Adams Paul: Questions for Oral Answer — Questions to Ministers 
Adams Paul: Questions for Oral Answer — Questions to Ministers 
[Volume:619;Page:14721] 
3.  
PAUL ADAMS (United Future) 
 to the  
Minister of Finance 
: Does he agree that the shortage of labour skilled and unskilled is the single biggest constraint on growth in New Zealand; if not what is the biggest constraint on growth? 
Hon Dr MICHAEL CULLEN (Minister of Finance) 
: 
 Yes I do. The workforce participation rate is now very high. Our unemployment rate is down to 4 percent which is the second-lowest in the developed world and the household labour force survey out today shows the total workforce for the first time now numbers more than 2 million people. The downside of course with this is a shortage of skilled labour. The solution lies in a mix of training immigration remuneration working conditions and a more productive workforce. 
Paul Adams 
: How can he claim that the country is “firmly on a path to growth” when labour shortages are threatening infrastructural development leading Fletcher Construction to turn down a $250 million construction project and stopping Auckland’s roading upgrade from being compressed from 15 years to 8 years? 
Hon Dr MICHAEL CULLEN 
: There are always some people who will find a cloud rather than a silver lining. The fact is that we are facing for the first time for getting towards 20 years serious labour shortages because the economy is going so well. 
Clayton Cosgrove 
: What is the Government doing to resolve this problem in respect of skills shortages? 
Hon Dr MICHAEL CULLEN 
: There is a range of initiatives across education and industry that are designed to address skills shortages. We have numbers of people in the Modern Apprenticeships scheme. We have very large numbers of people—numbers that are growing rapidly—in industry training. We are attempting to re-orientate the tertiary education system in a more productive fashion that is more relevant to the needs of business. We are getting key industries working together with the Government on those matters. Industry training alone grew by 20 percent between 2002 and 2003. 
John Key 
: Did the Minister notice recent comments by the co-leader of the Greens Jeanette Fitzsimons on Television One’s  
Agenda 
 programme where she concluded that a future Labour-Greens Government would implement capital gains tax even more restrictive transport and energy legislation and new environmental taxes; if so what impact does the Minister think these initiatives will have on New Zealand’s future growth rate? 
Hon Dr MICHAEL CULLEN 
: No I did not but I did see suggestions that the Government should own a very large number of local industries that should be controlled directly by the Government through an investment fund that should be dominated by a very small group of senior Ministers working together when the member opposite said we should emulate Singapore in terms of the way we organise our economy. 
Dail Jones 
: Does the Minister accept that the present problems being experienced for example in Auckland as indicated by the United Future member are brought about by the untrammelled uncontrolled and unplanned immigration to New Zealand as a result of the policies of the National Party and the Labour Party over the last 10 years resulting in housing shortages for the poor in Auckland and west Auckland; health problems not being able to be resolved; and of course educational problems with schools’ rolls rising to 2000 and 3000 something for which this Government must accept responsibility? 
Mr SPEAKER 
: In so far as that relates to the Minister’s responsibilities he may answer. 
Hon Dr MICHAEL CULLEN 
: It is certainly true that high levels of net immigration—and I emphasise “net” because most of that is not New Zealanders leaving or it is New Zealanders returning—has contributed to the pressure on New Zealand. But I certainly stand proudly in this House and say that many immigrants have contributed a great deal to this country; not least Mr Jones and myself. 
Paul Adams 
: Does the Minister agree that part of the solution to the labour shortage lies in fully utilising spare capacity in the domestic labour market; if so why has this Government presided over a 45 percent increase in the number of people who have been unemployed for 3 years or more? 
Hon Dr MICHAEL CULLEN 
: Unemployment levels have dropped very dramatically under this Government—down 12 percent in the last year alone. The problem is that there is not a great deal of unemployed labour resources in New Zealand at the present time particularly amongst those capable of being reskilled to participate in construction industries. 
Paul Adams 
: Is the high participation rate in tertiary education necessarily an effective response to the skills shortage when 50 percent fail to complete their qualifications after 5 years; and has he discussed the possibility of raising the entry standards for university courses with the Minister responsible for tertiary education in an effort to ensure students are undertaking the most appropriate study? 
Mr SPEAKER 
: I just want to say that I want to hear questions in silence. 
Hon Dr MICHAEL CULLEN 
: I think it is fair to say that sometimes problems with completion rates go with the territory as one might say. But I have raised this and my colleague the Associate Minister of Education shares with me the desire to ensure that we are getting better value for money out of the tertiary education system. 
Paul Adams 
: My problem was that I did not go to one of those courses. 
Mr SPEAKER 
: Regrettable though that may be that is irrelevant. Please come to the question. 
Paul Adams 
: Does the Minister agree that internal migration may provide a partial solution to regional labour shortages such as those in the South Island; if so why are there still no significant schemes to facilitate mobility between regions when this very point was made in the 2001 Treasury discussion paper  
Towards an Inclusive Economy 
? 
Hon Dr MICHAEL CULLEN 
: While it may be possible to have some measures that act in a negative sense by discouraging people from moving to areas of high unemployment—in other words making it more difficult to obtain benefits—it is very hard to move people around the country if they do not wish it to places where there is employment. Personally I regard it as strange that some people might stay in some parts of the country somewhat north of this place when they could move to the South Island to find employment and a better lifestyle.