Parker David: Questions for Oral Answer — Questions to MinistersText is incorporated into the Bound VolumeParker David: Questions for Oral Answer — Questions to Ministers[Sitting date: 08 August 2013. Volume:692;Page:12520. Text is incorporated into the Bound Volume.]4.Hon DAVID PARKER (Labour)to theMinister of Finance: Given that unemployment is rising exports are down and house price inflation in Auckland and Canterbury is in double-digits does he agree that after 5 years as Finance Minister he has failed to rebalance and diversify the economy; if not why not?Hon BILL ENGLISH (Minister of Finance):No. I think the Government has dealt reasonably effectively with two challenges. One was the severe imbalances in the economy caused by the previous Labour Government which focused on rapid increases in Government spending and depressing productivity in the rest of the economy. That was followed by a global financial crisis. Of course there are challenges about balance within the economy and the Government is addressing those challenges directly. For instance we hope that the Labour Party will support the Government’s measures to increase housing affordability and have a more reasonable housing market.Hon David Parker: Does he agree with the article in theWashington Poston 7 August that the botulism issue highlights New Zealand’s reliance on dairy exports?Hon BILL ENGLISH: Well you did not need the botulism issue to highlight the importance of the dairy industry to New Zealand. I must say that the dairy industry deserves some support despite New Zealand talking for 20 or 30 years about being too reliant on commodities. The dairy industry has performed better than the fashion industry the IT industry the wine industry and the film industry and it has injected billions of dollars of extra income into this economy in the last decade. We think that is not a bad performance.Hon David Parker: Given that over the last 5 years under National New Zealand’s reliance upon dairying has increased and the latest jobs statistics show a further decline in manufacturing employment how can he deny that he has failed to rebalance and diversify the export sector despite his promise to do so?Hon BILL ENGLISH: As the member may well know it is not really a matter of whether Governments can just pick to have another industry. New Zealand has 30 years of experience of trying to do that and how it has turned out is that we are very good at some things such as the production of protein and high-value niche manufacturing and those are the growing parts of the economy. Labour thinks it is good at government andit decided to grow the Government part of the economy. Well it turned out that that does not work very well.Hon David Parker: Given his failure to diversify the economy or grow exports why does he continue to deny the need to pull the levers recommended by the Reserve Bank the OECD the IMF and the Labour Party notably to get the capital into the right part of our economy instead of over-investment in Auckland’s house speculation?Hon BILL ENGLISH: Well I certainly do not agree with the member’s characterisation of what is happening in the economy. In respect of capital getting to the right places the Government’s tax reform has been very important to that. Our investment in infrastructure has been very important to that. Tidying up Labour’s mess in skills and education has been very important to that. We continue with a widespread programme of microeconomic reform which is having the effect of shifting capital away from areas like the Government which tends to not handle it very well to productive growth. The member is wrong. Manufacturing and exports both have been growing and those exporters deserve credit for their performance not criticism.