2. AMY ADAMS (National—Selwyn) Link to this
to the Minister of Finance
What reports has he received on the New Zealand economy?
Hon BILL ENGLISH (Minister of Finance) Link to this
Data released today shows that the economy grew marginally by 0.1 percent in the June quarter. It is the first positive quarter after a succession of five negative quarters stretching back to the start of 2008. It indicates that the economy is stabilising, and that growth is likely to pick up. That is good news, particularly for New Zealanders who are worried about job security, or who want to see the prospect of getting another job improving.
I think the challenge for this economy has been generally recognised: to get the right kind of balance in our recovery. The last recession occurred, to some extent, because of strong increases in Government spending, a housing boom, and excessive household debt. We do not want to go down that track again, so the Government will have to work hard to create the kind of environment where the economy grows from savings, investing, and exporting, rather than from fast Government spending and too much household debt.
Hon David Cunliffe Link to this
What additional measures is the Minister therefore planning in order to ensure that the 135,000 New Zealanders currently unemployed will benefit from a turn-round in the economy? How many Kiwis will be forced on to the dole queue before the Government comes up with a real and credible action plan for jobs and exports?
The Government has outlined six policy drivers that will shape the recovery. They include significant investment in productive infrastructure that employs people in the shorter term but lifts the productive capacity in the longer term, and a very strong focus on creating the kind of business environment in which the private sector will be willing to invest and employ, and therefore create more jobs. Over the next 5 to 10 years new jobs are unlikely to come from a Government sector that is already borrowing $400 million a week just to keep going.
We have learnt a lot of lessons from the last 10 years, when, even in the best of times, the economy was mismanaged so badly that New Zealand went into a recession before everybody else, and thousands of New Zealanders lost jobs that they thought were sustainable.
Hon David Cunliffe Link to this
In the best of times and the worst of times, does the Minister stand by his answer given yesterday that “New Zealand is now reaping the benefits of being an open and resilient economy,” in forecasting a lower peak of unemployment? Can he confirm that the difference is the strong record of the outgoing Labour Government, which had the world’s lowest unemployment, zero net national debt, and GDP growth a full 1 percent higher than it was the last time National was in office?
The previous Labour Government had the opportunity to oversee the best economic conditions in two generations. Labour managed to create a recession before almost anyone in the world. That, and not the shower heads, is what it should apologise for.
Mr SPEAKERHon David Cunliffe Link to this
—be better off now if the previous Government had taken the advice of “Minister Oliver Twist” and borrowed more to fund tax cuts that would have fuelled the consumption he now rails against?