The Mike Hosking Breakfast
Mike's Minute: Do we complain about public service pay too much?
14 Apr 2026
Transcript generated automatically by AI and may contain errors.
Chapter 1: What are the implications of the new water billing system in Wellington?
One of the easiest games in town is currently being played in Wellington. So you've got the water company, they've got a nice new Maori name, and they're going to start sending out specific water bills to everyone, which upon first blush, if you've never got a water bill before, seems a lot, the average being about $2,500 a year.
But then, the upsize, it's good to know I would have thought what things actually cost, as opposed to having it all hidden away in a mass bill called rates, where no one's got any idea what's going on. The real scrap, though, is over the pay packets. They, in this new company, are a lot bigger. Now, the chair of the board gets $110,000. They used to get $60,000.
The members of the board get $60,000. They used to get $30,000. The bloke who carries the can as the CEO, he gets $645,000 a year. Now, toss a few figures like that about the place, and suddenly you've got a lot of angst, a lot of upset. But here is your real-world issue. You either want decent people for the job, any job, or you don't.
Now, I don't need to tell you that previously a lot of people doing Wellington's water work were clearly useless. In a small and not complete way, money fixes that.
It is not to say big money automatically gets brilliance, but it is fair to say if you pay rubbish, you will get rubbish. The old community contribution, the give something back line, only carries you so far. You tend to get do-gooders, not professionals. And can I be even slightly more fiscally acerbic? by suggesting even at these new inflated numbers, you're not exactly paying top dollar.
I mean, $645,000 is a lot of money if you're in year 13, or you're a teacher, or you're a journalist. But it's not too much to be a CEO, and even less when you're the CEO of an entity that's under tremendous pressure and publicly accountable by a population that will want to lynch you if you fail. See, the public services, as a rule, underpays.
And that, in part, is why the public service is in the state it's in.
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Chapter 2: How do public service salaries affect the quality of leadership?
Cheap in general is no way to run business, sign contracts, accept quotes, or operate your life. Worry less about the money, more about the outcomes. If Wellington had never had a water worry, no burst pipes, no contamination, no poo in the harbour, and the bloke running the place was earning $2 million and gave you that, what a bargain.
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