From the House: Still plenty of pep in the economy

Mahia to Masterton: careful economic management

There are plenty of advantages to living in an island nation a long way from the world's trouble spots.

But in economic terms, we are not an island. Here in Hawke's Bay, the most remote beach settlements of Mahia peninsula know this very well.

Whether you are in Mahia or Masterton, your community is affected by the coronavirus outbreak in China.

The coronavirus is taking a big toll on ordinary Chinese people. Millions cannot go about their usual routines because of the need to minimise health risks and observe restrictions on movements and gatherings.

The Chinese New Year celebrations between January 25 and February 8 were particularly affected.

Exporters traditionally sell large numbers of rock lobster to China during this period, but most orders have been cancelled. In Hawke's Bay, Kahungunu's profitable fisheries business is directly affected. It has operations at Mahia, and yes, in Masterton.

As Fisheries Minister I decided the Government would step in to help crayfish exporters minimise the disruptions. Up to 180 tonnes of live crayfish were being held in storage. I agreed that fisheries officials would allow a limited release of rock lobster back into the wild.

But it's more than just fisheries. Primary producers in other regions, tourism operators and tertiary education providers, are also anxious about the economic impact of China's public health emergency. We are working across all government agencies to help respond and ease the impact.

Thankfully, we are prepared for this. Grant Robertson has built a solid reputation as Finance Minister for his careful management of the economy.

Our economic growth is outperforming that of our trading partners, and at 2.7 per cent, is higher than the previous government's average of 2.1 per cent. Our debt is at historically low levels – lower than the debt we inherited when we took office. Our wages are growing.

However, what is really keeping the accelerator to the floor in our economy is the Government's capital spending. We are a Government of infrastructure. We build things, we fix things, like schools, hospitals, roads, cycleways, public transport and other assets.

That is the compelling background to the good news we heard from the country's top banker this week.

Adrian Orr was upbeat when he announced the Reserve Bank's decision on the Official Cash Rate – he's kept it steady at a low 1 per cent. He can see there is still plenty of pep in the economy.

He expects the economy will take only a small and short-term hit from the coronavirus, because our fundamental settings are so sound.

To be the Government of infrastructure, we have to be the Government of training and education.

We simply cannot deliver this infrastructure without this focus. When we came in, we moved swiftly to implement fees-free.

That not only has reduced the burden of debt for our young people for generations to come, it's meant that those moving into apprenticeships for those first two years pay nothing. We've also dropped NCEA fees and increased funding support for schools so they don't need to ask for donations from parents.

I am proud of this Government's record when it comes to the management of the economy, but more than just the numbers, I am proud that we've seen unemployment go down in Hawke's Bay, Northland, Bay of Plenty, Gisborne, Manawatū, Whanganui, Otago, and Southland.

That is no accident, it happens because of deliberate investment: 530 Provincial Growth Fund projects across the country, making a huge difference.

In Gisborne and Hawke's Bay, we're seeing unemployment rates that were once as high as 8 per cent now down to 4.1 per cent. That is a huge difference.

Overall, the Government's economic plan will ensure we're adaptable and resilient to future shocks. We are future-proofing our infrastructure, creating jobs, and providing certainty.

With regard to trade with China, as the Reserve Bank said, it remains early days. However, it's nice to know there's still plenty of reasons to feel good about living on these islands.

• Stuart Nash is the MP for Napier and the Minister of Police.