2. Hon PHIL GOFF (Leader of the Opposition) Link to this
to the Prime Minister
Does he stand by his statement that by early 2010 New Zealand will be coming out of the recession “reasonably aggressively”?
Rt Hon JOHN KEY (Prime Minister) Link to this
I stand by the full quote from March 2009, which, for the benefit of the member, is: “… I think by the end of 2009 early 2010 this time next year we’ll be starting to come out of that and I think actually starting to come out of it reasonably aggressively, I’m more optimistic about 2011 than 2010 but nevertheless I think 2010 will be positive.” Those statements have proved to be entirely correct. We were starting to come out of the recession by the end of 2009; 2010 will be positive; 2011 will see considerable improvement; and in terms of aggressive growth, the House should note that the New Zealand economy has grown more in the last 9 months than it did in the full 4-year period prior to that, from September 2005 to September 2009.
If the Prime Minister’s prediction and statement were, as he said, entirely correct, how does he explain Treasury’s comments last week that the recovery was not going according to plan, that there has been a slow-down in the economy, and, in fact, that economic growth is failing to keep up with population growth?
Notwithstanding that the quote was made 18 months ago and in the world economy things move around by the week, let alone 18 months, why do we not quote Alan Bollard, who just today said that the economic recovery is proving “brittle, uncertain, and full of surprises”, but that we have now emerged from a long recession and have experienced some quarters of “significant growth”.
If the Prime Minister claims that his statement was entirely correct, how does he explain the Quarterly Survey of Business Opinion that came out in September from the New Zealand Institute of Economic Research, which showed that business confidence fell from positive 26 to negative nine?
There is quite a lot of volatility in the Quarterly Survey of Business Opinion, and that is for a variety of reasons; one has to accept that, globally, in May, August, and June we saw a number of different things occur internationally. But I would note in relation to the Quarterly Survey of Business Opinion that the BNZ’s commentary stated that it was disappointing but not deathly, and it is picking growth of 0.6 and 0.5 for the third quarter and fourth quarter respectively.
Chris TremainI could sum that up in one word, but I will choose not to do that. Let us just cast our mind back to the economic conditions of the 2008 September quarter, just before the election. The economy was in its third consecutive quarter of recession, having shrunk 1.5 percent in 9 months; inflation was running at 5.1 percent; real after-tax wages had dropped by 0.8 percent over the preceding year; real exports had declined 2 percent over the preceding year; the tradable part of the economy had been in recession for 4 years; and the current account deficit had blown out to 8.6 percent. Labour’s farewell gift to the nation was an economy in a disastrous state.
Why does the Prime Minister pretend that things are getting better for the average New Zealand household, when his own Statistics New Zealand department last week pointed out that, for the first time in its record-taking, the median wage of New Zealanders had actually fallen by $9 a week?
One could quote all the things that Statistics New Zealand has said, and it has said that this is not statistically significant. I would also say that the New Zealand Income Survey is a compositional number that includes all income of people aged 15 and above, which includes investments. So, for a start, if interest rates are lower, income is less. But the best measure of changes in earnings from year to year is the quarterly employment survey, which is the same rate that is used to calculate the floor of New Zealand superannuation, and it shows that real after-tax earnings have been growing under National after 5 years of no growth under the other lot, who were hopeless.
How does the growth in the number of unemployed people—up from 6.1 percent to 6.8 percent—respond to his comment last week that “My sense is they’ll be feeling a bit better now that summer has come.”?
Well, they will be feeling better, because one always feels better when the weather is a bit better, but also they will be feeling a lot better because the tax cuts are in their pockets. I shall quote Chris Carter; I remember his saying that Mr Goff had campaigned on getting rid of the increase in GST to 15 percent, and in the end he did nothing. That is why Chris Carter actually speaks for the Labour Party caucus.
It is a lot lower, but let us choose just one area, to give a sense of what has been happening with price increases. Let us go back to September 2008, and let us pick, say, fresh fruit and vegetables, which under Labour went up 14 percent in a year. Under Labour bread went up 18 percent in a year, milk went up 12 percent, cheese went up a whopping 42 percent, eggs went up 13 percent, petrol went up 29 percent, electricity went up 7 percent, and gas went up 14 percent. No wonder Labour was booted out.
How many additional jobs have the Prime Minister’s job initiatives such as the Job Summit and the cycleway—[ Interruption]
Mr SPEAKERI apologise to the honourable member. With the level of interjection I am struggling to hear the question, and I am sure the Prime Minister will want to hear it.
He might not, Mr Speaker. I repeat the question: how many additional jobs have the Prime Minister’s job initiatives created in New Zealand over the last year, how does that figure compare with the quarter of a million additional jobs created by Australia this year, and has he narrowed the gap?
I do not have to hand information on how many jobs have been created, but I can say that in my view the Job Summit did a good thing in getting employers, employees, the Government, and unions all on one page to deal with the worst financial crisis. And I can say this: there are 17 people who have got a new job; that is right, they are the people on Chris Carter’s list to get rid of Phil Goff.
I raise a point of order, Mr Speaker. A very specific question was asked—how many additional jobs had been created, compared with the quarter of a million extra jobs in Australia, and whether the gap had been narrowed. There was no effort made to answer it.
If I heard correctly—and I stress that, with the level of noise in the House, I may not have heard correctly—the Prime Minister said he did not have that exact figure. Of course, when a primary question is so vague as to ask whether the Prime Minister, in this case, stands by a statement made quite some time ago, it is hard to expect him to have that detail of information. I think it would be a bit unreasonable for me to expect that.