﻿Mr SPEAKER: The House comes to Questions for Oral Answer.
Question No 1, Dr Jian Yang.
Dr JIAN YANG (National) to the Minister of Finance:
How will Budget 2016 support further growth in jobs and wages,
while maintaining the Government’s fiscal management?
Hon BILL ENGLISH (Minister of Finance): The Budget will be on 26 May.
It will continue the Government’s record of fiscal discipline,
which focuses on getting better results from spending and managing
long-term spending pressures.
As a result of that, so far, expenditure has fallen
from 34% of GDP in 2011, where it peaked, to 30% in 2015.
We are committed to achieving debt of around 20% of GDP by 2020.
As we said in the Budget Policy Statement,
with the Budget now broadly in balance, the Government
will not distinguish between forecasts of small negative balances
and small positive balances.
David Seymour: What is the fastest growing item
of expenditure over the next 5 years
according to the Budget Policy Statement?
Hon BILL ENGLISH: That is likely to be national superannuation,
which is rising at around $700 million to $800 million per year.
Alongside that, the Government only spends
about another billion dollars per year on everything else.
Dr Jian Yang: What recent steps has the Government taken
to support growth, delivering more jobs and higher wages for NZ households?
Hon BILL ENGLISH: The most recent and one of the largest steps
the Government has taken is to sign the Trans-Pacific Partnership agreement (TPP).
This gives equal and fair access for NZ exporters to 800 million customers
in 11 countries that account for 36% of the global economy,
including the world’s biggest economy, the United States. It also means
that other countries are bound under that agreement by rules
that help protect access of NZ exporters to overseas markets.
So the TPP agreement is important to jobs and incomes in NZ;
the alternative of not participating would certainly be bad for NZ households.
Dr Jian Yang: What is the outlook for economic growth over the next 4 years,
and how will this growth deliver more jobs for NZ households and families?
Hon BILL ENGLISH: After a relatively soft first half of 2015,
recent data suggest the NZ economy picked up somewhat
in the second half of last year, and the outlook
is for continuing, moderate growth.
The most recent forecasts expect GDP to grow around 2.7% per year
each year through to 2020, and what this means
in terms of jobs and incomes is that there will be a further
173,000 additional jobs, on top of the 175,000 jobs added in the last 3 years.
Dr Jian Yang: What are some risks to the economic outlook?
Hon BILL ENGLISH: It is fair to say that 2016 has started with,
certainly, a perception of greater risk in the global economy.
Factors making up that would be weak commodity prices,
and slower growth in China, driven by lower investment,
even though the consumption aspect of China’s economy is growing pretty strongly.
There is uncertainty around the impact of US interest rates
and there appears to be some growing risks around European banks.
We will continue to focus on NZ’s resilience to any of these changes.
Grant Robertson: Is ASB chief economist Nick Tuffley correct
when he says: “On a per-capita basis, there has essentially been no growth
"over the past year.”?
Hon BILL ENGLISH: In fact, he may not be correct.
It depends how you measure growth over the last year.
It is not surprising that in a growing economy
where more and more people are turning up to enjoy
the benefits of one of the faster-growing developed economies,
that we may get periods where per capita growth is a bit slower,
but overall Treasury analysis shows per capita growth has averaged
about 1.2% per year, if you exclude the Canterbury earthquake.
Rt Hon John Key: What is NZ’s unemployment rate, and has he seen
any predictions of the unemployment rate going to 7%?
Hon BILL ENGLISH: The most recent unemployment number was, I think, 5.3%,
somewhat below the Labour Party finance spokesman’s forecast,
which as usual was based on his wishful thinking that everything
will go bad suddenly. He forecast 7%.
Grant Robertson: Has the Minister of Finance seen the forecast from Treasury
of unemployment being 6.5% in 2016 and possibly reaching 7% in 2017?
Hon BILL ENGLISH: You have always got to be a bit careful
with quarter-to-quarter numbers. It turns out Treasury was wrong,
but it is pretty hard to be wronger than the Opposition finance spokesman.
[MEMBERS TALK LOUDLY]
Mr SPEAKER: Order! [Interruption] Order!
James Shaw, question no 2.
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