Finance Minister Grant Robertson is convinced NZ’s economy is doing better than what he calls its international peers, despite the “uncertain economic backdrop and slowing global growth”. He reckons there are “many, many signs that things are getting better under this government”.
He was particularly gung-ho in Parliament answering a patsy question from Kiritapu Allan.
First he cited last week’s BNZ-Business NZ Performance of Services Index showing the NZ services sector continuing to grow and expand in June. He said it is encouraging to see that NZ’s expansionary services index of 52.7 for June was higher than in Australia, the UK, China, Japan, and the US—demonstrating the continued strong performance of the NZ economy compared with our peers.
Robertson also pointed to the Performance of Manufacturing Index (PMI) showing the manufacturing sector expanded faster in June than in May. This stands in contrast to manufacturing sectors in other countries, which contracted in June—that being in Australia, the UK, Japan, China, and the eurozone.
And even while the US expanded at 50.6%, it was lower than NZ’s reading.
“This data represents more evidence that the NZ economy continues to grow solidly and outperform our international peers”.
As if he felt his listeners remained unconvinced, Robertson then turned to contend the government is keeping the cost of living under control, referencing data for the June quarter showing inflation at 0.6% in the quarter and 1.7% annually in line with Treasury’s forecast.
This, he added, compares favourably with the latest data showing hourly wage growth of 3.4% in the March quarter and Treasury’s forecast showing wage growth around this level over the forecast period.
Robertson believes this is good news for NZ households and workers at a time when the economy is growing solidly compared to the rest of the world and the unemployment is at record lows.
But some chinks in his armour began to appear when the Opposition’s Finance spokesman, Paul Goldsmith, questioned whether the government’s economic policies are delivering a “stable and growing economy which is fair for all New Zealanders” and whether he thought a 70% increase in hardship grants to almost 500,000 is a sign of an economy that is fair to all New Zealanders.
The Finance Minister responded:
“Yes, after nine years of the government failing to deliver an economy that is fair for all NZers, over the last 20 months we are making good progress on turning that around”.
And this is how Hansard recorded the subsequent exchange:
Robertson “Well, one of the things that the Prime Minister’s already mentioned is that we as a government over here are not hiding away figures like that. We’ve actually encouraged staff within Work and Income to give people what they’re entitled to while we turn around the economy to deliver the jobs that they so desperately want.
Goldsmith: So is it a sign that things are getting better under this government or worse?
Robertson: There are many, many signs that things are getting better under this government, and I include in that the fact that I’m happy to purchase for the member a pair of cufflinks.
Goldsmith: Has his Cabinet colleague Andrew Little told him that the 70% increase in hardship grants is a “damning indictment” on their government?
Robertson: I think the Leader of the Opposition must have handed Mr Goldsmith his notes, since he’s now repeating all of his questions. What I would say to that member is that on this side of the House—if we get to the end of Mr Little’s quote, which we heard before—we actually have a plan to make this economy not only stronger but fairer, unlike the last government.
Goldsmith: He is aware that Mr Little—Andrew Little—thought a 40% increase under National was an indictment. Does he now accept that judgment against his government, now that it’s much, much worse?
Robertson: No. What I do think is that on this side of the House we have actually got a plan to build an economy that’s fairer for NZ. So when we lift the minimum wage to $17.70 an hour and that party opposes it, does that make it fair? When on this side of the House we index main benefits to the average wage and that side of the House oppose it—we know what’s fair on this side of the House”.
As Point of Order sees it, there is another aspect to whether the economy’s growth is as satisfying as Robertson makes out. How come in the June year the number of people on the job seeker support (DOLE) benefit rose by 13,720, at a time when unemployment was at a record low? In the previous four years the comparable figures were: June 14 to June 15 -3,059, June 15 to June 16 -118, June 16 to June 17 +822, June 17 to June 18 +3,737.