Gordon Campbell | Parliament TV | Parliament Today | News Video | Crime | Employers | Housing | Immigration | Legal | Local Govt. | Maori | Welfare | Unions | Youth | Search

 


Government Must Acknowledge Failed Policies

11 February 2004

Government Must Acknowledge Failed Policies

The time has come for the government to acknowledge that it has been pursuing failed economic policies, New Zealand Business Roundtable executive director Roger Kerr said today.

Mr Kerr was presenting the Business Roundtable's submission on the Budget Policy Statement to the Finance and Expenditure Committee at parliament

"The government's own projections make it clear that it will not achieve its 'top priority' goal of increasing sustainable growth and returning New Zealand to the top half of the OECD income rankings under current policies.

"The key statistics are as follows. Over the ten years 1993-2003 (March years), real (production-based) GDP grew by 3.6 percent a year on average. Real per capita GDP growth averaged 2.5 percent.

"These improvements, and improvements in New Zealand 's productivity growth rates, followed the economic reforms of the 1980s and early 1990s.

"By contrast, for the period 2003-08, the projections underlying the Budget Policy Statement are for real GDP growth averaging 3.1 percent a year and average real per capita GDP growth of 2.2 percent a year.

"This suggests New Zealand 's trend growth rates are declining, not rising.

"The finance minister has said that there would be evidence of his success or failure in raising the trend growth rate by the middle of this year. That was a realistic timetable, given that the government is into its fifth year in office and has enjoyed favourable economic conditions. Yet there is no evidence of such success. The Organisation for Economic Cooperation and Development (OECD) in its recent report confirmed that any improvement in New Zealand 's growth performance "is still not in sight".

"While the government says its top priority is growth, large expenditure increases are planned. It is clear that 4 percent plus per capita growth (the rate needed to return New Zealand to the top half of the OECD rankings in a reasonable time frame) cannot be achieved with total government spending (central plus local) at around 40 percent of GDP. The government is planning to spend a high and increasing proportion of the 'growth dividend, leaving little room for increases in after-tax wages and other incomes.

"Furthermore, its plans for the upcoming budget, which include tax cuts for low income earners, are focused on income distribution, not wealth creation and growth.

"If the government were serious about growth, its tax policy should be directed at cutting high marginal tax rates and taxes on capital income, as the McLeod Tax Review of 2001 recommended.

"The export sector is under pressure from the high dollar. Curbing spending and rising regulatory costs are clear options available to the government for improving export competitiveness. Instead, past and planned actions, like the proposed amendments to the Employment Relations Act, are adding to costs.

"There is now ample evidence that the government's policies are not resulting in higher sustainable growth. It is time for that fact to be acknowledged, and for changes in direction, on the lines recommended by the OECD and business organisations, to be implemented," Mr Kerr said.

The NZBR submission on the Budget Policy Statement is available online as a PDF file on the NZBR website

http://www.nzbr.org.nz/documents/submissions/submissions-2004/2004_budget_policy_statement.pdf


© Scoop Media

 
 
 
 
 
Parliament Headlines | Politics Headlines | Regional Headlines

 

Sector Opposes Bill: Local Government Bill Timeframe Extended

The Minister of Local Government Peseta Sam Lotu-Iiga has asked the Select Committee to extend the report back date for the Local Government Act 2002 Amendment Bill (No 2). More>>

ALSO:

Breed Laws Don’t Work: Vets On New National Dog Control Plan

It is pleasing therefore to see Louise Upston Associate Minister for Local Government calling for a comprehensive solution... However, relying on breed specific laws to manage dog aggression will not work. More>>

ALSO:

Not Waiting On Select Committee: Green Party Releases Medically-Assisted Dying Policy

“Adults with a terminal illness should have the right to choose a medically assisted death,” Green Party health spokesperson Kevin Hague said. “The Green Party does not support extending assisted dying to people who aren't terminally ill because we can’t be confident that this won't further marginalise the lives of people with disabilities." More>>

ALSO:

General Election Review: Changes To Electoral Act Introduced

More effective systems in polling places and earlier counting of advanced votes are on their way through proposed changes to our electoral laws, Justice Minister Amy Adams says. More>>

Gordon Campbell: On Our Posturing At The UN

In New York, Key basically took an old May 2 Washington Post article written by Barack Obama, recycled it back to the Americans, and still scored headlines here at home… We’ve had a double serving of this kind of comfort food. More>>

ALSO:

Treaty Settlements: Bills Delayed As NZ First Pulls Support

Ngāruahine, Te Atiawa and Taranaki are reeling today as they learnt that the third and final readings of each Iwi’s Historical Treaty Settlement Bills scheduled for this Friday, have been put in jeopardy by the actions of NZ First. More>>

ALSO:

Gordon Campbell: On The Damage De-Regulation Is Doing To Fisheries And Education, Plus Kate Tempest

Our faith in the benign workings of the market – and of the light-handed regulation that goes with it – has had a body count. Back in 1992, the free market friendly Health Safety and Employment Act gutted the labour inspectorate and turned forestry, mining and other workplace sites into death traps, long before the Pike River disaster. More>>

Get More From Scoop

 

LATEST HEADLINES

 
 
 
 
 
 
 
 
 
Politics
Search Scoop  
 
 
Powered by Vodafone
NZ independent news