“The Government's new legislation directing the Reserve Bank to focus on employment in monetary policy decision making ignores the very simple fact that printing money doesn’t create jobs", says ACT Leader David Seymour.

"Monetary policy doesn’t affect employment in the long-term.

“Jobs are created when we have a world-class education system, a flexible labour market, and a sound welfare system. None of these things are related to monetary policy.

“If central banks were able to create jobs by printing money, Venezuela would be a thriving economy. Instead, inflation is running at one million per cent.

“Requiring the Reserve Bank to focus on both inflation and employment will put it in an impossible situation.

“The Government’s massive new spending plans will at some point force a difficult choice on the Bank: raise interest rates and therefore short-term unemployment, or accept higher inflation with all of its damaging consequences.

"If we want New Zealand's employment rate to remain high, fighting inflation should be the sole focus of the Reserve Bank. Low inflation is an essential condition for strong economic performance.

“These changes are economic vandalism of the highest order”, says Mr Seymour.

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