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Economy – MPs Pay – School Year – Lion Mascot – DB Redundancies – Dairy Group – Insurance Levies – Armed Robbery – Fullers – Waikato River – Prison Escape – Gang Rape – Bendon Editorial

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ECONOMY: The Treasury expects a solid export-led recovery over the next three years, giving Labour leeway for extra spending and National sufficient headroom for its tax cuts. But in its pre-election opening of the books yesterday, the Treasury forecast a further blowout in the current account deficit and a surge in inflation which could fuel rising interest rates in the runup to the election.

MPS PAY: Prime Minister Jenny Shipley has been given a $12,000 pay rise. The 6 per cent salary increase, plus a $29,500 expenses allowance, takes her total pay package to $245,800. Yesterday, the Higher Salaries Commission also awarded a 6 per cent pay rise to other party leaders, whips and chairs of select committees. Cabinet ministers get a 5 per cent rise and backbenchers 3.75 per cent.

SCHOOL YEAR: Some schoolchildren will spend longer in the classroom under proposals by a Government working party examining the school year. Education Minister Nick Smith yesterday released Towards the Learning Culture, a report aimed at making the school day and year more consistent and flexible, and stopping non-curricular activities intruding into class time.

LION MASCOT: Wellington's rugby mascot, Leo the Lion, will be forced to roar from Eden Park's stands at the NPC final tomorrow because Auckland's Seagull was winged last weekend in a scuffle between rival mascots. The Auckland Rugby Union has refused to let Leo prowl the sidelines because a scuffle broke out between the Seagull and North Harbour's Harbour Master mascot at last Saturday's semifinal.

DB REDUNDANCIES: Brewer and liquor wholesaler DB Group could shed 200 jobs as part of changes to its business structure and direction. The cuts affect marketing, sales and administration staff in the group corporate office in South Auckland, and in Allied Liquor Merchants in Auckland, Wellington and Christchurch.

DAIRY GROUP: The dumping of Dairy Group chairman Doug Leeder over an affair with a staff member has angered farmers. One said these "little hiccups" happened all the time, while another claimed the board that sacked him should have "bigger fish to fry."

INSURANCE LEVIES: Home and vehicle owners will be hit with higher insurance premiums as Fire Service levies rise - after being cut by the same amount last year. Government ministers have refused to comment on the increase, described by insurers, unions and opposition parties as simply a tax rise.

ARMED ROBBERY: Police say an organised gang of armed robbers who have terrorised Armourguard staff for three months, striking again yesterday, are "out of control" and a serious threat to public safety. Detectives from two police districts will step up efforts today to hunt down the robbers after yet another holdup in Auckland, the seventh since July.

FULLERS: Australasia's oldest passenger ferry, Fullers' 94-year-old Kestrel, added another tale to a long list of seafaring misadventures when she came to a shattering halt at the Downtown Ferry Terminal yesterday. About 60 passengers from Devonport were shaken but unhurt after the ferry smashed her stern into Queen's Wharf while berthing soon after 8 am.

WAIKATO WATER: High-tech membrane filters in the $111 million Waikato River pipeline project will ensure the water is treated to Auckland standards, says the region's bulk-water supplier. Watercare Services said yesterday that a consortium called Water Waikato had won the contract to build the Tuakau treatment plant and 38km pipeline to Manukau.

PRISON ESCAPE: A long-time offender, who once escaped custody while watching a film he starred in about prisoner rehabilitation, is on the loose again after being let out of New Zealand's toughest jail to bag compost. Peter Anaru Matahaere, aged 31, who has numerous armed robbery convictions, escaped yesterday afternoon from an Auckland Prison work party near Paremoremo.

GANG RAPE: Two shaken teenagers told yesterday how they were awakened at 4.30 am by a group of men pounding on their door demanding sex. Armed police later swooped on the small Waikato town of Meremere and arrested three men on charges including sexual violation. Innes Clark, aged 17, said one of the men had a knife and slashed her car tyres.

EDITORIAL BENDON: Change can be cruel when it happens for the best of reasons. When the reasons are as hard to fathom as those given by the country's best-known lingerie manufacturer, Bendon, for its move offshore, business seems heartless in the extreme. In towns such as Te Aroha, the company's announcement came as a crippling blow. Change has already stripped Te Aroha of local servicing jobs in electricity, inland revenue and public administration. Bendon was the town's only remaining major employer and the loss of nearly 100 jobs when the factory closes in a few weeks will be felt throughout the local economy. All told, Bendon's planned closures could disrupt the lives of almost 400 people, unless a buyer can be found for its Te Rapa factory. The news is all the harder to stomach for the fact that the company has recorded a good profit in the latest year and remains one of New Zealand's most successful brands.

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