The Reserve Bank has doubled staff numbers in five years to 510, with its personnel costs rising to $80 million in 2023 from $32 million in 2018 - that's up by a whopping 250%. I guess when you get to print $50 billion in cash & flood the markets with liquidity, causing runaway inflation that now requires the Bank to now "engineer a recession" (in the words of the Governor) to get it back down again, there's always a bit of that cash floating around to spend on your own employees.
The upside of the 510 people working there may be that one of them is at last able to produce some decent research on hot topics, like the effect of immigration on inflation. That, of course, assumes the extra staff hired were economists. No such luck. Instead the Reserve Bank's latest report on immigration was not even written by anyone at the Bank - it was sub-contracted out to consultants!?
The report itself is mostly a literature summary - but why hire an expensive consulting firm to just go through some past economics papers on this topic? What do the consultants find out? According to the RBNZ they "outline how migration can add to or reduce inflationary pressures depending on the size & direction of flows & the characteristics of migrants". Oh great - so immigration can increase or decrease inflation, meaning they don't have much of a clue what is its overall effect. We already knew that in the first place, because immigrants, wait for it, buy more stuff, adding to demand & inflation, but also, to the extent they get jobs, supply more stuff, which reduces inflation.
What did the Bank pay for that amazing insight that is not news to anyone? God knows? The only thing we do know is that it is your money & the government has no legal authority to downsize the Bank since it is not a government department with a Minister in charge of it. Good to know that not everyone in Wellington is anxious about cuts.
Sources:
https://www.interest.co.nz/banking/124734/reserve-bank-staffing-levels-and-personal-costs-surge-over-past-five-years-it-takes
https://www.rbnz.govt.nz/hub/news/2024/03/inflation-and-migration
The report itself is mostly a literature summary - but why hire an expensive consulting firm to just go through some past economics papers on this topic? What do the consultants find out? According to the RBNZ they "outline how migration can add to or reduce inflationary pressures depending on the size & direction of flows & the characteristics of migrants". Oh great - so immigration can increase or decrease inflation, meaning they don't have much of a clue what is its overall effect. We already knew that in the first place, because immigrants, wait for it, buy more stuff, adding to demand & inflation, but also, to the extent they get jobs, supply more stuff, which reduces inflation.
What did the Bank pay for that amazing insight that is not news to anyone? God knows? The only thing we do know is that it is your money & the government has no legal authority to downsize the Bank since it is not a government department with a Minister in charge of it. Good to know that not everyone in Wellington is anxious about cuts.
Sources:
https://www.interest.co.nz/banking/124734/reserve-bank-staffing-levels-and-personal-costs-surge-over-past-five-years-it-takes
https://www.rbnz.govt.nz/hub/news/2024/03/inflation-and-migration
6 comments:
Of that headcount growth, how many are trained economists, and how many are DEI and other "cultural" hires?
Thanks Robert. What a joke the RBNZ has become, like so much of the Public Service! As a junior bank economist in the 70s I was in awe of RBNZ. Their research and analysis by the likes of Rod Deane were respected world wide. Now go read their web site…full of woo woo nonsense about Tane the tree and other Maorification stuff. And this is after they’ve doubled the staff! Oh dear…I’ve never felt more embarrassed to be a Kiwi!
And ... it is more dangerous than ever to be a non-Maori Kiwi. A real risk for one's economic and financial well-being.
The present governor has a second term till 2028? A really nasty final cut by Labour to styme the Coalition.
Why is the Bank not subject to cuts due to the weak economy - like other areas of the public service?
The Reserve Bank became a laughing stock when a couple of years back they had Rebecca Evans translate all their international monetary terms into te reo.
How much did they pay her for such arrogant useless nonsense ?
Was it ever used ?
I'll bet nobody off shore wanted to negotiate in te reo.
Was it another group think decision by a committee of ponamu wearing nodders ?
Any reason why it can't be found on their website now ?
Surely two of New Zealand’s most grossly over funded entities must be in David Seymour’s cross hairs. The RBNZ and NIWA. Both hugely incompetent where these head buffoons earn $750 and $850k respectively.
It seems most of us know what the right thing to do. CHOP all the useless waste from these entities. When will Willis do it!
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