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RNZ News
19 minutes ago
- RNZ News
New Zealand signs new agricultural trade deal with Indonesia
Minister of Agriculture/Trade and Investment Todd McClay and Indonesian Minister of Agriculture Andi Amran Sulaiman sign a new bilateral arrangement on agricultural cooperation in Jakarta, 7 August, 2025. Photo: Supplied New Zealand and Indonesia have signed a new agricultural trade agreement, as part of the government's bid to double export values in 10 years. The minister overseeing both agriculture and trade, Todd McClay, said the deal would create new commercial opportunities for farmers and agribusinesses in both countries. He signed the new bilateral arrangement in Jakarta on Thursday, alongside Indonesian Minister of Agriculture Andi Amran Sulaiman. "This new agreement will make it easier for our agricultural sectors to collaborate, share expertise and open doors for trade and investment," McClay said. "It provides a framework for stronger cooperation in areas like livestock development, smart agriculture, biosecurity, agricultural research, and streamlined trade processes." The arrangement would also see a dedicated 'Consultative Forum' established to coordinate both countries' regulations and reduce red tape for exporters. The forum would hold its first meeting within a year. "This is about building long-term commercial partnerships. It will help more New Zealand businesses connect directly with Indonesian partners, support our farmers to get their high-quality products into market, and encourage ... investment in agriculture from both sides," McClay said. "Agreements like this one help to grow the value of our exports, lift returns to the farmgate, and unlock future growth for the entire economy." Sign up for Ngā Pitopito Kōrero , a daily newsletter curated by our editors and delivered straight to your inbox every weekday.
RNZ News
4 hours ago
- RNZ News
Treasury briefing points finger at government spending during Covid-19 pandemic
The Treasury briefing said the Covid-19 response showed the challenges of using fiscal policy to respond to shocks and cycles. Photo: FANATIC STUDIO / SCIENCE PHOTO L The previous government spent too much during the Covid-19 pandemic, despite warnings from officials, according to a briefing released by the Treasury. The Treasury's 2025 Long Term Insights Briefing said debt had risen in recent decades, partly because responses to adverse shocks were not met by savings between those shocks. The higher debt meant less capacity to respond to future shocks, like natural hazards, weather-related risks and biosecurity risks. Treasury estimated the total cost of the pandemic was $66 billion over the 2020-26 financial years and about 20.4 percent of GDP. The IMF and OECD estimated it was among the largest Covid-19 responses globally. The agency releases a briefing every three years, with this one looking at the role of fiscal policy through shocks and business cycles. The briefing said the Covid-19 response showed the challenges of using fiscal policy to respond to shocks and cycles. Initially, Treasury recommended "strong fiscal stimulus" at the start of the pandemic, which was cited as "perhaps" causing the economy to be much stronger than expected by the end of 2020. The wage-subsidy scheme in particular was seen as making an important contribution to the strong initial recovery, limiting the increase in the unemployment rate and enabling economic activity to resume when restrictions relaxed. Treasury then moved away from recommending broad-based stimulus, preferring more targeted and moderate support. Its post-election advice to the then-Finance Minister in late 2020 highlighted "the importance of controlling ongoing spending and ensuring it was high value to meet the medium-term fiscal challenge." By August 2021, with the Delta lockdowns coming in, Treasury recommended any decisions to provide support to businesses "should take account of macroeconomic trade-offs". It recommended against any further stimulus from Budget 2022 onwards. Wage subsidies and similar schemes during lockdowns made up about 35 percent of the costs of the response. A further 18 percent came from health-system costs, like vaccination, contact tracing, and managed isolation and quarantine. The remaining "nearly half" was made up of a wide range of initiatives that Treasury said had "varied objectives". Some were aimed at directly responding to the impacts of Covid-19, others were aimed at providing fiscal stimulus or "achieving social or environmental objectives". They included "tax changes, training schemes, housing construction, shovel-ready infrastructure projects, increases to welfare benefits, the Small Business Cashflow Scheme, Jobs for Nature, additional public housing places and school lunches". Programmes within the fiscal response that were not tied to the shock were seen as having "a lagged impact on the economy and proved difficult to unwind in later years". The report suggested cyclical management was best left to monetary policy, run by an independent central bank. It also suggested governments set out clearly when fiscal policy will be used ahead of time, including pre-defining responses. Ideally, this would have cross-party agreement. An independent fiscal institution, which could scrutinise and report on the sustainability of fiscal policy, was also suggested. The previous government had considered setting up a watchdog to cost election policies, but it could not get cross-party support. National then changed its tune, with current Finance Minister Nicola Willis supporting such a measure, but New Zealand First and ACT were opposed to the idea. Willis jumped on the report's release, saying Treasury's language was "spare and polite", but its conclusions were "damning". She said the briefing showed the challenges of using "big spending measures" to respond to one-off shocks. Willis singled out the briefing's focus on the money spent on initiatives not directly tied to the Covid-19 response. "That is a very diplomatic way of saying New Zealanders are still paying the price of the previous government extending a big-spending approach, initially intended for a pandemic response," she said. RNZ has approached Labour for comment. Sign up for Ngā Pitopito Kōrero , a daily newsletter curated by our editors and delivered straight to your inbox every weekday.
RNZ News
4 hours ago
- RNZ News
Labour MPs gather in Christchurch to formulate election strategy
Labour leader Chris Hipkins addressed the Queenstown Business Chamber on Thursday. Photo: Screengrab Analysis: Labour MPs are gathering in Christchurch for a team 'away day', as the party inches closer to announcing its tax policy. Last year's mid-winter retreat was held in Auckland to re-engage with 'supercity' residents , after the party's bruising defeat in Election 2023 The caucus is now pushing to connect with the South Island - leader Chris Hipkins addressed the Queenstown Business Chamber on Thursday, while other MPs visited flood-affected properties in Moteuka. They will all come together in Christchurch on Friday to look to the year ahead and talk strategy for the run-up to next year's election. The meeting comes as the government works against a tide of negative headlines about the economy, with unemployment jumping to 5.2 percent on Wednesday. National campaigned on rebuilding the economy and Prime Minister Christopher Luxon heralded 2025 as the year of "going for growth" in his State of the Nation speech in January . The party is now battling the headwinds of an economic downturn, with some business voices, like former National leader-turned Auckland Chamber boss Simon Bridges, criticising the coalition for not doing more to stimulate the economy. Labour has been near silent on the policy front, choosing instead to criticise the coalition's ideas and hone its messaging on the cost of living to better resonate with voters feeling the pinch. Responding to an update on the government's transition to a universal road-user charges system , Hipkins said the timing could "clobber" those already struggling to pay the bills, but as for Labour's alternative timeline, who knows? The strategy thus far shows some promise, with the left bloc parties - Labour, the Greens and Te Pāti Māori - holding a narrow lead over the coalition in several political polls this year. Labour has also emerged as the party New Zealanders think has the best handle on the cost of living, according to the latest Ipsos Issues Monitor , but the race remains tight and the coalition parties are poised to pounce, when Labour unveils its tax plan this year. On Sunday, The Post reported Labour was one step closer to endorsing a capital gains tax (CGT) - insiders say the party's policy council has narrowly voted for a CGT over a wealth tax . While MPs will most likely discuss tax policy at today's mid-winter retreat, the public shouldn't hold its breath for an announcement. Party process requires both the council and caucus to sign off on policy. In the meantime, the party is clearly preparing to pitch - and defend - its approach to tax. Hipkins told TVNZ's Q+A in March he would need time to "counter the misinformation that often goes with tax changes" before the 2026 Election. Hipkins will give an opening speech to his caucus in Christchurch on Friday, before MPs have policy and strategy discussions behind closed doors. Sign up for Ngā Pitopito Kōrero , a daily newsletter curated by our editors and delivered straight to your inbox every weekday.
