Chris Hipkins: Prime Minister's Statement 2023

This Statement is being presented at a difficult time for our country. Many New Zealanders are doing it tough as a result of Cyclone Gabrielle, the Auckland floods, and the difficult economic headwinds we face.

Cyclone Gabrielle is the most significant weather event New Zealand has seen this century. The severity and the breadth of the damage we are seeing has not been experienced in a generation, leading to a national state of emergency being declared for only the third time in our history.

Our thoughts are with the eleven people who have lost their lives, their families and friends, and the many families who have the agonising wait to speak to those unaccounted for or without communication. No words can express the anxiety and grief you are experiencing.

Today many areas are still in an emergency response mode with food, water, fuel and supplies having to be dropped off. Electricity is still out to an estimated 12,000 people and telecommunications services are still unreliable in many affected areas. More than 1300 people were in civil defence centres overnight.

Many businesses and the primary sector in the affected regions have been hard hit by Cyclone Gabrielle. There has been widespread damage to farms, processing and pack house facilities and infrastructure, as well as losses across the horticulture, vegetable, forestry, stock and feed industries. A number of businesses have been either completely wiped out or forced to close.

At the same time, in the wake of the most significant and consequential global challenge in decades, the world faces a new challenge: a pandemic of inflation. Trade disputes, an energy crisis, and the Russian invasion of Ukraine have exacerbated the post-pandemic supply shock leading to significant increases to the cost of energy, food and materials around the world.

In response more than 90 central banks have lifted interest rates to combat inflation and the outlook for global growth is deteriorating. Overall, the International Monetary Fund forecast global economic growth to slow to 2.9 percent in 2023.

The IMF has warned the worst is yet to come, with a third of the world forecast to be in recession this year. The United Kingdom is already in recession. Europe is experiencing its most difficult winter since the Second World War, with energy prices 10 times higher than before Russia’s invasion of Ukraine and inflation at 8.5 percent.

We are not immune from this. As an open trading economy we are affected by this global volatility. While New Zealand’s rate of inflation remains below the OECD average, high global inflation is biting into Kiwi household budgets and families are feeling that pinch.

2023 is going to be a tough year for New Zealanders. It may feel like we are being buffeted by forces beyond our control. However, we are not powerless.

While the past three years have tested New Zealanders in ways we have not seen for many decades, New Zealand businesses and workers have proven to be resilient, innovative and highly adaptable.

Likewise the mark of this Government is how we have changed to respond to the shifting environment. We have moved quickly to respond to Cyclone Gabrielle. Over 100 civil defence and emergency management staff have deployed alongside local civil defence groups into affected regions to coordinate the response, including volunteers from the NZ Response Teams. The New Zealand Defence Force has more than 950 personnel involved and has mobilised aircraft, helicopters and ships. There is a significant effort by the New Zealand Police providing an increased presence across affected regions and working on missing persons reconciliation.

More than 47,000 people have received Civil Defence Payments. On Saturday alone supplies were delivered to over 40 affected communities in the Hawke’s Bay. These included medicines, food, and fuel. Nineteen of these were by helicopter.

It has been a real NZ Inc. response. Businesses have been working around the clock to respond. At peak there were more than 620 cell towers out of action across the country. This is now below 50 sites, restoring around 95 percent coverage, and crews continue to work hard to get every single one back on air as soon as possible. More than 95 percent of customers have had their power restored across affected regions. Napier has 73 percent of their connections fully restored, with further restoration expected over the next 24-36 hours. The response has been a powerful demonstration of what we can achieve when business, government and community work together.

On behalf of all New Zealanders, we want to express our enormous gratitude to those putting in the hard yards and their lives are on the line in the service of their communities. To the men and women of Police, Fire and Emergency New Zealand, the Defence Force, to the linemen and women, the communications companies, the supermarkets, the transport companies working to get food and goods to where they are needed, to the roading crews that are making that all possible: thank you.

In the coming weeks we will say more about the plan to rebuild. For now, it must suffice to say we will do what it takes. We will stand by New Zealanders as we recover. You are not alone. We will back you and rebuild.

The Government has also moved quickly to take the pressure off those who feel these difficult economic times most keenly. We have taken action to take the sharp edges off cost of living pressures on Kiwis, particularly those on lower incomes. Our temporary and targeted cost of living payment, fuel tax cuts and half price public transport fares have helped ease the inflationary effects of the Ukraine war and supply chain disruptions.

We have strong foundations to responds to these challenges.

We ended last year with strong economic growth. Our economy is nearly 7.9 percent bigger than before the start of the pandemic and growing faster than Australia, the US, Canada, Euro area, Japan and the UK.

We have near record-low unemployment and world-leading government books with low debt and a smaller deficit than forecast at Budget. We have passionate and dedicated public servants who are working tirelessly to respond, to rebuild and to position New Zealand to seize the opportunities before us and accelerate our economic recovery.

This statement sets out our priorities. We are focussed on supporting New Zealand families and businesses through difficult economic conditions, investing in the public services we all rely on, accelerating the economic recovery and laying foundations for the future, and providing strong and responsible leadership as we rebuild from Cyclone Gabrielle.

Together, we can tackle the challenging economic circumstances and respond to the sustained pressures that New Zealand families, businesses and communities are experiencing while making progress on the bread and butter issues New Zealanders most care about.

We can support each other to rebuild and prepare for a future where severe weather events become increasingly common and severe. Before the cyclone arrived six out of fourteen regions were already undertaking disaster recovery, two of which were in a regional state of emergency. The impacts of climate change are already being felt in our communities. Preparation will make our communities safer, protect our environment, and ensure our towns and cities can continue to support people’s jobs and livelihoods.

These challenges require focus. A Government focussed on the issues that matter most to New Zealanders. New Zealanders biggest concerns are our top priority. This Statement is focussed on getting back to basics – those bread and butter issues of the cost of living, health, education and training, crime, climate and trade.

Neither the challenges of today nor the opportunities of tomorrow will come easily. But we are optimistic about our future. We’re clever and resilient, proud and practical. With a healthy dose of Kiwi ingenuity we will rise to these challenges.

I. Supporting New Zealand families and businesses through difficult economic conditions

The Government’s number one priority is to support New Zealand families and businesses through difficult economic conditions and the impact of the cyclone and floods. Supporting New Zealanders with the cost of living is even more important as the weather events disrupt supply chains and lead to shortages in essential goods.

While there is no silver bullet for the high cost of living, we are focussed on providing targeted support for working families and lifting incomes so those who work hard can get ahead. This also means tackling the structural causes of inflation, including the lack of competition in grocery, fuel, building materials and banking sectors, and our exposure to volatile fossil fuel markets.

Responding to the cost of living pressure families are facing

As a small nation many of our economic winds blow in from offshore. My Government will have a strong focus on helping New Zealanders through these economic headwinds. Our focus will be on targeted support to working families to take pressure off these Kiwis and their communities.

As a Government we have consistently put families and children at the heart of our work.

We’ve supported parents with health costs by expanding free and low-cost doctors’ visits to children under 14, introduced mental health support into schools, and expanded school-based health services across approximately 300 schools. We’ve introduced the Winter Energy Payment and increased main benefits, superannuation, the Family Tax credit, Student Allowances, and Accommodation Supplement. We extended paid parental leave to 26 weeks. Low income New Zealanders have access to increased support for dental costs.

We’ve reduced the cost to send children to school by removing NCEA fees and removed school donations for more than 1,600 schools. Last year the School Donations Scheme saved families more than $70 million.

  • As the Equity Index rolls out this year, 154 new schools will now be eligible for more funding to remove school donations.

We’ve served more than 63 million free, healthy lunches in schools, feeding more than 220,000 students through Ka Ora, Ka Ako, and rolled out free period products in more than 2,000 primary, intermediate, kura and secondary schools.

We will continue to tackle the cost of living through supporting families and children.

  • From April this year we will roll out the next phase in cost of living support.

At a time when families are feeling the cost-of-living spike, we’re targeting investment into what matters most by making sure childcare is within reach for parents. We will reverse a freeze on the income indexation threshold for childcare eligibility put in place by National in 2010.

  • 54 percent of all New Zealand families with children will be eligible for subsidised childcare assistance, and eligibility thresholds will match future wage growth. Over 10,000 additional children are estimated to receive support.

This means a family with two parents both working 40 hours per week on $26 per hour with two children under five who were not previously eligible for childcare assistance, now will be eligible for $252 per week from 1 April 2023.

Research shows nearly 23 percent of mothers report difficulties getting childcare while working or wanting to work. Making childcare more affordable will help to remove financial barriers to work, particularly for sole parents and those on low- to middle-incomes. It enables parents to enter the workforce to help fill labour shortages - a win-win for families and the economy.

Supporting New Zealand families with the cost of living is the top priority for the Government. Working for Families provides significant support for almost 60 percent of New Zealand families.

  • From April 2023, the Family Tax Credit will also increase by $9 a week for the eldest child to $136 a week, and by $7 a week for subsequent children to $111 a week.

More than 112,300 parents and caregivers with children under three years old receive the BestStart payment to help support them with extra costs in a child's first three years.

  • Best Start will increase to $69 a week from April 1.

We know that it is crucial to invest in New Zealand’s safety net, especially in a time of economic uncertainty and disruption. This Government is committed to protecting NZ Super. Since 2017 the rate of NZ Super for a couple has increased by $223.84. On top of this the Winter Energy Payment is designed to help older New Zealanders and many of our low and middle income families heat their homes over winter.

  • From 1 May 1.2 million New Zealand adults will receive up to $31.82 a week to help with the cost of their heating through winter through the Winter Energy Payment.

Ministry of Social Development modelling shows that our Government’s significant lifts to main benefits and tax credits has meant around 351,000 beneficiaries are better off by on average $113 per week, increasing to $137 per week during the winter period compared to 2017 policy settings. Couples with children are $243 per week better off on average and then around $274 per week during winter.

  • This April New Zealand superannuation and main benefit rates will increase.

We will continue our commitment to reducing hardship for New Zealanders, particularly those families who are working, through the next steps of the Working for Families review.

Honourable members

We can deliver timely and targeted support to under pressure businesses and families fast. Transport is the third biggest expense on households after housing and food and a significant component of increases to other costs.

  • Extending the reductions to fuel excise, Road User Charges, and public transport until the end of June will reduce the cost of filling up a 40 litre tank of petrol by around $11.50, and for a 60 litre tank, around $17.25 and half price public transport will save an average person who pays two $5 fares a day $25 a week.

Half price fares for public transport will also be made permanent for Community Service and Total Mobility Card holders.

Lifting incomes so those that work hard can get ahead

New Zealanders should be confident that they can get ahead and create a better life for themselves and their families through their hard work. The primary response to the cost of living must be to increase wages and improve productivity.

We’ve made good progress. Wages are up 16 percent in the three years since December 2019 – an increase that Kiwi workers waited nearly five years for following the GFC. However, more work is required to lift productivity, add value, and increase the exports required to grow a high wage economy.

Fair Pay Agreements are a crucial tool in collaboratively improving productivity and increasing wages. The Agreements will improve wages and conditions for employees, encourage businesses to invest in training, as well as level the playing field so that good employers are not undercut and disadvantaged.

  • Three industries have made an application for an FPA – bus drivers, supermarket workers, and hospitality.

We will also ensure that the incomes of our lowest paid workers are able to keep up with inflation. Tackling inflation cannot come at the expense of New Zealand’s lowest paid workers and their families.

  • We will increase the minimum wage to $22.70 from 1 April 2023.

This increase will maintain the real value of more than 200,000 workers’ incomes and ensure our lowest paid workers are able to keep up with increases in the cost of living. Before tax, a full time worker on the minimum wage will be paid an additional $60 per week, increasing their annual pay by $3,120.

This is making a meaningful impact on kitchen tables across the country. Since coming to Office we have raised the minimum wage by over a third from $15.75 in 2017 to $21.20 meaning that full-time minimum wage workers now earn an extra $218 a week more than in 2017. Labour Cost Index data indicates that in percentage terms since 2018 the salaries and ordinary time wages of our lowest paid have grown about 1.7 times faster than those of our most highly paid workers – reversing a decade long-trend.

We are also taking steps to increase the wages of the essential workers providing the public services New Zealanders rely on. With a significant number of public sector workers set to enter pay negotiations this year, we’re working constructively with unions to improve the pay and conditions for teachers, nurses, police officers and a wide range of public sector workers.

We will continue to make progress on reversing gender based pay difference and achieving pay equity. This Government has also settled five pay equity claims under the 2020 Amendments to the Equal Pay Act with an average pay correction of 33 percent. Three pay equity adjustments were delivered in 2022.

Supporting Kiwis into work and tackling workforce shortages

One of the key drivers of inflationary pressure is global workforce shortages. This Government will continue to support New Zealand businesses through the global labour shortage, work to attract more high skilled workers, and support New Zealanders to learn new skills or retrain. We understand that labour shortages are the biggest issue facing New Zealand businesses, and are contributing to the cost of living.

Last quarter there were a record 2.9 million Kiwis in work and our 3.4 percent unemployment rate is one of the lowest in the world. But we recognise that the flipside of this is in many cases staffing shortages and recruitment challenges for employers.

This is particularly the case in the trades and other skilled occupations. We’re supporting New Zealanders to learn and upskill, as well as ensuring we have the workforce needed to rebuild. The reinstatement of the Training Incentive Allowance has had an overwhelming response with an over 600 percent increase in uptake from 1 January to 30 June 2022. More than 215,000 people have taken up free apprenticeships and targeted trades training and 54,838 apprentices have been supported through the Apprenticeship Boost Initiative.

  • There has been a 61 percent increase in the number of apprentices since 2020.

The Mana in Mahi programme has supported more than 5,000 job-seekers into jobs, exceeding the 4,000 target following its extension in 2019. Importantly 75 percent of participants, who had been on a benefit for two or more years haven’t come back onto a benefit after completing the Mana in Mahi programme Likewise He Poutama Rangatahi, which has supported almost 4,000 young people most at risk of long-term unemployment into employment, training, or education.

Over the longer term, we are making far reaching changes that will set up our skills system for the 21st century. We’ve shattered the silos between on-job and off-job training, put industry firmly back in the driver’s seat at setting skills standards, and given regional leaders a voice in steering our education, social development and immigration priorities

We will continue to invest in upskilling small businesses.

  • More than 56,000 small businesses are gaining the skills they need to improve productivity by digitising their businesses through Digital Boost.

This programme will continue to upskill small business to use digital tools, develop websites or take advantage of small business accounting software, to take pressure off small business owners by giving them more time to do business instead of administration.

We remain committed to the immigration rebalance, and ensuring our settings in this area contribute towards filling skills shortages, greater productivity, eliminating migrant exploitation, higher wages, and ensuring New Zealand remains one of the most attractive destinations in the world for both tourists and highly skilled workers.

We’ve had around 1.25 million requests to come to New Zealand to visit, study or work. We have approved over 120,000 job positions for international recruitment, granted over 46,000 working holiday visas, reopened the Pacific Access Category and Samoa Quota, delivered the largest increase in a decade to the RSE scheme, introduced sector agreements for tourism, hospitality, the care workforce, construction and infrastructure, meat processing, seafood, seasonal snow and adventure tourism, and resumed the Skilled Migrant Category and Parent Category so as to strengthen our international offering.

There is always more we can do to support businesses to attract the workers they need. To respond to workforce gaps we have expanded the Green List to include 10 additional roles and moved four roles to the straight to residence tier, introduced a sector agreement for bus and truck drivers, and extended the 12 month employer accreditation.

  • We’ll continue to review settings as needed to ensure we strike the right balance between certainty and responsiveness.

Increases to Working for Families payments and income thresholds for Childcare Assistance, and employment initiatives such as Mana in Mahi, improving access to driver’s licence support, and Flexi-Wage are already making a real difference in reducing barriers to work and supporting people into sustainable jobs. These investments have led to record numbers of people leaving benefit to go into work with 100,236 moving off benefit and into work last year, 25.7 percent higher than in 2017.

But we know there is more to do. We have conducted an Active Labour Market Review to pave the way for how we can invest in employment and training initiatives to provide security and opportunities for New Zealanders in our current and future labour market.

Improving competition in our grocery, fuel, banking and building materials sectors

Global economic headwinds do not mean we cannot take action on the causes of high inflation. The areas where New Zealanders are experiencing the greatest increases in costs are areas where there are systemic issues. As a small and isolated country New Zealand is particularly susceptible to market concentration or a lack of competition.

We have a strong track record of taking action to improve competition and back consumers. We amended the Commerce Act 1986 to give the Commerce Commission the ability to undertake market studies to determine whether there are any factors that may be impeding competition in a market and provide an in-depth understanding of how sectors and markets work.

This Government has already taken significant steps to break the duopoly stranglehold of the two major supermarket retailers and improve competition in the grocery sector.

  • We will pass the Grocery Industry Competition Bill to ensure a fairer and more competitive groceries sector where supermarkets do not make excess profits of $1 million a day but do see greater access, choice and value for consumers.

We are also improving competition in the fuel and building supplies markets. The Fuel Industry Act 2020 has already contributed to improving competition in New Zealand. The terminal gate pricing regime has supported expansion into new areas by low price retailers such as Gull, NPD, and Waitomo. Gull has publicly stated that without the Act, it would not be able to competitively source fuel to operate its South Island outlets and provide competitive tension. In its first quarterly report under the Act, the Commerce Commission noted that importer margins in the June 2022 quarter were lower than observed during the market study.

  • We will continue to closely monitor fuel company margins and amend the Fuel Industry Act 2020 to establish a regulatory backstop to incentivise wholesale suppliers to offer competitive terminal gate prices.

The Commerce Commission’s final report on competition in our key building supplies markets and industry supply chains found two key factors negatively impact competition in this crucial sector: incentives that favour familiar building products in the building regulatory system and quantity-forcing rebates.

  • The Government will respond to the Commerce Commission’s recommendations on competition in our key building supplies markets.

Building supplies make up a sizeable chunk of the costs of new residential housing and are a significant driver of inflationary pressures. We will continue to take steps to bring new suppliers into the New Zealand market, including through Government construction programmes and through regulatory reform.

Honourable members

New Zealand has a concentrated banking sector with four major banks undertaking 85 percent of mortgage and other lending. We will continue to work on establishing a Consumer Data Right Framework, starting with the banking sector. Open banking ensures banks must share customer information if they request it, making it easier for New Zealanders to compare mortgage rates, apply for loans and switch banks – improving competition by enabling customers to get better deals.

  • We will introduce legislation establishing a Consumer Data Right Framework this year.

We are taking steps to save consumers and small retail businesses money. Retail NZ’s 2019 Payment Survey showed retailers were paying nearly twice as much as Australian retailers pay for debit and credit card services, costing New Zealand retailers on average an estimated $13,000 per year more than their Australian counterparts.

  • The Retail Payment System Act 2022 is lowering the fees charged when credit and debit transactions are made, saving New Zealand businesses around $74 million this year.

This legislation has capped the amount banks can charge retailers on interchange fees for customers using credit, debit cards, and contactless payments in-store. The initial pricing standard came into force on 13 November 2022 and saw consumer credit card transactions capped at 35 percent of their previous charge.

Tackling cost of living through reducing our reliance on fossil fuels

The last year has shown how exposure to volatile global oil markets can disrupt our economy, affect New Zealand families, and endanger New Zealand’s economic security due to geopolitical disruption. As oil prices rose following Russia’s invasion of Ukraine, the areas where we had made less progress towards decarbonisation – such as private transportation and freight – were some of the areas where global disruptions put pressure most directly on household expenses. The global fuel price outlook remains uncertain, and it is plausible that high international fuel prices may persist for some time.

Our climate response is crucial to tackling the cost of living, taking pressure off households and communities, and maintaining New Zealand’s economic security. The faster we accelerate our transition away from fossil fuels to domestically-generated renewable energy, the more secure our economy will be. It will help insulate New Zealanders from significant price fluctuations when warming our homes, powering our cars, and fuelling our factories.

We will work with our cooperation partner, the Green Party of Aotearoa New Zealand, to accelerate the transition away from volatile fossil fuels. Measures such as the Clean Car Discount and Clean Car Standard, and investments in our public transportation network and the decarbonisation of freight, are all important in helping to lessen our reliance on global fossil fuels and improve our domestic energy security and economic security.

We have made significant progress in increasing electric vehicle uptake. There are now more than 70,000 EVs on our roads, 70 percent more than at the end of 2021. In December 2022, 30 percent of all new passenger car sales were electric, making us one of the world’s leading markets for EVs.

The Government has co-funded more than 1,300 EV chargers across New Zealand, growing our public EV charging network to the point that we now have fast/rapid charging stations at least every 75 kms over 97 percent of our state highway network.

  • This year we will reach our target of an EV charger every 75km over 99 percent of the state highway network.

While the current EV charging infrastructure network for light passenger vehicles is meeting current demand, it will increasingly come under pressure as more New Zealanders take up electric vehicles. Access to EV charging is the primary concern of prospective EV owners. In addition, there is an accelerating demand for charging infrastructure to support medium and heavy-duty EVs, such as electric buses and trucks.

  • We will release an EV Charging Strategy and work with the private sector to ensure chargers are readily accessible across New Zealand.

We have one of the best electricity systems in the world. It is clever and clean, and stands in contrast to the huge price hikes being experienced overseas. We now need to secure its future and grow our renewable energy generation capacity as we transition transport and industrial heat from fossil fuels to renewables. Renewable energy increases New Zealand’s economic security and means cheaper power bills for businesses and households. This Government will remain focussed on increasing the use of renewable energy across our economy.

  • We will increase renewable energy generation and transition from fossil fuels, including through a new National Policy Statement for Renewable Electricity Generation and Electricity Transmission

Rising global energy prices emphasise the need to scale up our ambition to decarbonise industry, and future proof our energy system, to ensure that a cheaper and more secure energy supply becomes the norm. So far 53 major industrial business have been supported to accelerate their transition to cheaper and cleaner energy alternatives, anticipated to save 364,000 tonnes of carbon dioxide each year.

  • We will support more businesses to lower costs, improve productivity and reduce emissions through the Government Investment in Decarbonising Industry Fund.

The installation of a heat pump and insulation can reduce cost, emissions and hospitalisations and illnesses. Studies show that electricity use through winter for homes with heat pumps fell about 16 percent relative to a house without a heat pump installed. Homes were on average two degrees warmer and were drier, and hospitalisations were reduced. More than 100,000 insulation and heat pumps installations have been completed through Warmer Kiwi Homes, ensuring more low-income families have healthy homes and lower power bills.

  • We will deliver 26,500 more insulation and heating retrofits through Warmer Kiwi Homes this year

II. Investing in the public services New Zealanders rely on

The Government is refocussing on core bread and butter issues like education, health, housing, and keeping communities and businesses safe.

Making sure our young people are engaged and thriving

Education is the great social mobiliser and critical to our future economic success. We have made schooling more affordable, and school buildings more modern and welcoming.

Attending school and kura regularly is crucial to student progress and achievement. However, attendance has been declining since 2015 for every ethnicity, decile, year level and region. The Attendance and Engagement Strategy placing the Attendance Service closer to schools, and pilots in South Auckland and Kawerau have seen some promising green shoots and improved key performance indicators. .

We know there is more work to do. This work has shown that schools can intervene earlier and work with whānau to get students with worrying absences on the path to better attendance. Dedicated resources placed in schools will enable each school to intervene early and turn around persistent absences.

  • We will fund 82 dedicated Attendance Officers to work with schools to turnaround irregular attendance, and increase funding for the Attendance Services to engage intensive support to reengage the most complex cases.

New Zealand is well-served by its school network. But more can be done to strengthen consistency from one school to another and ensure significant learning is not left to chance. This year the New Zealand Curriculum will be refreshed in both English and Māori medium so we have an evidenced based and engaging curriculum for our students.

  • The Mathematics and Statistics and English curriculum redesign will be completed and ready to be implemented in schools by the end of term one this year.

The new curriculum is clearer about what students need to understand, know and do within these learning areas. This is backed by high-quality teaching resources and based on evidence and best practice. We’ll continue the development and writing of refreshed curriculum content ready for teaching by the start of 2024 in other learning areas such as science, technology, arts, languages, health and physical education. The full curriculum will have been refreshed for the start of 2025.

We’ve also delivered Maths and Literacy action plans backed by investment into upskilling our teaching workforce to turn around decades of declining achievement levels. Free tutoring and loss of learning sessions will continue for Term one of 2023 for students who need extra catch-up support following disruptions from COVID-19.

New Zealand is blessed with great schools and passionate and hardworking teachers, support staff and principals. We will continue to support education workers to identify what learners need and empower them to make a difference.

  • Nearly 90 percent of schools have increased funding now they are receiving equity funding based on the Equity Index rather than the old decile system.

The Equity Index provides a much better picture of which students need extra resources, and enables more investment in the right places. A further 3,000 kids will be able to get free and healthy school lunches as a result of the Equity Index.

We are committed to support Māori education success and aspirations. To do this we have undertaken significant reform of the Māori medium education sector that will continue this year. We have invested in core Māori education, like the largest ever investment in kura property through Budget 2022, and our supports to increase the number of te reo teachers so that our Māori education system can flourish.

The Government will continue to build more classrooms. Since we introduced the National Education Growth Plan in July 2019 we have delivered around 32,000 additional student places through new classrooms.

  • Another 10,000 student places will be delivered this year.

Supporting the physical and mental health of everyone

A key focus of the Government’s reforms of the health and disability system is to create a truly national health service that has a single standard of care, improves access for all New Zealanders, and empowers communities to develop services that are tailored to meet local needs.

The new health system has been designed to enable a whole-of-country view to planning and delivering services, helping it to be efficient and consistent everywhere. A healthcare system that is nationally planned, regionally delivered and locally tailored will address things like surgical waiting lists. It also means that when it comes to health services, where you live will matter less than what you need.

  • We’ll leverage this integration to focus on workforce, winter and wait times.

We are seeing the benefits of a more coordinated approach to our health services across the country. An early focus has been sharing expertise across former DHB boundaries. For example a Hawke’s Bay constituent wrote that their family member had been waiting 12 weeks at Palmerston North hospital for radiation therapy for skin cancer. In November they were contacted by their radiation oncology team and informed Wellington hospital were sending a radiation oncologist, registrar and technician to Palmerston North to run a ‘super clinic’ and to help clear the back log of patients requiring treatment from Taranaki, Hawke’s Bay and other surrounding areas.

The reforms have been about building a system that enable our passionate healthcare workers to do their jobs, rather than preserving artificial barriers to helping people. As that constituent said “The Palmerston North radiation oncology team were literally fizzing with excitement at the opportunity to run what they had termed their first ever super clinic. This is an actual example of the 'post code lottery' being redressed and we are so appreciative of the changes in the health care governance that have made this happen.”

  • We will continue to work to remove the geographic barriers to healthcare provision and end the postcode lottery.

Our health system transformation allows the health system to think regionally and collaboratively, with more ability to meet clinical demand for planned care in a timely way. Regionalising waiting lists and sharing expertise has enabled 50 percent of people waiting longer than 12 months for surgery to be booked in for that surgery, despite the lingering winter and COVID-19 delays. One early example is South Canterbury, which is providing orthopaedic expertise to 70 patients a year from all over the Otago region.

Since coming to office we’ve increased funding for the Combined Pharmaceutical Budget by 43 percent. In recent months, additional funded medicines include the life extending drug Trikafta for those suffering from cystic fibrosis, Spinraza for spinal muscular atrophy for those under the age of 18 and expanded coverage of meningococcal B vaccine. Up to 12,000 people will also benefit from Pharmac’s funding of EpiPens for those who experience allergic anaphylactic reactions.

  • Due to funding increases since 2017, Pharmac has been able to make more than 200 medicines available for thousands of people and will make further funding decisions this year.

We will continue to take aggressive action to train, hire and support our frontline health workers. Record numbers of nurse registrations were made in the last four months of 2022. But we know there is work to do. There is a global shortage of health workers but this Government is pulling out all the levers to attract the best talent from overseas.

  • We have hired more than 1,700 doctors and 4,200 nurses – a 20 percent increase in both professions.

The reforms have also enabled us to more effectively deliver a nationwide nursing pipeline project in conjunction with the New Zealand Nurses Organisation. We have long relied on immigration to fill workforce gaps and overseas-qualified nurses will continue to play a vital role in our health system. An international recruitment centre has been established and tailored campaigns are underway to attract more people to work in New Zealand. But this cannot be the only response.

New Zealand depends on overseas trained doctors and nurses more than almost every other OECD country. We need to train more. This year we will increase the number of funded places available in the Nurse Practitioner Training Programme, reaching 100 places each year from 2024.This Government is also committed to improving nurses’ pay. We have already increased registered nurses’ wages by about 20 percent. We are also committed to pay equity for nurses.

  • Nurses will receive a 14 percent pay equity boost as we look to advance a settlement.

A key focus of the reform has been strengthening public health. Paying more attention to the wider determinants of health, addressing risk factors and intervening early has the potential to save lives and address equity.

  • We are rolling out HPV primary screening for cervical screening, including the option of self-testing from July 2023.

There will be significant pressure on our health system this winter. As New Zealand reconnects with the world seasonal influenza will remain a significant issue. Increasing influenza vaccination rates this year will be important to ease unnecessary pressures on the public health system through decreasing the winter burden.

  • We will deliver an influenza immunisation programme to maximise uptake for at-risk New Zealanders.

We know Māori are overrepresented in negative health statistics and we have taken decisive action to turn this around through the establishment of the Māori Health Authority and record investment in Whānau Ora.

We will continue to build a primary mental health support system from scratch. 2.66 million New Zealanders now have access to free mental health services through primary care organisations such as general practitioners. These providers have provided more than 670,000 sessions since the programme started in July 2019.

  • By the end of 2023 more than 3 million New Zealanders will have access to free primary mental health and addiction support.

We have also created a system of targeted support. In the last three months 15,700 kaupapa Māori and 12,100 youth focussed sessions were delivered. We will continue to work with our cooperation partner, the Green Party of Aotearoa New Zealand, on child and youth mental health. School-based health services provide free access to primary health care, including mental health, for students from Year 9 in low decile secondary schools. Students can either go to a health professional in their school, or be referred to youth health services, child youth mental health services, or their own doctor.

  • School-based health services are available to 115,000 students in around 300 secondary schools.

Overall more than 33,000 hours of free counselling have been delivered in primary, intermediate and small secondary schools.

ACC is a unique and world-leading no-fault insurance scheme and a valuable part of Aotearoa New Zealand’s social fabric, and helps to rehabilitate thousands of people each year, but we know that not everyone is able to access ACC equally. That’s why we have extended ACC cover to birth injuries, providing greater access to support for an estimated 28,000 new parents per year. This year we will continue to make progress on improving access to the ACC scheme and the support New Zealanders receive from it.

  • We will pass the Accident Compensation (Access Reporting and Other Matters) Amendment Bill to improve access to ACC for all injured people.

A record of nearly $7 billion in health infrastructure continues to be rolled out around the country – nearly six times the amount the former Government committed to hospital upgrades and rebuilds. This includes major hospital builds in Dunedin, Whangārei, Nelson and Hillmorton.

  • We will continue to rebuild our health system with the Christchurch relocation of mental health services, the Infusion Therapy Unit in Whanganui and Tōtara Haumaru – the elective and inpatient bed infrastructure rebuild in Waitematā due to be completed this year.

Nearly a dozen large projects are expected to begin this year, including mental health facilities in Waikato, Lakes and Tairāwhiti, and linear machines in Auckland, Northland and Taranaki.

III. Accelerating the economic recovery and laying foundations for the future

New Zealand is well positioned to accelerate our economic recovery and grow wages by investing in skills and innovation, growing our trading links and building the infrastructure of the twenty-first century.

Tackling the country’s infrastructure needs

Our Government will continue our record levels of investment in infrastructure as we work to turn around a lost decade following the GFC. From new roads to digital connectivity, public transport and the pipes for new homes, this Government is building the infrastructure we need to improve productivity, transition to a low emissions economy, and tackle our long term challenges such as housing affordability.

Cyclone Gabrielle has had a significant impact on transport networks across the country, particularly in Tairāwhiti, the Hawke’s Bay, Northland, Tararua, Bay of Plenty, the Coromandel, and parts of Auckland. A number of these areas were also affected by the severe weather events that occurred in the Upper North Island in late January 2023. There are around 400km of State Highways closed through Tairāwhiti, Hawke’s Bay and the Central North Island including parts of SH25A, SH23, SH35, SH2, SH5, SH4 and SH50. The number of local roads impacted is likely to be significantly higher.

  • The Government is providing an initial $250 million contribution to the National Land Transport Fund (NLTF) to reinstate critical transport infrastructure and quickly restore access to communities in response to Cyclone Gabrielle and the January flooding events.

This is intended to provide certainty to Waka Kotahi, local authorities, and affected communities in the short term.

Honourable members

Investing in resealing and repair work is vital to maintain and improve the country’s state highways, keeping them safe and resilient. We have reversed the ongoing cuts to road maintenance we inherited and are investing close to $7 billion in local road and state highway maintenance as part of the NLTP 2021-24, which will see around 7,000 lane kilometres of state highway and 18,000 lane kilometres of local roads renewed.

  • This summer we had 2,450 lane kilometres of State Highway renewals underway across New Zealand - about 10 percent of the network.

The work of ongoing renewal and maintenance of our transport system comes on top of record investment in new transport infrastructure to get our cities and regions moving. Construction will start on the next stage of Auckland’s Eastern Busway, a freight hub in Ashburton, and the rebuild of Wellington’s rail infrastructure, including a new resilient connection between Wellington and Lower Hutt. We will complete the Te Awa shared path between Cambridge and Hamilton, a shared path along State Highway 88 between Dunedin and Port Chalmers and the rebuild of State Highway 1 at Dome Valley.

  • Through the NZ Upgrade Programme and the Transport Choices package we will make investments in better transport infrastructure in nearly every region of New Zealand.

Addressing the long-term infrastructure deficits is more than dealing with the here and now; it’s also about planning for our future. This year we will continue progressing Auckland Light Rail and mass rapid transit in Wellington and Christchurch.

Honourable members

This year we will continue our work to make it easier to build a home. We have a strong track record to build on. Despite higher costs for construction materials and labour, record levels of residential investment has led to more than 50,000 homes were consented for nine consecutive months last year. This represented an increase of 59 percent from the year ended December 2017.

  • The housing shortfall we inherited is closing.

One of the leading causes of our housing shortage is the lack of residential construction in the wake of the GFC. Between 2008 and 2011 residential construction activity halved as developers and buyers struggled to get financing.

These effects can be long lasting. It took the housing sector in Auckland more than a decade to return to 2005 levels. Not only were fewer affordable homes built, the sector suffered a skills shortage with the number of construction jobs falling by 14 percent. Since its lowest point during the GFC in 2010, the total number of full-time employees in the construction sector has grown by 46 percent. There was also a record 20,000 apprentices training in the construction sectorin 2021.

However, new economic conditions bring new challenges. Rising interest rates are creating significant uncertainty in the housing market. The Real Estate Institute of New Zealand House Price Index indicates that house values nationwide dropped 13.7 percent in the year to December 2022, 15.1 percent from the market peak. Economists are expecting prices to fall further. Reducing demand for housing risks undermining the growth of new housing and a potential loss of capacity in our construction sector. We will not let this crisis stall momentum on the progress we have made tackling New Zealand’s housing crisis and ensuring every New Zealander has a warm, dry and secure home.

  • We will focus on supporting residential investment to continue our momentum through economic uncertainty, including providing confidence to developers through government underwrites of affordable housing developments.

There is no silver bullet. It will take a concerted effort over many years to increase the supply of new housing, improve the quality of our housing stock, develop more secure and affordable rentals, and support first home buyers into their own homes.

One of the most important interventions we can make to enable new homes is to remove the planning and infrastructure barriers. The evidence is clear – removing restrictive planning rules enables more housing and puts downward pressure on rents.

  • Tier 1 and 2 Councils will complete Housing and Business Assessments and Future Development Strategies this year for their 2024 Long Term Plans ensuring that more people will get opportunities to live and work where they want to.

Investment in infrastructure has been identified as one of the key actions the Government can take to increase the supply of housing in the short term.

  • The Housing Acceleration Fund will continue to jump-start housing developments by funding the necessary services, like roads and pipes to homes, which are currently holding up development.

So far $926.6 million in funding has been committed to infrastructure projects throughout the country enabling around 30,000 to 35,000 new homes for New Zealanders over the next 10 to 15 years. A further $2.3 billion has been provided for land remediation, transport and water infrastructure to enable around 18,400 new homes on Kāinga Ora land in Auckland and Eastern Porirua, as well as a further 13,000 homes enabled on adjacent privately owned land.

Maintaining the Government’s construction momentum is crucial to maintaining sector capacity throughout this uncertainty. After a decade of being prevented from building new homes and being required to sell-off existing ones, while extracted $576 million in dividends were extracted, Kāinga Ora is instead delivering thousands of new homes. Under this Government there are 11,473 more public homes, including 9,236 newly built homes.

  • This means that out of all of New Zealand’s public housing stock, this Labour Government has delivered nearly 1 in 7 of them.

We’ve also delivered over 4,000 transitional homes with wrap around support for people who need to get on the path to permanent housing.

It’s been a joint effort. Community Housing Providers have been turbo charged, with community providers getting five times as much funding to deliver housing in the last financial year than in the year before Labour came into Government.

  • We will deliver 18,000 additional public and transitional homes by 2024, and a further 700 homes will be retrofitted to meet or exceed new build building standards this year.

A further 8,000 homes will be upgraded to meet the Healthy Homes Standards, meaning 90 percent of state homes will be compliant by the middle of this year. This work represents one of the largest upgrade programmes in our history. But public housing alone cannot fill the gap, and we will continue to work with community groups, iwi and the private sector to deliver more secure and affordable rental options.

  • We will make further investments in affordable rentals, and pass legislation to create a Build-to-Rent asset class that provides greater stability of tenure for tenants and exempts developments from interest deductibility tax rules.

All people in Aotearoa should have a warm, dry and safe home that meets their needs. The Government is on track to deliver all actions under the Homelessness Action Plan, which has been crucial for focusing Government’s efforts on preventing and interrupting homelessness. The prioritisation of the longer-term actions has particularly empowered by-Māori for-Māori solutions and introduced a focus on the specific kinds of support required by rangatahi to interrupt inter-generational cycles of housing instability.

We will continue to work with our cooperation partner, the Green Party of Aotearoa New Zealand, to roll out on-going support services for people and whānau experiencing homelessness as we strive to prevent it where possible and, when it does happen, make it rare, brief and non-recurring. More than 5,000 households have been accepted into the Housing First programme with more than 1,500 being housed by the programme to date, nearly a thousand individuals and whānau are being supported to transition into permanent housing through the rapid rehousing pilot, and a further 1,400 are being supported to sustain tenancies.

Honourable members

Making the Resource Management process quicker, cheaper and better will help boost New Zealand’s economic growth and enable us to continue making progress on the national infrastructure deficit.

There is clear evidence resource consenting has become more costly, with council fees for notified consents more than doubling between 2015 and 2019. Costs for mid-sized infrastructure projects are up 70 percent in the same period, with smaller projects being disproportionately affected. Time to consent infrastructure projects has increased by 150 percent since 2010.

The current system is broken. It takes too long, costs too much and has not adequately provided for development nor protected the environment. It has made housing more expensive and contributed to a shortage of homes.

  • The Natural and Built Environment Bill and Spatial Planning Bill will progress through Parliament cutting red tape, lowering costs and shortening the time it takes to approve new homes and key infrastructure projects, and better protect the environment.

The new system will cut more than 100 RMA plans to just 15. The time taken to prepare those plans will reduce from 10 years to a maximum of four. On a conservative estimate annual costs to users are forecast to fall by 19 percent, or $149 million, and overall benefits forecast to be more than $10 billion over 30 years.

Successive governments have called for RMA reform. We are delivering it. We thank the local government steering group and other civil society representatives for their engagement and assistance.

Honourable members

Safe drinking water is critical for the health and wellbeing of New Zealanders. In many parts of New Zealand people cannot be confident that their drinking water is safe, that we’re achieving good environmental outcomes and that there is sufficient capacity to accommodate population and housing growth. Recent reporting from Taumata Arowai, the new drinking water regulator, shows that 18 percent of New Zealanders are supplied with water that does not meet drinking water standards.

  • Taumata Arowai has updated New Zealand drinking water standards, and is monitoring nearly 2,000 drinking water supplies covering approximately 85 percent of the New Zealand population.

Infrastructure performance is a significant contributor to these outcomes and the imposition of water restrictions, with some networks losing 25 percent of water between the treatment plant and the tap. It is estimated to cost between $120 billion and $185 billion to bring water infrastructure up to scratch, upgrade water assets to meet drinking water and environmental standards, and provide for future population growth.

  • We will refocus our reforms and work with local authorities to tackle this challenge.

While this occurs we have taken steps to ensure New Zealanders have safe drinking water by funding 291 km of drinking water pipe upgrades and 159 km of waste-water pipe upgrades. 101 drinking water treatment plants and 128 wastewater treatment plants are being upgraded.

When it comes to digital connectivity, we proudly rank high on the world stage in terms of access and uptake. But we know we can always do better as technology continues to improve. A reliable connection will make it easier for remote businesses to operate, pay invoices and network. For everyday New Zealanders, especially those in our rural communities, improved digital connectivity connects people socially, but also to online health services and educational tools.

  • 99.8 percent of all New Zealanders will receive access to improved broadband by the end of 2023

Supporting businesses to innovate and grow

This year we will continue working in partnership with industry and unions to identify high-impact interventions to drive greater and better directed investment, accelerate levels of innovation and its diffusion to lift productivity, support emerging sectors, and to enhance global trade and technology transfer networks in key sectors.

  • We will release Industry Transformation Plans with the advanced manufacturing, digital, tourism and agritech sectors.

Industry Transformation Plans are key to managing the transition to a high wage low emissions economy with security in good times and bad. They seek to move key industries along the value curve through increasing innovation and productivity, driving higher wages and living standards in a non-inflationary way.

We will back industry plans for more automation and to invest in the new technology that increases productivity. This type of investment can be win-win for business owners and workers – it means businesses become more productive and the increased economic activity will create more jobs for people to move into. This complements the expanded Venture Capital Fund, Elevate NZ, which is co-investing with the private sector to grow the innovative companies of tomorrow.

Research and innovation is critical to meeting the biggest challenges and opportunities facing New Zealand, from combatting climate change and preparing for and responding to natural disasters, to supporting our health and wellbeing, and increasing and growing the prosperity and resilience of New Zealanders.

New Zealand invests roughly half as much as a share of our economy in R&D as comparable countries. We’ve made considerable progress with the Research and Development Tax incentive supporting $1.6 billion of business investment to date. That is an increase of 18 percent between 2019 and 2021 alone.

  • We will accelerate innovation, diversify and scale up the impact from our innovative businesses and science talent through the Te Ara Paerangi science and innovation system reform.

Our climate response is also our greatest opportunity for new jobs and higher wages. For a country already earning a premium from our clean, green and innovative image, there is an opportunity to use that natural advantage to create new jobs in new industries.

New Zealand’s first Emissions Reduction Plan put innovation and clean technology at the heart of our economic transition. We will continue to implement our plan to transition into high wage and high productivity jobs and partner with businesses to not only reduce emissions and costs but to grow into new markets.

  • The Climate Commission will deliver its advice on the second Emissions Reduction Plan.

The Government will continue to support innovative and dynamic businesses to take advantage of economic opportunities arising from the transition to a low emissions economy. The Green Investment Fund will invest in new and innovative start-up businesses and low-carbon technologies of the future. The Regional Strategic Partnership Fund will work with regional New Zealand to identify, develop and maximise each region’s comparative advantages.

Honourable members

Our economic security depends on New Zealand’s food and fibre sector. Our shared goal is supporting farmers to grow their exports, reduce emissions, and maintain our agricultural sectors’ international competitive edge into the future. Consumers around the world are more climate conscious and are changing their spending to match. Fonterra has warned its farmers that it risks losing customers and facing trade barriers if it doesn’t meet its customers’ sustainability expectations. This follows similar warnings from Tesco and Nestle.

Other countries are moving to compete and seize these opportunities. New Zealand cannot afford to be left behind. In many areas we will not be the first to make these changes, but we can still be the most innovative. The future growth of our exports will be built on a credible plan to bend our emissions curve and meet our targets.

  • We will continue to work with farming leaders on He Waka Eke Noa for farm emissions

We will work to give more New Zealand farmers the tools they need to reduce emissions and improve productivity.

  • The newly established Centre for Climate Action on Agricultural Emissions will work on developing and promulgating new emissions reducing technologies.

The Centre will work to accelerate the development of high-impact technologies and practices to reduce agricultural greenhouse gas emissions while maintaining the primary sector’s economic prosperity.

Hydrogen is a key future tool for reducing emissions in the parts of the world economy that will be difficult to decarbonise. Its versatility, low weight, and wide range of uses could make it a particularly valuable and sought after export commodity. New Zealand is uniquely placed to become a world-leader in hydrogen production using renewable energy, creating new export opportunities, high-wage jobs and regional industries.

  • The first phase of the shared plan with businesses and investors to ensure New Zealand is well-positioned to produce green hydrogen at scale will be completed.

Honourable members

As the world feels the impact of global economic pressures, the importance of securing high-quality, modern free trade agreements is not only essential for growing export businesses but for the economic security of all New Zealanders. The last three years have highlighted the need to have a well-diversified range of trading partners to build resilience to shocks and economic and geopolitical disruption.

We are committed to providing New Zealand businesses with as many trading partners as possible. And this agenda has great momentum. Since coming to office, the Government has concluded four Free Trade Agreements and upgraded existing agreements with Singapore, China and ASEAN member states.

  • Free trade agreements now cover almost three quarters of New Zealand’s exports, up from less than half six years ago.

This year the UK Parliament is expected to ratify our free trade agreement. The UK FTA will provide unprecedented access to the UK market, eliminating all tariffs on New Zealand exports over time. Immediately on entry into force, 99.5 per cent of New Zealand’s current trade will be able to enter the UK duty free. At full implementation, the deal is estimated to boost New Zealand’s GDP by up to $1 billion, with New Zealand exports to the UK estimated to grow by over 50 percent.

The EU is New Zealand’s fourth-largest trading partner with two-way goods and services trade worth NZ$17.5 billion for the year to December 2021. The EU FTA will enable duty-free access on 97 percent of New Zealand’s current exports to the EU with over 91 percent being removed the day the FTA comes into force. NZ exporters will save $100 million per annum on tariff elimination from day one and the value of New Zealand’s exports to the EU is expected to increase by up to $1.8 billion per year from 2035.

  • We will begin the ratification process for the free trade agreement with the European Union.

New Zealand exporters offer some of the best products in the world and the Government will keep working alongside industry and business to unlock access and opportunities like those delivered in these agreements. 

IV. Providing strong and responsible leadership

As we rebuild from Cyclone Gabrielle and navigate our way through these challenging economic times, this Government will provide strong, stable and responsible leadership. We are committed to keeping New Zealanders safe and will continue to crack down on criminal behaviour while investing in the programmes that prevent crime. The best means of prevention is the high chance offenders will be detected by a growing Police force with adequate resources.

In a world as turbulent as ours is today, feeling safe extends to New Zealand’s global and regional security. New Zealand is not immune to global threats and we will uphold our responsibilities to protect our country and contribute to regional and global security and the rules-based international order. We have experienced two recent terrorist attacks and will continue to strengthen our national security system. We have responded alongside the international community to Russia’s illegal and unjustified invasion of Ukraine. We remain alert to increased geostrategic competition in the Pacific.

We will continue to shoulder our responsibilities to respond to the effects of climate change and natural disasters at home and in our region. The impacts of climate change are being increasingly felt and extreme weather events are becoming more common and of greater intensity. This Government will invest in our resilience to a changing climate and support those communities affected by unexpected events like Cyclone Gabrielle.

Providing strong and responsible leadership means listening, working together, and committing to build an enduring relationship with Māori that delivers on partnership, protection, and participation. We will celebrate what makes us a unique and vibrant nation – our history of voyages and our connections to the different cultures and ethnicities that have made Aotearoa home. As a nation we are proud of who we are and this Government is committed to working with all of society to ensure a New Zealand that future generations can be proud of.

Ensuring our communities are safe

Part of what makes this country great is that we feel safe in our own homes, in our workplaces, and on our streets. There is a strong sense of community and we all have each other’s backs. We have a clear message for those who attempt to challenge that lifestyle that we all know and love: You will be caught and there will be consequences. We will not stand for crime, behaviour which is designed to intimidate, or actions which compromise family businesses. This Government’s top priority in law and order is to maintain the safety in our communities which they deserve.

Prevention of crime is the priority, and one of the best means of prevention is the high chance offenders will be detected. That's why supporting our Police with additional officers and modern equipment is so important. There are now over 1,600 additional Police across the country under this Government.

  • Police are on track to deliver on their growth target of 1,800 additional Constabulary Police officers by the end of June this year.

This growth in Police numbers means they are able to increase the number of frontline staff focussed on organised crime. Investing in our Police is delivering results. Operation Cobalt has seen 933 search warrants and 608 warrantless searches executed, 332 firearms seized and 25,204 criminal charges filed. This is in addition to the targeted enforcement as part of Operation Tauwhiro, which, at its conclusion in June last year saw Police carry out 1,043 search warrants, 765 warrantless searches, seizing 1,804 firearms and making 1,457 arrests.

  • We will continue to target serious transnational organised crime that threatens the safety and security of our people, the integrity of New Zealand’s supply chain, and the prosperity of our businesses and economy.

We are hitting gangs where it hurts – in their pockets. We’re doing that by removing their criminally acquired assets which both reward and enable crime, and putting the proceeds back into crime prevention initiatives. We’re targeting organised crime and intimidating behaviour by ensuring they are faced with consequences that will make them think twice.

  • We will pass legislation to target organised crime, intimidating behaviour and seize criminal proceeds through the Criminal Proceeds (Recovery) Amendment Bill and the Criminal Activity Intervention Legislation Bill.

Last year there was a record-breaking year of drug seizures – including 1.82 tonnes of methamphetamine and 949 kilograms cocaine. Over $2.3 billion dollars in social harm was prevented through methamphetamine and cocaine seizures at the border alone. Overseas border authorities inform us that close to $873 million in harm was also prevented through offshore drug seizures that were destined for New Zealand.

Dealing seriously with crime means dealing seriously with the underlying causes of crime and being clear that those who cause harm to others must be held to account. We are focussed on evidence of what works, which is why part of the response to the spike in young people committing retail crime was ramping up the youth engagement and employment programmes delivering results. These are the programmes which get our kids off a pathway of crime and into education and employment, where they belong.

  • We will support the expansion of Kotahi te Whakaaro to 14 – 17 year olds, which has a proven track record of 76 percent of participants not reoffending.

We’re also continuing to support locally-led solutions across Northland, Auckland, Bay of Plenty and the Waikato, enabling them to deliver targeted education, employment and mentoring programmes.

We have to face up to the fact that not all crime can be prevented, and proportionate consequences must be in place for those who commit those crimes. But we have to move past the solutions that sound good, but do not work.

  • Since putting in place the ’Circuit Breaker’ intervention programme, aimed at a small group of serious repeat offenders aged between 10 and 13 years, 69 children have been referred to the programme. Of those, 84 percent have not been re-referred.

Honourable members

Ensuring that there is a more level playing field for access to justice is an area of focus for the Government. We have increased legal aid funding to an additional 93,000 people, and removing the upfront payment and interest on repayments instituted by the previous Government.

  • We will pass the Legal Services Amendment Bill this year to make the legal aid system fairer and better support access to justice for those people on low incomes.

We’re also ramping up our support for victims affected by ram raids and aggravated burglaries. On top of the 1000 fog cannons funded since 2018, 1,403 security interventions have been approved for eligible stores through the Retail Crime Prevention Programme, with 412 interventions completed so far. On 1 February this year we introduced a $4,000 subsidy for the installation of Fog Cannons for eligible small retail businesses who do not have to be the victim of a ram raid or aggravated burglary. 332 applications for this scheme have already been approved.

  • This Government will continue to support New Zealand business owners to put in place effective measures that will protect their businesses from being the target of retail crime.

Preventing and responding to family and sexual violence will continue to be a priority for this Government as we work to ensure that all people can live peaceful lives free from violence. For the first time ever, we have a National Strategy to eliminate family violence and sexual violence – Te Aorerekura – and a Minister leading this cross-government work. We are on track to deliver all 40 actions in the first Action Plan for Te Aorerekura. We will continue to work with our cooperation partner, the Green Party of Aotearoa New Zealand, to focus on primary prevention, integrated community-led responses and improved workforce capability to strengthen community approaches and enable people to seek appropriate help no matter where they turn.

Building resilience and responding to unexpected events

Cyclone Gabrielle is the most significant weather event New Zealand has seen this century. While the focus is on the response and recovery, we must ensure that we prepare for the future. 

Recovering from Cyclone Gabrielle will be one of the major areas of focus for the Government in the coming weeks and months. We’re committed to working in partnership with business and the community. Our overall approach to a recovery will be informed by past responses to events such as the Christchurch and Kaikōura earthquakes. We need strong and experienced coordination across all arms of Government, working alongside local government, the business community, social service providers, iwi, and community groups.

  • We’re committed to a strong local voice informing recovery priorities and decisions.

While the full impacts of the cyclone continue to be assessed, it’s clear that the damage is significant and on a scale not seen in New Zealand for at least a generation. The required investment to reconnect our communities and futureproof our nation’s infrastructure is going to be significant, and require hard decisions. We won’t shy away from those hard decisions, and we’re working on a suite of measures to support New Zealanders by building back better, building back safer, and building back smarter.

The impacts of climate change are being increasingly felt. Extreme weather events are becoming more common and of greater intensity. Even prior to these recent flooding events, the number of events requiring emergency works more than doubled between the 2018-21 and 2021-24 National Land Transport Programme periods. There has been a nine-fold increase in the amount of money required to help farmers and growers affected by floods, storms and drought over what was budgeted. And when they happen, everything from the roads we rely on to our drains and water supplies can be severely disrupted.

As these events show while climate change is a global challenge, its impacts are already being felt in our local communities. We must do more than respond to extreme weather events. New Zealand has a history of solving challenges through innovation, resourcefulness and determination – and adapting to climate change is no different. The sooner we act, the more effective that action will be.

  • This Government will support those communities affected by the impacts of climate change, and work to ensure communities have the information and support they need to prepare for the impacts of climate change, and start the work of adaptation.

Honourable members

Supply chain disruption has been a feature of the post-pandemic economic recovery. New Zealand is particularly exposed to disruption as a small, open, trade-based economy, far from global markets and heavily reliant on importing key goods and materials and exporting our products to international customers. The pandemic has exposed vulnerabilities with “just-in-time” logistics as well as highlighting New Zealand’s dependence on global supply chain networks.

The risk of supply chain disruptions is increasing due to a range of natural hazards, extreme weather events and climate change, and geo-strategic threats and conflict. Recent experiences with aviation fuel are demonstrative of a wider need for reliable, competitive and resilient supply chains, especially for essential goods and services.

  • The Productivity Commission will undertake an inquiry into the resilience of the New Zealand economy to supply chain disruptions, and we will take steps to improve the resilience of our fuel supplies.

Te Tiriti o Waitangi

We have continued to work closely with Māori and have walked a path underpinned by partnership and based on the articles of the Treaty and the promise of equality. This simple concept is not new. In fact there is no principle more fundamental in our nation’s history than working in collaboration with Māori.

The past has shown that working in partnership with Māori has not only opened up doors of opportunity for those involved, Māori and Pākehā alike, but it has been part of what has brought this nation forward as a whole.

However we must always be prepared to confront the realities of our past in order to be able to move forward together. Injustices in the relationship between the Crown and Māori are not just an historic artefact. They have a contemporary relevance.

We continue to see and feel these in the conversations we are having today and in the future.

We need to do more to support equity. It is a core pillar of the Treaty, a core responsibility of the government, and a core value for which we stand as a government. Māori Health is the perfect example. Māori are over-represented in negative health statistics and die younger than other ethnicities. We need to turn this around. That is the focus of the Māori Health Authority Te Aka Whai Ora.

  • Our work to date has seen us lower the starting age for Māori for Bowel Screening from 60 to 50, enable more Māori Primary and Community Care providers and has further strengthened our Health Workforce.

In education, you can see how we’ve built off the successes of Māori medium education with the aim of revitalising our indigenous language. We have striven to strengthen our national identity through our commitment to ensure that Aotearoa New Zealand history is taught in all of our schools to all of our young people.

Introducing Matariki as a public holiday was a meaningful step in celebrating what makes us unique as a country, and what holds us together as a nation.

  • This year New Zealand will celebrate Matariki on 14 July.

Our apprenticeship boost has trained around 9,000 of those as identifying as Māori. In Mana in Mahi we have lifted over 2,200 people into earn-while-you-learn jobs in just three years – for Māori and Pacific.

Māori participation is important, as it is required under legislation and under the obligations of the Treaty of Waitangi. There has been considerable misinformation around co-governance, where our position in fact aligns to successive National and Labour governments which have supported co-governance and have embedded it into Treaty Settlements.

Our approach has regularly centred on the protection and management of natural resources and this aligns with the work by Hon Chris Finlayson and the last National Government who signed the Te Uruwera settlement. It is limited to the overall wellbeing of the natural resource, and does not extend to operational and business decisions. Outside of natural resources, the Government recognises we have responsibilities under legislation and Te Tiriti o Waitangi to which we must legally adhere, and seek to support the needs of Māori. This Government is not wedded to a particular approach, but we have worked to ensure Māori are represented where required, and that the government supports those in need.

The Government can do more work to be a better partner alongside Māori for the future prosperity for everyone who calls New Zealand home. 

V. Conclusion

This is a Government getting back to basics. We’re focussed on the issues that matter most to New Zealanders: on supporting New Zealand families and businesses through difficult economic conditions, accelerating the economic recovery and laying foundations for the future, and providing

Prime Minister’s Statement 23

strong and responsible leadership through difficult times, especially as we rebuild from Cyclone Gabrielle.

We will work with our co-operation partner, the Green Party, to provide stable progress on transitioning to a low carbon economy, reducing waste, taking mental health seriously and improving New Zealand’s biodiversity.

New Zealanders understand the scale of the rebuild before us and the global economic pressures our country is up against. They know we cannot do it all. But we can make focussed progress on the issues that matter most to them.

We can reduce the cost of living and accelerate our economic recovery by putting innovation, renewable energy and clean technology at the heart of our economic transition. We can build the resilience we need to deal with unexpected events. We can rebuild from Cyclone Gabrielle and future-proof our communities to a changing climate.

We can invest in strong public services that ensure our young people are engaged and thriving and support the physical and mental health of everyone. We can continue the progress we have made on ensuring every New Zealander has a warm, dry home. We can prevent and respond to crime, and tackle the causes of crime.

These challenges require focus. Neither the challenges of today nor the opportunities of tomorrow will come easily. But we are no strangers to navigating rough waters or taking tough decisions. In our time in Government we have achieved a lot. We have built core social infrastructure that is supporting New Zealanders though this uncertainty – from increased parental leave and BestStart to cheaper doctors visits and mental health support, and from strong income growth and increased social support to thousands of more teachers, police officers, doctors and nurses.

There is more to do. We cannot put this progress at risk.

But we can do this, together.