1
00:00:00,080 --> 00:00:02,800
Speaker 1: More insight into the state of New Zealand in financial hardships.

2
00:00:02,840 --> 00:00:04,920
Speaker 1: Up here is your headline nineteen percent year on year,

3
00:00:05,000 --> 00:00:06,920
Speaker 1: So that seems a lot, but is it. This is

4
00:00:07,000 --> 00:00:09,039
Speaker 1: Centrics Dart and nearly half of the cases of mortgage

5
00:00:09,039 --> 00:00:11,960
Speaker 1: show related. Centrics Managing director Keith McLaughlin back, Well, there's Keith.

6
00:00:12,000 --> 00:00:12,520
Speaker 1: Morning to you.

7
00:00:13,160 --> 00:00:13,880
Speaker 2: Good morning, Michel.

8
00:00:13,880 --> 00:00:15,640
Speaker 1: So I'm trying to paint a positive picture here. So

9
00:00:15,720 --> 00:00:17,960
Speaker 1: four hundred and seventy thousand people are behind on payments,

10
00:00:18,000 --> 00:00:20,400
Speaker 1: but that's only up six thousand, not that many. Consumer

11
00:00:20,440 --> 00:00:23,760
Speaker 1: areas one point three percent higher, Not that many personal

12
00:00:23,800 --> 00:00:26,040
Speaker 1: loans rose to nine point two percent, up from eight

13
00:00:26,040 --> 00:00:29,560
Speaker 1: point one not that many. Am I being overly optimistic

14
00:00:29,640 --> 00:00:29,840
Speaker 1: or not?

15
00:00:30,840 --> 00:00:32,239
Speaker 2: Now? I don't think you are at all, Mike. I

16
00:00:32,240 --> 00:00:34,040
Speaker 2: think what we find at the moment is that there

17
00:00:34,080 --> 00:00:37,559
Speaker 2: is a seasonal increase in areas, which has been in

18
00:00:37,600 --> 00:00:41,599
Speaker 2: place for for the last fifteen years December January February.

19
00:00:41,640 --> 00:00:45,680
Speaker 2: We always find that areas move up because other expenses

20
00:00:45,720 --> 00:00:48,280
Speaker 2: take some other household budget. So look, I think it

21
00:00:48,360 --> 00:00:51,120
Speaker 2: is a seasonal thing, and I don't think there's needhing

22
00:00:51,159 --> 00:00:54,160
Speaker 2: to read into that. But when you look across the trend.

23
00:00:54,240 --> 00:00:57,120
Speaker 2: I think households has got their budgets under control, and

24
00:00:57,240 --> 00:01:00,440
Speaker 2: I think that you know, seems are looking a lot

25
00:01:00,440 --> 00:01:02,000
Speaker 2: bitter than though certainly did twelve months ago.

26
00:01:02,080 --> 00:01:05,320
Speaker 1: Good And so will we flush through the Christmas season

27
00:01:05,360 --> 00:01:07,000
Speaker 1: and we got the numbers or is there a February

28
00:01:07,080 --> 00:01:09,480
Speaker 1: or something like that still to come well?

29
00:01:09,520 --> 00:01:13,280
Speaker 2: I think it's from an Arare's perspective, certainty February through

30
00:01:13,280 --> 00:01:15,559
Speaker 2: the probably thinking to March it's quite tight. I think

31
00:01:15,800 --> 00:01:17,880
Speaker 2: people spin it up a little bit over Christmas. I

32
00:01:17,959 --> 00:01:21,040
Speaker 2: think there's back to school expenses, so there is always

33
00:01:21,080 --> 00:01:23,960
Speaker 2: a bit of a tidy economy ability to repay over

34
00:01:24,000 --> 00:01:27,240
Speaker 2: the December, January, February months, March starts to pick up,

35
00:01:27,240 --> 00:01:30,360
Speaker 2: and we traditionally find that areas do drop away during

36
00:01:30,400 --> 00:01:33,720
Speaker 2: the winter period because it discretion, the spinning falls away,

37
00:01:34,280 --> 00:01:36,240
Speaker 2: and people focus on paying off their debts.

38
00:01:36,440 --> 00:01:39,000
Speaker 1: So this business and mortgage areas, it's increased to twenty

39
00:01:39,000 --> 00:01:41,720
Speaker 1: two one hundred people. Am I also write or overly

40
00:01:41,720 --> 00:01:44,039
Speaker 1: optimistic in saying twenty two thousand people out of a

41
00:01:44,080 --> 00:01:47,520
Speaker 1: population of five million, isn't actually a lot of people

42
00:01:47,560 --> 00:01:48,000
Speaker 1: in trouble?

43
00:01:48,880 --> 00:01:50,680
Speaker 2: No, it's not. And I think when you also factor

44
00:01:50,680 --> 00:01:53,400
Speaker 2: into that that there are hardship cases out there, which

45
00:01:53,440 --> 00:01:56,560
Speaker 2: is where people are talking to the lenders to say, look,

46
00:01:56,600 --> 00:01:59,680
Speaker 2: I'm struggling, can we work through this. I don't think

47
00:01:59,720 --> 00:02:02,200
Speaker 2: that we're in a grim situation at all. I think,

48
00:02:02,240 --> 00:02:05,360
Speaker 2: you know the certainly households are struggling more than others.

49
00:02:05,760 --> 00:02:07,560
Speaker 2: There are a lot of household and it'd either have

50
00:02:07,800 --> 00:02:12,640
Speaker 2: very little or no mortgages who are lacking confidence to

51
00:02:12,680 --> 00:02:15,960
Speaker 2: go out and spend money, which is impacting small businesses.

52
00:02:15,960 --> 00:02:19,400
Speaker 2: But I think generally the economy is tracking towards an improvement.

53
00:02:19,520 --> 00:02:22,080
Speaker 1: I'm encouraged to hear that as far as businesses are concerned,

54
00:02:22,120 --> 00:02:25,240
Speaker 1: all those liquidations and receiverships we saw before Christmas, do

55
00:02:25,280 --> 00:02:27,240
Speaker 1: you have any read on that? What is that there

56
00:02:27,280 --> 00:02:30,200
Speaker 1: are more where that came from or not years.

57
00:02:30,240 --> 00:02:31,840
Speaker 2: Look, I think that's the beginning of a bit of

58
00:02:31,840 --> 00:02:36,600
Speaker 2: a wave. Discretionally spending fell away certainly during the course

59
00:02:36,600 --> 00:02:39,280
Speaker 2: of last year, because households just didn't have the money,

60
00:02:39,360 --> 00:02:40,800
Speaker 2: or if they did have it, they weren't prepared to

61
00:02:40,800 --> 00:02:43,720
Speaker 2: spend it at that stage. I took a conservative approach,

62
00:02:44,160 --> 00:02:46,440
Speaker 2: and I think the small to medium businesses who didn't

63
00:02:46,480 --> 00:02:49,520
Speaker 2: have the reserves in place didn't have the revenue coming

64
00:02:49,560 --> 00:02:52,680
Speaker 2: across the counter, and her expenses kept going up and

65
00:02:52,720 --> 00:02:55,440
Speaker 2: they really struggled. I think coupled with that as the

66
00:02:55,440 --> 00:02:58,519
Speaker 2: Inland Revenue Department took a softly approach over the last

67
00:02:58,560 --> 00:03:01,960
Speaker 2: two to three years and they are reversing the action

68
00:03:02,160 --> 00:03:04,960
Speaker 2: and they are now quite active and winding up companies

69
00:03:04,960 --> 00:03:06,880
Speaker 2: that probably should be wound up anyway.

70
00:03:07,360 --> 00:03:09,280
Speaker 1: So you've given us a bit of positive, you've given

71
00:03:09,360 --> 00:03:10,800
Speaker 1: us a bit of negative. Where does that leave the

72
00:03:10,800 --> 00:03:13,080
Speaker 1: Reserve Bank on the nineteenth of February to go twenty

73
00:03:13,120 --> 00:03:14,960
Speaker 1: five or fifty or that's out of your wheelhouse.

74
00:03:15,560 --> 00:03:17,639
Speaker 2: There's a way on my wheelhouse. I'm not the economist,

75
00:03:17,680 --> 00:03:19,880
Speaker 2: so I'd like to see OUs as much money different

76
00:03:20,000 --> 00:03:22,440
Speaker 2: house of budgets as possible so that we can get

77
00:03:22,639 --> 00:03:23,880
Speaker 2: economy stimulated again.

78
00:03:23,960 --> 00:03:25,600
Speaker 1: Good stuff, Keith, Nice to talk to you is always

79
00:03:25,680 --> 00:03:29,000
Speaker 1: Keith McLoughlin's Centrice Managing Director. For more from the Mic

80
00:03:29,000 --> 00:03:32,119
Speaker 1: Asking Breakfast, listen live to news talks. It'd be from

81
00:03:32,200 --> 00:03:35,640
Speaker 1: six am weekdays, or follow the podcast on iHeartRadio.