Lisa Owen interviews Steven Joyce

Joyce says National’s biggest disappointments this term are Northland by-election loss and failure to push through RMA reform; proudest moments include “good achievements in the economy”, Korean free trade deal, raising benefits and free healthcare for under 13s.

Admits National not meeting last year’s economic growth projections, but says New Zealanders understand we’re in a difficult part of the cycle and a range of industries are showing resilience

Says Government veto of Lochinver Station sale this week wasn’t xenophobic, despite last year criticising Labour’s opposition to the sale as “beating the anti-foreigners drum”

“In this case, this one did not meet the test. The two ministers decided that it wasn’t sufficient”

He says National hasn’t previously argued about policies its now implemented, such as increasing benefits and paid parental leave and taking more refugees

Owen: They’re all the things that you have argued against in the past. So how are you fundamentally different to a Labour government?
Joyce: I don't think we actually argued against all those things in the past at all.

Says the way National is encouraging economic growth and lower taxes distinguish it from Labour

Lesson from Northland was “don’t have an MP disappear on you in an unexplained fashion so soon after a general election”

Lisa Owen: So while National’s well ahead in the polls, it’s not been a year without its challenges. National’s campaign chief and, of course, Economic Development Minister Steven Joyce joins me now. Good morning.
Steven Joyce: Every year has its challenges, Lisa.
All right. Well, briefly, to start off with, what do you think are National’s proudest achievements, and what’s the biggest hit you’ve taken this year?
Oh, we’ve taken some good achievements in the economy, particularly Korean FTA, which will go through next week through the house. It was mentioned in that clip, the benefit changes. That’s really important. We’ve got the under-13s - the free healthcare for under-13s. There’s actually a whole range of advances on all fronts.
And the biggest hit?
Oh, probably two things, I would say, which are sort of related – the Northland by-election was, from a political point of view, disappointing. We had to learn some things out of that, and I think we have. And then the second thing is – and it’s semi-related to that – we still have yet to be able to build a consensus in the house for some significant RMA reform, which most New Zealanders in regional areas want, but so far, the politicians haven’t actually been able to get themselves together to vote for it. And, I mean, that’s politicians of all sides of the house.
Okay. Well, you mentioned Northland there. What was the big lesson that you learned?
Well, there’s a number of things. One would be don’t have an MP disappear on you in an unexplained fashion so soon after a general election. That sounds a little bit trite, but actually, that was very difficult. And as a result, there was lots of people in Northland confused as to why they should vote for somebody new that came up.
Wasn’t the big lesson, though, that the regions felt that they weren’t getting any love from the Government? Wasn’t that the lesson?
No, I think that that was part of the lesson in Northland, but I think it would be way too simplistic to suggest that’s across the country. That’s Labour’s narrative, and, of course, Winston Peters is trying to run that line as well, but actually, you go round other regions in the country, and they’re in positive shape. Everybody wants to get there faster. We want to get there faster in a whole range of areas as well, and that’s what we’re doing.
When you mention the regions, in 2013 you put out this press release, which says, ‘Regions leading New Zealand’s economic recovery.’ And last year you put out this one, which was, ‘Regions lead recovery from the global financial crisis.’
And that’s true.
The thing is, you couldn’t put those out in good faith this year, though, could you?
Oh, yes, you could. There’s some regions that are going particularly well. I was in Bay of Plenty the other day, and that is really honking away, because it’s got a very strong recovery, for example, from kiwifruit. So Bay of Plenty missed out a little bit in this story that you’re talking about back in 2013.
Yes, Taranaki was highlighted in both of these press releases as going great guns. It’s in recession now.
Well, I don’t think you can say that. No, you’re using numbers that don’t actually indicate that at all, some ANZ numbers or NZIER or something like that.
Do you think it’s rosy?
No, I’m not saying that.
It’s ANZ numbers, but do you think it’s rosy?
I’m saying it’s tougher than it was before, because you’ve got the two biggest industries in Taranaki struggling at the moment because of low dairy prices and low international oil prices. That’s definitely having an impact. But it doesn’t change the fact that actually, it was the regions that lifted New Zealand out of the GFC. What’s going on now is it’s probably more the top half of the country, particularly Waikato, Bay of Plenty, Auckland. Auckland was late to the party and so was the Bay of Plenty, because of the kiwifruit. And it all does change over time.
And it is changing. I suppose that’s the point. A year ago you were saying, National were saying, that a strong economy was a top priority.
And it is.
But everyone is revising down their projections. Exports are falling. Unemployment is projected to grow. Do you concede that you’re not meeting targets from last year?
Exports aren’t falling.
China.
Well, China is definitely is.
Yeah.
That’s right, and dairy definitely, but, actually, other exports are growing. In fact, the real story of the last 12 months in export turnover is how much that overall exports stayed up, notwithstanding very tough times, as you say, in the dairy space. So what I think we are seeing is a story of New Zealand’s increasing resilience across a range of industries, and, yes, dairy is not able to carry the weight that it once did in the New Zealand economy at the moment—
And you’re not meeting—
But other industries are coming.
You’re not meeting those growth projections from last year, I mean, are you?
Well, that’s right. I mean, the growth has softened since, but I think the reality is most New Zealanders know that things do go through cycles. They look at the world economy, and they see that it is coming back a little bit, that China is coming back a little bit, and what they’re doing is looking to us to continue to do the things that actually puts us in the best possible light, and we are doing so. So some of those big macro things like fiscal consolidation, we’re well ahead of most of the rest of the world. Our international liability – what we as a country owe the world – continues to drop. Our exports have stayed up really well despite these things.
Okay. Well, last time you were here on the show, you were talking about encouraging foreign investment – growing foreign investment.
Yes, that’s right.
Now, how vital is that? Because you had someone standing by to invest $88 million in Lochinver Station, and you told them to go away. The Government told them to go away, even though the Overseas Investment Office said you could do the deal. How do you square that one away?
Well, firstly, international investment is very important – international and domestic investment. It is very important, but that doesn’t mean all of it goes through, because we do have a test, as you know, a sensitive land test, the ministers have to apply. They have to do it on their own. They get advice from officials, but, actually, they have to make the call, and, as we know, these things have been litigated quite a lot in the past, so it’s quite a lot of weight to carry. And if you’re going to have a test, that means one or two of them won’t get through. And in this case, this one did not meet the test. The two ministers decided that it wasn’t sufficient—
But just a couple of months ago, you were here saying it was crucial to get investment, you wanted more investment, and the Overseas Investment Office said, ‘Yeah, you can do this deal.’
Well, they said on balance, but don’t forget the ministers actually have to make the decision. In this instance, they can be legally reviewed if they make the wrong decision, so they actually do have to take advice. They took advice from the officials, and they took advice from an economist – an agricultural economist. They took advice from a range of sources because they’re very aware that this particular one, as with other ones, can potentially be litigated before the courts, and they’re wanting to get it right.
But when Labour said it would block this deal, you said that was xenophobic, so by your own measure—
No, I said their general attitude to international— No, I said—
By your own measure, you must be therefore be xenophobic too.
No, I said it’s their measure is that they don’t like Chinese investment.
No, no. No, it was—
I mean, these are the guys that—
No, it was specifically in relation to Lochinver. No—
Let me have a go.
No, I want to get this right. It was specifically in relation to Lochinver, and you said—
No, it was in relation to their international investment.
I was there too. 'A little xenophobia from Labour to start the day' is what you said.
That's right, because actually they are against Chinese investment. The other ones have been out there — and you saw it on your clip — saying that Chinese-sounding surnames should not be able to buy property in Auckland.
But you did exactly what you accused them of doing.
No, that's not correct at all. What we did is apply the same test that we apply to everybody. The test has not changed. And actually, most New Zealanders know that we do apply a test of economic benefit. It has nothing to do with the particular country that people are from. We're not the ones here saying, 'If you've got a Chinese-sounding surname, you shouldn't buy property in Auckland.' We're actually saying 'If this brings an economic benefit to New Zealand, you're in,' and it's irrespective if you're Chinese, American or whoever.
Let's talk about some of your third term strategy. You've increased benefits; you're taking more refugees; you've increased parental leave; and you've introduced a sort of non-tax tax on property investors — all the things—
Well, actually, it's just a bright-line test.
They’re all the things that you have argued against in the past. So how are you fundamentally different to a Labour government?
I don't think we actually argued against all those things in the past at all.
Yes, you have.
No, no, that's not true. Parental leave, we've always been in favour. The challenge of parental leave, and it's still a debate that's going on today, is how the country affords it in the context—
The question is — how are you different to Labour?
OK, if you want to say that—
Fundamentally, given that list of things.
I think we're fundamentally different because of our trust of the individual; our focus on growing the economy, attracting investment; pushing innovation, which is something that Labour has argued against; the infrastructure investment and roading; and things like water storage, Central Plains Water, the encouragement of that; the investment in broadband, which has been criticised by Labour all the way; so the encouragement of growth in the New Zealand economy; and the lower tax—
So that's how you're different? You're encouraging growth in the New Zealand economy?
I'm just saying, the method by which we do it. The things that they're turning around and saying it at the moment is that, firstly, they'd want to knock migration on the head, which actually is a positive for New Zealand. It's a positive for New Zealand's ITC companies; it's a positive for the South Island. And the other thing they came up with in an interview last weekend was that they would do nothing except promote the CRL in Auckland and, perhaps, this Opotiki Harbour development, which we're already working on. So they don't actually have much of their own things to promote at the moment.
Well, before we go, I just want to ask you one final question. If you dig into the polls, John Key's numbers are high, but the trend is down — honesty ratings, lowest ever; capability, lowest ever. Is that a reflection of being out of touch?
Look, my view is that if you ask anybody in the National Party would they want John Key to be their prime minister and leader, they would say absolutely, because—
But it's a trend, isn't it? It's a downward trend.
No, I don't think it is at all. And when you say that, I mean, quite genuinely, we have the highest ratings of a leader—
But actually it is a downward trend, because they're numbers, so the numbers are tracking down.
But my point is — in any point in New Zealand history, has there been a prime minister who is more in touch with New Zealand in his seventh year in being prime minister? I'd very, very much doubt it. I think most parties would love to have a leader as successful and as in touch with New Zealanders as we have. And actually, the test will be for us in two years' time — which is I'm sure what you really want to talk about, because that's coming up quite rapidly — in just another two years, we'll be doing the right things for New Zealanders, and not whether they see the opportunity to get ahead, and that we will enhance their security, and those are the things we're focused on.
We'll leave it there. Thanks for joining us this morning, Minister.
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