Sustainable Economic Development

We are focused on playing our part to support generating prosperity and sustainable economic development.

To that end, we are prioritising infrastructure.

You will have heard already about this Government’s plans for transport. This will see increased investment in regional roads, rail, walking, cycling and safety.  This will impact right across New Zealand.

Together with the Auckland Council, we recently unveiled a record investment of $28 billion under a new 10-year funding package. Traffic congestion in Auckland is costing $1.3 billion a year in lost productivity. Our package will free up our biggest city.

Budget 2018 also includes further funding for reinstating the Main North Line following the Kaikōura earthquakes and more funding for KiwiRail.

Mr Speaker

It is time, once and for all, for the people of Canterbury to be properly supported in the regeneration of their community.

I am proud to announce that this Budget provides a $300 million Acceleration Fund for critical projects.  This will see faster progress on the residential red zone and a multi-use arena.  Cantabrians have waited too long and this Government is determined we will play our part in making these vital projects a reality.

We are also launching an independent inquiry into the performance of the Earthquake Commission to ensure lessons are learned from the aftermath of the earthquakes.

As promised, this Budget also provides new funding to establish and operate a tribunal to resolve unsettled residential insurance disputes arising from the Canterbury earthquakes.

Mr Speaker

It is vital for our economy to be better prepared for the future. This will require a new approach with fresh thinking. As Albert Einstein is reported to have said: “No problem can be solved by the same kind of thinking that created it.”

This is why Budget 2018 gives a major boost to innovation, with $1 billion over four years to finance a tax incentive for more Research & Development by Kiwi businesses. We have committed through the Coalition Agreement with New Zealand First to lifting our Research & Development spending as a country by 50 percent – to 2 percent of GDP inside 10 years.

This is about future-proofing our economy.

We are also building on Labour’s Future of Work Commission to ensure we can face the future with confidence, built on a resilient and adaptable economy.  We will establish a tripartite forum with Business New Zealand and the Council of Trade Unions to advance projects that will improve business use of technology, create more productive workplaces, improve skills and training and support a just transition to the rapidly changing world of work.

A range of digital and data initiatives are funded in this Budget, including New Zealand’s first Chief Technology Officer. Crucial investment will also be made to counter major cyber threats.

This Budget provides support to small businesses.  In particular the introduction of
e-invoicing will see small businesses able to be paid on time and ensure better cashflow.

Mr Speaker

We want to support the value the primary sector brings to New Zealand’s economy.

The Ministry for Primary Industries will receive new operating funding of $38 million over four years so it can better keep New Zealand safe from pests and diseases, ensuring the food we produce is safe and our natural resources sustainable.

This Government wants to work alongside farmers and rural communities to provide leadership in sustainability. This Budget gives $15 million more in operating funding over the next four years to the Sustainable Farming Fund to develop cleaner, smarter farming.

This Government is determined to strengthen our biosecurity system after years of neglect. Budget 2018 will give $9.3 million in new operating funding over the next four years to improve systems to better manage the risks.

Mr Speaker

Our provinces need to thrive if New Zealand is to do well.

This Budget formally establishes the $1 billion per year Provincial Growth Fund to support growth in the regions, as outlined in the Coalition Agreement between Labour and New Zealand First.

This Fund represents the single biggest investment in the regions of New Zealand in our lifetimes. It aims to enhance economic development opportunities, create sustainable jobs, contribute to community wellbeing, lift the productivity potential of regions, and help meet New Zealand’s climate change targets.

This year the Provincial Growth Fund will be made up of $684.2 million of operating expenditure and $315.8 million of capital expenditure.  This includes significant investment in the One Billion Trees programme and support for regional rail projects.

The Budget also sets aside funding for the establishment of the New Zealand Forestry Service.   Our investment in forestry will help us to deal with climate change, lift our economy and provide employment.

Mr Speaker

This Government wants to be a world leader on climate change in urgently reducing our emissions of greenhouse gases. We will introduce a legally binding emissions reduction target and emissions budgets to keep New Zealand on track to this goal.  We will establish an Independent Climate Commission to recommend emissions budgets and provide advice.

It is possible and necessary for New Zealand to transition to our goal of a net zero emissions economy by 2050. This will require some major changes, but we can do this if we work together.

This Government also sees the opportunity that this transition provides. Budget 2018 sets aside $100 million of new capital funding for the Green Investment Fund to kickstart investment in assets and technology to reduce carbon emissions.

This Fund, which is the result of the Confidence and Supply Agreement between Labour and the Green Party, will help a just transition to a more sustainable economy that will ultimately create jobs in new, clean industries.

There are other environmental challenges to be faced.

After years of neglect this Government is going to make significant new investments in conservation, delivering on our promise to protect New Zealand’s distinctive native wildlife, plants, and landscapes.

Budget 2018 delivers more than $181 million in new operating funding for conservation initiatives over the next four years.

Predators such as possums, rats, and mice, are firmly in our sights with more than $81 million going towards predator control. Money will also be set aside for biodiversity initiatives and conservation staff numbers will increase, with better management of popular visitor areas.

Mr Speaker

A big part of any economy is the work force. We wish to make sure New Zealand has the workers it needs, in the places it most needs them. And we want to make sure wages and conditions are fair and workers are treated with dignity and respect. It is our view that the growing gap between the highest and lowest paid is counter to New Zealanders’ values.

Work is underway on developing lists of regional skills and labour shortages. We want an immigration system that really works for New Zealand. We want to match migrant skills to the regions and industries where they are needed most. We want to ensure that any genuine skill shortages are filled, with immigration levels that are sustainable.

We also want to stop any exploitation of workers. The Budget significantly increases the number of labour inspectors. It provides $34 million over the next four years to strengthen border security and improve screening to prevent people trafficking.

This Budget also provides funding for more support for refugees and to ease pressures at the Mangere Refugee Resettlement Centre.

Mr Speaker

Budget 2018 includes significant funding to support New Zealand’s role and voice in the world.  We know that the relationships and influence we develop are critical to our economy in terms of trade and broader economic development.

This Government is committed to restoring the capability of our Ministry of Foreign Affairs and Trade to advance our cause in the world.

We are committed to our role as a leader in the Pacific and to supporting our region to meet the challenges of climate change and enjoy sustainable economic development.  We will lift New Zealand’s contribution through a $714 million boost over four years.

Funding will also be provided to enable New Zealand to host two major events: the 36th America’s Cup and APEC in 2021.

New Zealand’s Defence Force will be able to make more meaningful contributions to global security and peacekeeping, and better respond to natural disasters, with a $345 million operating funding boost to the Defence and Veterans portfolios over the next four years, including, in partnership with the Ministry of Social Development, funding to expand the Limited Service Volunteer programme for young people under 25.

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