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Luxton Slams NZ First's Rural Policies

4 OCTOBER 1999


"Rural New Zealand will not be fooled by the smorgasbord of populist policies announced by New Zealand First," said Food and Fibre Minister John Luxton.

"Low interest loans, accelerated depreciation rates and tax breaks are the failed ideas of a bygone era. These ideas were all tried and rejected in the eighties because they simply do not work. Subsidies are not the panacea New Zealand First claims. They create distortions without offering any real benefit. The EU pays 45% of its farmers' net incomes in subsidies and their farmer incomes are still at an all time low."

"Rural New Zealand needs policies which create a competitive economy so our primary industries can prosper and grow. National has provided that platform through low taxes, an open economy, responsible monetary and fiscal policy, and flexible labour laws," Mr Luxton said.

Mr Luxton also rejected amending the Reserve Bank Act to incorporate export growth and employment as monetary policy objectives, calling it another woolly Winston idea. "Leaving monetary policy to do what it does best, namely maintain price stability, is the best contribution it can make to achieve those worthwhile objectives. Blaming the Reserve Bank for economic woes is a cheap shot which has been widely discredited by all serious commentators."

"Creating a new government department to look after rural affairs is another piece of flawed thinking. Existing departments already advise the Government on issues affecting rural communities. We already have too many bureaucracies in Wellington. We don't need another one."

"As for the Farm Debt Mediation Bill that has already been considered by a Select Committee and thrown out because it is only cosmetic and would not change what already occurs."

"Winston Peters is the ultimate re-cycler - all his ideas are 20 years old - but what he doesn't realise is that the rest of the world has moved on," Mr Luxton concluded.


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