Bishop Chris: Oral Questions — Questions to MinistersText is incorporated into the Bound VolumeBishop Chris: Oral Questions — Questions to Ministers[Sitting date: 17 March 2016. Volume:712;Page:9868. Text is incorporated into the Bound Volume.]2.CHRIS BISHOP (National) to the Minister of Finance: What recent reports has he received on the New Zealand economy?Hon STEVEN JOYCE (Associate Minister of Finance) on behalf of theMinister of Finance:Statistics New Zealand has today reported that the economy grew 0.9 percent in the 3 months to December. This took annual growth over 2015 to 2.3 percent. The first half of 2015 was a weaker time for the economy so it is pleasing to see that growth has picked up again in the second half of the year with two quarters of nearly 1 percent growth now. Growth was led by service industries which made up 70 percent of the economy. The construction sector also saw strong growth. Our 0.9 percent growth rate compares positively with other developed countries with 0.6 percent in Australia 0.5 percent in the UK and 0.3 percent in the US. The OECD average was 0.3 percent.Chris Bishop: How is diversification of the economy contributing to sustained moderate growth and delivering more jobs and higher incomes for New Zealand families?Hon STEVEN JOYCE: It is clear from these numbers that the New Zealand economy is proceeding in a diversified manner. We have a dairy industry that is having a difficult time at the moment but despite this we are seeing solid growth more employment and higher wages. Although we are of course concerned for dairy farmers the important lesson is that it does not mean that the whole economy is in difficulty. And that frankly is a good thing for all of New Zealand. We are seeing continued growth across many parts of the economy. For example tourism is performing well; annual beef exports are now up one-third in the last year; international education was worth $3.1 billion in 2015—and that supports 30000 jobs—and wine exports are now worth $1.5 billion up 14 percent in just 1 year.Grant Robertson: Do the latest GDP figures show the second consecutive quarter of falling per capita real disposable income?Hon STEVEN JOYCE: I congratulate the member because he has obviously been in his office trying to find the one slightly negative statistic ever since quarter to 11 this morning. Real GDP per capita which the member used to care about up until this week has gone up in both of the last two quarters. The real gross national disposable income per capita which the member is now so fixed on has gone down slightly in the latest figures.Grant Robertson: Was Westpac senior economist Michael Gordon wrong when he said that GDP growth per capita is “actually very sluggish at present.”?Hon STEVEN JOYCE: Speaking of sluggish—no it is not. The September quarter and the December quarter are both at 0.3 or 0.4 from memory.Grant Robertson: So he’s wrong?Hon STEVEN JOYCE: Well the Westpac economists were predicting 7 percent unemployment this year at one stage. I note they have been very quiet on that lately.Chris Bishop: What reports has he received recently on reductions in New Zealand’s external financial vulnerabilities?Hon STEVEN JOYCE: It is good news there too. Statistics New Zealand yesterday released its latest balance of payments figures. They showed a current account deficit of 3.1 percent which of course is significantly better than we used to experience. We were around the 8 percent mark back in the period prior to the global financial crisis before this Government came into office. Statistics New Zealand also reported that New Zealand’s net external debt has now fallen to 55 percent of GDP down from 83 percent when National took office and is now at the lowest level since 2003. These figures represent good progress in improving a longstanding imbalance in the New Zealand economy which we inherited. Lower national debt means New Zealand is better placed to respond to any future economic shocks.Chris Bishop: How is the Government’s responsible and consistent programme of economic management which contrasts with reports of other more knee-jerk approaches supporting ongoing moderate growth in the economy?Hon STEVEN JOYCE: It is important that the Government continues to undertake responsible and consistent economic reform that gives businesses the confidence to invest and grow and not just react to the latest news cycle. We are doing that for example through the Business Growth Agenda which includes 350 initiatives like signing up to new free-trade agreements reducing ACC levies by around $1.5 billion a year rolling out the ultra-fast broadband programme and launching three new ICT graduate schools. This all translates into an outlook that is for continued economic growth. In fact Treasury’s Half Year Economic and Fiscal Update forecast growth averaging around 3 percent over calendar years 2016 and 2017 while the Reserve Bank forecast is similar for the next 2 years.