Labour Leader David Cunliffe says a Government he led would invest up to $200 million over four years in development projects aimed at resuscitating flagging regional economies.

Speaking at Local Government NZ's conference in Nelson this morning, Mr Cunliffe said many regions across the country were currently struggling and were seeing a "steady erosion of opportunity and wealth".

"In region after region I've visited towns where major employers are downsizing or closing, a boat-builder in Northland, a timber mill in Rotorua, another two in South Otago, a heavy engineering firm in Taranaki, another in Dunedin.

"This is self-perpetuating - when young and talented New Zealanders leave to pursue opportunities that are no longer available in their own regions, they take with them the skills and energy needed to build for the next generation".


In a swipe at National's recent legislative roll back of parts of Labour's 2002 local government reforms, he put that down to the regions being "neglected" by the Government.

"More and more central government is pushing councils and authorities away from the four well-beings and toward a "rates, rats, and rubbish" version of local government."

Mr Cunliffe said things in some regions had got so bad "there is speculation of abandoning communities or 'red-zoning' regions".

"Labour will not let that happen. Labour will stand alongside regions and work with them to fulfil their ambitions and keep their young people at home."

That would involve central Government working with communities and businesses to develop "tailored regional growth plans that identify strengths and opportunities for each region, boost growth and create jobs".

Labour would support those plans by co- investing in "infrastructure and industryprojects" alongside the private sector and local authorities with the money to come from a new $200 million "Regional Development Fund".

22 Jul, 2014 5:00am
2 minutes to read

The kind of projects that would be considered included the Opotiki Harbour Development, Marsden Point rail line and the Gisborne-Napier Rail Link, Mr Cunliffe said.
The form of such investments would range from suspensory loans with delay repayment schedules and direct equity investments.

The fund would focus on investments "that will make a real difference, rather than spreading its money too thinly, as has often been the case in regional development initiatives in the past".

"We envisage project contributions in the tens of millions, rather than single millions."

While Finance Minister Bill English this morning said he hadn't seen the detail of Labour's policy, he said Labour's problem was it thought the only way to run the economy was "to have the Government run it".

"Our regions are doing well. They will certainly suffer if Labour implements their other policies along with the Greens which is to bring in a very significant carbon tax to bring restrictions on farming related to fresh water quality which will effectively shut down growth in our farming industries. Those policies will be very damaging and $200 million of lollies won't make any difference to that."