ACT Finance spokesman Rodney Hide said today that Reserve Bank Governor Dr Don Brash's hike in interest rates shows New Zealand's prospects for sustainable growth under current policies remains at best 2.5 percent a year.

"New Zealand is simply not attracting the investment and entrepreneurship that we need to boost our growth prospects.

"The key is less tax and less red tape. Helen Clark has increased both. That's why interest rates are being hiked, even on a pitiful growth forecast. The problem lies firmly with government policy.

"Prime Minister Helen Clark has constantly harped on that the economy is doing well. Well, after her signing her name to paintings that she didn't paint, New Zealanders have every right to ask, "Where's the evidence?"

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