Cunliffe David: Questions for Oral Answer — Questions to Ministers 
Text is incorporated into the Bound Volume 
Cunliffe David: Questions for Oral Answer — Questions to Ministers 
[Sitting date: 25 October 2012. Volume:685;Page:6207. Text is incorporated into the Bound Volume.] 
4. 
Hon DAVID CUNLIFFE (Labour—New Lynn) 
 to the  
Minister for Economic Development 
: Does he agree with the NZIER shadow board that “the growth outlook for the second half of 2012 looks weak and unemployment remains stubbornly high.”? 
Hon STEVEN JOYCE (Minister for Economic Development) 
: 
 Their view is one view. The jury is in fact out on what growth will be in the second half of this year. It was pretty strong in the first half of this year by world standards currently. It was 2.6 percent for the year to June which is higher than predicted given current global financial conditions so it would not be any surprise if growth in the second half of the year was not as strong but it is still likely to be stronger than in many other advanced economies. I would agree that unemployment is higher than we would like. I would point out that it is again though lower than in other developed countries—for example the US and the UK. I would also note that in countries like Croatia and Kyrgyzstan which were two of the examples championed in this House yesterday unemployment is 18 percent and 8.6 percent respectively. Of course I have also seen a statistic from 2004 for Kyrgyzstan and it was 18 percent. And in Zimbabwe of course where they follow the Norman plan it is over 80 percent unemployment. 
Hon David Parker 
: I raise a point of order Mr Speaker. I think that is probably the sixth time this week when that Minister in response has broken the Standing Orders by accusing the Green Party of something that it is not proposing. The Zimbabwe comparison that is being used in respect of the Greens—the Minister was warned earlier in question time that—[ 
Interruption 
] 
Mr SPEAKER 
: Order! [ 
Interruption 
] Order! Both members will cease. I have listened for a moment to try to pick up the point of order. I realise that the member does not like the Minister’s answer. I do not believe that the Minister was transgressing too far this time. I think that where I do owe the House an apology personally is that earlier on I let another Minister get away with a jab that was unfair. I apologise to the member for that happening. It beat me in timing. That was unfair and I apologise to the member where I let that happen. However on this occasion I think this sort of stuff is contestable information. I think he had gone on long enough though. 
Hon David Cunliffe 
: Given the Minister’s admission that growth forecasts are lower in the second half of the year with one at 0.8 percent per annum does he now agree with shadow board members Cameron Bagrie ShamubeelEaqub Dominick Stephens Phil O’Reilly Viv Hall and Stephen Toplis among others that “Inflation is below the bottom of the band … The exchange rate continues to be overvalued … placing greater weight on lower rates as the economy fails to ignite”? 
Hon STEVEN JOYCE 
: I certainly think that the exchange rate is challenging for some exporters. I do not have any disagreement with that although there are other exporters that are doing very well. I would also note though for the member that I read a report from economists this morning I think that said that even if for example the Governor of the Reserve Bank had taken the view of dropping interest rates today it was unlikely to have a significant impact on the exchange rate. That is because what is going on with the New Zealand exchange rate is that much larger forces are at work and ultimately it is about what the world thinks of the respective opportunities for different economies around the world. 
Rt Hon Winston Peters 
: It’s not! It’s about high interest rates that they can’t get in Europe. Everybody knows that. 
Hon STEVEN JOYCE 
: If you think that is a high interest rate Mr Peters then I think you are on another planet. 
Hon David Cunliffe 
: In light of the Minister’s extensive reading list does he now agree with the Bank for International Settlements which says of the New Zealand currency trading environment that the rate of inflows and outflows in the New Zealand dollar is 400 times that justified by its trade flows? 
Hon STEVEN JOYCE 
: No I have not seen that particular statistic although I sense a tension developing between Mr Cunliffe and Mr Parker. Mr Cunliffe wants— 
Mr SPEAKER 
: Order! The Minister will resume his seat. The question was an absolutely straight question. Ministers get plenty of opportunity to give that kind of answer but not to that question. 
Hon David Cunliffe 
: What is the Government doing to reverse the results of the most recent performance of manufacturing index which shows the manufacturing sector contracting for the fourth consecutive month and at its lowest September level in 4 years and the New Zealand performance of services index which shows that the service sector is also going backwards for the first time in more than 2 years and do they demonstrate the Minister’s words that he thinks the economy is “heading in the right direction”? 
Hon STEVEN JOYCE 
: I think the absolute sense that the economy is heading in the right direction is the actual physical activity that has occurred over the last 2 years. We have had 57000 more jobs in the economy; the economy is 2.6 percent larger than it was a year ago; the New Zealand stock market is at record highs at this point in time; and we are seeing a significant amount of jobs being added in a whole range of manufacturing and information and communications technology industries. I will give the member a few examples to help him with his confidence in that regard: 300 new jobs at the Tegel plant in Henderson; 350 jobs about to start at Marsden Point for the expansion there; 400 jobs for IBM and Unitec in Auckland; about 1500 jobs at Fonterra’s new Darfield plant; and new jobs at organisations such as Orion and Douglas Pharmaceuticals and at a range of information and communications technology companies and manufacturing companies around New Zealand. 
Mr SPEAKER 
: Order! I think that is sufficient answer. 
Hon David Cunliffe 
: Given the ability of members on both sides of this House to quote companies that have either hired or fired—and we do not need to go back through Solid Energy Tiwai Point Kawerau and others—would an economy “heading in the right direction” have contracting employment in the manufacturing sector contracting employment in the services sector and fewer total hours worked than the year before? 
Hon STEVEN JOYCE 
: The member should recognise contraction in the manufacturing sector because it actually occurred primarily between 2005 and 2009. The member does not like to hear it and Mr Parker does not like to hear it but in the last 2 years the number of jobs in manufacturing has actually stabilised and slightly grown. I think that is very encouraging for the New Zealand economy as it is the first time since around 2005. 
Hon David Cunliffe 
: I seek leave to table the New Zealand Institute of Economic Research shadow board’s statement of 24 October indicating that it believes the exchange rate was overvalued and the economy had failed to ignite. 
Mr SPEAKER 
: Leave is sought to table that document. Is there any objection? Is there any objection? There is no objection. 









Document by leave laid on the Table of the House.