Robertson Grant: Appropriation (2015/16 Estimates) Bill — Third Reading Imprest Supply DebateText is incorporated into the Bound VolumeRobertson Grant: Appropriation (2015/16 Estimates) Bill — Third Reading Imprest Supply Debate[Sitting date: 18 August 2015. Volume:707;Page:5858. Text is incorporated into the Bound Volume.]GRANT ROBERTSON (Labour—Wellington Central): For those who did not know the previous speaker David Bennett is actually the chair of Parliament’s Finance and Expenditure Committee—a frightening thought. He said that there are things that are working in Hamilton. Well I can tell you this: the statue of Riff Raff which stands in the main street of Hamilton is working harder for Hamilton than the member for Hamilton West is.Tim Macindoe: I take great exception to that Grant.GRANT ROBERTSON: Sorry—that is not true; Hamilton East. I apologise to Mr Macindoe. The member for Hamilton East stands up to take a call in the Budget debate to tell New Zealanders what great plans the National Government has for the New Zealand economy and how it will lift New Zealand out of an economic downturn. But instead we have a speech from the member for Hamilton East about the fact that he cannot understand the policies of other parties and that he is unable to articulate what this Budget will do to drive New Zealand’s economy forward. That unfortunately is the story of this Budget.It is very important when we look at the Budget to take a look at the downside scenarios. These are the things that Treasury and the Minister of Finance tell New Zealanders are unlikely to happen—the worst possible outcome of this Budget. If we look at those downside scenarios we see GDP of 3.3 percent in 2015 and 2.4 percent in 2016. Already the Government has had to admit that the worst possible outcome of this Budget is not even going to be the best possible outcome actually. The Government’s forecast is telling it that it will scrape towards 2 percent growth in 2015 and 2016. Westpac economist Dominick Stephens has said that it will not even get up to 2 percent in that 2016 year. So the worst-case scenario in the Budget is the very one that is now playing out and the reaction of the Government and of Bill English is to sit on their hands and to say: “It’s all fine. Watch out for those automatic stabilisers; they’ll sort everything out.” Well the reality is that they are not sorting everything out. Indicator after indicator in our economy is showing that this Budget is a failure. It is big on politics and big on spin but very very small on the policies that will actually grow the New Zealand economy.We look again at the downside scenario of the Budget. Unemployment is forecast to go down to 5.6 percent in 2015 and to 5.1 percent in 2016. The latest household labour force survey says that we are up to 5.9 percent—146000 New Zealanders are out of work. Eleven thousand more New Zealanders are out of work at this time this year than there were at the same time last year. Then there is the forecast of 5.1 percent in 2016. Again commentators right across the spectrum are forecasting unemployment to keep rising. The Westpac survey last week said that the unemployment rate will be 6.5 percent. That is worse than the worst-case scenario in this Budget. So for speakers on the National Government side of the House to stand up and proclaim that this Budget is somehow going to lead New Zealand into a strong economic future simply is not backed up by the facts. They are now going to have to look at all of those forecast scenarios and bring in the downside scenario. That is the story of this Government. That is the story of this Budget.We were told by the Prime Minister that we were on the cusp of something special and that we were on the cusp of an economy that was going to deliver for New Zealanders. The reality is that that has not happened. There are three legs to the stool of this National Government’s economic approach. The first of those legs has already been kicked out—that was the dairy boom. Make no mistake; the National Government was fully prepared to take credit when dairy prices went up. Day after day Bill English would come into this House and tell us how well the economy was doing when farmers were getting payouts at the $8.40 level. But now when those payouts are forecast to go down to $3.85 it is everybody else’s faultall of a sudden. All of a sudden it is nothing that the Government could have foreseen. Well that is simply untrue. A Goldman Sachs report that came out in June last year warned of a 5-year global dairy glut. When that was raised with Steven Joyce he laughed. He laughed at the prospect that the one thing that was truly propping up the New Zealand economy was on its way down. And now when the chickens have come home to roost—or the cows have come back into the yard—Steven Joyce has no plan B.That key leg of the economic stool is gone and all the talk is about the fact that suddenly we have found a tourism industry. Suddenly the wine industry and information and communications technology are the answer. Put together all of those things will not match what is being lost in terms of dairy. And that is because after 7 years the word “diversification” has finally left Bill English’s lips. Finally he is saying that that is what the economy should be about and it has not happened. That is why not only the Opposition parties but also groups like Federated Farmers and 75 percent of the chief executive officers in the Mood of the Boardroom survey are calling for a plan B for the economy. They are saying that plan A is not working and are asking where plan B is and we see none of that from the Government.That is because the other two legs of the stool still make Government members believe that there is something happening in the economy. There is the Canterbury rebuild. What is now quite clear about the Canterbury rebuild is that it will stop adding to the growth story this year if it has not already. It does not mean that there are not projects happening in Canterbury. What it means is that new activity is not going to be coming on stream and economists are now telling us that by the end of 2017 the Canterbury rebuild will actually be a drag on the New Zealand economy because we have not seen from this Government a proper plan for economic development in Canterbury. The rebuild is not a plan; it is coming to an end and there is no sign from this Government that it has got any replacement for it. The Canterbury rebuild has been responsible for about one-third of the growth rate in the past few years and it has gone—and so has the second leg of the stool.The third leg of the stool of the National Government’s approach to the economy is the one that is remaining and that is the Auckland housing bubble. In this Budget we looked for the answers from the Government—that it could respond to the huge supply and demand problem in Auckland housing—and the answers were not there. What we got were half-baked ideas from Nick Smith to build on power stations and in cemeteries but we saw nothing real in terms of getting the supply of housing that Aucklanders need or dealing with the 20000 house deficit that Auckland already has—plus the 10000 a year that it needs to build. There is no sign of that.The Government could have picked up some ideas from Labour. Government members have talked about plagiarism a lot on that side of the House today. Well they have plagiarised Labour’s ideas for years: Working for Families interest-free student loans and early childhood education and we had the immigration policy just the other day. Well I invite them to plagiarise the KiwiBuild policy because that would actually get some housebuilding going that would actually stimulate the economy and that would actually start to deal with the Auckland housing crisis. But instead Nick Smith is keeping his head in the sand.On the demand side is the Government’s great idea of having a register of foreign buyers—except that it is not really a register—and when we come to debate that bill in the House we will see all of the holes in it. There is no real plan to crack down on the speculators who are driving up Auckland housing prices and that bubble will burst at some point. It will happen and that is the final leg of the stool in terms of the National Government’s approach to the economy. So this Budget is not about a plan for New Zealand’s future. It is not about making sure that we build the skills that we need that we get the technology that we need and that we have the infrastructure that we need. It is a piece of political spin and of clever politics to be able to stand up here and say “We’ve increased benefits for the first time in 43 years.” even though that is not true and despite the fact that those on the lowest incomes in New Zealand benefited from Working for Families—that was a significant increase denied. But that is what this Budget is about. It is about spin.New Zealanders deserve better than this. New Zealanders deserve a Government that will not sit on its hands that will not sit on the sidelines and that will actually work as a partner. This is starting to happen in the regions. Every time Labour MPs go out into the regions now what we hear is: “We don’t want you to come and tell us what to do. We want to work with central government local government and businesses in the regions to grow the jobs that New Zealanders want and to grow the jobs that will deliver sustainable wages to New Zealanders.” And that plea falls on deaf ears on that side of the House. All of the mayors and all of the business leaders in the regions—their message is consistent: they want the Government to be a partner. They do not have that from the National Government; they will have that from the Labour Government.We need a Budget that has a plan to diversify the economy to grow the regions to build housing to build skills and to prepare New Zealanders for the future of work. None of those things are in this Budget. This is a wasted opportunity from a Government that is out of ideas.