Earth Overshoot Day – 29 July 2019

29 July 2019 has been calculated by Global Footprint Network as “the date when humanity’s demand for ecological resources and services in a given year exceeds what Earth can regenerate in that year. We maintain this deficit by liquidating stocks of ecological resources and accumulating waste, primarily carbon dioxide in the atmosphere.”

It’s worse for many countries, including New Zealand – they say that we used a year’s worth of resources on 9 May, well under half a year.

figure showing country overshoot days

While the trend has been flattening out over the last decade it has worsened substantially over the last four decades.

The calculation:

To determine the date of Earth Overshoot Day for each year, Global Footprint Network calculates the number of days of that year that Earth’s biocapacity suffices to provide for humanity’s Ecological Footprint. The remainder of the year corresponds to global overshoot. Earth Overshoot Day is computed by dividing the planet’s biocapacity (the amount of ecological resources Earth is able to generate that year), by humanity’s Ecological Footprint (humanity’s demand for that year), and multiplying by 365, the number of days in a year:

(Planet’s Biocapacity Humanity’s Ecological Footprint) x 365 = Earth Overshoot Day

Global Ecological Footprint and biocapacity metrics are calculated each year in the National Footprint and Biocapacity Accounts. Using UN statistics, these accounts incorporate the latest data and the most updated accounting methodology (the National Footprint and Biocapacity Accounts 2019 Edition feature 2016 data.) To estimate this year’s Earth Overshoot Day, Ecological Footprint and biocapacity are “nowcasted” to the current year using the latest data from additional sources, such as the Global Carbon Project.

While the actual dates could be quibbled about, I think that a valid and important point is being made – the human population and the way we live exceeds what our planet can cope with, by quite a margin. If this excess continues then Earth will suffer badly (more badly) – which means people and all creatures and plants will suffer. We may be able too carry on despite the damage we are contributing to, but bodes badly for our children and grandchildren.

It’s easy to dismiss this as not our problem, to say that it’s someone else’s problem, but that’s a part of the problem.

It won’t be quick or easy to turn things around, but there is growing attention being paid to at least making things less bd.,

Solutions to #MoveTheDate

From there, one suggestion from Gene Geveridge who is from the north of New Zealand:

Anecdotally there is interest in creating or joining a shared garden for the purpose of food production, food security, food education, and if possible ecological regeneration. Achieving some economy of scale, fostering community relationships and reducing food transport would be more general goals. Success depends on a few people with the right knowledge and experience and a wider group for man-power and to learn the ropes in time.

A setup similar to this could work: https://www.facebook.com/PakarakaPermaculture

That would have environmental as well as community benefits – but it’s remarkable that the right knowledge and experience to help people to learn the ropes to grow their own produce in a garden is seen as necessary. The knowledge and the practice of home gardening seems to have deteriorated alarmingly over the last half century.

I have a home garden and orchard, but could and should do a lot more. This is a project I will be working on more – on it’s own it will just make a tiny difference, but we need a lot of tiny differences to make a real difference.

 

 

Silver Ferns win Netball World Cup

Defying form over the last couple of years, and also seedings and predictions, New Zealand’s Silver ferns have won the 2019 Netball World Cup, beating Australia in the final in Liverpool by just one goal.

 

I even felt a bit emotional watching the final minutes, seeing the reactions to the result, and then the presentations and the national anthem.

Coach Noelene Taurua and everyone else involved in the campaign deserve a lot of credit too.

I’m not a great netball fan, but this is a great effort and a great result.

Netball New Zealand: Silver Ferns win Vitality Netball World Cup

 

England worthy winners of Cricket World Cup

England were worthy winners of the Cricket World Cup just completed at Lord’s in London.

New Zealand’s Black Caps were worthy runners up.

They won by the smallest of margins. The scores were tied after 50 overs, 241 runs to each side. The scores were tied again after a super over, 15 runs each. England won due to the higher number of boundaries scored – that’s the rules so there can be no complaints about that.

There are a number rof things that happened during the game that could have made the difference, could have swung the game one way or the other, but in the end that is all irrelevant. What matters is the final score and the final deciding factor, and England did what mattered.

England have been a top one day team over the last few years and were tournament favourites. They had some wobbles during pool play but won their semi-final easily against defending champions Australia, and won the final just over New Zealand.

This is the first time England have won the World Cup, so very good for them, and despite some disappointment at the result I actually feel as good a as a loser could for the winning team.

The Black Caps exceeded my expectations against Inndia in their semi-final, and exceeded my expectations in the final. I always hoped they could win, and they came so close to doing so, but my main thoughts coming into this game were hoping they would wouldn’t lose badly, and that they would lose with credit.

They couldn’t have come closer so couldn’t have come out of this tournament with more credit, short of winning.

This was one of the greatest games of cricket ever and was also worthy of a final. It will be very good for the game to have had such a hard fought, close game, played in extremely good spirit by England and New Zealand.

Kane Williamson (New Zealand  captain):

“Look, it certainly wasn’t just one extra run. So many small parts in that match that could have gone either way as we saw. Congratulations to England on a fantastic campaign.

It’s been challenging, the pitches have been a little different to what we expected. Lots of talk of 300-plus scores, but we haven’t seen many of those.

I’d like to thank the New Zealand team for the fight they showed to keep us in the tournament, and get us this far. A tie in the final. So many parts to it. The players are shattered at the moment. Obviously it’s devastating. They’ve performed at such a high level through the tournament.

We were weighing up the overheads versus the pitch, it was on the drier side. runs on the board, as it proved, was going to be challenging. We would have liked another 20, but in a World Cup final we’ll take 240-250. Both sides showed a lot of heart, a lot of fight. For it to go to the last ball, and the last ball of the next match, it was pretty hard. That [the Stokes deflection] was a bit of a shame, wasn’t it? You just hope it doesn’t happen in moments like that. You can nitpick, but perhaps it just wasn’t meant to be for us. It is perhaps tough to review the match, and such small margins.”

Eoin Morgan (England captain):

“There wasn’t a lot in that game, jeez. I’d like to commiserate with Kane. The fight, the spirit they showed. I thought it was a hard, hard game.

This has been a four-year journey, we’ve developed a lot over those years, particularly the last two. To get over the line today means the world to us. The guys in the middle keep us cool, the way they play, the experience. It’s calming at times. Not a lot between the teams. Just delighted we’re lifting the trophy today.

As long as he wasn’t too cooked [sending Stokes back out for the Super Over]. Full credit to those two boys and Jofra. Every time he plays, he improves. The world is really at his feet at the moment.”

Grant Robertson on Newshub Nation

Minister of Finance Grant Robertson was interviewed on Newshub Nation yesterday.

First, the sideshow.

imon Shepherd: It’s the highlight of the political year, for the government and one man in particular, the Finance Minister. I asked Finance Minister Grant Roberson if he was disappointed that the unauthorised early release of budget details overshadowed his first wellbeing budget. 
Robertson: I don’t think that it did. The reaction that we’re getting from New Zealanders to the budget is that they’re really pleased that we’re focused on a big, long-term issue like mental health. I don’t think New Zealanders are focused on the political games in Wellington.
But there were so many of them. There was the leak of the documentation, the allegations of a hack — you sort of seemingly linking the National Party to that, and then it wasn’t a hack. It was shambolic.
Look, I’ve expressed my disappointment in the fact that the Treasury system could be infiltrated this way and also that the Treasury didn’t do more to find out what had happened before they referred it to the police. The reality is that that’s now in the hands of the State Services Commissioner, who is doing an inquiry, and we’ll await the outcomes of that.
Well, how do you think you handled it all?
Look, I invite you to put yourself in my shoes. On Tuesday night the Chief Executive of the Treasury arrived in my office and said about an hour ago I have referred to the police 2000, of what he called, hacks into the system. I said to him, ‘Do you know how that’s happened?’ He said, ‘No, I don’t.’ I said, ‘Do you know if any other areas of the Treasury system have been compromised?’ He said, ‘No, I don’t.’ So at that point, I’m going to take that matter pretty seriously. That’s what we did. Obviously more information has now come to light. That’s what the inquiry will cover.
Do you think you acted too quickly? Do you think you should’ve waited and got some more information before you put out that press release just then, which seemed to indicate that National was linked to the allegations of a hack?
Like I say, I think most people in my shoes, having received the information I did, would react and say, ‘Well, we need to make sure, regardless of how the National Party might’ve got the information, that they were aware of what the Treasury had advised me. We all now know that the situation is somewhat different. The inquiry will look into how that happened.

Then the meat of the topic.

You named it the Wellbeing Budget, but mental health aside, what is actually transformational about it?
I think the work that we’re doing in domestic and sexual violence is absolutely transformational. We’re talking there about breaking a cycle that has bedeviled New Zealand for many years. $320 million going into that. We’re going to transform the lives of people who are on benefits by indexing that to the average wage. That’s going to lift their incomes consistently.
Okay. Well, let’s talk about that. Obviously the Welfare Expert Advisory Group said 12-47 per cent boost to benefits is needed, something like $5 billion. You didn’t go near that. You’ve done $300 million. Why not?
Well, because we’re doing this in phases. And we’ve actually done three things —we’ve done, not only the indexation of benefits, but we’ve also lifted the abatement rate — the rate at which your income drops if you’re working while you’re on a benefit. And we’ve got rid of the sanction that was on mothers who didn’t identify the fathers of their children. That’s stage one. We absolutely acknowledge that there’s further work to do in this area.
Do you think that you missed a chance to be transformational by not implementing a capital gains tax?
Well, as you well know, I would’ve like to have implemented a capital gains tax. That, of course, would not have come into force until after the election. That was always the plan, but the realities of coalition government are we didn’t have the numbers for that.
What about a greater focus on business? If you lift them and provide incentives for business, that changes the whole economy, doesn’t it? So why didn’t you do that?
Well, we are. There’s a great deal of focus on supporting business. One of the things I’m really excited about in this budget is the $300 million fund for venture investment in those businesses that have got past the start-up phase and are looking to grow to be international companies, and Peter Beck from Rocket Lab has raised this issue with us and said, ‘Too many of these companies head offshore because there isn’t investment here.’ The government’s now got $300 million of skin in the game.
But I would say to you, that this country is made up — the backbone — is small to medium enterprises, and the businesses you’re talking about there are start-ups that want to go internationally. You’re not addressing the small to medium enterprises.
Well, I’d argue we are. The biggest issue raised with me by business is skilled staff, infrastructure, making sure we get those trade agreements going so people can export. They are the issues we are working on.
Could you have been more transformational if you’d relaxed your debt rules earlier? Is there a chance you could look back at this and say, ‘I wish I hadn’t played it so safe’?
It’s always about a balance. We have to make sure that we do keep our debt under control. We’re a small country. We’re susceptible to significant economic shocks and natural disasters. We are actually borrowing more money in this Budget. The economy is growing as well. That means the percentage of GDP stays steady, but we are borrowing to invest in those areas like infrastructure, building up KiwiRail, building more schools and hospitals. But it is all about a balance, and I think we’ve got it right.
Well, what about the balance — you’ve just mentioned shocks like natural disasters or international shocks. You are actually borrowing more. You are running down the projected surpluses. Are you leaving us vulnerable to something like that?
No, I don’t believe so. I mean, we still have a surplus of $1.3 billion here. We still have debt at a relatively low level. We are creating that balance, but we made a decision in this Budget to spend more than we had originally allocated, and that’s because the need was there. The need was there in infrastructure, but the need was also there in services like mental health. We always said, Simon, is that a sustainable surplus would be one where we’d met the needs that were there, so therefore this Budget that surplus is a bit lower, but it still exists.
Are you meeting the health needs though? Because National’s Amy Adams points out that policies for midwives, no free health checks for seniors, reduced GP fees — those kinds of things are not addressed in this particular budget. And in fact, figures from the Child Poverty Action Group show that spending on public health is forecast to be the lowest in a decade by 2023.
Well, what we’ve done is prioritise mental health, and we’ve been completely upfront about that from day one. We have a mental health crisis in New Zealand. It’s been ignored, but there’s still significant resources going into the rest of our health system, around $2.9 billion into supporting DHBs, more money for ambulances. There are other areas, within our coalition agreement, within our confidence-and-supply agreement that we’ll look to address in next year’s Budget, but we made mental health a priority.
Such as?
Well, you’ll have to wait till next year.
What about teachers, though? They’re crying out for some more love from the government, and they’ve just announced more disruptive action. So why couldn’t you address that in this Budget?
We believe we’ve got a fair offer on the table, the $1.2 billion offer. The Budget also addresses some of the non-pay-related issues that teachers have been raising. Six hundred learning support coordinators for what we used to call special ed. 2480 more teachers—
And yet they’re still unhappy?
Well, that’s the reality of the world. What I hope is happening, and I’m pretty sure it is happening right now, is that the Ministry of Education and the unions are sitting down together to say, ‘Look, how can we resolve this?’ We want it resolved. We understand the frustration of teachers after 10 years of not getting supported. Let’s take these first steps together now.
What is there in this Budget for middle New Zealanders? Sort of, those low to middle income families. There doesn’t seem to be anything.
Well, I’d give you one example. We’re removing school donations for decile one to seven schools.
But in the hip pocket there’s nothing like tax bracket creep or anything like that.
Well, look, we’ve made a commitment not to change tax rates in this term of government because we believe that we need the resources that are there to meet the needs that are there.
Well, let’s talk about housing. There is nothing actually, really, apart from the Housing First — the transitional housing — there’s nothing else for housing in this Budget. You’ve got KiwiBuild, which has stalled at the moment because it’s not delivering.
We put $2 billion in last year’s Budget for KiwiBuild for the life of the programme—
And it’s not delivering.
And as you know, there is a housing reset coming forward, and actually in the Budget documents we state that we’ve put some money aside to help manage that housing reset.
How much?
You’ll see the details of that when the reset’s released.
What about the policies that you agreed with the Greens, like a shared equity scheme to get more people to be able to afford to buy into our houses. What happened to that?
As I say, you’ll have to wait for the housing reset that Minister Twyford’s going to announce, but clearly we’ve got a large-scale building programme for housing that’s not just about KiwiBuild. It’s about state housing, transitional housing. Mr Twyford’s now going to come back with that reset, and you’ll be able to see—
But there’s 11,000 people on the state housing list, and there’s nothing extra in this Budget for them.
Well, we made a significant investment in the building of 6000 state houses in the last Budget. We’ve got an integrated programme with transitional housing and affordable housing. Phil Twyford’s going to announce a housing reset. We’ve set some money aside to support that.
What would you say to business-owners, teachers and say, middle income, low-income earners — some of those feel left out by Budget 2019. What would you say to them? What hope will you offer them for next year?
Look, I’ve always said that the three budgets of this term are a trilogy. Last year we did the foundation-building of making sure we got spending back into those core areas. This year we’ve targeted areas like mental health that all of those people will benefit from. We’ve got a third Budget to come as well.
So is that going to be the blockbuster for these people?
No, I see them all as part of an attempt to start turning around a decade of neglect in a lot of important areas in New Zealand. Two-thirds of the way through, I think we’re making good progress.

A pretty good budget

I despair about the circus leading up to and surrounding yesterday’s budget. Media even investigated the person on the cover photo of the printed budget in a bizarre sideshow. And there were a number of ‘what’s in it for you’ angles, despite lolly scramble budgets largely being very historic,

But for what really mattered, I think that yesterday’s budget was pretty good, delivered by someone who increasingly looks like a pretty good Minister of Finance, Grant Robertson.

A significant boost to mental health related initiatives is long overdue, and very good to see,

Indexing benefits to wages is also a long overdue fix to the erosion of benefit value over the years.

There’s a bunch of other stuff that can be praised or quibbled about, but generally it seems ok to me.

There is always a limit to how much a Government can spend of our money, and there’s a limit to tolerance of how much we are taxed. Robertson and the Government seems to me to have found a fairly good balance. They will never please all of the people all of the time, but I don’t think there’s much to be worried about.

Budget today

It is budget day in Parliament. I don’t see any point in saying much until we know what is in it.

Jacinda Ardern’s 2019 pre-budget speech

Prime Minister Jacinda Ardern gave a pre-budget speech to Business New Zealand yesterday. Excerpts:


Not surprisingly, I want to talk to you today about next week’s Wellbeing Budget, why we are doing it, what it means and what it will achieve. I’ll also run through some of the pre-Budget announcements we have made to illustrate what the new approach means in action.

As I said when I entered Parliament, I developed a passion for social justice over many years, but in part from living through that and seeing people lose their jobs and seeing families struggle.

For this Coalition Government, a key plank of delivering that change is our Wellbeing Budget. Let me talk a little about our rationale for taking on quite a different approach, and one the OECD is watching quite closely.

…what we are trying to do with the Wellbeing Budget.

It has five priorities, which were developed using the Treasury’s Living Standards Framework, evidence from sector-based experts and the Government’s Science Advisors, and through collaboration among public sector agencies and Ministers.

These priorities, which yes include our economy, but go beyond that too, are the areas where the evidence shows we have the greatest opportunities to make a difference to New Zealanders’ wellbeing.

These are:

  • Creating opportunities for productive businesses, regions, iwi and others to transition to a sustainable and low-emissions economy;
  • Supporting a thriving nation in the digital age through innovation, social and economic opportunities;
  • Reducing child poverty and improving child wellbeing, including addressing family violence;
  • Supporting mental wellbeing for all New Zealanders, with a special focus on under 24-year-olds; and
  • Lifting Māori and Pacific incomes, skills and opportunities.

The second step was to then look at Budget bids under each of these priorities, through a different lens.

We asked three big questions:

  • is the Budget bid intergenerational? Will it make a difference now and for the lives of our children, grandchildren and beyond?
  • does it move us beyond the narrow measures of success to take a wider set of factors into consideration?
  • and, finally, is it a whole of Government approach? After all, for too long policies and initiatives have operated in isolation, sometimes with overlapping work and other times resulting in gaps in policies.

First, homelessness.

Instead of looking solely at public housing places, we have acknowledged that chronic homelessness is often a result of multiple complex and often compounding issues.

Rather than take part in a merry dance on what issue comes first, we should instead, house first.

And that’s exactly what a well-researched and evidenced-based model called Housing First does. It houses those who are in cars or on our streets and then wraps social support around them – whatever is required – to make it stick.

Budget 2019 does that by making the largest Government investment in chronic homelessness ever, and rolling out Housing First into more centres, and funding more places.

Family and sexual violence

Every year about one million New Zealanders are affected by family and sexual violence, including almost 300,000 children.

Violence is expensive, in more than one way. It, for instance, can do as much harm to a child who witnesses it, as it does to a child who is directly harmed. And that then plays out in their behaviour, and their relationships. And so it continues.

We all know we need to put in place a crisis response, but we just haven’t invested much before in breaking cycles, working with children for instance, or addressing the mental health impact of family and sexual violence. A wellbeing approach demands that we do.

And so on Sunday we announced a $320 million investment in this area. And because of our new coordinated approach, it’s an investment that will sit across eight portfolios and deliver more support services to more New Zealanders, major campaigns aimed at stopping violence occurring and major changes to court processes to reduce the trauma victims’ experience.

Budget Responsibility Rules

Finance Minister Grant Robertson…confirmed we will meet all of the Budget Responsibility Rules as we did last year as well. For anyone who needs or wants a reminder, these were a set of self-imposed rules to demonstrate our commitment to sound economic management covering our debt-to-GDP ratio, core Crown spending and Budget surpluses.

The reaction to his news that following the expiry of the Budget Responsibility Rules in 2022 we would be moving from a net debt target (of 20%) to a net debt range (of 15-25%) received positive and negative attention – usually a sign we have the balance right.

Global Economy

Fortunately we are well positioned to face instability and uncertainty. Although growth rates are set to be lower than we have seen in recent years, the IMF projections for New Zealand are that we will still grow at around 2.5% in 2019 and 2.9% in 2020. We are still tracking ahead of most of our major trading partners. The average growth for advanced economies in the same period is projected to be 1.8% and 1.7% respectively.

We are projected to grow faster than the US, the UK, Japan, Canada, the Eurozone and Australia. Just this week the OECD released its latest outlook which also shows us growing faster than our peers, while last week the Reserve Bank of Australia further lowered its 2019 growth forecast for the Australian economy.

We continue to have historically low unemployment and stable, low inflation. This is supported by Budget surpluses and low public debt due to our Government’s responsible fiscal management.

This all supports this Government’s economic plan which includes:

  • Focussing on increasing trade and broadening our trading base to protect our exporters and economy through the introduction of the CPTPP, pursuing an EU FTA and we recently, of course, signed our Enhanced Partnership with Singapore.
  • We are reforming skills and trade training to address long-term labour shortages and productivity gaps in the New Zealand economy, to make sure we are prepared for ongoing automation and the future of work – I’d like to acknowledge the work Kirk and Richard Wagstaff are doing alongside the Finance Minister on the Future of Work Tripartite Forum. So far a focus on the future of work has meant greater investment in apprenticeships and partnership with business like the skills pledge launch by my Business Advisory Council under the leadership of Christopher Luxon.
  • We are addressing our long-term infrastructure challenges – and that doesn’t just mean billions in investment, but establishing long-term planning through the Infrastructure Commission.
  • We are transitioning to a sustainable carbon-neutral economy. Our focus is not only having a long-term plan through the Zero Carbon Act, but also investing in R&D as the economic transition occurs.
  • And, of course, investing in wellbeing because this is inextricably linked to our economic success too. You will see more on that in the Budget on May 30.

These economic initiatives are, in turn, part of the Government’s approach of finding pragmatic solutions to New Zealand’s long-term challenges.

CONCLUSION

Ultimately though, it’s fair to say we are taking nothing for granted. Our relatively solid position does not mean we should simply ride out the conditions around us. Nor do the existing parameters successive governments inherit mean we should use traditional frameworks to make decisions or measure success.

Systemic change does however take time.

My hope is though that this year, by meeting both the Budget Responsibility Rules and with the new Wellbeing Budget, you’ll see us doing exactly what is needed – setting a strong foundation for both our country and our people.

Full speech at Scoop.

Grant Robertson: shift from net debt 20% target to 15-25% range

One of the biggest talking points coming out of Minister of Finance Grant Robertson’s pre-budget speech to Craigs Investors Conference yesterday was a shift from a net debt target of 20%, to a much more flexible range of 15-25% dependent on economic conditions.

The 20% target was a feature of the Labour-Green fiscal responsibility agreement prior to the 2017 election.

Robertson 24 March 2017: Labour and Greens commit to rules for responsible financial management

The Labour Party and the Green Party have agreed to Budget Responsibility Rules, which will provide the foundation for sound fiscal management after the election.

“New Zealanders rightly demand of their government that they carefully and effectively manage public finances. We understand that and are committed to delivering this,” says Labour Finance Spokesperson Grant Robertson.

“These rules demonstrate how Labour and the Greens in Government will manage the economy prudently, effectively and sustainably.”

Under the Budget Responsibility Rules the Government will:
• Deliver a sustainable operating surplus across an economic cycle
• Reduce the level of Net Core Crown Debt to 20 per cent of GDP within five years of taking office
• Prioritise investments to address the long-term financial and sustainability challenges facing New Zealand
• Maintain its expenditure to within the recent historical range of spending to GDP ratio
• Ensure a progressive taxation system that is fair, balanced, and promotes the long-term sustainability and productivity of the economy.

The Government will establish an independent body to make sure the rules are being adhered to.

Since the Labour-Green-NZ First Government took over in late 2017 the target (and fiscal prudence) has been strongly criticised by people on the left who have been demanding much more spending for ‘urgent needs’.

Relevant section of yesterdays speech under Budget 2019 Economic Priorities – Fiscal sustainability:


We are reducing the level of net core Crown debt to 20 percent of GDP within five years of taking office. New Zealand has low levels of Government debt by international standards, but we remain vulnerable to shocks that are beyond our control, such as earthquakes and other natural disasters. We have made our commitment to keeping debt under control to ensure that future generations of New Zealanders are in a position to be able to respond effectively to any such shock.

This Government will prioritise investments to address the long-term financial and sustainability challenges facing New Zealand. This is apparent in the intergenerational wellbeing priorities we have identified in this year’s budget and restarting contributions to the NZ superfund and our focus on issues such as climate change.

We will maintain Government expenditure within the recent historical range of spending to GDP, which has averaged around 30 percent over the past 20 years. We are also focussed on the quality of spending, with Ministers running prioritisation exercises across their portfolios to identify spending that doesn’t fit with the Coalition Government’s priorities.

I am pleased to announce today that on the 30th of May the Budget will show that we are meeting these rules again, as we did in last year’s budget.

I know there has been some criticism of this approach – particularly around the debt target. For me it is a question of balance. We have made, and will continue to make, significant investments in our future, but we also know that the volatility of the world, be it economically or through natural disasters, biosecurity incursions or unexpected events, is never far away.

The Public Finance Act obliges Governments to outline their long-term fiscal strategies at Budget time. One of the key elements of this is the Government’s approach to debt.

People in this room will all have different views on what it could or should be. That in part depends on the levels of investment you believe the Government should be making and in what areas.

We also have to take into account capacity constraints at any point in time – like in our construction sector. With this in mind, I am comfortable with the 20% point that we have been targeting. But circumstances can obviously change.

Beyond the Budget Responsibility Rules, our fiscal intentions in this budget will signal a shift to a net debt percentage range, rather than a single figure. At this point we are looking at a range of 15-25% of GDP, based on advice from the Treasury. This range is consistent with the Public Finance Act’s requirement for fiscal prudence, but takes into account the need for the Government to be flexible so that it can respond to economic conditions.

Essentially, our current 20% target falls in the middle of the new range that will exist from 2021/22 onwards.

A range gives governments more capacity to take well-considered actions appropriate to the nation’s circumstances – circumstances that change over time. It establishes boundaries within which debt is kept to sensible and sustainable levels and where fiscal choices are driven by impact and value.

For example, a government may choose to move higher up the debt range to combat the impact of an economic recession, or where there are high value investments that will drive future economic dividends. At other times it may be prudent to reduce debt levels to the lower end of the range to provide headroom for future policy responses.

Grant Robertson: Budget 2019 Economic Priorities

Minister of Finance Grant Robertson outlined economic priorities for the 2019 budget, due next week, in a speech to the Craigs Investors Conference yesterday.

He is pushing the ‘wellbeing’ focus, mentioning it 15 times in his speech overall.


Budget 2019 Economic Priorities

In next week’s budget you will see investments to support our economic strategy.

This year’s Budget is different. There are three fundamental elements to the Wellbeing Budget.

First, a whole-of-government approach. This is about stepping out of the silos of agencies and working together to assess, develop and implement initiatives to improve wellbeing.

Secondly, a wellbeing approach means looking at intergenerational outcomes. We have to focus on the long-term thinking about the impacts of policy on future generations as well as thinking about meeting the needs of the present.

Thirdly, we need to move beyond narrow measures of success. This can be seen through the development of the Living Standards Framework Dashboard and from the Indicators Aotearoa New Zealand work led by Statistics New Zealand.

We have developed our Budget priorities on the basis of a wellbeing analysis. We looked at the evidence and got expert advice to assess where we have the greatest opportunities to make a difference to New Zealanders’ wellbeing. We have focused our efforts on those opportunities.

This approach has led to some significant and different programmes, like the $320 million investment announced last weekend to address domestic and sexual violence. This is the wellbeing approach in action. The evidence shows the long-term impact that domestic violence has, especially on children. We are taking a joined-up government response to start addressing this long term challenge. We have brought together eight government agencies, working with the community to take on this scourge that has such massive social and economic consequences.

From an economic perspective, our wellbeing analysis showed that we have some way to go in achieving our vision of a productive, sustainable and inclusive economy.

Productivity growth is a key driver of incomes both at a household and country level. Despite working longer hours on average than workers in many developed countries, New Zealanders’ incomes have for some time remains in the bottom half of the OECD.

In addition, the Government has set ambitious greenhouse gas reduction targets to meet the 2015 Paris Agreement goal of keeping temperature rise to no more than 1.5 degrees.

As a result, two of the priorities in this year’s budget are:

• Creating opportunities for productive businesses, regions, iwi and others to transition to a sustainable and low-emissions economy; and

• Supporting a thriving nation in the digital age through innovation, social and economic opportunities.

Come Budget day you will see targeted investments in these areas to support more productive, sustainable and inclusive economic growth.

Fiscal sustainability

Of course, fiscal sustainability is an inherent part of maintaining and improving intergenerational wellbeing and a sustainable economy.

That’s why this Government made a commitment to our Budget Responsibility Rules when we came into office.

These include:

Delivering a sustainable operating surplus across the economic cycle. The key word here is sustainable.

That means our surpluses will exist after we have funded our policy objectives, so that issues are not kicked further down the road for the next government or generation to deal with, as I discovered after coming into my role as Finance Minister.

We are, reducing the level of net core Crown debt to 20 percent of GDP within five years of taking office. New Zealand has low levels of Government debt by international standards, but we remain vulnerable to shocks that are beyond our control, such as earthquakes and other natural disasters. We have made our commitment to keeping debt under control to ensure that future generations of New Zealanders are in a position to be able to respond effectively to any such shock.

Thirdly, this Government will prioritise investments to address the long-term financial and sustainability challenges facing New Zealand. This is apparent in the intergenerational wellbeing priorities we have identified in this year’s budget and restarting contributions to the NZ superfund and our focus on issues such as climate change.

Fourthly, we will maintain Government expenditure within the recent historical range of spending to GDP, which has averaged around 30 percent over the past 20 years. We are also focussed on the quality of spending, with Ministers running prioritisation exercises across their portfolios to identify spending that doesn’t fit with the Coalition Government’s priorities.

I am pleased to announce today that on the 30th of May the Budget will show that we are meeting these rules again, as we did in last year’s budget.

Our Budget Priorities are focussed on the outcomes New Zealanders want to achieve and all Ministers and agencies will be collectively accountable for delivering them. And in their delivery, this Government will follow a disciplined fiscal strategy. The strategy gives the balance to be both a responsible manager of public finances and responsive to New Zealand’s intergenerational wellbeing needs.

We’ve prioritised spending that improves the wellbeing of all New Zealanders. This means tackling the big long-term issues, by investing in an economy that is more productive, sustainable and inclusive.

Come Budget day you will be able to see that this is not simply the same old Budget repackaged with softer edges and brighter colours. You will see a Budget that is new, with a more structured approach and a new, explicit emphasis on what we want to achieve for the long term for our country.

 

Anzac Day 2019

While it’s worth remembering the sacrifices of wares last century, one of them now over a hundred years ago, and remembering the relations that many of us had who were involved in both World Wars as well as other wars, perhaps it’s time we moved the focus more to the present and the future.

We are very unlikely to see repeats of the large number of boys and men sent into battle, often wantonly and needlessly.

But the same mentality of mostly if not exclusively men abusing power by ordering death and destruction seems to be  all to prevalent. We may be just one bad decision away from a world catastrophe.

So while learning from the past we need to apply those lessons to changed times and a changed world.

We should reach out to our neighbours and all our fellow Kiwis, learn to show more love, more understanding, and more tolerance of differences.

We shouldn’t just sit waiting, dreading what some stupid bastards may inflict on the world.  We should be thinking of how we can reduce the risks.

Sure we should remember the red poppies representing blood spilled in historic wars.

But we should look more to the white poppies of peace.