3. Question No. 3—Prime MinisterCHRISTOPHER LUXON (Leader of the Opposition) to the Prime MinisterQuestion No. 3—Prime Minister3. CHRISTOPHER LUXON (Leader of the Opposition) to the Prime Minister: Does he stand by the Prime Minister's statement that we are well placed to recover with one of the best economies in the world"; if so is he confident that New Zealand's economy will grow faster than Australia's over the next four years?Hon GRANT ROBERTSON (Acting Prime Minister): With characteristic modesty I note the full quote of the Prime Minister: "in the midst of a crisis in the midst of such tough economic times globally we are well placed to recover with one of the best economies in the world. And … there are many reasons for that [but] Grant Robertson is one … and for that I thank him." In answer to the second part of the question the Budget Economic and Fiscal Update forecast gross domestic product (GDP) growth of 4.2 percent for the year ending June 2023 moderating to 0.7 percent 1.6 percent and 2.5 percent in each of the following years. By comparison the Reserve Bank of Australia estimates GDP growth of 3 percent in 2022/2023 and 2 percent in 2023/2024—a slight moderation on the Australian Budget forecasts. Global economic growth is forecast to be slower and inflation higher than even just a few months ago and that makes forecasting uncertain. What I am confident in though is the resilience and strength of the New Zealand economy and that both New Zealand and Australia have done well with dealing with COVID and are in a good position to deal with the challenging times that we're in.Christopher Luxon: Is he concerned that Treasury's average growth forecast for the next four years of 2.1 percent is a full percentage point lower than the equivalent forecast in Australia?Hon GRANT ROBERTSON: As I said there are changing forecasts all the time. I've mentioned the Reserve Bank of Australia. The most recent forecasts in Australia were to see GDP growth of 3 percent and 2 percent as compared to 3.5 percent and 2.5 percent as the Australian Treasury did. These are very difficult and uncertain times but I remain confident in the resilience of the New Zealand economy.Christopher Luxon: What impact will faster economic growth in Australia over the next four years have on the number of Kiwis moving across the Tasman?Hon GRANT ROBERTSON: As we know for many decades we have seen New Zealanders go to Australia from time to time for work opportunities. What I do think is that when you have a Government in New Zealand that is continuing to invest in our people making sure that they've got the skills and the training that they need making sure that we're investing in the infrastructure deficit that we inherited and rectifying that that there will be ever more prosperous growth in New Zealand. New Zealand remains a small country beside a large country and many countries around the world in those circumstances experience people leaving from time to time. There is every reason to stay in New Zealand with a productive and resilient economy.Christopher Luxon: Does he believe that inflation outpacing wages for 10 of the last 17 quarters is a major factor pushing more Kiwis to move overseas?Hon GRANT ROBERTSON: As the member well knows 2022 is the only year where inflation outpaces wages in New Zealand. In terms of the forecast period and in terms of the period coming into this 2022 is a very challenging year. I would note for the member that Philip Lowe the Governor of the Reserve Bank of Australia made the statement just in recent days that Australia's inflation will reach 7 percent by the end of the year. Most forecasters in New Zealand are forecasting New Zealand to peak at around 7 percent inflation.Christopher Luxon: How many more months then does he expect real incomes to fall?Hon GRANT ROBERTSON: The Treasury's forecast is that continues through 2022 and then when we reach 2023 we move into a period of time where New Zealanders' wages outpace inflation. I do note the member's sudden interest in the wages of New Zealanders and the failure of the National Party to support measures that might actually increase wages in New Zealand—for instance lifting the minimum wage or indeed fair pay agreements something that had been a feature of the Australian economy for some considerable time. So if the member is looking for policy ideas out there perhaps he might look to Australia and fair pay agreements.Christopher Luxon: What impact will New Zealand's slide in the IMD Global Competitiveness Rankings—from one spot ahead of Australia in 2017 to now 12 spots behind them this year—have on the number of Kiwis moving across the ditch?Hon GRANT ROBERTSON: Well that survey is one particular survey. I would say that what that survey tells us is that in the last year New Zealand has improved its position on real GDP growth real GDP growth per capita labour force long-term unemployment exchange rate stability GDP per capita foreign currency reserves per capita the unemployment rate the export of goods. There are many many reasons to be optimistic about the New Zealand economy. The member might like to talk it down but on this side of the House we're proud of New Zealanders.David Seymour: Is the Minister aware that in the time his Government has been in place the gap between the median New Zealand wage and the median Australian wage has grown by $6600 and if he is aware what has he got to say for himself?Hon GRANT ROBERTSON: What I am aware of is that all of the agencies who come to look at the New Zealand economy have said that it is in good heart be that the OECD who said that the near-term economic outlook is positive and the New Zealand economy has recovered strongly from the pandemic or be that the IMF who said that New Zealand's economy has reached a strong cyclical position enabled by sound management of COVID-19. We will always seek ways on this side of the House to improve the wages of New Zealanders. That includes the actions we take like lifting the minimum wage and introducing fair pay agreements and it also is in supporting small businesses making sure that we've got the infrastructure to improve productivity. We do need to invest to do those things.Christopher Luxon: Does he agree with Infometrics that now is in fact the worst time in 65 years to be a first-home buyer and what impact does he believe this will have on the number of Kiwis moving to Australia?Hon GRANT ROBERTSON: That particular study from Infometrics makes its judgment based on effectively the capital gain that someone will get over the lifetime of purchasing that house. So they do a guesstimate of what they think interest rates will be over a 25-year period. I think when most New Zealanders are considering whether or not it is a good time to be a first-home buyer they are considering how easy it is to get into the market. On this side of the House we've done demand side measures such as the interest deductibility removal such as the extension of the brightline test such as the ban on foreign buyers and we're building more houses than any Government since the 1970s. So I don't agree with that report—Christopher Luxon: Outcomes. Outcomes.Hon GRANT ROBERTSON: —because I actually—well no Mr Luxon whose favourite thing I might say is to tap a table and say the word "outcomes" as if somehow or other he's going to draw that out from the table. The outcome is that more first-home buyers have been getting into homes because of what we've done.Christopher Luxon: Has he seen ASB's estimate that household disposable incomes over the next 18 months will drop a combined $15 billion and is he concerned that his Government's legacy will be more Kiwis than ever before choosing to leave the country?Hon GRANT ROBERTSON: I think that the legacy of this Government will be that we supported New Zealanders to get through the really tough times of COVID that we supported businesses and that we supported households that we put ourselves in as good a position as possible to get through these tough economic times and that on this side of the House we truly believe in lifting the wages of New Zealand. We've taken action to do that every one of them opposed by the National Party."