The Productive Economy Councils welcomes Labour’s stance on tax and monetary policy reform
The Productive Economy Councils welcomes Labour’s stance on tax and monetary policy reform
The Productive Economy Council welcomes comments in a speech from Labour leader Phil Goff today in which he outlined Labour’s economic priorities in 2010.
PEC spokesman Selwyn Pellett says Phil Goff is spot on in highlighting the need to up skill our population to create more productive and wealthier society.
“Phil Goff obviously understands the danger we face. Namely, that as New Zealand comes out of the recession it is not enough to simply rely on a default recovery back to the status quo. It will be all too easy to mistake a general improvement in the economic outlook for a positive long-term prognosis for our economy’s health. In reality our economy is in no better position to guarantee a prosperous future than it was before the recession,” says Pellett.
In his speech, Phil Goff criticised the National government for “sitting on the sidelines”. He stressed that Labour believes there are key areas that need to be addressed to improve the health of the economy long term, such as improving investment in research and development, reforming our monetary policy to help the productive sector, addressing the volatility of our exchange rate, and making changes to our tax system.
“Phil Goff has reiterated what the PEC has been saying for the past 12 months; that the tax system has to stop disadvantaging the productive economy and favouring speculative investment. He has highlighted that more than $200 billion is invested in property with the taxpayer subsidising those investments, while lack of capital investment in the productive economy works against a high-skill, high wage future for New Zealand,” says Pellett.
“This is the bottom line. If we don’t rectify that imbalance, then whatever recovery we enjoy now will only be temporary, and we will continue to be extremely vulnerable to the winds of global economic fortune. We need to build a sustainable, productive economy, so that we can build a reliably prosperous future for the country, and it won’t happen without intervention from our politicians,” he says.
“Labour appears to have now understood this reality. Phil Goff says the party continues to be willing to work with the government on tax policy, to build consensus and make changes that will be sustainable. That’s what we need now, for our politicians, both on the left and right, to realise this is too important an issue to waste time in point scoring. The PEC hopes that the National government can overcome its policy inertia and political caution and step up to work with the opposition in shaping a better future for us all.”