Buzz from the Beehive
Finance Minister Nicola Willis had plenty to say when addressing the Auckland Business Chamber on the economic growth that (she tells us) is flagging more than we thought.
But the government intends to put new life into it:
We want our country to be a better place to do business, to invest, to innovate, to take risks, to build things, to make things, to hire people, to grow and to raise our children.
And we want you, New Zealand’s businesses, on board the mission.
She gave a brisk review of what the government has done so far:
In our first 100 days of office we acted swiftly on first steps to deliver this cost of living relief, fiscal repair and economic reform. We’re keeping up the pace.
And then she conditioned her audience to brace for grim news when the Government’s Budget Policy Statement is published in two weeks: .
That statement will update you on the Treasury’s growth forecasts for the economy.
The numbers haven’t been finalised, but I know enough to say they won’t make happy reading.
Treasury last published growth forecasts in December, and they weren’t flash.
Since then, due to factors outside the Government’s control, Treasury has become even more pessimistic about the growth outlook.
It seems the Treasury has warned Willis that economic growth over the next few years is likely to be significantly slower than it had previously thought.
One response would be to break major commitments to New Zealanders, drastically cut back on Government investment, give up on overdue tax reduction, downsize ambitions, and hunker down to weather the storm, hoping it will pass in time.
But no. Willis ruled that out.
Nor would the government simply carry on as usual,
“… meekly accepting the lower-growth fate predicted for New Zealand, doing things the way we’ve always done them and passively watching while Kiwi’s real incomes fall, the books weaken further and our national debt soars.”
The Government’s answer is:
- To stick to its commitments to lower personal incomes tax, to drive more resources into frontline services and to invest in infrastructure.
- To work even harder to drive more value from Government spending, to stop waste and to make decisions now that will make New Zealand more fiscally sustainable in the medium term.
- To drive much harder for real economic growth.
“We must pull out every stop to beat the gloomy forecasts and get this country growing faster, more productively and more sustainably.”
This will require the Government to break down “the obstruction economy” and impediments such as the consenting nightmare to be faced when you go to build a granny flat on your back lawn, the big city-changing infrastructure projects that never get off the ground, the regulatory marathon tat discourage investors…
And so on.
Willis set out five key themes, each containing big-rock policies to drive change:
- Building Infrastructure for growth and resilience
This entails fixing long-standing infrastructure problems by:
- delivering a one-stop shop fast track permitting and consenting regime and ultimately replacing the Resource Management Act
- electrifying New Zealand and setting out to double New Zealand’s renewable energy capacity
- building roads of national significance to unlock congestion and enable housing growth with the help of private funding and financing
- establishing a National Infrastructure Agency that develops a 30-year infrastructure plan and that supports our ambition to enable more housing much faster
- forging regional and city deals; and
- establishing a Regional Infrastructure Fund.
2. Improving educational achievement and growing skills
To grow Kiwi’s skills, attract talent and drive productivity the commitment is to:
- refocus our schools on improving student achievement across the core competencies of reading, writing and maths
- refine our immigration settings to attract the talent we need when we need it; and
- redesign vocational training to make it more responsive, efficient and relevant.
3. Strengthening trade and investment
To boost the value of exports, grow international markets and attract investment for our firms the government intends to:
- drive new Free Trade Agreements with India, the United Arab Emirate and others
- support capital investment with a refined overseas investment framework
- increase the scale and pace of the development of mineral resources; and
- help drive greater value of our agricultural exports.
- Promoting innovation, science and technology
To boost uptake of innovation the government will:
- shake up the state-funded science system to focus it better on work that will drive commercial value
- deliver enabling biotech regulation and establish a pro-science biotech regulator; and
- develop tools to reduce agricultural greenhouse gas emissions.
5. Better regulation
To remove regulatory barriers the government will:
- charge David Seymour’s new Ministry of Regulation with seeking and destroying problematic regulation with a programme of specific Regulatory Sector Reviews
- streamline the building consent system
- pursue strong competition for the grocery and banking sectors
- improve labour market regulation
- reduce on-farm regulation; and
- refine Māori land legislation so it can better enable Māori land development.
But when Point of Order checked this afternoon to provide you with the link to enable you to study the speech for yourself, it had not been posted on the government’s official website.
What we did find was
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Point of Order 