Fisking North & South part II

North & South responded last night to Thursday’s post “Fisking North & South on New Zealand novels” and I responded to the response. Rather than leave the exchange buried in the comments, I’m reposting it here on the front page for anyone interested in the discussion.

Graham Adams wrote:

Your criticisms of my North & South article centre on your claim that Creative NZ does not rely on taxpayers’ funds for grants and that such grants are not “public money”. You assert: “I can tell the taxpaying public how much return it is getting on its investment: 0%. That is because the [Creative NZ] grants do not come from tax revenue.” 

Unfortunately, to use your own words, you are “totally, utterly, spectacularly wrong”.

Forty per cent of Creative NZ’s funding comes directly from government taxes through the budget’s Vote Arts, Culture and Heritage and 60 per cent from the Lotteries Commission. And the commission, of course, is a Crown entity, which spends roughly 20 per cent of its revenue funding various sports, charitable and cultural bodies, including Creative NZ. Everyone who buys a lottery ticket pays for this levy as a de facto tax incorporated in the price — in much the same way drinkers, drivers and smokers do, since a tax is incorporated in the price of alcohol, petrol and cigarettes. The major difference is that by not routing the money from state lotteries through the consolidated fund, the government can create the illusion of the lottery grants not being funded from taxation but it is only an illusion. And the fact that these taxes can be avoided by not drinking, driving, smoking or gambling does not make them any less a tax.

Also, a proportion of each lottery ticket’s price goes to the government for GST and gaming taxes, bringing the total tax take from the sale of each ticket to more than 30 per cent. Lotto and Keno players are, indeed, taxpayers, even if unwittingly.

With the 40 per cent direct government subsidy and the taxpaying lotteries player accounting for the remainder of Creative NZ’s money, I was entirely correct to state that “the taxpaying public has a right to be told what sort of return it is getting on its investment”, that writers’ residencies are “mostly publicly funded” and that Carl Nixon was paid with public money to write Settlers’ Creek.

If your readers want to decide whether to believe North & South or Quote Unquote on how Creative NZ is funded, they could always ask Creative NZ itself. The figures it sent me regarding its funding were: “Approximately 60 per cent from the New Zealand Lottery Grants Board and 40 per cent from the Vote, Arts Culture and Heritage, ie Government funding”. Quote, unquote.

To which I replied:

Good to hear from you, Graham. As a mathy kind of guy I do like to get the numbers right and am always happy to be corrected when I am wrong, as happens – can you quote a person at Creative NZ rather than “it” so I can check? With whom did you talk?

Re that 40/60 split – maybe that 40% government funding goes to overheads and the 60% Lotto money goes to grants? What I have always heard is that grants money comes directly from Lotto. Is this not the case? I'm meeting a senior CNZ operative in a couple of weeks so I'll ask her and update here.

Leaving aside what seemed to me to be inaccuracies about the fellowships and the Montanas, which you don’t address, can you give a named source in publishing for that figure of most NZ novels selling 300 copies? Because everyone I have talked to, whether publisher, bookseller or author, snorts at it. I think we should be told.