4. Question No. 4—FinanceHon AMY ADAMS (National—Selwyn) to the Minister of FinanceQuestion No. 4—Finance4. Hon AMY ADAMS (National—Selwyn) to the Minister of Finance: Does he stand by his statement that we are building an economy that is more productive"; if so why is annual GDP per capita growth at its lowest level since 2011?Hon Dr DAVID CLARK (Associate Minister of Finance) on behalf of the Minister of Finance: I stand by my—[Interruption]SPEAKER: Order! Part of the problem with the byplay is that it fools me as well. David Parker will behave himself. Start again David Clark.Hon Dr DAVID CLARK: On behalf of the Minister I stand by my full statement last year that "New Zealanders will see a difference with next year's Budget. It will show how we are building an economy that is more productive more sustainable and more inclusive." I stand by that statement given that GDP per hour worked has increased on average by 0.9 percent per quarter under the coalition Government compared to just 0.1 percent under the previous Government. In terms of the second part of the member's question that is correct on one definition and not on others.Hon Amy Adams: Why does he continue to blame global headwinds for our economic performance when according to Treasury at the same time that our economy is weakening US GDP growth has risen above 3 percent growth in China has stabilised above 6 percent and growth in Australia and the euro area has recently picked up?Hon Dr DAVID CLARK: There are global headwinds; there's no doubt about that. I would note that the IMF forecast advanced economies to grow by 1.8 percent in 2019 and 1.7 percent in 2020 but within that the IMF forecast New Zealand's economy to grow 2.5 percent in 2019 and 2.9 percent in 2020. So compared to our peers we are set to grow solidly.Hon Amy Adams: Given he's so keen for global comparisons is he aware that the average growth rate per person across the OECD is three times higher than it is in New Zealand?Hon Dr DAVID CLARK: I stand by the statement that was made earlier—that we're building an economy that's more productive more sustainable and more inclusive and I note that GDP per hour worked has increased by an average of 0.9 percent per quarter under the coalition Government compared to just 0.1 percent under the previous Government. GDP per hour worked is growing faster on a quarterly basis under this Government than under the previous Government and that is a measure of labour productivity that looks at how much each labourer is producing in the economy.Hon Amy Adams: What does it say about our economy that New Zealand is now one of the only countries in the developed world that is lowering interest rates because of its rapidly weakening domestic economy?Hon Dr DAVID CLARK: The Reserve Bank report came out at 2 o'clock and on behalf of the Minister of course I haven't had a chance to read the whole report yet but it noted concerns around the global economic outlook. The underlying fundamentals of the New Zealand economy it said are strong. It noted that central banks around the world are easing monetary policy. I thought the member would welcome lower interest rates for homeowners and businesses. It means that housing is more affordable and businesses will have more incentives to invest.Hon Amy Adams: Well what does he think it says about his handling of the economy when he inherited an economy growing at close to 4 percent a year but 18 months in the Reserve Bank has now had to be one of the first in the world to act to lower interest rates to stimulate the economy?Hon Dr DAVID CLARK: The fact remains that New Zealand is one of the best performing economies in the OECD. New Zealand GPD growth of 0.6 percent in the December 2018 quarter was higher than Australia higher than Canada higher than the euro area higher than Japan higher than the UK and higher than the OECD average. The unemployment rate fell to 4.2 percent in the March quarter—the second lowest since December 2008. Wages grew 3.4 percent over the year and we have an economy that's in good shape. The member should celebrate that.Hon Amy Adams: Is he worried about the role of monetary policy in the event of a future economic crisis considering the official cash rate (OCR) is now at its lowest-ever rate and there is very little room left to stimulate the economy if something were to go seriously wrong offshore?Hon Dr DAVID CLARK: I reject that assertion and I would also note that our economy is in good shape. The Reserve Bank acts independently it makes independent decisions it has independent forecasts and it paints a picture of an economy in good shape in New Zealand.Hon Amy Adams: Does he reject the fact that the OCR as of today is now at its lowest ever rate; is that what he was rejecting in the question?Hon Dr DAVID CLARK: No."