Road User Charges, Waikeria Prison, foreign investment: Christopher Luxon reveals new quarterly action plan

Trade war not the right response

The Prime Minister said he did not agree with retaliatory tariffs and trade wars and wouldn’t be suggesting New Zealand engages in tit-for-tat measures against the US.

“I think the tariffs and trade wars will cause huge pressure economically, no doubt about it, he told Newstalk ZB’s Mike Hosking.

“Thats why we just don’t think it’s the right thing.”

He said they would lead to rising inflation, currency challenges and a halt in economic growth.

He said New Zealand was “well placed” in this situation given our goods and services were in high demand across the globe.

Plan to bring economic turnaround

There are few surprises on the quarter two plan. Many of the actions are to simply “take Cabinet decisions” or “pass legislation” that is already close to finishing in the House. One action is to deliver a Budget, something that happens annually.

“There are positive signs of the economic turnaround this Government was elected to deliver, and our latest quarterly plan lays out more of the actions we will take to rebuild the economy, reduce the cost of living, and make Kiwis better off,” he said.

Luxon added that “growth doesn’t just miraculously happen” and he made “no excuse for keeping the public service focused on delivery with these quarterly action plans”.

The full list of 38 actions can be found below, but they include introducing legislation to ratify the recently signed New Zealand-United Arab Emirates Comprehensive Economic Partnership Agreement.

Trade Minister Todd McClay announced on Sunday that he would travel to Abu Dhabi this week to attend an investment conference and strengthen ties with UAE, which has two-way trade with New Zealand currently valued at $1.3 billion.

“Foreign direct investment is vital for New Zealand’s economic growth and UAE investors are seeking high-growth opportunities. New Zealand offers world-class prospects in energy, infrastructure, cleantech, fintech, transport, manufacturing, aquaculture, and many more sectors,” McClay said.

“Building on the recent Infrastructure Investment Summit, we’re now presenting these opportunities directly to top-tier investors offshore.”

The action plan includes introducing legislation to establish Invest NZ, the new agency that will help attract foreign direct investment. Legislation will also be introduced to amend the Overseas Investment Act, reforms which David Seymour has been pursuing to simplify getting investment into Kiwi business.

A new tourism growth roadmap is expected to be launched as well as a plan to boost export education earnings. Cabinet decisions are also expected on the Parent Visa Boost, which would make it easier for migrants to have their parents or grandparents enter the country.

One promise the Government has fulfilled is to pass legislation removing barriers to the use of overseas building products. That passed its third reading last week.

Cabinet is expected to consider decisions on the fleetwide transition to Road User Charges (RUCs). The Government has previously spoken about transitioning the light vehicle fleet to RUCs by as early as 2027 to ensure the system for funding transport investment remains viable. With vehicles becoming more fuel-efficient, the Government has said excise tax on petrol is no longer sustainable.

The plan also includes passing legislation that would allow for pay deductions in response to partial strikes. This involves workers turning up to their workplace but not completing key tasks.

Speaking in Parliament last year, Seymour said this would “provide a far more effective and efficient bargaining environment where rights and consequences are more balanced and which minimises potential disruption to public services”. Labour’s Camilla Belich said all it did was “attack workers’ rights” and “take working New Zealanders backwards”.

There are a number of law and order actions, like opening a 600-bed extension at Waikeria Prison and taking decisions on proposals from an advisory group about strengthening trespass law.

The Government also plans a pilot attendance programme to set expectations for students and outline the action schools should take for any student who reaches a threshold of days absent. That could include the prosecution of parents.

But just because the Government is committing to doing something this quarter, doesn’t mean it will be able to follow through.

A checklist of the 40 actions it promised to undertake between January and March this year shows it missed completing three.

The quarter one plan said Cabinet would take decisions on the Regulatory Standards Bill, which would outline principles for responsible regulation. A paper was completed but Cabinet has not yet considered it. The quarter two plan promises the legislation will be introduced shortly.

Cabinet did consider a Health Infrastructure Investment Plan, but it has not yet been published as the quarter one action plan said.

A promise to take Cabinet decisions on legislation to improve the regulation of medical devices has been pushed out to allow for more industry consultation.

The full action plan for quarter two: