The economy is showing positive signs of rebalancing with reducing household debt and growth in the tradeables sector, Finance Minister Bill English says.New Zealanders were being careful with their spending -- per capita private sector consumption increa
The economy is showing positive signs of rebalancing with reducing household debt and growth in the tradeables sector, Finance Minister Bill English says.
New Zealanders were being careful with their spending -- per capita private sector consumption increased by only one percent in the past year compared to increase of four percent from 2002-2007 -- and the tradeables sector grew 3.4 percent in the nine months to March, Mr English said.
They were the early signs that the economy was rebalancing, he said.
However, risks remained and there was still more work to be done, particularly in reducing government, business and household debt.
Mr English said the exports and imports sectors went into recession in 2004 and there had been no net new jobs in agriculture of manufacturing since 2002.
In the same period non-tradeables, such as government spending and domestic industries, grew, he said.
The Government's programme to boost economic growth included investment in infrastructure and reducing red tape and regulation, Mr English said.
"This reinforces the Government's commitment to continue with its broad-based programme to ensure growth and jobs come from the rights parts of the economy," he said of the results.
In Parliament today, Labour's finance spokesman David Cunliffe criticised the Government's handling of economic growth.
"Given the cancellation of plans to mine sensitive conservation areas, the tyres of the national cycleway going flat, and the end of the nine-day working fortnight is the dangerous proposal to reduce labour rights now the centrepiece of the Government's strategy for jobs and growth."
He said the Government had scrapped the research and development tax credits, the skills strategy, education and the fast forward fund since the election.
Those initiatives drove skills and technology which were primary drivers of productivity and productivity was one of the key issues that is holding back New Zealand, he said.
