Hon Jim Anderton
Minister for Economic, Industry and Regional Development
5 March 2003 Speech notes

Budget Policy Statement

Michael Cullen's fourth Budget Policy Statement is another excellent summary of the Labour-Progressive Government's progress so far in improving the quality of life of all New Zealanders.

One of its greatest values, however, is that it highlights how the excellent management of the government's books will allow us to make further progress to improve the quality of life in New Zealand in this and coming years on very firm financial foundations.

I know it isn't usual for non-government parties to congratulate the Finance Minister or the coalition government on anything very much, but I think there is something for all of us to celebrate in this Budget Policy Statement.

The Labour and Progressive members are of course very proud of the government's record in steadily improving opportunities for New Zealanders to participate in their society.

The Progressives above all else seek a government which facilitates job creation and we want to see a society where every young person is in work, training or education. We know that we need to see the already very sound financial position of the government made even stronger.

That is because we know this is the best way of ensuring that the dividends will be there to pay for the investment in better job opportunities and improvements to the quality of health and education services which have in the past been under-funded and therefore are inadequate to meet the expectations of a first world society.

The sound handling of the government's finances, outlined in the Budget Policy Statement, has made it possible for us to have:

1) A growing economy where New Zealand's rate of economic growth - and therefore its ability to create meaningful work, educational or training opportunities for our people - has been above the average of the Organization for Economic Co-operation and Development over the past three years and the OECD forecasts New Zealand will continue to outpace the average of the OECD over the next three years.

You don't out-perform the OECD average unless you have a jobs-friendly government - that is a government that encourages people's natural innovative and creative ideas.

2) We have more people in real jobs: almost 15,500 less people are on the main Unemployment Benefit than a year ago, and there are 123,000 more jobs today than there were in December 1999 when we first came into government.

3) We are expanding opportunities for people to learn in the workplace: We intend to have over 6,000 young people in Modern Apprenticeships by the end of this year, an increase of 100 per cent since the middle of last year.

But it is of course also true that any government can temporarily boost spending on training, education and job-creation.

The Third National Government from 1975-1984, for example, had a Big Idea based on increased spending which all ended in tears because it wasn't based on firm economic development foundations.

The challenge for this government is to improve social wellbeing. We believe that can only be achieved through intelligent partnerships.

„h Partnerships between government and industry.

„h Partnerships in the community, because government's don't create all problems and don't solve all problems.

„h And partnerships within the government, because coalition governments are better quality governments.

What this Budget Policy Statement shows is that we have those partnerships today and they are working positively for the social well-being of New Zealanders.

I want Opposition parties to, just for a moment, to dwell on one important thing in the Budget Policy Statement.

NET CORE CROWN debt, after taking into account the accumulated assets of the New Zealand Superanuation Fund, is forecast by the Treasury to fall to just 2.9% of gross domestic product by June 30, 2007 based on current policy settings - down from around 20% of GDP when the center-left first took office in late 1999.

I can accept that the ACT Party - and the National Party which recently adopted ACT's key policies and values - might disagree with the new spending on education and training or the development work being done in the regions of New Zealand to get industries and firms working in a more coherent fashion together to meet common challenges.

I can also accept that the ACT and National parties would much rather sell off taxpayer-owned assets because they have this "non-negotiable principle" which is that the taxpayers shouldn't own anything in this country - not even strategic assets like the national airline.

But surely even the Opposition can accept for themselves some happiness at this government's overall fiscal stance as outlined in the Budget Policy Statement.

You'd be hard pressed to count on the fingers of one hand the number of OECDs nations with governments running as healthy and strong a position as this government is doing.

The Budget Policy Statement is a progressive document highlighting a government commited to investment in the country's productive capacity, in training and education, doing so with an eye to the known future costs of superannuation and all the while maintaining one of the most prudent set of debt and operating positions of any country in the OECD.

There are political implications in all of this.

It means that a respectable and intelligent stance is available for all Opposition parties to engage constructively with this minority government to advance legislation through this House.

It should be clear to most people now that the New Zealand Labour Party is going to be by far the largest single party in this Parliament for many years to come. The challenge to the other six parties here is to constructively interact with Labour-led governments for years to come to produce the best laws and policies for New Zealand's future.

I am personally delighted that this is in fact already happening.

The Labour-Progressive government holds 54 seats in this Parliament, which means no law can pass without the support of at least one non-government party.

In fact, of the 17 laws that have been enacted since last year's election in July, no less than 13 have secured the support of more than one Opposition Party. Seven laws have been enacted with the support of more than two Opposition

What this shows is that we have a Parliament which is working under MMP. There is a positive role to play for each and every non-government Party showing there is an opportunity to constructively engage across the floor f this House in the support of progressive legislation.

But it is also a sign, in my view, of a underlying confidence by the whole of Parliament in the Finance Minister and his responsible and far-sighted fiscal management.

ENDS

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