Minister of Finance and Deputy Prime Minister Bill English gave a big pat on the back to all small business operators in New Zealand last month at the BNI North City meeting.
He said that small business getting on with its business and creating more business activity was right in line with Government thinking and intentions as it strove to increase economic growth, create jobs and hold spending.
Mr English was one of two Cabinet ministers attending the chapter that day. Ms Hekia Parata, Acting Minister of Energy and Resources, Minister of Women’s Affairs, Minister for Ethnic Affairs, Associate Minister for ACC, and a list MP, also attended as she is standing for the Mana seat in the forthcoming General Election.
About 45 people attended the meeting which was run on the standard BNI agenda, with BNI members making their 60 second presentations and passing raps and referrals. Visitors were able to enjoy the speakers and get an insight into BNI, its networking and businesses referrals system, and, through reality checks, the value of the business being passed around the room.
Mr English’s presentation was off the cuff, informal and humorous. He was happy to answer questions and mix and mingle with members and visitors before leaving for another engagement within the electorate.
He was generally upbeat about the economic situation, and the impact of Government policies. The Government was on track to return to surplus in 2014/15, with the recovery continuing to pick up pace, he said.
The Treasury Pre-Election Economic and Fiscal Update (PREFU) forecasted average annual growth of almost 3 per cent between 2012 and 2016, more than 150,000 new jobs over the forecast period and strong growth in wages and household incomes.
“The Government has put in place a comprehensive programme over the past three years to improve the economy’s competitiveness and build faster growth. The economy has now grown in eight of the last nine quarters and growth in the first half of this year has been stronger than Budget 2011 forecasts. This has contributed to the creation of 43,000 new jobs in the past year – 20,000 more than forecast at the time of the Budget,” Mr English said.
“A solid growth outlook, combined with the Government’s responsible economic management, has ensured we remain on track to move from a forecast deficit of $10.8 billion in the current year to a surplus of $1.5 billion in 2014/15.
“Getting back to surplus as soon as possible is one of the most important things the Government can do to lift national savings and rebalance the economy towards our productive sectors,” he said.
However, while New Zealand is relatively well placed, the global waters are getting rougher. Growth is forecast to peak slightly lower than expected in the Budget, but off a higher base. Growth of 3.4 per cent is still expected in the March 2013 year and average almost 3 per cent a year across the forecast period.
“That growth outlook underpins Treasury’s forecasts of more than 150,000 new jobs and average annual wage growth of almost 4 per cent between 2012 and 2016,” Mr English said. “In the Budget, Treasury predicted an extra 170,000 new jobs over the forecast period. The new estimate of 150,000 jobs recognises that actual jobs are already 20,000 ahead of Budget forecasts.”
“While the outlook for many developed countries has weakened, New Zealand is expected to benefit from our growing trade links with Australia and the faster-growing Asian economies, which now take about 60 per cent of our exports.
“The Canterbury rebuild will also support growth, with Treasury revising its damage estimate from the earthquakes from $15 billion to $20 billion, meaning the rebuild will be longer and contribute more to economic activity,” he said..
“Household saving is expected to continue to strengthen after becoming positive in the past year for the first time in over a decade. This will have a dampening effect on growth in the near term, but build a stronger platform for future growth.
“It’s crucial we stick to our programme of responsible financial management and policies that build a more competitive economy if we are to make the most of the opportunities that lie ahead,” Mr English said.
