Bryce Wilkinson: Increased working-age welfare dependency is a problem

New Zealand’s welfare system is a problem for beneficiaries, taxpayers and others. Think of those affected by the reported problems in Rotorua from emergency housing in motels.

At its most concerning, welfare dependency is associated with inadequate housing, mental illness, child poverty, drug dependency, inability to budget, obesity, poor parenting, household violence, school absenteeism, and the intergenerational transmission of misery.

Bryce Wilkinson: New Zealand's fiscal challenges - Lessons from the Wellington City Council's plight

Wellington City Council’s current leaking water woes epitomise the misplaced spending priorities of successive councils.

Wellingtonians now face water rationing in their homes while they see vast quantities of leaked piped water escaping down streets and across pavements.

Bryce Wilkinson: More oversight of public spending needed

Thank goodness New Zealand has an Auditor-General who takes his official responsibilities seriously.

Last week, he released a damning assessment of recent ministerial processes for making funding decisions on two major infrastructure investment programmes.

Bryce Wilkinson: Media release - Government’s mini-budget fronts the serious challenges ahead

Wellington (Wednesday, 20 December 2023) - “Treasury’s updated fiscal and economic forecasts released today confirm that this government faces serious fiscal challenges”, said Dr Bryce Wilkinson, Senior Fellow at the New Zealand Initiative.

“The Minister of Finance’s “mini-budget” statement shows she fully ‘gets it’.”

“Taxpayers and the recipients of government spending cannot all expect to avoid the burden of those challenges”.

Bryce Wilkinson: The background to "Passing a Regulatory Standards Act as soon as is practicable"

The Coalition Agreement between National and ACT includes a commitment to pass the “Regulatory Standards Act as soon as practicable”.

How fast is that? What is it, what does it do, and what might its passing mean?

Bryce Wilkinson: Underperforming in education harms national income

The incoming Government needs to make improving education a major priority. Achieving that will take decisive action, and many years of effort.

Right now, New Zealanders are feeling the squeeze on their living standards. That squeeze is a result of poor productivity growth for the last 30 years, lost export income and major deficit spending by the outgoing Government.

The good news is that reversing New Zealand’s 25-year decline in educational achievement would also lift future living standards. Better-educated populations have higher national income per capita.

Bryce Wilkinson: A historical perspective on the 2017-2023 Government's spending spree

In this research note, we analyse the six-year spending spree of the Sixth Labour government in the context of historical precedents.

Elected on the back of an ambitious policy agenda, the Ardern government quickly found itself struggling to balance the books. Their Fiscal Plan prior to the 2017 general election forecast an $11.7 billion increase in government spending in the five years to June 2022.

Bryce Wilkinson: Borrowing to spend is like waiting for Godot

History does rhyme, and apocalyptic plays can make a sobering point or two.

This government is borrowing heavily to fund current spending. On Treasury’s latest projections, it will have borrowed $66 billion for this purpose between 2019 and June 2026. That is over $33,000 per household.

That represents either a lot of additional taxation or greatly reduced spending in the future.

Bryce Wilkinson: Of deficits and debt

How big is the fiscal deficit problem and how long will it take for our governments to turn it around?

Do not be fooled by rosy scenarios of painless correction. They typically rest on two assumptions: 1) an implausible degree of future spending constraint and 2) continuing positive national income growth to lift tax revenues.

The Deficit Diaries - Six years of red

The New Zealand Initiative’s latest research note, written by Dr Bryce Wilkinson and Dr Oliver Hartwich, analyses Labour’s six-year fiscal record.

Bryce Wilkinson: It's the spending, stupid

That is the sign all Ministers of Finance should have on their desk.

Treasury’s latest pre-election economic and fiscal update this week forecast cumulative fiscal deficits of $17 billion for the four years ended June 2027.

These forecasts are far too optimistic. Cameron Bagrie spelt this out in a BusinessDesk article on Wednesday.

Bryce Wilkinson: The PREFU forecasts are not realistic

Tuesday’s Treasury’s pre-election forecasts confirmed that Government spending exceeds revenue by more than what was forecast in the May 2023 Budget.

Far too many commentators are concluding the increase is not too bad.

Do not be fooled. The forecasts are not realistic. They are too optimistic.

Bryce Wilkinson: Beyond tax tweaks - The real path to New Zealand's prosperity

This week, the National Party revealed its tax plans for the election. These are aimed at people with average incomes.

Overall, the changes are minor. Yes, many people would be able to earn more before moving into a higher tax bracket. And yes, there are some further tax cuts for low- and middle-income earners.

These tax cuts will cost $14.6 billion over five years.

Bryce Wilkinson: Benchmarking New Zealand's economic performance against Ireland's

New Zealanders should not be too proud to learn from others.

In 2017, The New Zealand Initiative led 36 senior business leaders to visit Switzerland for this purpose. Critical points of difference that emerged were its direct and participatory democracy, devolved government, strong vocational training system and flexible labour market. Both its education system and its devolved government were instructive for New Zealand.

Bryce Wilkinson: The case for attracting foreign investment

New Zealand’s current legislative approach to overseas investment is a mess.

It is a mess because it does not focus on what is important – facilitating strong connections to the rest of the world while protecting New Zealand’s sovereignty.

New Zealand’s prosperity depends on its ability to access overseas markets, technologies, knowhow, and capital. We must compete for export markets and capital, and not just with Australia.

Bryce Wilkinson: Why 'Wellington' can be sure it knows what is best for us

Everyone knows that Wellington’s CBD will thrive when those who know best ban cars.

People will love coming into the CBD to buy bulky products, such as a microwave, to cart home on the handlebars of their bicycles. Buses are an option too, in between shortages and strike action, but bicycles are better for us. Wind, rain and steep hills heighten the experience.

Delivery firms will love supplying CBD businesses. Motorised roller skates could flourish.

Bryce Wilkinson: Examining the official case race-based privileges in public health

In 2020, my report, Pharmac: The right prescription? for the New Zealand Initiative found much to compliment in Pharmac’s pursuit of its statutory duty to obtain the best reasonably achievable health outcomes for eligible people from pharmaceuticals within the subsidy budget.

No race-based preferences are implicit in that concept. So, I was surprised last year to see the Pharmac Review Panel recommend that Pharmac bias its subsidy and employment decisions in favour of “priority populations”, notably Māori.

Investigating further, I found that a race-based focus has invaded health policy more generally.

Bryce Wilkinson: Productivity: Wot about Ireland?

Background

Yesterday the Treasury hosted a seminar on New Zealand’s lagging productivity growth rate. It shared the slot with the New Zealand Productivity Commission (NZPC) and Motu, a Wellington-based research institute.

Attendees could (and many did) pick up a new NZPC paper, “Productivity by the numbers”.

It was data heavy, with 54 charts, but light on solutions.

Bryce Wilkinson: Submission - Consultation on New Zealand Grocery Supply Code Of Conduct

This submission in response to Consultation on New Zealand Grocery Supply Code of Conduct is made by The New Zealand Initiative (the Initiative), a Wellington-based think tank supported primarily by major New Zealand businesses.

Bryce Wilkinson: When a Bill's objective is vague, it's provisions are rudderless

Parliament’s Environment Committee released its reports on the Natural and Built Environment and Spatial Planning Bills this week.

The (Labour) majority recommends that modified Bills be enacted.

But the recommended NBE Bill looks as unworkable and misguided as its earlier version. It has 12 parts, 861 sections, and 15 Schedules. The problems start with the NBE Bill’s purpose statement. It does not identify any problem in the community for which the Bill is the remedy.