The Government needs to produce a credible plan to grow the economy in the face of slower economic growth, fewer jobs and a Reserve Bank cutting interest rates to try and prop up the weakening economy, National’s Finance Spokesperson Amy Adams says.
“Under this Government, annual GDP growth has fallen from 3.4 per cent to 2.3 per cent and is set to fall further next quarter. And on a per person basis we are doing even worse. In 2018 New Zealand had annual GDP per capita growth of just 0.6 per cent. That was the sixth lowest in the OECD and means New Zealanders’ living standards are falling behind.
“And while unemployment is still relatively low, it has stopped falling and people are actually leaving the labour market. The number of jobs has fallen by 4000 this year, undoing the 10,000 new jobs created a month under National.
“Yet for the last year, the Minister of Finance repeatedly ignored warnings the economy was slowing and instead chose to bury his head in the sand. Now, instead of producing a credible plan to grow the economy, the Minister is blaming the slowdown entirely on global factors and doing nothing to strengthen the domestic economy.
“While there are global risks, they are mostly still just that: risks not happened yet. In fact, as the Treasury noted earlier this week, economic growth in the US is above three per cent, Chinese growth has stabilised above six per cent and European and Australian economic activity have both picked up again. As of yet, there is no excuse for the domestic slowdown.
“The Reserve Bank yesterday intervened to prop up the weakening economy by cutting the OCR to its lowest ever level. While this may be good news for borrowers, an OCR barely above zero means when a real economic shock hits New Zealand there is very little ability for the Reserve Bank to stimulate the economy.
“The Government has simply not put New Zealand in the best possible position to deal with an economic shock. Business confidence has plummeted with over 200 working groups in fundamental areas like tax, transport, education, banking and insurance.
“The Government needs to stop deflecting and ignoring the economic slowdown and instead take some accountability producing an economic plan that helps to strengthen the economy.”