Adams AmyHon AMY ADAMS (National—Selwyn): Thank you Madam Chair. I'm pleased to take a call in this annual review debate where we are once again approaching the annual reviews through the sector approach which I must say for myself I have found as one of the good innovations of recent years where we can group together votes with a similar theme and address them as one global debate. This House will know that I am a relative newcomer at least this time round to the Finance and Expenditure Committee but this is a bit of a groundhog day for me. I was there nine years ago and it's good to return to familiar territory and look at some of the reports we're seeing from Treasury and the like as we go through that annual review process. Of course in terms of the change of Government the period of review largely is the period that related to the National-led Government. Of course it is also looking into what is termed current operations—so the current year under the new coalition Government. I think the clear take away when you look at that period that Treasury have been reporting to us on in their annual review and covering—it really is a story of a very strong economy actually. I think all parties in this House would acknowledge that New Zealand has been served remarkably well by the strength of our economy in recent years at a time when the international trends have been uncertainty and some of our comparator countries have been seeing quite stagnant and lumpy growth if at all we have had an economy that has been held up under various monikers one of which of course—perhaps most well-known—being a rock star economy. Actually what we've had and seen developed during that period—and this is important when we look forward into the current year and years ahead—is a very sustainable solid rate of growth in the New Zealand economy that has allowed us as respective Governments to have the certainty of a reliable and actually growing revenue stream and has allowed Governments to make choices.The reason that's worth highlighting is because that cannot be taken for granted. One of Treasury's core functions that we test them on in the annual review process is their ability to properly study and understand and reflect the risks to that economic performance and the criticality of any small deviation in those growth tracks. One of the things that I've been interested to read through in recent weeks has been the sort of weighty tome that Treasury has put out their investment statement. My colleague Michael Wood who has just resumed his seat has spoken about the fact that this reflected the Living Standards Framework that Treasury are very interested in and which I want to return to but the investment statement itself is an interesting four-year document which does go through and stress test or resilience test how well our economy would respond to various shocks. This is important because when you're looking at the resilience of our economy to something like a major Wellington earthquake or foot and mouth disease it really tells us that it wouldn't take much at all to considerably derail the projections that the new Government is working with. When you are looking therefore at hardwiring in significant increases in spending at the same time that reforms could seriously weaken that performance of our economy I think New Zealand has real reason to be concerned.I do just want to touch on the Living Standards Framework because Treasury did spend a bit of time talking about this in their examination before the committee. I don't disagree at all and I don't think anyone on this side of the House would disagree that of course there is more to a standard of living and the things that we value in this country than the books. No one would doubt that and I think it would be a very brave politician or member of society who would suggest that. Of course we care about a far wider range of indicators than simply the financials. But the question for me in Treasury's role is the extent to which Treasury is the right agency to do that and whether in doing it they risk losing their focus on the criticality of understanding those very very finely weighted calls at the margin around the impact on our economy. One of the concerns that I have that I would have put to Treasury certainly given that opportunity is the fact that we're hearing from public agencies throughout this annual review process that they simply have no idea how they're supposed to apply this Living Standards Framework.So it's a lovely sounding ideal and of course New Zealanders all care about a range of indicators but let's not lose sight of the fact that Treasury must remain our central and our centrally focused agency looking at the criticality of those economic settings understanding how vitally important it is. Because let's not kid ourselves that anybody will have a good standard of living and a strong health system and a good education system and a clean environment and swimmable rivers and safe communities unless we have an economy that can pay for it. Anything that risks taking that focus away is of concern. So we'll watch it and we'll watch it with interest.