Edmonds BarbaraRESERVE BANK OF NEW ZEALAND (ECONOMIC OBJECTIVE) AMENDMENT BILLThird ReadingDebate resumed.SPEAKER: We come now to the resumption of the Address in Reply debate—sorry the Reserve Bank of New Zealand (Economic Objective) Amendment Bill. Is some honourable member taking a call? Oh sorry. The Hon Barbara Edmonds.Hon BARBARA EDMONDS (Labour—Mana): Thank you very much Mr Speaker. Sorry about that. You can understand with the noise as people are leaving the Chamber it's possibly—SPEAKER: I agree with you; it's very inconsiderate—very inconsiderate—and your time will start from now. Hon BARBARA EDMONDS: Thank you Mr Speaker. It has been a very interesting 24 hours in the House since it went into urgency.SPEAKER: Sorry can I just interrupt the member and she will be able to start again. Members who are leaving the House leave as quietly as possible and don't engage in discussions on the way out the door. So would members please in an orderly fashion resume seats or quietly leave the House. One more time—the Hon Barbara Edmonds.Hon BARBARA EDMONDS: Thank you Mr Speaker. Thank you very much for the opportunity to stand and to be able to take a call on the Reserve Bank bill that's currently before the House. It's been an interesting 24 hours under urgency that we've had in the House. It's also been incredibly disappointing for a number of members here in the Opposition who because we did not have a select committee process did table a number of amendments to try and be able to provide the robust analysis of the bill given that we couldn't have a select committee we couldn't call for submissions. We also had members from this side of the House who had actually proactively contacted other people who had submitted on the previous bill when it was changed in 2019 and then enacted in 2021 asking those submitters whether they had any particular responses to the current mandate by the Government to basically remove the dual mandate and to return to one mandate which us on this side of the House believe takes us back to 1989.It takes us back to 1989 which is a time where for some of us on this side of the House we were probably just in primary school. Dead Poets Society was released I understand that movie. Ghostbusters II was also released at that time. And there's a lot of ghost-bustering and myth-bustering that we've been having to do over this side of the House in the last 24 hours to be able to provide some scrutiny and accountability and to hold this Government to account. One of the biggest mythbusters and ghostbusters that we've had to try and really push from this Minister of Finance is actually asking the Minister what evidence base does she have or does she hold in order to make such a change? We had absolutely no response to that. She could not provide evidence of the advice that she had received from her officials to absolutely and emphatically support her view that the Reserve Bank mandate should go back to one mandate which is in relation to price stability. The Minister at the time also referenced a letter that she had received from the Reserve Bank Governor which apparently supports her view or the Reserve Bank Governor will work towards supporting the view of going back to one mandate. But a number of our members on the Opposition had asked a very clear question and asked the Minister to table then her letter to the Reserve Bank Governor. We'd asked for that letter because what we want to know is actually what did she ask the Reserve Bank Governor? Because actually as the Minister was—she was a member of the Finance and Expenditure Committee and a number of times we had the Reserve Bank Governor Adrian Orr come to our select committee and confirm that even though there were two mandates in practice there was a form of hierarchy and the remit which then follows on from the objectives of the Act also reaffirms that there was in some form a hierarchy. However the Reserve Bank Governor also confirmed that he could work within the two mandates.So we go back to the evidence base and again there was no evidence-based policy and that is incredibly disappointing from this side of the House because if we look at actually what is the evidence that we have on hand the evidence shows that there is no relationship between a country's inflation trajectory and its central bank mandate over the past two years. I've talked in the House early in the committee stage around some of the Treasury reports that were part of the regulatory impact statement which actually set out that there are really quite global issues at hand and that stability is needed. That confirmed that inflation has been a global challenge which means that what we should do then is look to the evidence about how New Zealand compares and our experience against other wealthy OECD countries. On the logic of this new Government which again was not evidence-based but on their logic inflation therefore should be higher in countries with a dual mandate central bank and therefore lower in countries with a single mandate central bank. Unfortunately—unfortunately—the evidence stacks up that for this new Government no such relationship exists.So again we've heard time and time again in the last 24 hours this side of the House questioning the Minister: show us how this single mandate central bank will bring down inflation. But you know you look at New Zealand and Australia we both have a central bank with dual mandates—inflation peaked at 7.2 percent and 7.8 percent for Australia. But in the UK which has a central bank with a primary price stability mandate inflation peaked at 11.1 percent. I want to address something that the Minister had said in the House during question time: she said that inflation was around 4.4 percent. That is actually the amount that it has dropped so it's still high. They have one mandate and their inflation rate is still high. In the eurozone which has a central bank with a primary price stability mandate it peaked at 10.6 percent and in Sweden which has a central bank with a primary price stability mandate it peaked at 12.3 percent. So additionally almost all wealthy OECD economies have experienced a similar inflationary trajectory regardless of the central banks' monetary policy mandate. The question this then begs for us is: so what is the relationship between the speed at which central banks have responded to rising inflation and their monetary policy mandate? We found the evidence—and The Reserve Bank is only second to the Norwegian central bank in hiking interest rates in 2021. I know this is perhaps a lot of technical jargon and a lot of interest rates and a lot of macro- and microeconomics for 3 o'clock in the House but the reason why I bring this up is because the Government time and time again over the course of the last four weeks has been saying they want to do evidence-based policy. This is clearly not evidence-based policy because the Minister failed to prove to the House that she had the evidence to back that if you went down to a single mandate it provides a laser-sharp focus on inflation without basically showing how the inflation is going to change because actually again look to Australia look to New Zealand where we have a dual mandate we have seen that inflation is lower compared to those that have had one mandate. But a number of times in the House—and this is the reason why I'm quite disappointed—last week I spoke here about the vision that was lacking in the Speech from the Throne and from this Government. But actually it's been really really clear what the vision is for this Government and it's been really clear in the last 24 hours given that this is their very first bill that they put on the table. This is the very first bill that they decide to put under urgency not calling for submissions not allowing the Opposition to scrutinise it through a select committee process. It shows that their vision is not for workers because both this bill and the very next bill that is on the Order Paper which looks to repeal fair pay agreements—and there were hundreds of people outside today who were protesting that—show that the vision of this Government is not to support workers and that actually by changing those economic parameters by having one mandate it doesn't matter for them how much official cash rate (OCR) rates hike it doesn't matter the job losses which I find incredibly contradictory to which the Minister of Social Development just stood up and answered a question in the House about. I find it incredibly contradictory that we're not going to pay attention to trying to keep a maximum sustainable employment for the people of New Zealand.Again there are going to be remits that come from this but as we showed through the committee of the whole House stage it didn't matter how much we were trying to get that assurance of flexibility there wasn't any flexibility because you go back to the one mandate and very much the evidence-appointed policy or the most recent case that you can think of is you go back to 2014 when the Reserve Bank Governor had the one mandate and even though inflation was relatively low in comparison to what we have today at 3.5 percent inflation that Reserve Bank Governor still decided to increase the OCR at a time when unemployment was over 5 percent. You can understand what happens after that. Basically it's going to be the working people—those who are going to be unemployed—that are going to be paying for this policy change.It gives me a great disheartenment to stand here in the House today to basically once again understand that the vision of this new Government is not to support workers is not to support those who are employed in salary and wages—and again the next bill that's coming through the House again under urgency with no ability to be able to scrutinise it with the public once again shows how deaf that side of the House is to the hundreds of people who stood outside and protested who were workers. That's exactly what this bill does. This says to those workers You are no longer important it's just about increasing the interest rates and we don't care for you.""