Q+A: Grant Robertson interviewed by Corin Dann
Finance Minister: we need to do better on biosecurity
Finance Minister Grant Robertson is considering a fund to front foot an increasing number of bio security issues like the bacterial infection to cattle, mycoplasma bovis.
Speaking on TVNZ 1’s Q+A programme this morning Mr Robertson told Corin Dann he has asked Treasury and the Ministry of Primary Industries to investigate the possibility of creating a fund that could be funded partly by the government and partly by industry.
“We can’t just sit there and wait for these things to happen. We know they’re happening more regularly and I want us to get ahead of that,” he said.
“We are in a very reactive stance when they come in. We have this with Mycoplasma bovis, and we scramble around both as a government and the industry, trying to find the money to respond to them.”
Mr Robertson said the government was also looking at ways of curbing land owners from so-called banking.
Q + A 2018
Interviewed by Corin Dann
CORIN Let’s get to the finance minister Grant Robertson. One thing I didn’t notice in the budget – you’ve got all these reviews. No review of the constitutional arrangements in New Zealand. You’re not thinking about moving to a republic any time soon? Does this change your mind perhaps?
GRANT Not any time soon, no. I think this government is going to go on in New Zealand for a period of time, but I think all New Zealanders would want to wish Harry and Meghan really well today.
CORIN All right, let’s move on. This budget – you talked about trying to be a transformational government that you wanted to be while you were in opposition; that you wanted to do things differently. But looking at how this has landed, it’s not exactly Michael Joseph Savage, is it?
GRANT It’s the first steps in a transformation. You actually had the clip from me in the budget speech in your intro saying that. We can’t transform the economy or our society without getting the foundations right, and that’s what this budget focused on. So it’s not just the foundations for the investment in the public services and health and housing and education, but the beginning of us moving to a real 21st century economy. Now, we’ve set ourselves this goal of being a zero net emission economy by 2050; we have to start that work now. We want to make sure we’re adapting to that future of work, the changing technology in the workplace; we have to start that work now. But this budget was always going to be the one that lay the foundations. There’s two more this term and hopefully one after that.
CORIN Is that transformation going to see Labour and this government move away from those market economy frameworks, the neoliberal frameworks? Because you said in an article in The Standard in opposition that, ‘It’s time to throw out the neoliberal agenda and build a genuinely progressive vision for New Zealand.’ So when you’ve made this transformation in three years, will you be able to come on this programme and say we’ve ditched neoliberalism?
GRANT We’re turning the page from what we’ve seen before. One of our first actions was to reverse the National government’s tax cuts. So I don’t think a classic neoliberal government would come in and say, ‘Let’s return that money back in and put it back out within our families package, targeting low and middle income earners.’ We are looking to transform the basis of our economy to be more sustainable, to be more productive. We’ve got programmes in here, Corin, that are much more hands on. You know we’re going back into the regions and saying we’re going to help develop these regions. We’re not going to stand for it–
CORIN With the greatest respect, Minister, that doesn’t make sense. You have said in your budget yourself that as a percentage of the economy, the government is going to stay under 30%. You are going to be less, in fact, than the last government. So in terms of our economy and what role the government plays, it’s not going to get any bigger.
GRANT It’s going to get smarter, is what it’s going to do, because we are going to make sure that we invest in those sustainable technologies and industries. And actually, in fairness, we are spending – I think I saw a Victoria University analysis the other day – about $1000 per head more than the previous government were spending. So we are spending more, but we’re doing that in a balanced way. We’re making sure that we do keep the buffer that we need for a rainy day. Those are sensible things. Having fiscal discipline’s not the monopoly of the National party. If you actually look back over history, Labour has managed the economy in a disciplined way and made big social changes. I think we’ve got the balance about right.
CORIN But it’s an issue around trust and what you were campaigning on, that you campaigned to throw out this agenda. This isn’t Bernie Sanders and Jeremy Corbyn. I’m trying to get a sense of what your Labour party is. It’s not that, is it?
GRANT What we’re doing is we’re transforming in a deliberate and planned way. And I was a teenager in the 1980s. I watched what happened when there was a snap of the fingers and a change of the economic direction. It caused massive damage to the communities I lived in. I want to make sure that we plan a 20 or 30-year transition, that we go through that in a methodical way and we keep a balance in the economy as we do it.
CORIN But to use a horrible phrase, you’re wasting a good crisis. When you were in opposition, you talked of a crisis in housing, a crisis in health, a crisis in mental health. Where is the war-footing that your government should be on to deal with these crises?
GRANT I think $4 billion of extra spending on health shows that we’re serious about taking those first steps. The first of three budgets; we will keep lifting expenditure on those critical public services throughout our term in government. But I think saying, actually, we’re prepared to put the investment in rebuilding our hospitals – $750 million in this budget versus $150 million in the last budget. So we’re making those changes, but we’ve got to bring New Zealanders with us. We’ve got to transform the economy in a way that there’s still a place for everyone in New Zealand wherever they live.
CORIN But you hammered the last government on child poverty –hammered them. Yet the Poverty Action Group says, ‘This will not do that much.’ It says, ‘These increases will not be enough to alleviate their day-to-day poverty.’ So what is the point of coming into government if you cannot make a big enough different to their day-to-day poverty?
GRANT I think we will make a big difference. In the Families Package that we put in place before Christmas, which was really part one of this budget, we’ve got $5.5 billion going into middle and low-income families. It will transform the lives of a family when they’re $75 per week better off than they were before the Families Package. We are making a difference there. But we said it on budget day – we know there’s more to do, and we’re going to keep doing that over a sustained period of time.
CORIN What about the group of New Zealanders just slightly above those who are in the day-to-day poverty, the working poor? By this estimate, $70,000 will be the average wage in 2022, but they’ll start paying the top tax rate. So the gains that they might make there, they’re going to lose. I mean, $70,000, that is not a lot.
GRANT In the immediate term, many of those families will be getting Working For Families extensions, and so we will be making sure that we’re helping them meet their cost of living. I think when it comes to tax, what New Zealanders want to know is that they’ll pay tax happily if they know the services they’re going to get in health and in education and in protecting the environment, the Department of Conversation, is delivering for them. And that’s what we’re aiming to do with this budget – show that the taxes that they’re paying are going towards the things that they want.
CORIN Will you rule out changing those thresholds?
GRANT It’s certainly not on our agenda at the moment. But we’ve got the tax working group, and the tax working group’s job is to come back to us initially in September this year and then finally in April next year with their ideas for the better balance in the tax system. We’ll take a look at those, and we will campaign on them running in to 2020.
CORIN Nurses and teachers – help me out here. So you’ve got a contingency pot of money that you’ve put aside to pay for their wage demands, correct?
CORIN That’s $650 million? Is that right?
GRANT I’m not going to get in to numbers, Corin.
CORIN But that’s what it says in your budget.
GRANT Well, actually, if you look at the full contingency line over four years, it’s a bit more than that. But I don’t want to get into negotiating teachers’ and nurses’ pay on Q+A, sadly for you.
CORIN But this is important, because during the coalition negotiations, the State Services Commission, when you asked them questions about this and got information, they came back with about $530 million - that’s just for collective bargaining – and then it’d be way more if it was pay equity. From what I can see in the budget, you haven’t got a lot there to do that and have any money left over for another– for a problem. So I’m wondering whether maybe Steven Joyce had a point when he talked about just how tight your budget is.
GRANT What we’ve got in there is a contingency. I think everyone will appreciate that we’re already in negotiations with the nurses; the teachers have just initiated bargaining. We’re going to go into those negotiations in good faith, but I’m not going to negotiate the exact amounts of money or outcomes on air. A balance has to be struck. There are some pretty ambitious claims out there from some of those groups. We’ll sit down at the table and work out what they’ve got.
CORIN Fair enough. Will there be any money left over in your contingency for any other problems that come along?
GRANT Well, there has to be, and there will be.
CORIN It won’t be much, though, will it?
GRANT You’re conflating a whole heap of things together there. I mean, the pay equity claims are going to come over a period of years, an extended period of years.
CORIN That’s interesting, because you’ve just told the teachers they’re not getting anything at this time.
GRANT Well, teachers aren’t campaigning on pay equity.
CORIN Well, nurses I should say, sorry.
GRANT Nurses, that’s a negotiation that’s very active. But if you’re trying to claim all of the pay equity claims that are on the table will have to be paid for out of this contingency, that’s not quite right. What I’m saying is we have made provision for our negotiations, but that’s exactly what they are – negotiations. We’ll do those in good faith, and we’ll see the outcomes in time.
CORIN Speaking of contingencies, in the budget lock-up, you mentioned about M. bovis, this terrible disease, and you talked about a new way of needing to look after biosecurity threats. What are you talking about?
GRANT The issue that I have is we are seeing an increasing number of biosecurity incursions into New Zealand, and we are in a very reactive stance when they come in. We have this with Mycoplasma bovis, and we scramble around both as a government and the industry, trying to find the money to respond to them. What I’d like to see is for us to get ahead of those, and we’ve got examples about how we do that in other parts of government – the Earthquake Commission, ACC – where we actually try to plan ahead.
CORIN So you’re saying a fund – some sort of a fund?
GRANT Potentially. And I’ve asked Treasury and the Ministry of Primary Industries to investigate what that sort of fund would look like, how much would the government contribute, how much would industry contribute in the future. But we have to be realistic. We can’t just sit there and wait for these things to happen. We know they’re happening more regularly, and I want us to get ahead of that.
CORIN So you would want farmers in the industry to put in money as well?
GRANT Farmers in the industry already put in money in response to this, so this is about saying, ‘Let’s not be reactive. Let’s actually plan for it and get– ‘
CORIN So they’d pay some sort of a levy into a fund?
GRANT Potentially. But they already pay, as I say, in a reactive manner. This is about getting a plan, and we’ll sit down with the industry and talk about this idea. It’s early days for it, but I think as a minister of finance, watching us now, we will make sure we will provide whatever we need to to deal with Mycoplasma bovis, but I’d rather have a much more planned approach to dealing with that sort of incursion.
CORIN You seem to want farmers to drive their tractors up the steps of parliament, because you’ve got water, you’ve got the ETS, and now you’re suggesting they may be need to put a little extra in a levy for an EQC fund. I mean, they are our productive backbone. Is that too much for them?
GRANT As I say, they already contribute in situations of biosecurity incursion. But we’ve got money in the budget to work with farmers to help more sustainability in farming. We’ve got more money for the Ministry of Primary Industries to do their job as well. We recognise the importance of the farming sector. But they’re just, as any other sector, facing those changes in technology, facing the need to move to a lower carbon economy. We have to work together to allow that industry to move up the value chain, produce higher paying jobs in New Zealand. That’s what this budget’s largely about.
CORIN Okay, a couple of quick things. I heard you on National Radio a couple of days ago talking about an urban development authority working to get rid of zoning laws in Auckland – this sort of stuff. Sorry, it’s a crude description, but anyway… Could an urban development authority that your government sets up be able to compulsorily acquire land? In other words, get the land bankers and sell us your land under the Public Works Act or take it off them.
GRANT Other urban development authorities in the world do have those powers. The experience that they’ve had is that they don’t actually need to use them. We’re still designing the urban development authority, but its job is to break through some of those–
CORIN Would it be using those powers?
GRANT It could be, but I don’t think they’d be used very often, and the experience internationally–
CORIN But you’d need the threat?
GRANT The essence is that you need a way of breaking through the blockages that have stopped the developments that we need. Phil Twyford’s working on this, and we’ve already campaigned on the idea the Auckland urban limit needs to be broken back out, because that’s how the land bankers make their money.
CORIN Land bankers could face, under a new law, the possibility that they’re forced to sell. Now, you might not use it, but they could face it.
GRANT We haven’t finished our design on that. What I’m saying is other urban development authorities in the world have had those powers but haven’t actually really used them that often.
CORIN All right, final question – a new stadium in Auckland; you’ve talked to Phil Goff about it. Is this serious?
GRANT What Mr Goff and I both agreed is that we have higher priorities at the moment than a new stadia. Auckland Council’s done some work on its overall stadium strategy. Phil and I have talked about that, and I’ve said I’m happy to keep talking to him, but it’s not–
CORIN You ain’t got a spare $500 million down the couch?
GRANT Not at the moment. No, I don’t.
CORIN Finance minister Grant Robertson, thank you very much for your time on Q+A.
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