Gordon Campbell | Parliament TV | Parliament Today | Video | Questions Of the Day | Search

 


Reserve Bank research: OCR rise to cost up to 30,000 jobs

12 March 2014

Reserve Bank research shows OCR rise to cost up to 30,000 jobs

The National Government’s failure to contain rising house and power prices is to blame for the coming increase in interest rates that will cost up to 30,000 jobs, Green Party Co-leader Dr Russel Norman said today.

Reserve Bank papers obtained by the Green Party via the Official Information Act show that a 1% rise in the Official Cash Rate (OCR) reduces economic output by 0.5%-1% and increases unemployment by 0.5%-1.2% compared to the situation if the OCR wasn’t raised. That equates to 12,500-30,000 fewer jobs in the economy than if the OCR wasn’t increased.

The Reserve Bank is forecast to raise the OCR by around 1% in the coming year to tackle inflation,which is being largely driven by house and power price rises.

“National’s failure to get house and power prices under control is going to mean higher interest rates and up to 30,000 fewer jobs for New Zealanders,” said Dr Norman.

“If National had stabilised the housing market and bought power prices down, the Reserve Bank would not be moving to put up interest rates.

“Rising interest rates mean less household spending, reduced business investment, and a higher exchange rate – all of which mean fewer jobs.

“Inflation isn’t rising because the economy is strong. The inflation we’re seeing is due to poor policy choices driving price rises in the non-tradable sector.

“There are 50,000 more Kiwis unemployed than when John Key came to power. National’s bad economic management will make it harder for those Kiwis to get back into work.

“The Greens have launched a suite of policies that will stabilise the housing market and lower power prices. These policies would make living more affordable for families and help to keep interest rates down.

“The Greens will focus on keeping interest rates down so that mortgages are affordable, businesses can invest, and the exchange rate is lower for our exporters. Our plan means are more jobs for Kiwis. National’s inaction will cost jobs,” said Dr Norman.

Additional information:
An estimated small open economy model with frictional unemployment pages 20-21
Shocked by the world! Introducing the three block open economy FAVAR pages 22, 2

ENDS

© Scoop Media

 
 
 
 
 
Parliament Headlines | Politics Headlines | Regional Headlines

Gordon Campbell:
On War Crimes And The Afghan Insurgency

Truly, with friends like former defence Minster Wayne Mapp, the SAS does not need enemies. At the very least, the Hit and Run book has raised the possibility that the New Zealand SAS committed war crimes in the attack they led in Afghnistan upon the villages of Naik and Khak Khuday Dad...

Mapp’s attempted defence of the SAS on RNZ this morning unintentionally indicated that collective punishment was baked into the planning exercise for the raid, and also into how the raid proceeded on the ground. More>>

 
 

Little Heading For Court: Apology Over Donation/Hotel Contract Claims Not Accepted

Today I want to publicly apologise unreservedly to Mr Hagaman for any hurt, embarrassment or adverse reflection on his reputation which may have resulted from my various media statements. I have offered that apology to the Hagamans. More>>

ALSO:

Biscuit Tin Of Democracy: World Heritage Site Protection, Ombudsman and Equal Pay Bills Drawn

On Thursday, 23 March 2017 three places are available on the Order Paper for the first reading of a Member’s bill. The ballot was held, and resulted in the following bills being drawn... More>>

ALSO:

Emissions Plan: NZ Needs More Science, More Trees, Fewer Beasts

A combination of technology breakthroughs, much more plantation forestry, and a big switch away from pastoral, particularly dairy farming, are identified as the key elements of any approach New Zealand takes to reducing its carbon emissions to a net zero level, according to a new report sponsored by the New Zealand chapter of GLOBE, a multi-party, global parliamentary grouping. More>>

ALSO:

"Backed To Win Seats": Labour Māori Seat MPs Won't Stand On List

The Labour Party is backing a request from its Māori seat MPs to stand as electorate MPs only, says Labour Leader Andrew Little. More>>

OutsKey: John Key's Valedictory Speech

I rise to address this House for the very last time. It has been a huge privilege to have served the people of Helensville as their member of Parliament, and, of course, the people of New Zealand as their Prime Minister. More>>

ALSO:

Productivity Commission: New Models Of Tertiary Education Are Coming

The report is a broad-ranging inquiry into how well New Zealand’s tertiary education system is set up to respond to emerging trends in technology and the internationalisation of education, and changes in the structure of the population, and the skills needed in the economy and society... More>>

ALSO:

PM's Press Conference: Water Everywhere

Monday's Post-Cabinet press conference focused on water, with the Prime Minister fielding questions about the possibility pricing water taken for export. Mr English said the government was directing their water allocation technical advisory group to include export water in considerations. More>>

ALSO:

Get More From Scoop

 

LATEST HEADLINES

 
 
 
 
 
 
 
 
Parliament
Search Scoop  
 
 
Powered by Vodafone
NZ independent news