Henare Tau: Questions for Oral Answer — Questions to MinistersText is incorporated into the Bound VolumeHenare Tau: Questions for Oral Answer — Questions to Ministers[Sitting date: 09 April 2013. Volume:689;Page:9118. Text is incorporated into the Bound Volume.]2.Hon TAU HENARE (National) to theMinister of Finance: What reports has he received on progress in building economic growth?Hon BILL ENGLISH (Minister of Finance): This week I have received Treasury’s latest monthlyEconomic Indicatorsreport which shows that the outlook for the economy is looking more positive following a robust 1.5 percent increase in GDP in the December 2012 quarter. Also the New Zealand Institute of Economic Research’s business opinion survey out today shows confidence up moderately in the March quarter to a 3-year high pointing to growth of around 3 percent a year. I might point out that in the calendar year 2012 New Zealand grew 3 percent and Australia with its mining boom grew 3.1 percent.Hon Tau Henare: What are some of the main contributions to the improving outlook?Hon BILL ENGLISH: Treasury reports a range of indicators looking reasonably positive. Commodity prices in March had the third-strongest rise on record driven by dairy prices. Manufacturing and services industry indexes have both risen strongly so there is clearly not a crisis in manufacturing when it is growing. Consumer confidence business confidence and firms’ reported outlook for activity are all around or above long-term averages and our major trading partners Australia China the US and Japan have generally reported economic data a bit ahead of expectations.Hon Tau Henare: What reports has he received on the Government’s finances?Hon BILL ENGLISH: The Government’s accounts for the 8 months to the end of February show that the deficit was $3 billion for the first 8 months of the financial year $556 million lower than the deficit forecast back in December. This reflects good control of expenditure as well as marginally higher revenues. The Crown’s operating balance which records change in the value of all the Crown’s activities including its investments recorded a surplus of $4.3 billion. The Government is on track to surplus.Hon Tau Henare: What independent comment has he seen about the Government’s economic programme?Hon BILL ENGLISH: I have seen comments from the managing director of the International Monetary Fund Christine Lagarde who said of New Zealand: “All I can tell you is the IMF is very supportive of what is being done by the Government …” and “If you look at the numbers if you look whether it is growth whether it is employment whether it is inflation whether it is debt overall it is very stable and it is also very promising … it’s certainly a lot better than what we see in other parts of the world.”And she went on to say that the economic policies are supportive of good fundamentals and “policies we believe are sound and solid.”Hon David Parker: Do the latest financial statements of the Government show that while “Total labour force earnings were in line with forecasts” this is because the fall in employment has been “concentrated at the lower end of the income scale” meaning that the same amount of income was earned by fewer workers; and what further proof does he need to show that income inequality is growing wider and wider under the settings that his Government pursues?Hon BILL ENGLISH: The member is I think telling half the story there. As I understand it what the figures showed was that employment for part-time and young workers reduced. It is still a bit of a puzzle because it is likely that one of the reasons it did that is because more of them are going into training. That of course is what that party advocates—that young people should not be in low-paid part-time jobs they should be in training. Well they are moving from low-paid part-time jobs into training and I thought he would have supported that.