Paul Goldsmith – Speech to National Party Conference
new-zealand-national-party
Sat Jul 27 2019 12:00:00 GMT+1200 (New Zealand Standard Time)
Paul Goldsmith – Speech to National Party Conference
Saturday, 27 July 2019, 12:42 pm
Speech: New Zealand National Party
You will have noticed a strong economic theme to the start of the conference.
It’s true, we in the National Party do bang on a lot about the economy.
It makes me think of my old Nana, who always said, ‘money isn’t everything’.
Of course it isn’t.
As one of the richest men in the world, Warren Buffett, put it, ‘it doesn’t matter how much money you’ve got, if you’re not loved by the people you want to love you, life is a disaster’.
It’s similar with countries. Good government is just as much about preserving and enhancing what is special about this country.
That, to me, is the quality of our environment, our social cohesion, our relatively high trust and low corruption traditions, our commitment to the rule of law, freedom and tolerance of different views, our sense of security.
All these things are incredibly important and should never be taken for granted.
So the economy is not everything, but it is important.
Not because we revere the great machine for itself – it’s simply a means to an end.
The economy is about people. It’s about you, me, our families and our neighbourhoods.
To me, the point of a strong economy is to enable New Zealanders to do the most basic things in life well.
A strong economy improves our chances of finding satisfying and well-paying work so that we can look after ourselves and our families – the most fundamental task each of us have.
A society based on the assumption that its average citizen can’t or shouldn’t be expected to look after themselves and their families is doomed.
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That’s not what we believe.
Work itself, in its countless varieties, brings the opportunity to make a contribution to our world and the people in it, whether we’re providing someone with a new hip, a new app, or a cup of coffee with a smile.
And third, if we do well, we can afford to have some fun in our leisure time, and maybe if we have some energy left do something in the neighbourhood; on the barbecue for the school committee, or whatever.
That, to me, is the good life to which we aspire.
As well as generating work and opportunities, good economic management and a strong economy enables the country to have better public services that improve our lives – a quality education, access to world-class healthcare when we need it, decent transport infrastructure so we can get home on time, the reassurance of superannuation when we’re old.
There are times in everyone’s life when we need help. At certain times of their lives some people can’t look after themselves and their families; the stronger our economy is, the more we can help.
Now, good economic management is not just about spending money, it’s about generating it.
As we all know, the current Government is having great fun spending the surpluses it inherited. Look at the glee on Shane Jones’ face when he wanders the countryside handing out cash.
But they have been slack, confused, and lazy in their spending choices.
The hundreds of millions on free tertiary fees, for fewer students, is the classic example; as is the Provincial Growth Fund – one part economic development, nine parts NZ First re-election fund.
There are countless other examples. The $2 billion for KiwiBuild that was supposed to deliver 10,000 houses a year but has instead delivered about 200 in two years, and the $300 million for 279 working groups.
Meanwhile, they have been irredeemably complacent about economic growth.
Every month or so they take something off the table – we’re so rich we no longer need oil and gas; so rich we don’t have to look for gold; we’re not sure about dairy; we’re not sure about international students; we don’t really want foreign investors, the list goes on.
Then every month they add new costs – fuel taxes, car taxes, industrial relations changes, taxes on landlords.
In almost every area, they’ve created uncertainty by sending hundreds of working groups off in every direction.
The most rational reaction to 18 months of uncertainty over whether there would be a Capital Gains Tax was for investors to keep their hands in their pockets to see what happened.
That issue has, mercifully, been resolved but there are countless others and lots of people are holding off investing as they wait for the dust to settle.
And what have we seen? Well, don’t take my word for it, take the Reserve Bank Governor’s – there was a ‘sharp decline’ in the New Zealand economy in the second half of 2018.
Growth has dropped to somewhere in the low 2 to 2.5 per cent range. On a per person basis, it’s barely moving.
If it continues there will be fewer opportunities for Kiwis. We could be back in deficit within two years, which would be a calamitous outcome.
Grant Robertson and Jacinda Ardern will blame everyone else. It’s Donald Trump, the Iranians, President Xi, Brexit.
Of course, international sentiment, and risks, have some impact.
We’re living in very strange times. Right now, about $12.5 trillion in securities are returning a negative yield.
But don’t forget our terms of trade, the prices we are currently getting for exports, are still at historically high levels. We should be doing well right now.
The IMF’s latest forecasts for global growth have it rising from 3.2 per cent this year to 3.5 per cent next year – about the 40-year average.
Domestic factors are critical.
Slumping business confidence, which Government Ministers routinely refer to as ‘junk’, is a symptom of the confusion and doubt this Government has sewn.
It’s fallen because this Government continues to add costs to businesses. It has created massive uncertainty and demonstrated incompetence in critical areas, starting with KiwiBuild and transport.
Our approach would be the opposite.
We’d spend carefully and demand specific results from that spending.
We’ll have a clearly articulated plan for growth. One that accepts successful, modern economies have to do lots of things to make a living. The most sophisticated and successful economy in the world, the United States of America, is also the largest producer of oil.
The answer to the question, ‘can we do this to make a living?’ needs to be yes, more often.
We’ll look for ways to increase the flow of investment and domestic capital. We’ll invest in skills and lifelong learning for the modern economy – not bribe students.
We’ll carry on the multi-decade task of building the infrastructure we need for a growing economy.
We won’t be deranged by hatred of ‘car fascists’ like Julie Anne Genter and Phil Twyford.
We will be balanced and conscious that not everything needs to be funded off the Crown’s balance sheet – we can innovate.
We’ll concentrate on reducing costs by being more disciplined about regulation – recognising that we weren’t perfect in Government in that area – by taxing people less and by tackling the cost of new housing head on.
We’ll provide more certainty and predictability in the way we govern so that investors feel confident to take their hands out of their pockets and start putting their money to work, to start new businesses, take on more staff and take a chance.
What’s the goal? To deliver a strong economy and world-class public services that enable Kiwis to look after themselves and their families, to find satisfying work, and to lead full lives.
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