Show Notes
With the election campaign in full swing, it’s a pleasure to host Finance Minister and Deputy Leader of the National Party, Nicola Willis, for Episode 72 of Leaders Getting Coffee. When former Finance Minister Steven Joyce resigned from Parliament in the aftermath of the 2017 election, his departure created an opportunity for a relative unknown to enter Parliament from the not-so-lofty position of 48 on the National Party list. Her name was Nicola Willis. She had just lost the Wellington Central electorate contest to another future Finance Minister, Grant Robertson. At the time, she was largely unknown to most New Zealanders. But she’d already completed a political apprenticeship that most new MPs could only dream of, working first as a policy adviser to Bill English and subsequently as a senior adviser to Prime Minister John Key. For the next five years, she had to bide her time in Opposition. It was a period that gave her the opportunity to learn the parliamentary ropes, take on a wide range of portfolios and establish herself as one of National’s emerging leaders. Then came 2023. National was able to form a government alongside ACT and NZ First, and Nicola Willis was appointed Minister of Finance. On this episode of Leaders Getting Coffee, Nicola talks to Bruce Cotterill about being at the centre of the coalition negotiations that led to the formation of the current government. She also discusses the state of the government’s finances they inherited, and the rapid-fire decisions required during those early days in office. There’s plenty of discussion about the performance of the government she’s been part of: the difficult decisions, what they got right, and what they might have done differently. And then there’s the current election campaign. Nicola and Bruce agree to disagree on National’s policy for the supermarket sector. And she is refreshingly open when asked about the possibility of National winning electorate seats at the expense of her own position on the party list. This is a wide-ranging conversation with the Minister who has held the government’s purse strings for the past three years. It provides an informed look behind the scenes of government, coalition politics and economic management — as well as some insight into the person behind the portfolio. Nicola Willis is bright, articulate and ambitious for the country. She also speaks candidly about the very real personal sacrifices that come with pursuing those ambitions in public life. It’s well worth a listen. Leaders Getting Coffee – Episode 72 with Bruce Cotterill and Hon Nicola Willis, Minister of Finance See omnystudio.com/listener for privacy information.
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Inflation is still much higher than it should be, largely because of high global oil prices. Stats NZ data shows the rate's now on 3.7%, down from 4.1% three months ago. Domestic non-tradeable inflation —for things like housing, electricity, and healthcare— has been trending down. Internationally-driven tradeable inflation —for things we import and export— has dipped, after trending up. But NZ Herald Business Editor at Large Liam Dann told Kerre Woodham economists are forecasting anywhere up to 4.7% inflation for the December quarter, which is pretty ugly. He says even if the Reserve Bank were to look through the impact of oil prices, the Consumer Price Index would still rise around 3.2%, which they can't ignore. Dann says it's one of the reasons economists expect them to hike interest rates. LISTEN ABOVE See omnystudio.com/listener for privacy information.
We may be at a turning point when it comes to property investment. Cotality data shows residential property is worth $1.66 trillion and still accounts for more than 50% of all household assets. But it also shows property sales and values are largely subdued. Chief Property Economist Kelvin Davidson told Kerre Woodham over the last couple of decades, strong capital gains and low interest rates were a big driver for the housing market. He says mortgage costs went down and selling provided capital gains as well, but this potentially won't last into the future. Davidson says property investment will probably need to be done a little bit differently, focusing on active management and cash flow rather than relying on capital gains. LISTEN ABOVE See omnystudio.com/listener for privacy information.
Inflation's eased up slightly - but it's also become more persistent and widespread. The official inflation rate has fallen in the past three months - from 4.1 percent to 3.7 percent - due to a brief fall in fuel prices. But underlying core inflation has been rising and more items are increasing in price. Labour's Finance Spokesperson Barbara Edmonds told Francesca Rudkin the government doesn't have a plan to tackle the rising prices. LISTEN ABOVE See omnystudio.com/listener for privacy information.
National and Labour are offering quite different solutions to persistently high inflation. Headline inflation's eased back to 3.7%, but some economists say it could reach as high as 4.7% by the end of the year. Labour's Barbara Edmonds says freezing the fuel tax would address the single biggest factor – surging fuel prices. But National's Nicola Willis told Mike Hosking National would address the other two major factors – rates and electricity. She says they will push ahead with rates caps and continue consenting new energy projects. LISTEN ABOVE See omnystudio.com/listener for privacy information.
Auckland Business Chamber CEO Simon Bridges says politically, the Mood of the Boardroom shows a "tactical draw" between National and Labour. The survey of business leaders shows dissatisfaction and a desire for more investment in infrastructure, reform, leadership and talk of productivity, Bridges told Ryan Bridge. "Because you'd expect, and they are in their numbers, the Nats as a centre right incumbent government to be higher up, I would sort of call it a tactical draw between the Nats and Labour when you look at this closely." Unease about "the tail wagging the dog" with minor parties gaining more power in the future government is also present. "This is a very small sliver of business. It's the top end of town, let alone it being the electorate... "They've got a very clear view about what they like. They tend to like stability, certainty, an incumbent government over change that might be messy and uncertain." The former National Party leader said no result in the upcoming election would surprise him. LISTEN ABOVE See omnystudio.com/listener for privacy information.