Heather Roy's Diary

We are using Parliament's recess to go to Europe, visiting small parties philosophically similar to ACT. We're investigating how they fit into the political landscape, their relationships with larger parties, and what lessons a party like ACT can learn.

We are visiting Germany's Free Democrats (a valuable case study, since Germany is another country governed under MMP), and Ireland's Progressive Democrats. I am particularly looking forward to our meeting with Mary Harney, who has recently announced her resignation as leader of the Progressive Democrats, but remains Ireland's Deputy Prime Minister and Minister for Health.

We are also spending time in London, visiting a number of politicians from across the political spectrum.

For the next two weeks, while I'm away, we'll have guest columnists for the Diary. Today we have notes from Rodney Hide's speech to the Institute of Economic Affairs, which he delivered in London this afternoon.

Trust The People

It's a huge buzz, as a Kiwi, stepping off the plane in London - the land of Big Ben, Shakespeare and 'mind the gap'.

As politicians, we have come to learn. We will take back new ideas to make our own country more free and prosperous.

Today, Heather Roy and I are the only MPs in our Parliament advocating freedom, choice and personal responsibility, but in the 1980s, New Zealand led the world.

Sir Roger Douglas, the Labour Party's Finance Minister, who went on to be one of ACT's founders, introduced our economy to the free market.

That Labour government gave us more freedom and choice.

Now ACT stands in opposition to a Labour government which is taking choices away.

As economists, we know what works to deliver more prosperity.

Small government.

Politicians having less control, and citizens having more.

Less government results in a prosperous economy, a strong society and a quality of life that is the envy of the world.

We will get there by trading freely, by taking care of our environment, and by trusting the people.

As David Cameron has said, the more we trust people, the stronger they become.

ACT trusts people to make their own choices - about the health and education of their family, and about their role in the economy.

Freedom and choice are enduring ideas.

Enduring policies we've already seen include the Fiscal Responsibility Act, where Government has to tell Treasury every six months about all the decisions they've made that involve spending money. Treasury then have to prepare a four-year forecast.

That makes government more transparent and accountable. Politicians can no longer commit taxpayer funds in secret.

The effect was immediate. Every New Zealand government had run a deficit every year of my life.

That's how they would win votes - by spending the money now, and piling up the bills for future generations to deal with.

No government has run a deficit in any year since the passing of the Fiscal Responsibility Act.

We've also got the Reserve Bank Act that tamed inflation.

The Reserve Bank Governor has one objective - price stability. His inflation target is set by the Minister of Finance, publicly and in writing.

New Zealand now has price stability. Our politicians don't just let the printing presses rip, running up a debt tomorrow to buy an election today.

These laws have survived elections. Our tax and spend parties have been in government, and not repealed them.

So what did those Acts have in common?

They made political decision-making more transparent and politicians more accountable to the voters.

So the solutions we should be advocating are precisely those.

The more politicians are accountable, the better decisions we will get.

The next proposal I will take before Parliament in November is a Regulatory Responsibility Bill.

It says that, before making a law, Parliament has to publicly answer a few key questions, like 'what is this law for?' 'What will it cost?' And 'what will it achieve?'

After a time period, the rules would have to be reviewed, to see if they work.

Politicians would be made accountable to the people for the regulations they passed.

We believe, in ACT, that less government and better government walk hand in hand.

That greater opportunity comes from having fewer barriers to trading between nations.

And that just as we separate church from state, we should separate the state from business.

In New Zealand the State owns power companies, a bank, an airline, the post office, radio and television networks.

We're told that these are assets held in trust for the people - but politicians without experience or proper incentives make bad trustees.

The people didn't choose to own them - they can't opt out.

Politicians appoint the managers, and taxpayers take all the risk.

Citizens who could put their share of these investments to better use, like having a hip operation, are denied that opportunity.

If State assets are the people's assets, they should be owned and managed by the people.

I would return shares in State owned assets to the citizens of New Zealand.

That would give every Kiwi a real stake in our economy.

Families would prosper through selling the shares they don't want to keep, and collecting the dividends on those they do.

Margaret Thatcher began to separate the state from business, right here in the UK, about 25 years ago. Governments around the world followed.

Here, as at home, there is still unfinished business.

By making the actions of politicians and Government transparent, and giving the people a stake in our country's economy, we can deliver that freedom and choice.

If we trust the people.

The full speech can be read at www.act.org.nz/iea - and you can follow our progress through Europe on Rodney's blog at www.rodneyhide.com.

ENDS

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