Ardern JacindaDEBATE ON PRIME MINISTER'S STATEMENTRt Hon JACINDA ARDERN (Prime Minister): Mr Speaker I present the Prime Minister's statement. SPEAKER: That paper is published under the authority of the House. Copies are available on the Table. Rt Hon JACINDA ARDERN: I move That this House express confidence in the coalition Government and commend its programme for 2019 as set out in the extensive Prime Minister's statement. I do hope that all members of this House have had a restorative summer—particularly Mr Speaker your good self as we move into question time tomorrow. I hope you will look favourably upon us as we enter into question time / the game of tennis between the two of us.I have reflected over summer on three things that remain true to me. No matter how much this Government did in the last year—and it was plenty—there is more to do. There is more to do. Even if there's a summer break I didn't stop thinking about that for a moment. I reflected secondly that a teething baby has no timetable or respect for summer. And thirdly I reflected that every day in this place is a privilege. I reflected on the privilege of serving with our confidence and supply partner with our coalition partner and the fact that we reflect the values and ideas of the majority of New Zealanders and we will demonstrate that in 2019. I have to say that remains true certainly as of yesterday as well.I want to reflect on the context for which we enter 2019. We have strong fundamentals and I want to reflect on the traditional measures that are used internationally to reflect the success or otherwise of a Government. Unemployment is at the second-lowest rate in a decade—the second-lowest rate in a decade—and of course the lowest in a decade was last quarter. Of course some will claim that unemployment is currently pretty close to being at about the maximum sustainable level. I don't for a moment accept that though. We have a goal as a Government to get it even lower and that will be our focus.Our growth rates remain strong at around 3 percent particularly as you look at the IMF's predictions of other advanced economies which are at 2 percent. So relative to that we have a lot to be proud of. Inflation is tracking at 1.9 percent. We are as a Government running surpluses. We are on track with our management of net Crown debt. Our Budget Responsibility Rules remain absolutely in place and just for the benefit of the Opposition who may have missed this: Standard & Poor's revised their outlook for New Zealand from stable" to "positive". Of course that's the first time it's been in that state since September 2011. Now we might reflect on that and if you were any other Government—say for example the last one—you might look at those fundamentals and say "That's enough. Let's just govern. Let's just stay exactly where we are." They might say "GDP is looking sufficient at its current point." They might say "Employment is close to full. Let's just govern." But we as a Government have acknowledged that those measures do not tell us enough. They do not tell us the full story.Take GPD. Even Robert Kennedy a long time ago was saying that GDP measures everything—just about everything except that which is worthwhile in life. If you look even at employment figures they may capture the work that's undertaken but not whether or not it is quality work whether or not it is secure work and whether or not people fear the potential of losing their work. Again those numbers don't tell us about some of those domestic challenges that we all know exist. They don't necessarily tell us about the skills shortage that we've inherited. From 2011 to 2017 23000 students exited the polytech and training sector. At a moment where we have a skills shortage crisis we have not been training our future workforce and that has been a travesty and an indictment left behind by the last Government. We have an infrastructure deficit. There has been a lack of investment in health and education and there has been environmental degradation and inequality. Those fundamentals won't tell you that story but those are the long-term challenges.They also won't tell you necessarily about the international headwinds and we cannot ignore them. There are trade tensions. There is a slowing in China and of course we've already seen the economic downgrading by the Bank of England about the UK's prospects off the back of Brexit. We are preparing for the future because strong fundamentals provide you a foundation but they don't provide you answers to those long-term challenges that New Zealanders elected us to tackle. That's why on this side of the House we won't just govern; we will lead. Our plan is not just for the next three years; it is for the next 30 years.Let me step through the fundamentals of that plan. It covers 12 areas which we put out for the public in September of last year but now is an opportunity for me to touch base on some of the progress on each whilst outlining where we will go next. The first priority is around growing and sharing more fairly New Zealand's prosperity. That goes directly to the heart of the inequality that that last Government failed to fundamentally address in New Zealand.We dealt with that immediately. We cancelled the last Government's tax cuts and we instead put that spending into the Families Package. We've already had hundreds of thousands of New Zealanders benefit. This year we'll continue to see the roll-out of that package the winter energy payment will run for longer this year Best Start payments will be extended and all in all by 2021 384000 families will be better off.This year—and I acknowledge our coalition partners New Zealand First with this commitment—the minimum wage will increase to $17.70 in April. That means for over 200000 workers they will be better off by roughly $48 a week before tax. That is significant and it's exactly what that workforce needs. We've also laid out a plan and a programme of work around welfare and around tax both of which report this year. We will be engaging in a debate with the public around the next steps we take as a Government in both of those areas.We know we also need to address the issue of prosperity. Our economy will not be a success if it follows the last Government's formula of just trading on housing and allowing immigration to be a growth strategy. That is not a plan. That is what you do when you govern but not when you lead which is why we have said we want to directly invest in research and development. The R & D tax credit will be coming into force in April and we know it will make a difference to business development in this nation.We want to build greater resilience for our exporters. That's why we're pursuing the Regional Comprehensive Economic Partnership that's why we are pursuing vigorously an EU free-trade agreement (FTA) it's why we're amongst three countries in line to be first off the block with the UK in negotiating an FTA and it's also why we are pursuing a Trade for All agenda. We want the benefits of trade spread more evenly to a wider range of New Zealanders and that's the work that our Minister is leading.I want to come and reflect on another area of distinct neglect from the last Government: supporting our thriving sustainable regions. I remember at the last election visiting a small town in the South Island where one of the local elected council members said to me that they had seen a desertion of their main street they had seen businesses who should have been able to grow in their region leave and they had seen young people lose opportunities as a result. Now the Government of old would have just continued on with the plan that they had which was to do absolutely nothing invest in roads that weren't regional—and in some cases were ghost roads—but that pretty much amounted to their regional economic development plan. That was it! The Provincial Growth Fund (PFG) I know is making a difference and how do I know? Because local people tell us it is making a difference. The PGF has already invested in 166 projects from around the country. It is investing $700 million and attached to that based on the submissions by the applicants in their own words it has the potential to increase jobs by 10000. I have come to conclude that one of the reasons that the Opposition particularly dislikes the Provincial Growth Fund is because their mayors love it so much. And when I say "their mayors" I mean their mayors—John Carter in particular. Of course when it comes to regional and economic growth and development the billion-trees programme remains critical as well as the work that we have to do that is often unexpected. We will continue on with our plan to eradicate M. bovis and I do hope that we will finally see success as part of that plan.Our third focus within the economy of course has been about governing responsibly with a broader range of measure of success. The Budget Responsibility Rules will cushion us against uncertainty and it sets out our expectations so the public can see in a full and transparent way our expectations around economic management. Contrast that with the Opposition who I've seen have announced in recent times $650 million worth of spending with absolutely no way to fund it including I've heard suggestions that they will halve debt—again absolutely no plan to achieve that. I've heard State sector wage promises—again with absolutely no way to fund that. To use a phrase I've heard before: show us the money because at the moment I see absolutely no plan whatsoever. We've also committed though that those economic fundamentals are not sufficient for us. We have said this year that we will develop a well-being Budget and that yes that focus on the economy is critical but we need to add those additional levers. And again this is what you do when you lead not just govern. The issue of environmental degradation the changing international environment we exist in and the international responsibilities we have means that if we are going to act responsibly—not only according to our international obligations but actually to the people of New Zealand—we need to transition our economy to a clean green carbon-neutral economy. We will progress our climate change bill this year. We will continue to invest in just transitions and we've seen excellent examples already today where the Provincial Growth Fund has been partnering with some of those ideas on clean energy and so on. We have the Green Investment Finance Ltd the entity established with the strong support and initiative of Minister James Shaw and the New Zealand Green Party. For all of their leadership on biodiversity on climate change on all of the challenges we face with transitioning to a just sustainable economy I thank you for your work. We need to plan for the future not just sign international agreements and that's what you do when you lead not just govern.We've frequently said that those economic measures are not enough so the agenda for us around well-being is absolutely critical. We've talked about creating an environment where everyone who is able is earning learning caring or volunteering. For us fees free was the way to prepare the workforce for the future. And it's undeniable when you have stories as I have on a frequent basis of someone who is in their 30s who had never gone into tertiary education and is now studying to be a teacher because of us; of the child of a beneficiary in Kaikohe who said to me "I'm going to university because of fees free. You have made a difference to us." But where we need that extra emphasis is vocational training and the Minister of Education will be saying more on that very soon. Overall there is $4.2 billion of new funding in education—an extraordinary investment—but just wait for the work that we continue to do on Tomorrow's Schools on early learning and under our employment work for those who are NEETs through for instance Mana in Mahi.The second area of focus of course is in health. The 2018 Budget invested $3.2 billion in operating funding in health. We've had a significant number of capital rebuilds. Just to cover a few: Auckland District Health Board Greenlane Clinical Centre North Shore Hospital Counties Manukau Wellington Children's Hospital Whangarei Buller Hospital. We've also had investment in Capital and Coast District Health Board and Bay of Islands. These were all areas that had lacked investment from the health sector. They are things that we are turning around.But of course it matters what is happening for people: 540000 people have already had cheaper doctors visits in the order of $20 to $30. But again as we've said over and over again mental health needs to be the priority this year and it will be. It's within our Budget priorities statement. It's an area where we've had the support of the sector to develop up their expectations and May will all be about delivery.All of our well-being measures though are absolutely affected by housing.Hon Dr Nick Smith: Haven't mentioned KiwiBuild yet.Rt Hon JACINDA ARDERN: And I will proudly Dr Smith mention KiwiBuild because I put this question to the House: how many affordable homes did the last Government build? Absolutely none—absolutely none—and when this Government was faced with an extraordinary challenge when we were faced with a housing crisis the option was to do what the last Government did and do nothing or the option was to show leadership. We have shown leadership. We have contracted 4000 houses for building under KiwiBuild. First-home buyers are already in their homes. We will keep building houses. How many State houses did the last Government build? They actually sold them. Not only have we stopped the sale; we have built more than a thousand State houses. I am proud of the leadership this Government is showing on housing when that last Government wouldn't even call it what it was and it was a crisis.Finally we've said we will focus on children and that means continuing to progress our targets on child poverty; again another Budget priority area for us as is domestic violence for the effect it has on children and their families. We've said we want to govern differently. The royal commission into State abuse will continue. The Pike River re-entry work will continue. State sector reforms will continue. Te Arawhiti and our relationship with Māori will continue to be built and grow as we fulfil the obligations that we have signed through successive settlements and that we will look to conclude. We have also placed lifting Māori and Pacific incomes as another priority in this Budget.On international issues on our reputation in the world we stand proud of our independent foreign policy. We will not play politics with our foreign policy and we have long had a proud tradition in this country of a unified voice in favour of our independence. Well we stand on the side of no one but the side of New Zealanders and our values. I ask Mr Bridges: what changed? I ask: what changed?Finally to conclude we have done a lot but there is a lot more to do. We as a Government had two options: to follow what the last Government did to take no risks to defer challenges and to govern; or to lead to look for new solutions to tackle what's in front of us not just in the next three years but in the next 30 years. That does mean doing things differently. It does mean taking risks but if that benefits more New Zealanders if that reduces inequality if it gets people housed and if it gives jobs in the region those are risks worth taking. I am proud of this Government and I'm proud of what we'll do in 2019."