Ardern Shane: Questions for Oral Answer — Questions to Ministers 
Text is incorporated into the Bound Volume 
Ardern Shane: Questions for Oral Answer — Questions to Ministers 
[Sitting date: 21 March 2012. Volume:678;Page:1140. Text is incorporated into the Bound Volume.] 
1. 
SHANE ARDERN (National—Taranaki - King Country) 
 to the  
Minister of Finance 
: What reports has he received on the economy? 
Hon BILL ENGLISH (Minister of Finance) 
: 
 Statistics New Zealand today reported on the current account for the December quarter 2011. This shows New Zealand’s position improved a little in line with market expectations. The current account deficit narrowed to $8.3 billion or 4 percent of GDP in the year to December from 4.3 percent in the year to September. 
Shane Ardern 
: What are his expectations for New Zealand’s current account position over the next 4 years? 
Hon BILL ENGLISH 
: In the Budget Policy Statement Treasury predicted the current account deficit would widen to more than 6 percent over the next few years. That would be driven by one of two main factors—a lift in imports due to the Canterbury rebuild and also an increase in business investment. Getting on top of the current account is a significant challenge. We are aided by the fact that there are record high volumes of dairy exports so continued export performance will help. I am a bit more optimistic than Treasury as is the Reserve Bank which is forecasting a 5 percent rather than a 6 percent current account deficit. 
Shane Ardern 
: What measures is the Government taking to rebalance the economy reduce New Zealand’s vulnerability to overseas debt and ensure we live within our means? 
Hon BILL ENGLISH 
: This is a long-running issue in New Zealand and reflects some fundamental imbalances in our economy. In the past 3 years the Government has taken a number of steps such as reforming the tax system and setting the Government on a faster return to surplus in 2014-15 because that is one of the most important contributions a Government can make to lifting national savings. We will also continue to focus on the competitiveness of our businesses because maintaining New Zealand’s competitiveness is critical to improving the current account deficit. 
Shane Ardern 
: How does New Zealand’s present current account deficit compare with the position in the 3 years until 2008? 
Hon BILL ENGLISH 
: The current account deficit has been affected particularly by the recession but it has improved in recent years. It did fall to less than 2 percent in 2010 mainly because of the recession but New Zealanders have started saving more and borrowing less. Between 2005 and 2008 the current account deficit averaged more than 8 percent per year reflecting fast growth in Government spending and big increases in debt as well as poor policy settings that squeezed the productive sector of the economy. 
Hon David Parker 
: Why is Treasury asking high school kids “to propose policy options that address New Zealand’s long-term fiscal challenges”? Is it because Treasury the Reserve Bank and the New Zealand Institute of Economic Research forecast a growing current account deficit is it because Treasury calculates that the country’s international debt will grow by $50 billion over the next 4 years under his Government’s policies or is it because his Government is so clearly out of the ideas needed to properly rebalance the economy? 
Hon BILL ENGLISH 
: The member may be interested to know that Treasury is doing that because of a statutory requirement put in place by his Government which is that Treasury produce long-term fiscal estimates every 4 years. That report is coming up in the next couple of years and Treasury is taking a broad public education approach to compiling that report which is required by law. 
Hon David Parker 
: I seek leave to table a statement from Treasury saying that it is going to secondary schools to invite proposals for policy options to address— 
Mr SPEAKER 
: Is this a media statement? 
Hon David Parker 
: Yes it is a statement from Treasury. It is not a political party one. 
Mr SPEAKER 
: No it is just a media statement for the daily media. I do not think we need to table statements for the daily media.