Thursday, April 02, 2015

Yeah, nah

Phil Goff is outraged because the government is planning to close down some operations of the Armed Forces Canteen Council and put them out to tender. What's the Armed Forces Canteen Council? A statutory body established to "provide amenities on service establishments for the benefit of members of the Armed Forces and of other persons employed or residing on those establishments". Which, in English, means cafes, convenience stores, and a network of duty-free stores. Its exempt from income tax and liquor laws. And yet, it makes bugger-all money - an average of $630,000 a year, most of which is disbursed to military welfare funds.

The reason for this? Reading their annual reports (latest here), it seems that generals just aren't very good at running cafes.

There's an argument for the NZDF or a subsidiary body to run base shops where there's nothing else around - in Scott Base, for example (though really, given the terms of the Antarctic Treaty, that should be under the NZ Antarctic institute, not NZDF). But most of the AFCC's business is done in places like Devonport and Linton and Waiouru and Trentham, where there are plenty of other options. They even run the Waiouru Four Square, which isn't even on the base - its on State Highway One, catering to tourists, not soldiers.

I oppose privatisation. But here it seems like there's not even a shred of a case for government ownership of most of these facilities. If soldiers want a flat white or moro bar (or, apparently, a washing machine or digital camera), there's no reason for a special statutory body to provide it to them. They can go to a shop like anybody else. And it'll probably be cheaper - AFCC consistently complains about its inability to compete with other retailers.

The Armed Forces Canteen Council's predecessor, the Canteen Board, was founded to provide basic facilities to conscripted soldiers in vast military camps or on deployment overseas. But there's just no need for it in peacetime. Time to put it out of its misery.