Thu, 19 Nov 2009 5:58p.m.
By Duncan Garner
John key was out celebrating one year in office today – but it was Labour leader Phil Goff making all the play.
Mr Goff says Labour will make significant changes to how the Reserve Bank controls the economy – if it gets elected back to office.
It is a controversial departure from 20 years of political consensus.
Mr Goff turned up at a Federated Farmers conference today wanting to help struggling exporters.
“The Labour policy is to change the monetary policy and to serve better the wider interests of NZ,” he said.
Mr Goff says the Reserve Bank's job of keeping inflation low, by moving your mortgage interest rates up and down is hurting exporters.
He wants more tools used by the Reserve Bank to help lower the kiwi dollar – a high dollar makes exporting less profitable.
“We don’t think the balance is right and we are committed to changing that balance.”
For Labour and Goff, this is a major departure from the political consensus of the past two decades.
He is also admitting Labour got it wrong.
“In government, as governments always are, we were too orthodox, we accepted the status quo.”
John Key was out celebrating his first year in office today.
He claims any new tools could cost Kiwis dearly.
“If Phil Goff is suggesting new tools then that is mortgage levies and petrol excise tax increase. If he wants to explore those options, then good luck to him.”
Initially Mr Goff did not want to talk about what new tools could be used.
“I don’t want to include or exclude any one of the specific alternatives,” he said.
So 3 News pressed him – what about tax increases on petrol and mortgages?
“We have not looked at those areas, that is not part of our consideration,” he said.
Business NZ represents exporters and businesses, it is critical of Mr Goff's approach.
“I think this is a really sad day for New Zealand’s economic management if we want to attract investment. If we want to have stable economic policy settings and that’s really what businesses wants, then this really throws that away,” said spokesman Phil O’Reilly.
Labour in Government reviewed monetary policy five times and made no fundamental changes.
So Mr Goff now faces huge pressure on this because he has most certainly committed Labour to making significant changes - changes Helen Clark and Michael Cullen did not agree were necessary - nor does anyone in National.
3 News