Hon John Key
9 December 2008Speech
Embargoed until delivery
Speech from the Throne
Speech from the Throne, delivered by Governor General the Honourable Anand Satyanand, PCNZM, QSO, to Members of the
House of Representatives in Parliament's Legislative Council Chamber at the State Opening of Parliament.
Honourable Members of the House of Representatives. It is a privilege for me to exercise the prerogative of Her Majesty
the Queen and open the 49th Parliament.
E nga mana, e nga reo, e nga rangatira ma, tena koutou, tena koutou, tena koutou katoa.
Just over four weeks ago New Zealanders elected a new Parliament.
The outcome of the election clearly demonstrated New Zealanders’ desire for a new government and, in the view of my
government, a desire for a fresh approach to our country’s challenges.
Within two weeks of that election, negotiations between political parties enabled the formation of a new National-led
Government that commands the votes of 69 Members of this Parliament on confidence and supply.
Those confidence and supply agreements are held with the ACT Party, the Maori Party and the United-Future Party. These
agreements will form the basis of constructive and mana-enhancing working relationships and will enable my Government to
govern in an effective, stable and inclusive manner.
Beyond these agreements, my Government anticipates co-operating with other parties in Parliament on issues of mutual
Honourable members. The driving goal of the new Government will be to grow the New Zealand economy in order to deliver
greater prosperity, security and opportunities to all New Zealanders.
It will be going for growth because it believes in the power of economic growth to deliver higher incomes, better living
conditions and, ultimately, a stronger society for New Zealanders.
My Government knows that only a strong economy will guarantee financial security for families, well paid jobs in New
Zealand for our young people, and larger superannuation payments for our older people.
In pursuing this goal of economic growth my Government will be guided by the principle of individual freedom and a
belief in the capacity and right of individuals to shape and improve their own lives.
My government believes that building a stronger economy in the term of this Parliament will not be without considerable
These are extraordinarily difficult times for the country and the world.
The world is experiencing what is now being described as the worst financial crisis since the Great Depression of the
1930s. Global credit flows have dried up, financial institutions have fallen over, sharemarkets have plunged and
economies worldwide are falling into recession.
The New Zealand economy has been in recession this year and economic growth in 2009 is forecast to be low. Asset values
are falling and unemployment is predicted to rise. The Government will run an operating deficit this year and is likely
to do so for some years to come.
My government believes that in such challenging times our country can not afford its Parliament to be distracted from
the issues that matter.
So my government will not seek to involve itself in decisions that are best made by New Zealanders within their own
homes and their own communities. The new Government’s vision is not to dictate the way in which New Zealanders should
live their lives, but instead to ensure they have the opportunities they need to make the best choices for themselves.
My government will therefore, in representing the will of New Zealanders, remain resolutely focused on the issues that
matter, pre-eminent of which will be the need to strengthen the economy to ensure future economic growth.
Honourable members. My government is concerned that in recent years, New Zealand’s productivity growth has been poor,
our after-tax wages have slipped further and further behind those in Australia, and record numbers of people have
departed our shores to live permanently overseas. New Zealand’s economy has slipped further behind those of other OECD
It is the view of my Government that if New Zealand’s past ten years were to be described as the decade of missed
opportunities, then the next ten years must be the decade of maximized opportunities.
My Government intends to embrace New Zealand’s clear opportunities for improved economic performance and to use them to
deliver better wages and living conditions for all New Zealanders.
It commits to, amongst other steps, an ongoing programme of personal tax reductions; a step-up in infrastructure
investment; a reduction in government bureaucracy in favour of frontline services; an across-the-board commitment to
lifting productivity growth and a renewed effort to lift education standards.
In recognition of the current financial crisis, my Government will move quickly to provide much-needed fiscal stimulus
to the flagging economy, in the form of personal tax reductions and a step-up in infrastructure investment.
My Government is today tabling a Bill to reduce personal taxes from 1 April 2009. Its intention is to pass this new tax
legislation by Christmas and it believes this tax reduction will equip New Zealanders with some much needed extra cash
in tough economic times.
Personal taxes will be further reduced from 1 April 2010 and from 1 April 2011. As a result, by 1 April 2011 around 80%
of New Zealand taxpayers will end up paying no more than 20c in tax for every additional dollar that they earn
This programme of tax reduction is a central part of the economic plan of my Government, because it believes in
encouraging New Zealanders to get ahead under their own steam, and it views personal tax reductions as an essential step
in ensuring that can happen.
In addition to this tax programme, my Government will urgently set about tackling the infrastructure blockages evident
in New Zealand’s economy.
This will involve a stepped-up programme of Crown infrastructure investment, with many overdue projects brought forward.
This infrastructure programme will in the short-term create much-needed jobs and economic stimulus, while in the
medium-term it will help unclog the arteries of the New Zealand economy and improve economic productivity.
Of particular focus will be the development of new roading and public transport projects, the improvement and expansion
of school property in a 21st Century school-building programme and the accelerated roll-out of an ultra-fast broadband
network across New Zealand.
The development of this ultra-fast broadband network will be critically important to New Zealand’s growth prospects, as
it will provide New Zealanders with high-speed, real-time Internet connections to the world, and will give rise to new
enterprise and innovation.
In this area of infrastructure investment, as in others, my Government will work constructively with the private sector
in order to maximize the impact of public investments.
In parallel with this commitment to infrastructure investment, my Government will undertake a two-step reform of the
Resource Management Act.
The first stage of this reform will be focused on improving the consent process and will include amendments to
streamline and simplify the Act, including priority consenting for projects of national significance.
The second stage of this reform will focus on improving decision-making around infrastructure, water and urban design.
The goal of both stages of reforms will be to reduce the costs, delays and uncertainties in current law that my
Government believes are holding back development and job creation.
My Government is acutely aware that despite the measures I have just outlined, the enormity of the economic challenges
that New Zealand faces today are such that unemployment is forecast to rise in the months ahead.
It believes that the economic crisis will not be averted by cutting government spending and social support, but rather
by backing the everyday New Zealanders who, through their hard work and resilience, will power New Zealand through this
In what may be particularly tough times, my Government is determined to ‘stay the course’ with New Zealanders, by giving
those who have lost their jobs the support they need to get back on their feet.
Before Christmas my Government will announce the details of its transitional relief, ‘Re-Start’, package to help those
New Zealanders worst hit by redundancy.
This package will be carefully targeted and designed to help people who have worked hard and who have big aspirations
for the future but who will be, through no fault of their own, coping with a big financial blow.
In this area, as in all others, my Government intends that its actions reflect the belief that New Zealand is a country
built on a sense of fairness and a sense of our obligations to each other.
It is confident that as the steps I have just outlined are taken, the country will be able to push through this downturn
and onto a longer-term pathway to stronger growth.
In the short-term, my Government is committed to shoring-up the liquidity of the financial system. It will continue to
support the retail deposit and wholesale banking government guarantees currently backing our financial sector. Its
intention is to continue those guarantees for as long as - but no longer than - they are needed to ensure the effective
operation of our banking system.
The new Government notes that of the $14 billion of assets in the New Zealand Superannuation Fund, less than 25% is
currently invested in New Zealand.
It believes this Fund should be used to invest in our country’s future growth and to underwrite our future prosperity.
My Government will therefore set a target of at least 40% of the Super Fund to be invested in New Zealand.
In addition, it will take steps to ensure that saving is a more affordable choice for more New Zealanders by reducing
the minimum employee contributions to Kiwisaver to 2% of an employee’s gross salary.
My Government also wishes to address the issue of New Zealand’s low productivity growth and intends to lead by
example,by carefully examining public spending.
It will require that public agencies focus taxpayers’ money on the frontline services they have a right to expect and
that public spending is scrutinized to ensure sure it is deployed to good effect.
My Government is concerned that for the past several years the number of people employed in the public service has grown
at a rate that has not been matched by a commensurate increase in the level of services provided to the public.
Its focus therefore will be on improving services to the public and not on increasing the number of public servants
engaged in government administration. To that end, it will halt the growth in government bureaucracy and ensure that
resources are focused on the provision of frontline services.
My Government recognises that the public accounts leave little room for new spending over the next few years. It will
work hard to make the most out of every dollar, so as to deliver high-quality public services and to protect the
vulnerable from the sharp edge of a recession
Furthermore, in order to help businesses and employers through this downturn and onto a stronger growth pathway, it will
focus on reducing the regulatory and compliance demands that get in the way of productivity growth.
In addition to the reforms to the Resource Management Act I outlined earlier, my Government will undertake a regulatory
This review will identify and remove inefficient and superfluous regulation and it will ensure that regulations are used
sparingly and effectively.
As signaled in its confidence and supply agreement with the ACT Party, the Government will undertake a review of the
Emissions Trading Scheme (ETS).
My Government believes that New Zealand as a responsible international citizen, and as a country that values our clean,
green environment, must act to reduce greenhouse gas emissions and to confront global climate change.
In this area, as in others, it will pursue an appropriate balance between meeting our environmental responsibilities and
taking up our economic opportunities.
The purpose of the ETS review will therefore be to ensure the reduction of emissions in ways that result in the least
cost to New Zealand’s society and economy.
My Government acknowledges that efforts to reduce emissions at home must be matched by efforts to reduce emissions
It will honour its Kyoto Protocol obligations and it will work to achieve further global alliances that build on the
goals agreed to at Kyoto. In approaching future international climate change negotiations it will work with fellow
countries on finding a pragmatic way to include large emitters like China, the United States, India and Brazil.
My Government will also advocate firmly in international negotiations for the appropriate recognition of New Zealand’s
unique agricultural-emissions-profile. This push will be buttressed by increased public investment in research and
development to reduce greenhouse gas emissions from livestock.
Honourable members. An unwavering focus on lifting education standards will be a critical aspect of the Government’s
plans for strengthening New Zealand’s economy.
It will work to modernise New Zealand’s school system to ensure it responds to the varied needs of our young people and
that it prepares them for the demands of tomorrow’s employers.
Of particular concern to my Government is the long tail of underachievement that it sees in our schools, with as many as
one in five young New Zealanders leaving school without the skills and qualifications they need to succeed
Steps will be taken across the board to confront this problem.
In early childhood education particular focus will be given to ensuring early childhood providers respond to the needs
of New Zealand families and that children from less privileged homes are better engaged in pre-school education.
In primary schools, the introduction of National Standards in literacy and numeracy and the new requirement that every
pupil’s progress be assessed against these standards will ensure that problems are identified early and confronted.
In addition, parents will be better informed about their children’s literacy and numeracy progress through a new
requirement that National Standards results be reported in Plain English.
These steps will be critical parts of my Government’s intended crusade to improve literacy and numeracy standards
throughout New Zealand’s school system.
In secondary schools, many students will get more out of their education as a result of my Government’s ‘Trades in
Schools’ policy. This will include the development of specialised Trades Academies, expanded opportunities for
school-based apprenticeships and enhanced trades and technology-based learning opportunities.
At the senior end of secondary school the newly elected Government will introduce a Youth Guarantee. This will provide
16 and 17 year olds with an entitlement to free school-level education at a wider range of institutions including
polytechnics, wananga and private training establishments.
In tertiary education, my Government will work to streamline the bureaucracy, ensure course quality, and to respond
better to employers’ and students needs.
In recognition of chronic workforce shortages, it will introduce voluntary bonding schemes, based on student-loan
write-offs, for graduates in hard-to staff areas across a range of professions, including doctors, nurses, midwives,
vets, and teachers.
Honourable members. I have outlined today a number of steps my Government will take to strengthen the New Zealand
economy both for today and for the years ahead.
My Government has made it clear that its plans for the economy set the foundation for a wider set of aspirations. The
new Government is committed to improving the lives of New Zealanders across a range of fronts, and its policies will
In particular, it will address the frustrations shared by many New Zealanders who have conveyed to my Government their
concerns at the high and climbing levels of violent crime throughout the country.
My Government has a number of policies and approaches for reducing violent crime and making our communities safer.
Criminal gangs and the “P” trade they support will not be tolerated.
Youth offenders will be targeted earlier and more effectively through a new and expanded range of interventions and
Youth Court sentences, including ‘Fresh Start’ programmes incorporating military-style training and intensive mentoring.
Sentencing, parole and bail laws will be strengthened to ensure that sentencing decisions reflect my Government’s view
that public safety should be paramount and that parole is a privilege, not a right.
Additional police officers will be recruited and a greater proportion will be deployed to South Auckland.
Police will be given new and enhanced powers. These will include the ability to issue on-the-spot-protection orders to
protect victims of domestic violence and the ability to take DNA from offenders at time of arrest.
Victims of crime will be provided with enhanced rights, support and follow-up services from the Government.
New focus will be brought to rehabilitation within prisons, with enhanced provision of drug and alcohol services and the
introduction of compulsory work programmes for prisoners.
Honourable members. My Government is also committed to improving the efficiency and effectiveness of the public health
It observes that in recent years a significant increase in public health spending has not been matched by improved or
increased health services to New Zealanders.
My Government intends to reduce surgery waiting lists, to cut wasteful bureaucracy, and to address the health workforce
As highlighted in its agreement with United Future, my Government will make better use of the private sector to deliver
public health services, including reducing elective surgery waiting lists.
It will also give health professionals a greater say in the running of the health system and it will require District
Health Boards to work more collaboratively to improve patients care.
The Government’s welfare policies, like all its policies, will help people to help themselves. They will reflect its
belief that paid work is the route to independence and well-being for most people, and that it is the best way to reduce
In this area, as in all areas of social policy, my Government will establish new relationships with the non-government
and voluntary groups that are so important to the functioning of a healthy society.
By working more closely with these groups and turbo-charging their efforts, my Government will tap into the resources,
ideas and collective goodwill of New Zealand communities.
My Government is impatient to see Maori standing strong, economically independent and fulfilling the complete promise of
For New Zealand to move forward as a nation, the settlement of historical Treaty grievances will be vitally important.
My Government is committed to the expeditious completion of final, durable settlements of historical grievances.
Accordingly it will devote fresh energy to this important area. This will be essential to reaching its medium-term goal
of achieving just and durable settlement of all historical Treaty claims by 2014.
In addition to these ongoing settlement negotiations, and in accordance with the confidence and supply agreement with
the Maori Party, my Government will undertake a review of the Seabed and Foreshore legislation to ascertain whether it
adequately maintains and enhances mana whenua.
If repeal is necessary it will ensure there is appropriate protection in place to ensure all New Zealanders enjoy access
to the foreshore and seabed, through existing and potentially new legislation.
My Government’s confidence and supply agreement with the Maori Party further sets out its intention to establish a group
to consider constitutional issues including Maori representation.
In addition to a consideration of these issues, it will give New Zealanders the chance to have their say on the Mixed
Member Proportional representation system that has formed the basis of this country’s parliamentary elections since
This will take the form of a binding referendum, and if a majority of voters decide they want to consider other
electoral systems, the new Government will offer them a choice of a range of systems to replace it.
My Government will repeal the Electoral Finance Act. This reflects a concern on the part of my Government that this
piece of legislation can be viewed as placing a yoke on free speech and thereby eroding the democratic principles that
underpin our country.
As an interim measure it will return to the Electoral Act 1993, with the parts of the Electoral Finance Act dealing with
donations added in. It will then work across the Parliament to create durable and effective electoral law that enjoys
the support of the New Zealand public.
Honourable members. My Government will ensure that New Zealand exercises a free, independent foreign policy that
reflects the best interests of New Zealand.
It will have a bipartisan approach to foreign policy and it will be driven by a considered evaluation of New Zealand’s
evolving international interests.
This will include an ongoing commitment to trade liberalization and the pursuit of bilateral, regional and world-wide
free trade agreements.
In the course of this Parliamentary term other matters, and other measures, will be laid before you. That is as it
While I do not seek to lay out all aspects of the new Government’s proposals today, it has made it very clear that at
all times strengthening the economy will be front and centre of its priorities. For it is this growth agenda upon which
my Government’s vision for New Zealand rests.
It aspires to see New Zealanders becoming more prosperous, to see them taxed less and paid more. It wishes to see our
people living in safer communities, and to ensure that they have access to world-class educational opportunities and
improved health services.
Without economic growth my Government’s objectives will be compromised, with stronger economic growth, its objectives
will be realized more fully.
My Government will aim to raise New Zealander’s sights, and encourage them to set their aspirations higher – for
themselves and for their country.
Honourable members. In going for growth my Government will be acutely conscious of the fact that it is in the interests
of no New Zealanders, and to the detriment of us all, to allow an underclass to develop in New Zealand.
It will take seriously its duty to protect our most vulnerable citizens.
It will take seriously the importance of the obligations and ties we each, as citizens and as communities, have to each
Most importantly, it will seek to give all New Zealanders the confidence that this is a country where you can get ahead
– and that the State, through its agencies and through this Parliament, should reward rather than discourage effort.
My Government views economic growth as the platform upon which a stronger New Zealand will be built. It views political
leadership from this Parliament as essential to achieving that goal. But it is It is under no illusion about who the
real builders of a stronger economic future will be.
The true builders of that future are not sitting in this Chamber today.
The true builders of that future are the millions of New Zealanders working in the homes, the businesses, the industries
of our country.
It is they who make this country strong.
It is they who have placed their trust in us their Parliament.
And it is they, our fellow New Zealanders, that my Government will ever seek to serve.