Watch: Christopher Luxon’s election pitch – National ministers should be in charge of planning rules
Prime Minister Christopher Luxon has promised to forge ahead with his “programme of bold reforms” and made a pitch to have more National ministers at the heart of the Government at the expense of coalition partners, in his state of the nation speech today.
In his first major appearance of the year, at the New Zealand International Convention Centre in Auckland, Luxon acknowledged it had been a “tough time for Kiwi households and businesses over the last five years”, but insisted the country was turning a corner.
Luxon picked up on themes he began rolling out in a speech last year, widely tipped as a “reset” of his leadership: an acknowledgement that times were tough, but that ultimately, the Government’s sometimes painful reforms were essential to building a more prosperous future.
However, citing recent economic data releases, he said the economic recovery was now underway.
“NZIER’s latest survey showed business confidence at its highest level since 2014. BusinessNZ’s PMI indicator released on Friday shows growth in manufacturing is stronger than at any time since December 2021 and higher than many of our global peers,” Luxon said.
“And while last year, there were pockets of optimism in the South Island and in the rural economy, conditions now seem to be improving nationwide. According to Westpac, Auckland is now the strongest region for consumer confidence.
“I feel more confident than ever that the recovery has arrived.”
Luxon repeated an attack on what he’s dubbed “sugar rush economics” – using house prices and immigration to stimulate the global recovery. This is despite reports the Government will U-turn on Auckland densification changes, a change likely to draw a line under the property crash in the Super City.
Usually never shy of attacking Labour, Luxon didn’t mention the party once by name in the speech.
He obliquely referenced the party’s rumoured spending plans, which, though not yet public, are likely to include pledges to lift spending in several areas.
In December, Luxon said, the Government confirmed a path back to surplus under the new Obegalx measure in 2028/29, which Luxon said would be achieved “by tight Budgets in the coming years”.
Treasury, however, thinks this won’t be achieved until 2029/30.
“Tight Budgets have become standard practice for this Government. In just the last two years, our Minister of Finance, Nicola Willis, has delivered savings of around $11 billion per annum, equivalent to around $5000 for every single household in the country,” Luxon said.
Prior to the election, a surplus was forecast under the old Obegal metric for 2027, however the Government is now not forecast to post a surplus under this metric until the end of the decade, mainly, Treasury said, because the economy’s worse-than-expected performance has seen tax revenue shrink.
“Let’s be straight up with each other. Any party that wants to ramp up spending is being economically irresponsible,” Luxon said, in his main dig at the Opposition.
“The only way to spend more money is to borrow it or to raise taxes. Borrowing more would lift our debt to dangerous levels, while raising taxes would snuff out the recovery and send Kiwis overseas,” he said.
Luxon promised there would be further “savings” in the Budget, expected in May and with “no room for extravagant election promises”.
He finished his speech talking up the Government’s reforms to KiwiSaver, on which National wants to move faster than the rest of the coalition, its plans to scrap the National Certificate of Educational Achievement (NCEA) and the changes to the Resource Management Act (RMA).
Luxon noted that the new resource management law was “only the start” and that over time, “more and more” resource management rules would be “managed through national standards, setting out guardrails for the development of everything from agriculture to mining to apartment buildings”.
These new standards, should the law pass, would be written by the ministers who sit around the Cabinet table in the next Government. Currently, the likes of NZ First’s Shane Jones have power under the RMA to issue resource management regulations in their portfolios.
“I’ll be blunt. I want – and you should want – National ministers writing those rules, so we have a resource management regime which allows New Zealanders to build the future.
“And the only way to build that future is with a National Government.”