Cullen can't deal with facts

  • Bill English
Treasurer

Dr Cullen's silly outburst over today's Reserve Bank statement shows yet again that Labour hates New Zealand doing well, and that he cannot deal with the facts, Treasurer Bill English said today.

"His response to the Bank's Monetary Policy Statement is wrong on all three points he makes.

"First, interest rates are low. Ninety day bill rates are around 5.35%. Floating mortgages are around 6.75%. Mortgage rates are the lowest they have been since 1971. Low interest rates support economic growth.

"Second, we are not losing jobs. National's record is of creating jobs. Since the end of 1991 to September this year 289,000 new jobs have been created. Those are net new jobs - the total increase in jobs after the ones that have been lost are replaced. The Reserve Bank's forecasts show another 13,000 new jobs by March, 40,000 the following year, and 44,000 in the year after that. Dr Cullen might like to compare our record to what Labour's performance on jobs was - 80,000 lost in Labour's last term.

"Third, exports are driving this recovery. Exports, not consumption growth as Dr Cullen claims, have been the feature of growth this decade. Exports drove growth in 1993, 1994 and 1995, they were ahead of consumption growth in 1998, and exports are forecast to drive the strong growth of the next three years.

"For an historian, Dr Cullen has a slim grasp of what's happened in the last decade.

"As someone who wants to be Treasurer, he has a slim grasp of economic facts.

"Labour and the Alliance should stop badmouthing New Zealand and deal with the reality that we've got the economy growing strongly and a great future," said Mr English.

Ends

For further information contact:
Liz Rowe, Press Secretary, 04-471 9154 (wk) or 04-383 5491 (hm)
Internet address - www.executive.govt.nz/minister/english

10 Things Dr Cullen doesn't want to know about the economy

1. Our economy has grown significantly over this decade. Our GDP was $71.1 billion in 1990 and is at $99.7 billion now. That is despite droughts and the Asian Crisis hitting us over the last two years. The Reserve Bank is forecasting real growth of 4.1% next year, and 3.8% the following year.

2. Over the next two years, New Zealand's growth rate will match Australia's and will be well ahead of the US, Canada and the large majority of European countries.

3. There are now 289,000 more jobs than at the end of 1991. That's the net increase on top of replacing the jobs that are lost as the economy changes. From March next year to March 2003 Treasury are forecasting another 115,000 jobs.

4. With agriculture strengthening, exports in the next three years are forecast to grow by an average 6% a year. Tourism numbers are at a record high with September arrivals up 7.5% on 1998, and exports of manufactured goods have grown by an average of 3.5% per quarter for the past four quarters.

5. After 17 years of consecutive Budget deficits, National has delivered six surpluses in a row. Four more are forecast.

6. Net Government debt has been more than halved from 51.5% of GDP in 1992, to 22% now. It is forecast to fall to 17.8%.

7. Over the last year mortgage interest rates have been at their lowest level since 1970.

8. $2.3 billion more is being spent on health than in 1990. 50% more people a year are getting elective surgery than 10 years ago - 123,801 compared with 82,283.

9. There are $1.8 billion more education dollars than in 1990, and 73,000 more students in tertiary education than 10 years ago.

10. Tax cuts and increased family assistance have increased weekly take home pay by $98 for a parent on the average wage of $35,000 a year with three young children.

10 things Dr Cullen hasn't been able to teach his caucus (or Jim Anderton) yet

1. Money doesn't grow on trees. Government spending comes out of workers' pockets.

2. Tax increases don't create growth.

3. Tax increases won't create jobs. How could they?

4. Higher taxes won't stop the brain drain. They will chase more people who want to succeed overseas.

5. If government spends too much money, debt increases.

6. If government spends too much money, interest rates rise.

7. Lots of "little" spending promises add up.

8. Businesses create jobs. Not unions.

9. Businesses pay wages. Not unions.

10 a) The government doesn't control the weather and it doesn't control world markets
b) We're moving into the 21st century, not the 1970s.