Tabuteau Fletcher: Motions — Reserve Bank—Ratification of Funding AgreementText is incorporated into the Bound VolumeTabuteau Fletcher: Motions — Reserve Bank—Ratification of Funding Agreement[Sitting date: 04 June 2015. Volume:706;Page:4351. Text is incorporated into the Bound Volume.]FLETCHER TABUTEAU (NZ First): Thank you Mr Deputy Speaker. I will try to remain within the confines as you have set out. However this is a once-in-a 5-year opportunity to put on record the views of the New Zealand First Party with regard to that relationship and the funding as laid out in this agreement. So I will move on and please—Hon Paul Goldsmith: See how you go.FLETCHER TABUTEAU: Yes I will see how I go.Mr DEPUTY SPEAKER: I will just remind you that this debate may not provide that opportunity because it is to address the matters that I have just outlined. So we will listen with interest.FLETCHER TABUTEAU: Thank you. Most New Zealanders will not actually know much about the Reserve Bank aside from what they hear every several months about setting the official cash rate and interest rates. With regard to the funding we actually used to print the New Zealand money in Whangarei but in 1990 that work was sent offshore across the Tasman and jobs were lost in New Zealand. It is perhaps emblematic of the two-tier economy that seems to have developed of late.The Reserve Bank of New Zealand Act was passed in 1989 which actually seems like a lifetime ago. Perhaps it is for Mr Seymour. My point is that it was hailed as revolutionary and world-leading at the time. However times have changed and given the funding that this bill seeks to endow the Reserve Bank with we must in our opinion ask the question about the relationship that New Zealand has with the rest of the world. What is happening out there?It would appear that having set what was good legislation for its time the Reserve Bank and this Government have kind of got stuck in their ways and after 26 years are not willing to change their minds on how best to discuss an accord or go beyond the bounds of the agreements that are being debated today.Consider the staid nature of this agreement. Consider the fact that as spoken about today inside this House and outside there are actually discussions about change and the need for change. For example I refer to the comments of Michael Reddell ably reported by Hamish Rutherford who described the powers of our Reserve Bank Governor as one of the most powerful on Earth. Mr Reddell ought to know as he was the special economics adviser at the Reserve Bank until April. He describes the governor’s power to make the final call on both interest rate decisions and financial stability as “outdated risky and out of step internationally”. This motion is about our governor’s salary and the relationship that he has with this Minister of Finance.Since Mr Peters was Treasurer the Governor of the Reserve Bank has turned into some kind of monetary policy demigod. In other countries such power is not concentrated as it is here in New Zealand and these are not the words of an embittered former employee. Treasury has even lobbied for change itself. It has seen the inherent flaws in investing such vast powers in one individual. In April the deputy governor Grant Spencer called for fresh consideration of possible policy measures to address the tax-preferred status of housing investment. The nominally independent Reserve Bank—if you would picture this—walked across the street into the Beehive took the lift to level seven and essentially said to the finance Minister: “Take a walk. We are taking over.”Although my party has issues with this Government’s economic policies it is elected whereas Messrs Wheeler and Spencer most definitely are not although to be fair I can feel their frustration as this Government’s inaction particularly in the housing market and it has been very frustrating for all. It is engaging in public policy by stretching the definition of financial stability so far that you could bungy jump off the top of the building itself. What gives the Reserve Bank Governor a demigod-like power to say whatever he or she wants and to challenge an elected power? I put it to you: it is the Reserve Bank of New Zealand Act and the negotiations this agreement that we are discussing today. This agreement is enabling these powers and the relationship between the Minister and the governor has not been clarified in this agreement.New Zealand First is not advocating for something along the lines of creating a Bank of England - type committee. Unsurprisingly New Zealand First actually put a solution to the House when the Rt Hon Winston Peters put a member’s bill before the House. I will talk to some of the reasons for it. In November 2013 before sanctions in Europe cut heavily into our export commodities and before regional neglect was so blatantly exposed by the Northland by-election the Rt Hon Winston Peters put his member’s bill to amend the Reserve Bank of New Zealand Act in front of this House twice and it was voted down both times.Mr DEPUTY SPEAKER: That needs to be applied to the motion about funding for the Reserve Bank.FLETCHER TABUTEAU: I endeavour to do so Mr Deputy Speaker. If you will forgive me I am talking about policy as it relates to what has been allowed through this funding document.The policy initiative could deliver so much in terms of the benefits to the New Zealand economy. The amendments put forward to the House were coined in such a way that the changes were needed so much because there is no more important a piece of legislation that would benefit the rank and file provincial voters who hitherto have been voting for the National Party.The intention of this motion remains clear and compelling. The Reserve Bank Governor needs the flexibility to promote growth exports and employment as well as price stability. The reasons why an amended Act is urgently needed still remain. New Zealand is still not paying its way proving that some things never change. We still get the National Party line that everything is perfect and that it has got a plan that is working. It is clearly not when departments such as this go to war and former employees call for decisive actions to counter current operational activity.We are not paying our way in the world. Instead imports are up and exports are down. The Budget is not a tax and spend Budget; it is a borrow and spend Budget with tens of billions of dollars of extra debt written off balance sheets through student loans State enterprise debt and local government debt. The main factor underlying the current account deficit is a grossly overvalued dollar underpinned by a borrow and spend Government.We need to consider that the funding agreement between the Reserve Bank and this Government is insufficient in and of itself to provide New Zealanders with a good and positive outlook. This agreement does nothing to hold this Government to account. For example look at rural towns around New Zealand and our small rural cities—the provincial cities—and see how many shops are closed and how much there is a lack of action. National members tell us that we have got growth. Yes but when we talk about the Reserve Bank and what growth is we have to ask ourselves what the quality of the growth is and what is happening to the people who could save this country.This agreement serves a functional purpose. It is insufficient in and of itself. I do feel restrained in what I can say in the House today. This agreement does give rise to policy decisions and actions taken by the Reserve Bank—which I would have liked to elucidate on in more depth—but there is much more that is required. Thank you.