Goldsmith PaulHon PAUL GOLDSMITH (National): I rise to oppose this legislation. The previous speaker Michael Wood said that there's nothing to see here nothing to worry about; it's all standard stuff and the Opposition should be supporting it. I suppose what we would be saying is that the Government has not made a case for change and that was the strong feedback of most of the submissions. The strongest feedback in most of the submissions was that New Zealand's monetary policy has been performing very well for the last 25 to 30 years and we are now still enjoying a strong economy which had massive momentum after a number of years of expansion and growth and stable currency a stable dollar not being eaten away by inflation and incredibly strong employment growth.So we had 245000 jobs created in the last two years—245000 jobs created in this economy in the past two years. Now the Minister over there Shane Jones says he's going to create 4000 with $3 billion in spending but of course we haven't drilled down into the details about exactly what those jobs are. But that's all by the by.Now what we can say about this bill is that it is at the behest of one Winston Raymond Peters and it has been his focus and absolute obsession over many years in politics to change and attack the Reserve Bank. If you go back to his speeches—and I encourage anybody listening into this debate to go back and have a look at the sorts of things that he predicted—we have had the accusation or claim from the Government today that the National Party is being alarmist and Chicken Little about these things. Well just have a look at the sorts of things that Mr Peters said about the Reserve Bank in the mid-1990s. He blamed it for everything. He blamed it for high unemployment for doom and gloom in the economy and suggested it needed radical change. Of course then he became the Treasurer of the country in 1996 after doing a deal with the National Party and his changes were just slightly increasing the band from 0 to 2 percent I think to 3 percent. So after all the tub-thumping he just slightly expanded the band within which the Reserve Bank should be targeting.Now he's back on his bugbear and implying that there's something wrong with the way that the Reserve Bank operates in New Zealand and has brought about this change. Two elements: there being a committee and yep you're quite right it won't be the end of the world but we don't see any strong case for it and in fact we worry about the potential politicisation of the decision making but the real thing is around this introduction of the bank having two goals. For the last 25 years it's been focused solely on inflation—keeping that low so that people can make long-term decisions and have a sense that the currency is solid and we're not going to inflate our way out of problems and you're not going to find that the savings that you have have been eaten away by inflation—and that's been very successful.Now the suggestion is that we focus also on stable employment and the point I'd make is that there's no evidence to show that monetary policy—which is the control of interest rates that are charged by the Government—can have a long-term effect on employment. There's no question that it can have a short-term effect and that's why it used to be used prior to elections back in the 1970s and early 1980s in New Zealand but there's no evidence that it has a long-term impact. The things that do make an impact on employment are the basics of good economic policy which is what we saw in New Zealand over a long period of time. It's about ensuring that there's plenty of money coming in for investment because where do you get a job? Well you might spend millions of dollars of taxpayers' money to create a job as Mr Jones is good at but most jobs are created by individuals—private sector businesses—deciding to invest some money and hire a person build new plant start a new business take a new risk. All those investment decisions are what drive real employment growth and Government can influence that by making either positive or negative impacts on those investment decisions.So if you're dangling the prospect of a capital gains tax for example then people are probably less likely to make an investment decision. If there's a whole lot of uncertainty around how Government acts such as was introduced with its oil and gas decision then people are less likely to make investments. So the point is that this piece of legislation here is all about trying to increase employment and I'm making the simple point that actually this is not going to increase employment. It's the basic Government policies around investment that make a difference to employment in New Zealand and also around skills. So you're going to get employment growth if you have a good generation of New Zealanders coming through with the right skills that we need which is why it's so disappointing that this Government has decided to waste about $2.6 billion of the tertiary budget on free fees to people who are already going to university and so we haven't got any more extra people. So that is not going to lead to further employment.Then another way you're going to get more employment is to enable New Zealanders to have greater access to the resources of this country in order to make a living. And this Government of course with oil and gas—New Zealand is so rich apparently that we don't have to look for oil and gas. There are only two countries in the world who think that they're that rich that they don't have to even look for it and that's New Zealand and France. Of course you might have noticed that the French have got a few issues at the moment like they're good at rioting but they've got nuclear energy and they don't have much oil and gas. So New Zealand and France are the only countries in the world who think they are so rich that they don't have to look for oil and gas.ASSISTANT SPEAKER (Adrian Rurawhe): Interesting as that is you might want to come back to the bill.Hon PAUL GOLDSMITH: Well the point I'm making is that if you want to create jobs—sustainable jobs and employment—you don't turn to monetary policy and the Reserve Bank; you do basic things in Government that lead to jobs and investment.Then the next thing is around infrastructure—you invest and continue to invest in infrastructure. Again I look at what the Government's doing and I scratch my head and I think to myself that instead of building roads to Northland which will actually grow the economy and create jobs in Northland—much more than Shane Jones's stuff—we're going to spend it all on a slow tram down Dominion Road that nobody can make any sense of. So that's another one. Then if you want to have more jobs and employment you look for export markets. That involves actually having to go overseas and talk to other nations and we didn't do any of that. As a result of that we haven't got much hope of an upgrade to the Chinese free-trade agreement.Finally if you want to grow jobs then you make investments in technology and the knowledge-based economy and we haven't seen much of that. In fact if you look at the universities budget for example they've got less money per student than they've had in the past coming from Government. So how we're going to get a knowledge economy growing out of that I'm darned if I know.So this piece of legislation—it's not the end of the world. The world will not collapse. We're not claiming to be Chicken Little here but what we're saying is that it is a perfect example of a Government that focuses on everything else apart from what is actually important in terms of growing this economy and providing the opportunities for New Zealanders and their families to get ahead—and we do that. New Zealanders have the opportunity to provide for themselves and their families and to make a contribution in this country and to live a good quality life in this country if they have a strong economy and that's based on those sorts of things: enabling investment delivering good quality skills having access to natural resources building quality infrastructure that actually makes a difference expanding our export markets and making real investment in a knowledge-based economy. Those are the things that lead to full and strong employment such as we've seen over the past few years not mucking around with the monetary policy and the organisation of the Reserve Bank. On that basis I oppose this bill.