Robertson Grant; Willis NicolaHon GRANT ROBERTSON (Labour): Well thank you Madam Chair and thank you for that clarification as well.I want to refer to a specific amendment which I believe is in the name of the Hon Deborah Russell and that is the amendment that would require a report to be written by the Reserve Bank outlining a number of matters that they consider to be important when it comes to reporting on monetary policies. This is section 131 of the original Act. At the moment—and this also applies to the point that the Minister made about the Hon Dr Megan Woods' suggestion about reviews—while the Act currently contains both provisions for reviews and provisions for reports what we're endeavouring to do through the amendments that we have tabled is ensure that both the review and the report contain reference to issues around the labour market unemployment and wider economic impacts.Because at the moment while the Minister is technically correct that there might be a clause to review the overall Act that clause does not necessarily cover off the issues of employment. So that's the reason for the amendments that we're making: to make clear that we want both the review and in this case the amendment I'm talking about here to section 131 to actually have a report that does cover that.So what this proposal proposes is that we have a new subsection to 131(2) to insert that the report must consider the observed impacts of monetary policies of the bank over the review period including the impacts on price stability employment and economic development; and structural economic factors that influence monetary policy decisions; and any trade-offs involved in meeting the economic objectives of the bank; and the actions required to mitigate any identified trade-offs.This is the very reason for us in Part 2 asking having dispensed with the dual mandate in Part 1 can we please have something that allows and prescribes for the Reserve Bank some attention to matters that are beyond just price stability? Price stability is important—always has been; always a core objective of the bank. But price stability and a focus on it will have impacts in other parts of the economy and that's what this amendment does—it says Well if you're going to do this there'll be trade-offs and there will be other impacts and we need to understand those."In the debate on Part 1—actually no it wasn't; it was in the second reading debate—I brought up the example of the former Reserve Bank Governor Graeme Wheeler who did launch on a monetary policy tightening programme when unemployment was still very high—it was over 5 percent. Now he did that for his reasons and he had those reasons but that ultimately did start to see potentially unemployment rise from that point. That kind of trade-off is enormously significant for people's lives for jobs and for wages.So for us proposing these changes here in Part 2 is because we are concerned that the bank will now take its eye off the ball of the consequences of its single mandate. One of the issues that we have is that monetary policy is a long game. And actually what we've established through the debate thus far is in the period that there was a dual mandate; actually the Reserve Bank wasn't compromised in its focus on inflation and that situation could go on for a very very very long time. But there will come a time when the focus—and I'm giving the example from 2013-14 with the former Reserve Bank Governor Graeme Wheeler as an example of when I had a concern about a single mandate meaning that we didn't focus on those other issues.So we know the dual mandate didn't have the impact that has been suggested it might possibly or could have but some time in the future it might. So therefore we are asking for these amendments that we have tabled to Part 2 to be taken up so at least the Reserve Bank will be asked regularly to make sure it's talking about the trade-offs that are inherent in monetary policy. If we don't pass these amendments we then run the risk that monetary policy goes off in a direction that New Zealanders are not comfortable with and that will have an effect on their jobs and their employment.So I ask the Minister again: if not these amendments then what will she be doing to ensure that the Reserve Bank reports and reviews regularly the trade-offs that it's now going to have to make?Hon NICOLA WILLIS (Minister of Finance): The member asking those questions should know that the Reserve Bank charter can already set out reporting requirements and it will. Also the member should know that the remit will allow that under section 117 of the Act the Reserve Bank acting through the monetary policy committee (MPC) is required to formulate monetary policy in accordance with the economic objectives in the Act which has historically allowed—which will ensure that the MPC can be seeking to avoid unnecessary financial instability and instability in output in the economy. As I've said the member seems very interested in the remit and the charter and I look forward to publishing them shortly."