Labour's Chris Hipkins and National's Christopher Luxon are vying for your vote. Photo / NZME
OPINION
The good thing about being away from the country, aside from escaping Auckland’s weather, is that you come back with a clearer perspective and an eagerness to get up to date with what’s been happening.
I’ve been overseas for a couple of weeks, so arriving home just in time for Wednesday’s debate on TV3 was a timely opportunity to catch up with what the two leading prime ministerial candidates were saying.
And what a disappointment it was.
Anyone who treated the debate as light entertainment probably got what they wanted. However, if you were looking for a proper debate, to inform your voting decision, you were wasting your time.
The invitation to listen to a debate should conjure up expectations of a discussion between two sides, usually with opposing views, where each has an opportunity to present and defend their ideas, while also responding to the other party’s opinions.
But the prime minister was having none of that. His mission for the evening was to interject and interrupt. He did so loudly and at times disrespectfully. And, it seemed, the more combative the better. No need for policy to be presented. Just attack the individual on the other side of the podium.
Even the carefully selected panel of left-leaning observers said Christopher Luxon looked more prime ministerial. That was an understatement. To the outside observer, the so-called debate would have appeared more like a prime minister-in-waiting attempting to speak while being abused by a student protester.
Chris Hipkins forgot to bring a couple of things to the debate. He didn’t bring any intention or ability to discuss policy, nor to defend his record. And inexplicably, he forgot his megaphone.
As usual, there was plenty of tit-for-tat around policy that has already been announced. Crime, health, education and the economy all had a share of the timeslot. The current Government’s softly-softly approach to dealing with gangs was there too.
But, in a country ravaged by a wide range of complete failures over the past six years, there was nothing substantive. When your business, or for that matter your economy, is having a tough time, there are usually two places to look: increasing revenue and decreasing costs.
In attacking the National Party position on reducing the cost of running government, the prime minister wanted us to know that doing so would result in job losses in the public service. And so it should.
As part of his Government’s wild spending spree over the past six years, we have employed more than 14,000 additional public servants. Even at a conservative average salary of $80,000 a year – and I suspect it’s more – that’s an additional cost to the taxpayer of $1.12 billion. Every year.
And in doing so, we have seen most indicators of the performance of those government departments deteriorate. Crime is up. Hospital waiting lists are longer. Educational attendance and outcomes are down. Economic performance places our once “rockstar economy” at the bottom end of OECD and IMF analyses alike. The cost of living is up.
And despite what they might tell you, our inflation problem is not imported, but rather a function of excessive government spending and a dollar made weaker by government policy.
Big organisations are typically hopelessly inefficient. They usually lack accountability and comprise hordes of people who are internally focused – doing business with each other – rather than outward looking. They require exceptionally strong leadership, clear direction and disciplined behaviour to be productive – traits that don’t come naturally to the public service.
Government departments are the worst example of big, clumsy organisations. Making those ministries bigger, without a clear reason why, is a recipe for productivity decline and performance failure. And that’s what we’ve seen in the past few years.
Most rational people will agree that we don’t need all those people in government roles. But that doesn’t mean those people are useless or that they should be thrown on the scrapheap. Instead of an argument about whether or not National’s policies imply public sector job losses, how about a discussion on what those government employees could be doing instead?
Across the country, we are desperately short of people. We need teachers, nurses, truck drivers and builders. We need hospitality workers and more people in retail. Despite almost 200,000 people on the Jobseeker benefit, I know of companies with 40 or 50 vacancies.
It’s one thing to say we have too many people working in the wrong places. That’s an easy stone to throw. But what about looking at ways in which we can retrain those people who are up for a change? Instead of cutting them loose, how about we keep paying them for a year or more while they learn new skills that then enable them to become part of a more productive sector within our needy economy?
As a result, instead of paying these people to sit unproductively in an underperforming bureaucracy, where their careers will go nowhere, we can try to create a productive existence for them, and in turn solve some of our skilled worker shortages. Of course, they won’t all take up the opportunity, but if it’s the difference between having a job and not having one, surely it’s a better option all round.
On the revenue front, we’re not hearing anything from the political combatants about how we grow our economy. All these years later, we remain heavily reliant on a couple of narrow income streams for our worldly income.
Agriculture is our bread and butter, but soft market prices make that particularly difficult at present. Agriculture is heavily influenced by the weather, and we know how challenging that has made farmers’ lives over recent years.
And then there is our tourism industry. Once so strong, we were slow to reopen ourselves to the world post-Covid and, as a result, we missed a season and the recovery is taking longer. The increasing cost of travel does no favours to a distant land and, once here, tourists find we’re an expensive place to visit.
So we need to find additional and reliable sources of revenue. In 2018, the newly installed Labour-NZ First government banned future offshore oil and gas exploration, essentially without notice. While I’m sure the greenies love the ban, we have to be realistic. Our financial position is dire and getting worse with every week of borrowing and spending.
We are fortunate to have access to mineral resources in this country. In addition to oil and gas, we have some of the world’s highest-quality coal deposits, yet we would rather import an inferior product than use our own.
As they love to tell us, our Australian neighbours have managed to avoid recession over the past 30 years. One of the reasons for their resilience is that they continue to export to a world craving what they dig out of the ground. Australia’s biggest export products by value in 2022 were iron ore, coal and petroleum gases.
Recently released research tells us that Guyana, a small country in the northern part of South America with just 800,000 people, is the world’s fastest-growing economy this year. Its projected growth rate is 38 per cent for the year, according to recent GDP forecasts by the International Monetary Fund. Its secret? Oil production and export.
On the surface, it would appear that we have the natural resource base to play that game too. As much as the greenies would hate it, rebuilding our ability to generate oil, gas and coal revenue is a potential game-changer for our economy in the long term. But re-establishing ourselves is not without its challenges. The reality is that we will have to work very hard to attract the oil and gas industry back. Some players lost a lot of money when the surprise ban was sprung.
And assuming there is a change of government, and our trade representatives go back out into the world’s mineral markets and declare New Zealand is once again open for business, we will no longer be able to claim one of our original strengths.
One of the legacies of this Government is that a stable regulatory and political environment no longer exists. The apparent reality is that the extreme political left wing would rather see this country fail than have us breach some of their idealist thinking about oil, gas and coal, the very markets that could help rescue our financial position.
It’s funny, isn’t it? The current Government, and many in the media, make much of questioning how National and Act can fund their policies and aspirations for the country. And yet, no one seems keen to question the current approach, whereby we continue outrageous levels of spending, all while borrowing more money every week to pay the bills.
There is no question that we need big ideas and major initiatives to grow our revenue and cut our costs. A failure to do so will leave this once-great little country both financially and morally bankrupt.
- Bruce Cotterill is a company director and adviser to business leaders. He is the author of the book, The Best Leaders Don’t Shout, and host of the Herald’s new podcast, Leaders Getting Coffee. www.brucecotterill.com
OPINION: Turns out the human brain is not well evolved to handle money.