Lawrence Yule: Govt has no magic money source

Tukituki MP Lawrence Yule says the Government has inherited an economic buffer. Photo / File

The prime minister's announcement of yet another working group to try and shore up plummeting business confidence will do nothing to address the uncertainty created by the Government's anti-growth policies.

We are now up to 153 working groups and you have to ask what Labour did in opposition.

This is a Government that believes it can talk its way out of anything – but instead of trying to shout over the conveyor belt of weak economic indicators they should be taking concrete steps to change their anti-growth policies.

The way to lift wages and grow a sustainable economy is to take real steps to support businesses, not driving uncertainty through endless working groups and bad policy.

Instead, the prime minister has announced a Business Advisory Council; a body with a chair but no members yet, and a Business Partnership Agenda that merely repackages existing problematic policies, a third of which are working groups.

I have huge respect for Christopher Luxon and he would be in any economic growth team if I was asked to pick one. However he isn't a minister and his degree of influence will be interesting to watch.

The reality is that there is a growing sense of panic from this Government against these
facts:
1) GDP per capita has fallen to its lowest annual level since 2011.
2) Job creation has plummeted from 10,000 to 4000 per month since the election.
3) Business confidence is at its lowest level since the GFC. And the cost of living is
rising.
4) NZIER has revised down their GDP growth forecasts from three months ago which means every man, woman and child will be $1600 a year worse off on average by 2022. That is $6400 for a family of four.

A business breakfast in Auckland is an inconvenient dream for the employers that provide most of the jobs - the small business.

You talk to them about collective bargaining, automatic access to work sites by unions, tougher immigration rules for work visas, increased fuel taxes and the never-ending lift in compliance costs and they will soon tell you why confidence has stalled.

It is right that any government sets its priorities at the beginning of each term but I am yet to see a plan from this coalition Government apart from borrowing more, spending more and banning oil and gas exploration.

I will always champion a business growth agenda which maximises growth within realistic environmental and social boundaries.

I do, however, have a very simple philosophy. The Government has no magic money source to fund schools, hospitals and public service salaries.

The money government relies on comes from businesses and individuals in the form of taxes. For this to occur people need to be in jobs, and businesses need to be profitable.

The fact is the Government has inherited an economic buffer which is protecting New Zealanders from the worst.

Responsible economic management matters - National delivered a solidly growing economy that lifted wages and created jobs.

If I were the prime minister I would have delivered a business confidence speech in the first month of the electoral term not the 10th. It is all about priorities.