From fending off the GFC and Canterbury earthquake recovery to social investment and addressing child poverty, the last government has a lot to be proud of, writes National MP Chris Bishop.
As the dust settles on the election and the new super-sized Labour/NZ First/Greens ministry gets to work, it’s worth looking back on nine years of National-led government, and what has been achieved for New Zealand.
Let me say at the outset that no government is perfect. All are affected by global economic circumstances and – as encapsulated in Macmillan’s famous dictum – “events, dear boy, events”. Governments never deliver all the fervent desires of their most ardent supporters, and most aren’t anywhere near as hopeless as partisans from the other side would have you believe.
I believe New Zealanders can look back with pride on nine years of National government. The country is demonstrably a better place than it was in 2008. Since Muldoon (who infamously, and depressingly, promised to leave the country no worse than he found it) that has surely been the litmus test for good government in this country. New Zealand is prouder, wealthier, more confident and aspirational than it was nine years ago.
Here then are 10 of National’s achievements.
1. Getting the country through the global financial crisis – and back into the black
Any account of the last National government has to start with the GFC. Sir John Key, Bill English and team took office in the teeth of the worst financial crisis since the Great Depression, and it’s worth recalling that New Zealand actually entered recession a year before the rest of the world. Treasury predicted never-ending deficits, unemployment to rise to over 10%, and debt to peak at 40% of GDP.
The government didn’t panic – and nor did it slash and burn. Social support was maintained, but poor quality programmes were rationalised, and new Budget operating allowances were pared back. In the years preceding 2008, Labour had increased spending unsustainably (50% in its last five years) for little to no effect. With Bill English in charge of the purse strings, departments were told to focus on results, not just to lobby for ever-escalating spending.
The government books got back into the black in 2014/15. Unemployment is now down to 4.6% and labour force participation is at record levels. Our debt to GDP topped at just 25%, and is coming down (Australia’s is 40, the UK’s is 90 and the USA’s is 108%!).
I’m proud that we did this while maintaining investment in core public services. For example, since 2009 health spending has increased by $3 billion per year, or around 25% (population growth has been 14%).
The incoming government inherits books that are the envy of the developed world.
2. Building a more productive, diverse and competitive economy
While dealing with the GFC, National started the process of consistent, moderate and sustained economic reform to build a more productive and competitive economy.
Through careful, measured tax reform, state asset sales and welfare reform, the results are plain to see. The economy is growing at 3% per year, one of the fastest growth rates in the world, and has generated 274,000 jobs in the last two years. The job numbers are remarkable: New Zealand has the third highest employment rate in the developed world (at a time of record migration – it seems that immigrants don’t “steal” New Zealand jobs, as some like to claim).
Economic strength has flowed through to people’s pay packets: average annual household income is up 42% since 2007, and average wages have increased by more than twice the rate of inflation. In fact after tax wages have increased twice as fast in New Zealand than in Australia since 2008.
The economy is more diverse. When the bottom fell out of dairy in 2014/15, New Zealand kept growing. The technology sector is expanding at a dizzying rate with revenue now over $10 billion. That famous “manufacturing crisis” that Labour used to talk about? The sector’s now been expanding for 57 consecutive months.
3. Dealing with the Canterbury earthquakes
Following the Canterbury earthquakes in 2011, the government was told that the local economy could expect a sustained downturn, a dramatic fall in population, and rising housing costs. National worked quickly to keep jobs in the region and support unemployed workers and businesses facing temporary shutdowns. The SCIRT programme to repair broken roads and pipes was an unequivocal success and the EQC home repair programme has repaired hundreds of thousands of homes – a building project the likes of which New Zealand has never seen. Yes, a small number of the repairs require remedial work, but this is typical in the private sector as well.
Many of the key anchor projects are now complete, including the Bus Interchange and brand new Justice Precinct. A solution has finally been achieved for the Cathedral and progress is being made again on the Convention Centre.The real news is in the results. The Canterbury economy is booming and the population higher than ever. The housing market is stable. The dire predictions following the earthquakes have not come to fruition – on the contrary, Canterbury is thriving and is well on the way to becoming one of the best cities in the world to work and live in.
4. Significant reductions in child poverty
Some will call it chutzpah for including this, but the facts are indisputable: child poverty measures fell on National’s watch, despite absurd hyperbole to the contrary. Using MSD’s Material Wellbeing Index, the number of children in material hardship in 2016 was 135,000. Too many, obviously, but well down on the 170,000 in hardship in 2008; and massively down on the 220,000 following the GFC (in 2011).
For a supposed “neoliberal” government regularly accused of showing no empathy for the disadvantaged, National’s record is impressive: the first real benefit increases in 43 years, massive insulation programmes for state homes (and the private market), breakfasts in schools programmes, free GP visits for all kids under 13, and more. National’s family incomes package (about to be legislated away under urgency by Labour) would have lifted around 50,000 further kids above the poverty line.
5. The Better Public Services programme and Social Investment
In 2012 the government did something quite profound. It set ten targets aimed at delivering results for our customers by reducing welfare dependency and crime, increasing immunisation and achievement at school, and more. This quiet revolution in the public service has led to improvements across the board: crime down 14% (youth crime is down a third), rheumatic fever has reduced 23%, 94% of 8 month olds are now fully immunised, to name a few.
Allied to this was “Social Investment” – targeted, evidence-based investment to secure better long-term results. The government spends $61 billion on social services every year. Far too often we don’t ask much about the efficacy of that spend – particularly for those with complex needs. Bill English often says: “we need to know what works, for whom, and at what cost.” Social Investment is about doing things differently: using sophisticated data to identify need and risk, and to invest up-front in what works. By breaking down silos between agencies, harnessing the power of community instead of big government this approach changes lives for the better, rather than just servicing misery.
6. A more competitive, affordable, secure and renewable electricity system
It’s a bit odd that Labour has promised a full-scale review of the electricity market (although it seems to be what new governments do – we’ve had one every time there’s been a change of government). I’m confident the review will show that New Zealand’s electricity policy settings are outstanding. That’s largely due to the work of Gerry Brownlee, who inherited a totally dysfunctional system. Under Labour consumers were told every second year to save power during winter, prices rose 72% in nine years, and security of supply was at serious risk. Moreover, despite rhetoric to the contrary, gas and coal use massively increased – Labour even underwrote the building of a new gas power plant!
Fast forward nine years and renewable electricity is at near record highs, electricity prices actually fell in 2017 in real terms thanks to more competition, and despite dry years we’ve had no forced conservation campaigns. Most astonishingly, we have decoupled economic growth from increased electricity demand: the economy is growing at around 3% while demand is flat and even falling.
7. Reforms to welfare to reward independence and work
National undertook the most significant reforms to the social welfare system in a generation. Benefit categories were simplified and new expectations introduced for beneficiaries, requiring them to be available for work or getting ready for work. Social obligations for beneficiaries with dependent children were introduced to ensure they were meeting health and education goals. National established the Youth Service, where case managers and providers help young people gain education, training and employment skills. Sixteen and 17 year olds on benefits were placed under money management.
Welfare reform demonstrably worked. The number of sole parents on a benefit is the lowest it has been since 1988. Sixty thousand fewer children are now growing up in a benefit-dependent household since 2011. The current lifetime liability of the benefit system has reduced by $13.7 billion over the last five years. This equates to clients spending 1.3 million fewer years on main benefits over their working lifetimes.
8. A big lift in the number of young Kiwis achieving educational success
When National came to office in 2008, one in two Māori and Pasifika kids left school without NCEA Level 2 – a passport for the future and the recognised minimum standard for other tertiary options.
In 2016, nearly 75% of Māori students, and nearly 80% of Pasifika students, achieved the NCEA Level 2 qualification – remarkable progress by any measure.
Under National, participation in Early Childhood Education hit record highs. The dysfunctional industry training system was overhauled. By 2016, there were 43,000 apprentices around the country, including 100,000 trainees. The Network for Learning was started and completed (on time and under budget) providing ultra-fast, uncapped, high-quality data, at no cost to schools. Pathways from school to study and work were overhauled through the Youth Guarantee and Trades Academies.
9. Treaty of Waitangi Settlements
Despite Māori overwhelmingly voting for them, and Labour liking to preen as the party of and for Māori, the Treaty Settlement process stalled between 1999 and 2006, only getting started once Michael Cullen took over the portfolio.
Using his skills developed in a former life as a negotiator for Ngāi Tahu, and his genuine good-hearted commitment to reconciliation, Chris Finlayson just got on with the job. The results speak for themselves: 59 Deeds of Settlement signed in nine years, meaning the majority of historical Treaty settlements across New Zealand have now been resolved. And consider this: it was Chris Finlayson that delivered the long overdue apology to the Parihaka community for the atrocious actions of the Crown committed almost 140 years ago. Not only that, National gave legal personhood to Te Urewera and the Whanganui River, allowing long-overdue settlements to proceed.
A final point. The Foreshore and Seabed confiscation was one of the most disgraceful acts of the Clark government. National restored the rule of law by restoring the right of Maori to go to court to prove customary rights through the Marine and Coastal Area (Takutai Moana) Act 2011.
10. A turnaround in net migration
One of National’s most effective ads in the 2008 election featured John Key standing in Westpac Stadium, pointing to the 30,000 plus yellow seats, and noting that about the same number of New Zealanders were leaving to move to Australia every year. National said that we’d turn it around – and we did.
Quite remarkably, net migration between New Zealand and Australia for the year to June 2017 was 560 – in our favour. Usually people move from smaller countries to much larger countries. But over the last nine years, New Zealanders literally voted with their feet: staying home and coming home in record numbers. Around 10,000 more Kiwis are coming home than under Labour, and far fewer are leaving.
There’s so much more that could be added: the most significant action on improving freshwater quality in New Zealand’s history, the National Sciences Challenges and a big lift in research and development, huge investments in infrastructure (such as the Waterview tunnel and the Kapiti Expressway), the ambitious goal of Predator Free NZ, and so much more.
National leaves behind a better New Zealand than it inherited from Labour in 2008. And we are hungry to hold the government to account so it doesn’t squander the hard-won gains of the last nine years.
Chris Bishop is MP for Hutt South and National Party spokesperson on Police and Youth
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