain. A subject considers a picture of jelly beans. AI offers a picture of similarly colored beads. A subject looks at a red station wagon; AI presents a red sedan. Until very recently, most people thought the data produced by EEGs, an 80-year-old technology, was noisy garbage. “They just didn’t understand the power of large language models,” Jonathan says. He is 24 years old.

Reading minds is what AI engineers mean when they talk about hard problems. Eventually, the tech will advance to interpret “evoked states.” “So we start with, you know, discrete smaller tasks like emotion, like positive, negative, maybe now ten, 20 emotions. And then we add more dimensionality so that eventually we can go into full sort of inner monologue,” a world of superior self-knowledge wherein we sift through our own memory banks rather than selectively recall events through a haze of misperception. “And,” he says, “we do it all in-house.”

Doing it all in-house looks like this: a server rack with LED-lit fans in the garage next to some exercise equipment and some bicycle helmets. Jonathan and his housemates built the rig themselves. “Just asking ChatGPT basically. You know, you can just ask and then order the parts you need and you learn and you debug.”

Kids partnering with AI to build things, no need to ask anyone's permission. 

Howley's kicker here... so very good. 

How do you make contact with the intelligence rising up from the machines around you? Do you build it a body? Do you offer it yours? It is perhaps tedious to point out that we are always operating under the shadow of destruction, deploying tools that might end us, convincing ourselves, not without reason, that if we don’t build the bomb, someone with worse intentions will. Not a single one of the AI kids had attempted to lecture me about a theory or suggested I read a paper; it was not me they were trying to program. Somewhere along the way, drawn into their swell, I had begun to think of large questions about the nature of AI as New York questions, millennial questions, distant from the center of things. Where it mattered, humans were not debating AI; they were merging with it. You order the parts you need, you learn, you debug. The kids carry on with the crisp clarity of engineers, integrating what is immediately useful, discarding or rewriting what is not. No one will ask your permission to build a world you do not understand.

It's like they're living in an 80s William Gibson novel. Working in spaces where policy and regulators can't really stop them. They don't care about policy papers. They're just building. 

Those spaces matter. Policy is so impossibly stupid. 

Here, Parliament's trying to figure out the best way of breaking the internet, with National wanting to copy Australia's insane social media age-gating bill, and Labour wanting to copy the UK's even worse version. News outlets cheer them on, having always figured that social media platforms are the enemy anyway. Both parties see it as crack cocaine for attracting pivotal female votes in the 35-55 age bracket. 

And I understand that Parliament's select committee looking into this is wondering whether it's possible to regulate VPNs. Because that's been the obvious workaround in the UK for adults who don't want to have to show ID to visit every darned website. So long as at least one country remains free, VPN to it and pretend to be from there. 

I'm cheering for the cyberpunks. They may be our best hope. 

Banning racing

New Zealand will be banning greyhound racing. 

The Bill to formally end greyhound racing will be introduced to Parliament later this year. The public will be able to make submissions to the select committee as part of the process.

“It is important people get the opportunity to have their say. The decision to end greyhound racing was not one Cabinet took lightly. I acknowledge the impact that closing the industry will have on those involved.

“But globally the industry is winding down, with Tasmania recently announcing an end to greyhound racing. The bottom line is too many dogs continue to die and be seriously injured, and it is time to do the right thing,” says Mr Peters.

Ok. So the reason for banning greyhound racing is that too many dogs die and are seriously injured.

That is the basis for the ban, according to Minister Peters.

Let's go with that. 

I've asked my advisor about the rates of accident and death per racing start for greyhounds and horses.

Because we haven't banned horseracing. Indeed, we subsidise it. 

My advisor's answer, which presumably could be checked by someone with industry-knowledge:

Bottom line

Per start, a horse is more likely to die than a greyhound in racing, with the gap ranging from ~1.5× (NZ flat) to ~5× (Britain, all racing), and ~12× or more in jump racing. 

Greyhounds sustain more recorded race‑day “serious” injuries per 1,000 starts than Thoroughbreds in the datasets that exist, but those counts include categories (e.g., ≥22‑ or 43–90‑day stand‑downs) that don’t map cleanly onto how horse‑racing reports non‑fatal injuries. 

So on a first cut horses have a substantially higher risk of death per racing start than greyhounds have.

So if the government wanted to ban racing on basis of deaths, it should have started with horses.

Maybe there could be some CBA claiming a lot more benefits from horse racing per race as offset, or maybe people care more about dogs dying than about horses dying. 

But the simplest explanation here is probably the correct one.  

Breaking the internet

There are a lot of metrics folks can use when evaluating policy.

"Will this policy break the internet" is an important one. At least for me and the handful of folks who were online in the 90s. 

Age-gating social media, or otherwise making platforms/sites liable if kids see sensitive content there, is one way of breaking the internet.

It has not been going well in the UK, where making sites liable if kids see 'sensitive' content has meant geoblocks on content that could be considered sensitive, pending Know Your Customer verification that the person on the other end of the web browser is an adult.

My column in today's Post went through some of those issues. New Zealand Prime Minister Chris Luxon seems very keen on setting age gates on social media. Any policy putting liability on platforms if kids access the platform will require others to prove that they're adults - the same kind of KYC mess that the UK is getting itself into.

Depressingly, a proposed bill in the biscuit tin, from Labour, suggests fully following the UK in penalising sites that don't do enough to keep kids from viewing sensitive content. 

Breaking the internet should not be a vote-winner. C'mon. 

Compensation for regulatory takings - reader mailbag

I've had a couple of recent columns explaining the in-principle case for compensation for regulatory takings. 

Such compensation is recommended in the Regulatory Standards Bill, and is likely to be part of proposed Resource Management reform. 

The shorter version of the argument was in our Insights newsletter; the longer one in The Post, ungated here. A snip:

The Regulatory Standards Bill sets a principle that legislation should not take or impair property without fair compensation. And, where practicable, that compensation should be provided by those benefitting. Parliament remains free to ignore that principle.

In some cases, the beneficiaries are the broader public and compensation should be provided by the government. In other cases, a smaller group would benefit. Where practicable, that benefitting group should be the one to provide compensation.

Done sensibly, none of this would prevent beneficial regulation. Instead, it would help solve an imbalance and inequity in how things are currently done.

Governments can be tempted to use regulation in cases where a spending measure would be more effective for achieving some desired purpose, simply because government can ignore the cost that regulation imposes on others. Compensation would bring a more level assessment.

And requiring that the beneficiaries compensate those harmed from loss of legal rights accords with many reasonable views of equity. Where the gains to the winners exceed the losses to the losers, those gaining can compensate those losing and everyone is better off.

The excellent Brent Layton emails with a fun Wellington Council regulatory takings case. He writes (I've bolded one bit):

Dear Eric

I “enjoyed” reading your recent article on the logic behind the Regulatory Standards Bill containing provisions pointing decision makers towards consideration of compensation to those subject to a regulatory taking. I also “enjoyed” watching on a streaming service you and Bryce interact with two Labour MPs and a TPM MP at a Select Committee hearing on the Bill. If any group in the country should be supporting compensation for regulatory takings it should be the TPM, but she clearly did not get this. The Labour MP’s seem to not realise that principled regulation will be in the interests of everyone, but particularly those without wealth to exploit regulatory loopholes and inefficiencies.

Earlier this month my partner and I were among a smallish group of landowners in Wellington subjected to a significant regulatory taking over collectively a large area of land. The Wellington City Council adopted its new District Plan. Under it approximately 20 hectares of our backyard in Karori is designated an SNA. The Wellington CC SNA restricts the rights of landowners to use and develop the land subject to it very materially. 

For us, the impact is not as great as for most other owners for three reasons. Most of our land subjected to the SNA is already subject to a QEII Trust covenant that constrains its use and development anyway. In addition, I made submissions on the Council’s initial proposal and got most of our non-QEII Trust land out of the SNA designated area. Most of my neighbours did not make submissions, some, at least, because they mistakenly thought the change of government had put an end to councils imposing SNAs. The proportion of their land now covered by an SNA  designation is in many cases very high. We had also done quite a bit of development in the area affected by way of putting in tracks, drainage of tracks, building reinforcement to stop the stream eroding areas, etc. knowing that Wellington CC was determined to effectively “take” the land. Maintenance rights are better than development rights under the SNA.

Our experience illustrates a point you made very clearly; that the absence from a need to consider compensation to those adversely affected impacts adversely the area taken. The initial Wellington CC proposal relating to our place contained a lot of land that was covered in gorse, blackberry, Darwin’s barberry, and buddleia. The extent to which there was natural vegetation it was limited to immature mahoe pushing their way up through the pest plants. There was also an area containing a cluster of very mature macrocarpa. The land had been farmed with goats until the 1990’s. 

The council had arrived at its proposed SNA’s through looking at articles, some very old, on where a botanist thought there was significant natural coverage or something else worth protecting and from looking at aerial photographs. Anything that looked like bush from a few thousand feet, was included. I think that no compensation would be paid meant the “planners” were able to take a wide view of what should be an SNA and wait for the landowners to complain and provide evidence that the area did not contain significant natural features.

In my submission I argued that, if there was a net benefit to the community, those adversely affected should be compensated. This would ensure the land designated is properly scrutinised. I also included photos showing that a lot of the areas on our land the planners wanted to include were not areas of natural vegetation. The Chair of the Hearings Panel organised for an independent botanist to come out and view the land in detail. The panel itself also paid us a visit but did not do a detailed inspection of the site. They looked along the valley from a good vantage point where you could see that the vegetation in the areas I had identified in the photos was not natural.

The upshot was that after receiving the botanist's report 3 of the 4 areas I had pointed out did not contain significant natural vegetation were excluded from the area designated as an SNA. The fourth area was still included in the SNA, this included an old but still used farm track flanked by gorse and the cluster of macrocarpas. I wrote to the Chair of the Hearings Panel and pointed out the inclusion of this area in an SNA was clearly a mistake. He replied there was no appeal until after the Wellington CC had adopted the plan. However, when I checked the plan released with the adoption I found the land containing the macrocarpas and the gorse flanked track are outside the legally imposed SNA. Possibly I misread the earlier map. I wish I had of taken a screenshot.

We have decided we will not appeal because the costs would be high and we think we may be net beneficiaries of Wellington’s regulatory taking, or, alternatively, we think it possible the SNA will become redundant by legislation as the impact on land and house prices gets wider recognition. We own in total a block of  approximately 65 hectares in Karori. The area - approximately 30 hectares - that could in future be developed for residential subdivision is outside the SNA. The effect of Wellington’s SNA designations is to severely restrict the supply of alternative land that could be developed. If the SNA designations remain, our developable land will be a scarcer asset and probably significantly more valuable. If the SNA designations get over-ridden by legislation, then it would have been pointless to have spent the money to appeal. 

From society's perspective, I think the SNAs should be over-ridden by legislation and a regime be introduced by which Councils that want to protect areas have to negotiate and reach agreement with landowners, including over payment of lump sum or annual compensation. From a personal point of view, we suspect we have been winners from the actions of the Wellington Council. To hell with those wanting and needing affordable housing; we are boomers and deserve to fly business class. 

Keep up the good work.

That last line of the penultimate paragraph is very clearly tongue-in-cheek - Council has restricted the supply of land that might compete with Brent's when developers want to build more greenfield housing in Karori. Which likely makes him better off all-up, but he'd clearly prefer that the SNAs hadn't happened. 

If council wants more land in parks in the green belt, it should buy land and add it to the green belt. Stealing it via SNA isn't right.

The map of the SNAs, at least as of the draft district plan, is here.

Monkeypox and Medsafe

In a sane world, medicines and vaccines already approved by trustworthy overseas regulators would automatically be able to be used in New Zealand as well.

New Zealand is not sane. But neither is anywhere else really on that standard. Other places are just faster than NZ in getting things approved, with more practicable pathways for expedited review. 

If a medicine is unapproved, it can still be accessed under restrictive provisions of the Medicines Act. Medsafe summarises it here. 

Those restrictions include bans on advertising and marketing. 

Monkeypox has been an obvious risk for some time. Jynneos was approved by the EMA in 2013 for smallpox and was recommended for monkeypox in 2022. It was approved by the FDA in 2019, and given emergency use authorisation for monkeypox in 2022. The "Emergency" in the EUA was the monkeypox outbreak. 

Nobody applied for Medsafe authorisation until 2023.

Medsafe took over a year to approve it, despite its already having been approved in Canada, the US and Europe at the point at which application was made.

It was available in New Zealand through Section 29. However, you can't advertise unapproved medicines. 

The Post noted the difficulties in letting at-risk communities know about the vaccine, because of s29 restrictions. 

 

Radio New Zealand notes that greatest transmission risk is concentrated among men who have sex with men, and those who have sex with men who have sex with men. 

The outbreak from the Queenstown Pride Festival now counts five in total. 

It sure would have been great if it hadn't been illegal to advertise the vaccine earlier and to make it real easy for folks to get the vaccine.   

Or if Medsafe had been required to automatically approve medicines already approved by two others - which would have had it authorised in New Zealand in 2022.

We are ruled by Vogons.

Let's ban Mazda Demios and put an end to ram-raids

The post title is obviously stupid, right?

Mazda Demios are pretty common in ram-raids but:

1. Ram raids have started coming down off their peak;
2. People can use all kinds of cars for ram-raids;
3. Most Mazda Demios are not used in ram-raids. Other people drive them too.

Now consider the National Party's proposed "Let's ban disposable vapes and vapes that use non-refillable pods or tanks to put an end to youth vaping" policy.

Disposable vapes are pretty commonly used by youths who vape - more than tanks or pods. But:

1. Youth vaping has stopped increasing (and came down a bit in the most recent Year 10 survey);
2. Youths can use all kinds of devices, not just disposables and non-refillable pods and tanks;
3. Adults use these too. Adults who used them to quit smoking, and who were attracted by the convenience and cost of non-refillable systems. 

The proposed ban is so stupid. 

In late August, I had a column over in the Post on it [ungated here]. I noted the very obvious problems with the proposed ban. The vape systems that are hardest to use would be the only ones left on the market, which will screw things up for adult vapers who can't handle those systems while making it easier for screw-ups to happen. 

The Government will ban vaping products that are more affordable and that are easier to use – for everyone, adults included. The measures seem to be aimed at reducing youth vaping by increasing the cost of vapes. But if the Government wanted to increase the cost of vaping, excise would make more sense than banning specific types of vapes.

Vaping is a lot less risky than smoking, but there are ways for vaping to go wrong. If someone who doesn’t know what they’re doing mixes their own vape fluid in a tank-based system, they could get a higher dose than intended. Or they could experiment with adding things into the mix that should not be there. Or they could let the tank run dry, resulting in overheated coils and potentially noxious fumes.

Self-contained disposable vaping products and pod-based devices avoid those risks. They are designed to avoid hot dry heating coils. The vaping fluid is pre-mixed and cannot be adjusted. But those are the vaping devices that the Government is going to ban.

Let’s say that again. The Government is proposing to ban the safest devices while leaving the potentially riskier ones on the market, and says it is doing this because it wants to protect kids.

The Ministry hadn't yet put up the RIS on the ban. It was fun to read through it - they'd written it before my column, but hadn't released it yet. And they said much the same that I'd said: if you want to target cost, excise or minimum pricing make more sense but there are tradeoffs with that. Banning pods and single-use tanks goes beyond what's needed and will have adverse consequences for adult vapers. 

What did the Ministry say? 

1. Daily vaping has been stable for three years but is high in international perspective;
2. Youths who vape most frequently choose disposables: twice as common as pods, three times as common as tanks)
3. "There is risk that reducing youth access to vapes will lead to higher youth smoking rates"
4. "Actions to reduce youth vaping need to be targeted towards young people and minimise any barriers on adults wanting to access vapes to quit smoking"
5. "While banning disposables may prevent further young people taking up vaping, it may not stop vaping in those cohorts who are already doing it regularly."
6. Existing rules that came into effect end-December ban disposables without removable batteries; this removes most traditional disposables from the market already.
7. Broadening the ban on disposables won't be a material barrier to adults; three quarters of adults use pods and tanks.
8. Cabinet's preferred broad ban brings safety concerns because you're forcing everyone to refill tanks. 
9. "There is also the potential risk that a more comprehensive ban incentivises an illicit market. Whilst not directly comparable, tighter regulation in Australia has seen the rise of a significant illicit market with 87% of Australians who vape reporting sourcing vapes illegally."
10. "accessibility of use for adults who smoke and wish to vape to quit smoking would also be impacted."
11. If the government wants to increase the cost of vapes, excise and/or minimum prices make more sense but have trade-offs when thinking about encouraging adults to shift away from smoked tobacco.

The Ministry preferred the much narrower ban. 

And it's great that they pointed to the risk of illicit market access under a broader ban. Otago's public health people like to pretend that those worries are invented by industry. 

I went through the Ministry's RIS over at Newsroom this week. This will wind up biting National unless they fix it at Select Committee:

And here is where we shift from the measures just being poor policy to also being a political mistake.

Under the previous Labour government, then-health minister Ayesha Verrall had legislated a ban on cigarettes that contain any appreciable amount of nicotine, an annual increase in the age limit for smoking, and reductions in the number of retail outlets allowed to sell cigarettes.

Measures from that legislation had not come into effect by the time of last year’s election. And, to some surprise, the incoming Government’s coalition agreements reversed that legislation while committing the Government to considering a broader range of reduced-harm alternatives to smoking.

Labour strongly opposed the Government’s reversal of its legislation, claiming its legislation was needed to continue the path to Smokefree 2025.

Many ex-smokers use the vaping systems that National is due to ban. Smoking rates could well be increasing again in the lead-up to the 2026 election. If smoking rates are on the rise, Labour will have its choice of rod with which to beat National. It could point to the vaping rules, or to the coalition’s reversal of Verrall’s legislation, or both.

The legislation may provide the Government with a temporary reprieve from parents and teachers worried about youth vaping. But the Ministry of Health’s Regulatory Impact Statement suggests the ban is far broader than is really necessary. If the government does not reconsider its options through the select committee process, it may yet find that bad policy becomes bad politics.

Labour's been curiously silent on this one. 

In other instances in which National set tobacco/nicotine policy that MoH disagreed with, Labour and Radio NZ have been sure it's because National/NZ First are corrupt. Haven't heard from them yet on this one - probably because they're following Napolean's warnings against interfering when an enemy is making a mistake.