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Finance Minister Bill English and Economic Development Minister Steven Joyce have today launched the first Business Growth Agenda progress report on Government actions to boost New Zealand exports.

The Building Export Markets report confirms the Government’s target to increase the contribution of exports to the economy from 30 per cent to 40 per cent of GDP by 2025.

Good morning, it is a pleasure to open this conference.

The Chinese and New Zealand Governments enjoy a warm and constructive relationship, and the New Zealand political leadership has had the opportunity of frequent and open access to China’s most senior leaders. We are delighted to host China’s leaders on their frequent visits to New Zealand.

This year marks 40 years since the establishment of diplomatic and trade relations between China and New Zealand.

Standard & Poor’s has today affirmed New Zealand’s long-term foreign currency rating at AA with a stable outlook, noting this country’s fiscal flexibility, resilient economy and strong political and economic institutions.

“This is welcome news and confirms New Zealand is heading in the right direction – and it is better placed than many other countries,” Finance Minister Bill English says.

A new system assessing the health of New Zealand’s regulatory regimes will help improve economic performance over the longer term, Finance Minister Bill English and Regulatory Reform Minister John Banks say.

The results of preliminary assessments are included in a report, Best Practice Regulation Model: Principles and Assessments, released on the Treasury website today.

I want to give a reasonably broad high level view of the way the Government is thinking about public services.

I think the first point is that all organisations, public or otherwise, are dealing with a number of what are now permanent changes.

Finance Minister Bill English has appointed Rod Carr to the board of the Reserve Bank of New Zealand.

“Dr Carr has extensive experience, both in the banking industry and as a director,” Mr English says. “I’m confident he will make a strong contribution to the board of the Reserve Bank.”

Dr Carr is the Vice-Chancellor of the University of Canterbury and holds a number of governance positions including the chairmanship of the National Infrastructure Advisory Board.

The Government will continue to responsibly manage its finances and build a platform for stronger growth in uncertain times, Finance Minister Bill English says.

The Government’s financial statements for the 11 months to 31 May show core Crown tax revenue was $667 million higher than forecast in Budget 2012 and core Crown spending was $431 million lower than forecast.

This led to an operating deficit before gains and losses of $5.91 billion - $1.13 billion better than forecast.

Finance Minister Bill English provides some history and an overview of the Government's targets for improving the delivery of public services. For more information see: beehive.govt.nz/feature/better-public-services and ssc.govt.nz/better-public-services

The Government has today announced that KiwiRail’s balance sheet will be restructured in another step towards putting the company on a more commercial footing under its challenging Turnaround Plan.

“Under the plan, the Government is committed to ensuring KiwiRail can fund its business on a commercial basis,” Finance Minister Bill English and State Owned Enterprises Minister Tony Ryall say.

There are two main parts of the restructure:

Finance Minister Bill English today announced his intention to appoint Graeme Wheeler governor and chief executive of the Reserve Bank of New Zealand, after Alan Bollard’s second five-year term expires on 25 September 2012.

Mr Wheeler will be governor-designate until a new policy targets agreement is finalised in the next few months. This is required before a new governor is appointed.

The economy grew more strongly than expected in the March quarter, despite ongoing economic and financial market uncertainty in other parts of the world, Finance Minister Bill English says.

The 1.1 per cent quarterly increase in Gross Domestic Product took annual growth to 2.4 per cent compared to March 2011, which is better than growth in most other developed countries.

New Zealand has joined other countries in extending its financial commitment to the International Monetary Fund so it has the capacity to deal with any significant disruption to the global economy, Finance Minister Bill English says.

The extra commitment, agreed by Cabinet yesterday, will be made through a US$1 billion (NZ$1.26 billion) standby loan facility, which will be called on if needed. New Zealand will not provide any funds immediately.

Mr Speaker, I move that the Mixed Ownership Model Bill be now read a second time.

This Bill and debate, is about controlling our nation’s debt, strengthening New Zealand’s capital markets, and providing funding for new high-priority infrastructure projects.

No nation can afford to let debt get out of control.

Huge debt is at the core of why the United Kingdom, Ireland, Spain, Italy, and Greece are being forced to impose tough measures – we don’t want that for New Zealand.

Finance Minister Bill English travels to Sydney tomorrow for a two-day visit that includes meetings with Australian Treasurer Wayne Swan, along with business and economic leaders.

During his meeting with Mr Swan tomorrow, Mr English will discuss progress with the Trans-Tasman Single Economic Market, and share thoughts on the latest global economic developments and their impact on the New Zealand and Australian economies.

The International Monetary Fund’s 2012 staff report on New Zealand confirms its support for the Government’s economic plan and particularly its focus on getting back to surplus and increasing national saving, Finance Minister Bill English says.

“The IMF endorses our approach to getting back to surplus and the rationale behind it,” he says.

“It notes that our deficit reduction path strikes a balance between the need to contain both public and private debt increases, while limiting any adverse impact on economic growth during the recovery.

Ongoing spending discipline and a better than forecast tax revenue have led to an improvement in the Government’s financial statements for the 10 months to 30 April, Finance Minister Bill English says.

Higher corporate tax and GST revenue left core Crown tax revenue for the 10 months $772 million higher than forecast in last month’s Budget. Core Crown expenses were $323 million below forecast.

The operating deficit before gains and losses at $5.94 billion was $1.42 billion better than forecast.

The Government’s new smartphone and tablet app for Budget 2012 was downloaded more than 8,600 times and was New Zealand’s most popular free-download app on Budget day, Finance Minister Bill English says.

The Budget App, called NZ Budget, allows users to read the Budget speech and key Budget documents, watch video coverage and read ministers’ public statements.

COMPETITIVE ECONOMY, SURPLUS AT HEART OF BUDGET

Budget 2012 invests in building an innovative and productive economy that sells more to the world, supports more jobs, and delivers better public services while getting back to fiscal surplus, Finance Minister Bill English says.

“It takes the next steps in the Government’s plan to build sustainable long-term growth based on more exports, higher savings, and more effective investment,” he says.

Builds a platform for growth, while returning to surplus in 2014/15

Budget 2012 sets out a programme of balanced measures to ensure the Government remains on track to return to surplus in 2014/15, Finance Minister Bill English says.

“New Zealand will then be one of the few developed countries not running deficits and increasing debt.

“Getting back to surplus is one of the most important contributions the Government can make to increasing genuine national savings and building a more competitive economy.

Budget 2012 has freed up $4.4 billion to invest in improving frontline public services and getting better results, while running a zero Budget, Finance Minister Bill English says.

“At a time when the Government’s finances are constrained, these savings provide significant funding to put into new initiatives aimed at improving frontline public services and getting better results for New Zealanders,” Mr English says.

“At the same time, they allow the Government to run a zero Budget, ensuring a return to surplus in 2014/15, based on Budget forecasts.

Budget 2012 includes further steps towards an innovative, efficient public sector delivering better results for New Zealanders within tight financial constraints, Finance Minister Bill English says.

“This Government is focused on getting better results, rather than just increasing inputs. It’s time to measure success by better outcomes, rather than by how much extra money we are spending, as was the case for much of the 2000s,” Mr English says.

Schools, health, science and innovation, and transport all benefit in Budget 2012 from the Future Investment Fund set up to invest proceeds from the sale of minority shareholdings in four SOEs and Air New Zealand, Finance Minister Bill English says.

"The Government is committed to investing in modern infrastructure that helps build a faster-growing economy with more exports and more real jobs, without borrowing more from overseas lenders,” Mr English says.