Christopher Adams
The Business Herald’s markets and banking reporter. Chris Russell doesn't have much time for views such as those of the anonymous Chinese real estate agent who, in a recently published Herald article, criticised this country's high immigration levels. The chief executive of HSBC New Zealand, the local subsidiary of the global bank, reckons that kind of "populist rhetoric" is a major risk. "Targeted migration is crucial," says Russell, a recent arrival from Australia. "You're hearing quite a bit in the political environment ... New Zealand is seeing some very healthy migration flows and it is a real concern of ours that populist rhetoric doesn't overwhelm what is actually a benefit for New Zealand." The 56-year-old took the helm at HSBC NZ in January. He views New Zealand's tourism boom as one of the biggest positives for the economy, especially given the dairy commodity price slump. "Now where's that tourism coming from?" Russell asks. "It's coming from Asia. Now if there's a concern that starts emerging that New Zealand's closing the border on migration ... this could have flow-on effects [on tourism]." It's no surprise that HSBC is a big supporter of immigration. The London-based bank - which has around 46 million customers across 71 countries - has carved out a lucrative niche providing banking services to wealthy migrants moving to New Zealand. Russell, who worked for National Australia Bank before joining HSBC in 2005, stresses that the bank supports "targeted" migration. "I'm empathetic to where some of this [populist] talk is coming from. "The impact on housing we've talked about and the impact that could have on certain sectors of communities." But Russell says blanket statements about immigration are dangerous. "New Zealand for too long has had a situation where it's been used to the bright people heading offshore," he says. "Don't close the door across the board - that's the key message." Russell is a little more circumspect on the red hot housing market. His counterpart over at ANZ, David Hisco, labelled the market "overcooked" in an opinion piece published by the Business Herald a couple of months ago. "Having been in banking since 1980 I have seen this movie before," Hisco wrote. "The ending is pretty much the same - sometimes a little plot twist, but usually messy." Hisco wasn't, however, joined by a chorus of other bank bosses in calling out the dangers of rapid house price inflation. Far from it. "To me", Russell says, "the housing market is a supply and demand situation and clearly there are genuine shortages." HSBC estimates that Auckland - where the average house price may already have reached $1 million - has a deficit of about 30,000 homes or 6 per cent of total housing stock. Russell says migration is obviously contributing to demand for housing. "What we've got to focus on, then, is where do we get the investment to make certain to get that supply back into balance," he says. "It's not just housing - it's all the infrastructure that goes around it - it's roads, rail, hospitals and schools and that needs to be much more planned." Russell pauses when asked whether he'd label the New Zealand housing market a "bubble". Bank bosses hate the B-word. Even Hisco steered well clear of it in his otherwise unrestrained article. "My focus would be to not just look at that one part," Russell says, finally. "Someone that's got a very large focus on domestic banking, I think they're better [placed] to talk about those aspects." He doesn't think a housing market collapse is imminent. "Supply and demand does get out of whack, but as long as that demand keeps going I don't see that we're at risk of a complete collapse." Low mortgage rates have undoubtedly added fuel to the fire, and HSBC has been offering some of the lowest of them all. Last month the bank announced a two-year fixed home loan rate of 3.79 per cent, thought to be New Zealand's lowest rate in at least 50 years. It is only available to owner-occupiers - not investors - with a minimum mortgage of $500,000 or $100,000 in savings or investments. "It's very much focused on that [owner-occupier] market and we don't think that's the market that might necessarily be causing the robust prices at this point," he says. When it comes to banking controversies, HSBC's list is a long one, from processing the proceeds of vicious Mexican drug cartels to allegations that its Swiss arm helped wealthy clients evade tax. Russell says HSBC has "taken ownership" of its scandals. "The go-forward position is to learn from the past and make certain we're a different bank," he says. "Credit risk is in our DNA and financial crime risk has got to be similarly [important]." HSBC staff, meanwhile, have been facing much uncertainty amid sweeping job cuts. The bank, like many of its counterparts, is facing a range of challenges, including stubbornly low interest rates, a rising tax rate for UK banks and a range of geopolitical and economic uncertainties such as Brexit. Group chief executive Stuart Gulliver has cut HSBC's workforce from 296,000 to about 250,000 since he took over in 2011. And last year he signalled that another 25,000 job cuts would take place as HSBC pivoted towards Asia - especially China, where it is focusing on the Pearl River Delta region - and adopted more digital technology. Russell said HSBC New Zealand, which employs around 230 staff, had to be mindful that it was part of a global group. "My focus is how do we look to grow the business and create new roles, however, we'll always be looking at how we can do things more efficiently." To read the actual article, please visit here.
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6:03 pm on 14 September 2016 by Gill Bonnett Immigration Reporter
A former Labour Party candidate convicted of electoral fraud for registering ineligible voters is facing action for his part in an immigration job-selling scam. The Immigration Advisers Complaints and Disciplinary Tribunal found Daljit Singh, a senior Sikh leader, was paid offshore to hide the scam. It noted it had seen "multiple cases" involving suspected job-selling. The victim, Parminder Gill, said his parents paid $16,000 through Indian bank accounts to Mr Singh and his New Zealand employer for a restaurant job and visa. But when he arrived he was paid $120 a week, plus food and accommodation, and his employer later reduced even those wages. Mr Singh was sentenced to five months community detention and 200 hours of community work over the registering of 116 voters in the Otara-Papatoetoe area, where he stood unsuccessfully for the local board in 2010, when they lived in places as far away as Timaru, Tauranga and India. The Immigration Advisers Complaints and Disciplinary Tribunal upheld the complaints against him that he did not provide his client with written information, invoices and updates. It said there was a coherent claim by Mr Gill that Mr Singh and the employer "conspired to exploit the complainant, using promises of immigration opportunities, and payments to be made in India". It said such scams worked by part of the immigration fee being used to "purchase employment in New Zealand with or without the funds being remitted to New Zealand". The parties would then present that employment to Immigration New Zealand as genuine in order to gain visas fraudulently. "In such cases, there is potential tax evasion, immigration fraud, breach of employment laws, and human trafficking issues." Mr Gill later applied for residence as a restaurant manager but Immigration New Zealand refused, finding the business was not financially sustainable. It noted such cases were difficult to prove in criminal courts but it had a lower burden of proof. "Was I to be deciding this complaint treating the complainant as having an onus of proof, the adviser enjoying a right to silence, with beyond reasonable doubt as the standard of proof; Mr Singh could have confidence I could not find he was a party to soliciting and receiving fees of $16,000 for his services, paid indirectly. "However, he is not in that position. In these circumstances it is consistent with the allegation that he required fees to be paid offshore and colluded with employers to manufacture immigration opportunities. "Mr Singh says it was difficult to communicate in writing with his client. Had he made proper inquiries regarding the reasons for that, he would likely have discovered that this was related to him being exploited by the employer. "Where a migrant in a managerial position has no internet access and cannot readily receive letters, is an issue that ought to trigger concern and meaningful inquiries; it is an unusual situation in New Zealand." Mr Singh has already lost his adviser licence and faces a possible fine, costs and reparations when the tribunal decides on what sanctions to impose. To read the actual court case, please click here. The Immigration Minister has defended efforts to get New Zealand job seekers into the regions, saying the government needs to look at why they are not taking up available work.
Labour Party leader Andrew Little told Morning Report today the government should make getting young New Zealanders into work a priority, and reduce the number of work visas issued for labouring jobs. Prime Minister John Key has admitted high immigration is putting a strain on the country's infrastructure, Mr Little said Labour was happy with the Recognised Seasonal Employer scheme, which applied to people from the Pacific, and Labour would not be looking to restrict those numbers. But he said the government should reduce the number of work visas being issued. "There is no justification when we have 15,600 labourers unemployed in New Zealand, taking the dole, and we are issuing work visas for 6500 people to do labouring work, that doesn't make sense to me," he said. "The reality is the seasonal employers want a workforce ready to go - because they've got a short period of work ahead of them - and we've got to make sure that work gets done. That's why the last Labour government introduced the [Recognised] Seasonal Employer scheme to get overseas workers here. "But we've got to make a priority of the young people who live here in New Zealand, to get their work habits right, so they've got a meaningful work life ahead of them. Immigration Minister Michael Woodhouse said employers worked very hard to get New Zealand workers to the regions, but they were simply not ready, willing or able to do the jobs. He said the government would have to look at why that was the case and have an honest conversation with the public and the job seekers about why they were not taking up the work. Mr Woodhouse said the Labour Party leader should go out to the regions and talk to employers. He said the feedback the government got was that New Zealand job seekers just did not turn up, and that drugs were also a problem. "The anecdotes are that when Work and Income require people be free of drugs and alcohol, particularly for occupations where that is considerable risk, often many of our young fail those tests." Mr Woodhouse said the government was redoubling its efforts to make sure New Zealanders were at the front of the queue for jobs. Treatment of young workers is the key - LittleMr Little said many employers already worked hard to get young people, often with troubled backgrounds, into good, secure, long term work. "They go round and pick young workers up from their homes at 6.30 in the morning because they know that if they didn't do that the car that they used yesterday probably doesn't start, probably doesn't have a warrant of fitness, they may not have made their lunch because they don't know how - all these sorts of things." But others treated minimum wage workers "shabbily". "For every situation where a young worker hasn't turned up on time, done something the employer doesn't like, there are dozens of cases where there are young workers trying to get a foothold in the labour market who've been paid poorly, treated poorly, haven't had good conditions." Domestic fruit-picking scheme still a success - MSDMeanwhile, the Ministry of Social Development has defended its fruit-picking work scheme, despite the fact that only half of those who join it complete their contract or remain in work. The scheme, launched about a year ago, encourages beneficiaries to move to the main growing regions such as Nelson, Marlborough and Hawke's Bay. The ministry's national commissioner, Penny Rounthwaite, said the scheme complemented the RSE scheme, which attracts about 9500 workers each year from the Pacific Islands. She said, since the scheme began last October, 300 people had moved for employment for up to six weeks. Ms Rounthwaite said about half of them were still in employment or had successfully completed their contract. The scheme had been a success but the ministry would look at ways of getting more people to complete it, she said. To read the actual article, please visit here. |
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