Goldsmith Update - June 2016
The four week Parliamentary session, which finished last week, started with Bill English’s eighth budget. Budget 2016 lays a stable and financially sustainable platform, upon which the economy can continue growing. Following the budget’s release, Ministers appear before the relevant Parliamentary Select Committees to have a useful and robust discussion about their part in Government spending.
As Minister of Commerce and Consumer Affairs, I appeared before the Commerce Committee. My portfolio consumes around $150 million annually to operate the Commerce Commission, the Financial Markets Authority, the Companies Office and part of the large Ministry of Business, Innovation and Employment (MBIE), amongst other things.
The main budget initiative in my area was a $15.2 million boost in funding for the Commerce Commission over four years. This represents a 25 per cent increase in their resources for General Markets supervision – the first increase since 2006.
You might ask how that benefits the consumer. Well, we all buy things and what we get for our money depends in part on the competitiveness of our domestic market. If monopolies and other anti-competitive practices are left unchecked, the consumer will be ripped off. A well-resourced Commerce Commission can prevent this by policing our competition laws in a timely fashion.
The Commerce Commission also polices our laws relating to fair trading and lending practices, an area we’ve strengthened in the past couple of years. For instance, we now require businesses to substantiate claims made about a product and introduced a Responsible Lending Code. I’ve written about the social problems caused by irresponsible lending practices, in particular unscrupulous truck shop operators and pay day lenders.
It’s one thing to toughen the law, but it needs to be properly enforced. The Commerce Commission has been active in this area in the past year, and we’ve seen a number of truck shop operators taken through the courts and fined. I was determined to ensure the Commerce Commission had extra resources to continue this battle, so I’m pleased we’ve been able to do so.
A couple of weeks ago I represented the Prime Minister in Tokyo to speak at the annual Nikkei Conference on the ‘Future of Asia’. I spent a couple of useful days meeting Ministers and business leaders and believe we have a real opportunity to re-enliven our important relationship with Japan over the next couple of years. Despite its demographic challenges and low growth in the past couple of decades, Japan remains a colossal economy and is a huge market for our premium products.
The TPP, which includes Japan, is hugely important as it will eliminate or greatly reduce barriers that have made it difficult for many kiwi exporters to do well there.
The other big talking point was rugby. Japan hosts the 2019 Rugby World Cup and will have New Zealand on its mind for the next few years.
It’s amazing how powerful sport is for opening doors and breaking down barriers. While in Japan, I participated in the announcement of former All Black Dan Carter’s involvement in the ‘Support our Kids’ charity, which helps children affected by the 2011 earthquake in Japan. I was blown away by the huge local interest in Carter and our All Blacks.
I regularly host morning teas in our Great South Road offices to get feedback from Epsom locals. Around thirty people turned up to our latest event and the feedback was typically robust. There was warm support for the Budget and the Government’s handling of the nation’s finances. There was also plenty of discussion about rising house prices. Most people in the room own houses and do well from increasing values, but worry about the ability of their kids and grandchildren to buy houses.
Nobody thinks it’s a simple issue to resolve. We’re contending with global trends, incredibly low interest rates, leading to asset price inflation. We’ve also seen Auckland join the club of highly desirable global cities and reversed immigrant flows. On top of that, we all know about the long-standing planning barriers that have pushed up land prices. I talked about all the Government initiatives to increase the supply of houses and reduce speculative demand through tax changes last year. The message I received was that we should consider more of these taxes. I’ve conveyed that to my colleagues and we continue to monitor and debate these issues robustly.
This week Parliament is in recess. I’ll be in and around Epsom for several days, visiting schools and local churches, to keep in touch with local concerns.
Hon Paul Goldsmith
National List MP based in Epsom
P: (09) 524 4930