The Finance Minister says revelations she wanted to keep numbers attending this year's Budget lock-up more restricted than she suggested is a mountain out a of molehill.
After a wave of criticism directed at Treasury for restricting lock-up numbers - Nicola Willis said she stepped in to enable more people in.
An extra 30 people were added to the list.
But new OIA documents show it was actually Willis who pushed for tighter restrictions
She says she had initially opted to stick to the same approach for the Budget, as had been used for the half-yearly fiscal update.
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Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Speaker 1 (00:00):
Right now. Nikola White's Sponance Minister. Good evening, Good evening.
How was your break? You've had some time off? I understand, well,
not really.
Speaker 2 (00:08):
I had thirty six hours of the school holidays to
take the kids on some nature walks and the like.
But I've kept on working through the school holidays this time.
Speaker 1 (00:17):
And why is that cost of living still out of control?
Speaker 2 (00:22):
Such a busy agenda? Ryan and I love my work
so much, so it's been a joy to keep progressing
it while others have been taking some.
Speaker 1 (00:29):
Leat fair How do you rate your progress on cost
of living? What would you give yourself out of ten
right now?
Speaker 2 (00:39):
I would say that we have made good progress compared
to where New Zealand was at I e. We had
double digit food price inflation under labor and we've now
got it well down into the single figures. But there
is still more work to do. And that's what I
get up every day and think about, which is how
do we grow this economy, address the cost of living,
(01:03):
make it easier for keywis to get ahead. And some
of those issues take time to work on, you know,
the supermarket challenges built up over a series of decades,
the electricity market was trashed by a series of decisions
by the last government councils and their rating ways have
been creeping up on us for some time. So these
are not issues that I think New Zealanders think we
(01:24):
will resolve overnight. What they need to see is progress
and we are making it.
Speaker 1 (01:29):
Are you has the price of groceries come down?
Speaker 2 (01:34):
The amount of food price inflation has reduced under our
government from what it was under the last But I
remain concerns, as you're aware, with a lack of competition
in the supermarket sector, and I am working on reforms
to address that.
Speaker 1 (01:49):
How's that going? Have you had the report back yet?
Speaker 2 (01:52):
Look, it's going well. We received multiple responses to our
request for information from those who might seek to to
compete in the supermarket sector about what's holding them back,
both in terms of the way that the current monopolists
conduct themselves, the barriers to setting up new supermarkets and
the structural issues. And I will shortly be making recommendations
(02:16):
to Cabinet about next steps and will be announcing those
this quarter.
Speaker 1 (02:20):
Is there any need to bust up the supermarkets? Is
that something that you're seriously still considering or based on
the information you've got so far, will you take it
down and notch.
Speaker 2 (02:34):
Well, I've always started from the position which says, ultimately,
for this to be a more competitive market, you need
another national scale competitor. That's what all of the economic
evidence internationally tells us that for so long as you
have a duopoly, effectively, you're not going to get the
downward pressure on prices and the increased choice that consumers
want to see. So the question is how do you
(02:55):
get that third player. I've always been cards on the table.
My first preference be to do pretty much anything we
can to usher in a third player to ease the way.
But if that doesn't occur, then we need a backup plan.
And of course, if you went back in time, we
did have more than two players in each island, and
that was prior to the mergers of the existing brands
(03:17):
that occurred, and so there is a worthwhile exercise of saying, well,
what happens if we split them up again? But I've
always been clear, first preference, let's get a third player,
a new player into the market.
Speaker 1 (03:30):
So, because this is sounding very different, I mean, if
we look at the headlines, Nikola Willis threatens bust up,
what you're actually saying is we're going to try something first.
If that doesn't work, we will have the specter of
a bust up hanging in the background, waiting to fall
on your necks.
Speaker 2 (03:50):
Well, I'm doing the work on what a bust up
would look like because I think it's important that we
do that work. I'm also ensuring that where we have
existing laws, that we are enforcing them and are ensuring
that we've got enough teeth in the enforcement of them.
And then this next piece around what would it take
to usher in a third player actually goes to some
(04:12):
of these competition issues, because one of the things that
people who would potentially compete in New Zealand say to
us is that one of their concerns is about the
market power of the existing entities and what they might
do to them to stamp on that competition were it
to occur. So all of these issues need to be
considered together. My work on this has yielded some good
(04:37):
progress that I'm looking forward to sharing with New Zealanders
once Cabinet has considered it fully, and that will be
happening very soon.
Speaker 1 (04:45):
You're not using the confusion of your intention as a
pr tool to sound tough on supermarkets.
Speaker 2 (04:55):
No, it's really clear for me. New Zealand consumers aren't
getting a good deal because there isn't enough competition in
our grocery sector. And I want to use all of
the policy and legislative leaders available to the government to
encourage that basic thing, which is competition. And if you
write from the beginning say hey, look, we're going to
do a bunch of stuff, but I'm not prepared to
(05:16):
ever break them up, then what you're actually saying is
I'm not prepared to do everything it would take to
ensure competition, because actually my focus is on the New
Zealand shopper, who right now, in most parts of the
country has the choice between food stuffs and wire worse
in any other country in the world that have a
lot more choice than that. And what we have seen
again and again is that because there aren't those choices,
(05:39):
it appears that those big players misuse their market power.
New Zealanders pay more for their groceries, get fewer choices,
and it's harder to get the kind of innovation that
you see off shore. So I want to see more competition.
That's my starting place, and I'm considering all the ways
that you can get there.
Speaker 1 (05:55):
Okay, When will we have an answer?
Speaker 2 (05:59):
Well, I will be providing an update in the next
couple of months.
Speaker 1 (06:03):
Okay, and then we'll find out where you're going to
bust up the supermarkets Within a couple of months.
Speaker 2 (06:08):
Well, you'll find out what our next steps are.
Speaker 1 (06:09):
Run Why you why is this so hard? Why can't
you just say what you're going to do and when
you're going to do it.
Speaker 2 (06:15):
This is a problem that is literally decades in the making,
and whatever solution I put forward, I am testing very
carefully to ensure it will actually result in a better
deal to you, the shopper and other shoppers around the country.
And it's certainly an issue where you need more hastily speed,
which is to say that you need to carefully think
(06:36):
through your proposition. Let's remember the last government introduced massive
we know what they did, the Grocery Act, and did
it result in an improvement in competition or prices? No?
Jury is being prettle. So do I want to fall
for the same trap? No, No, I don't want to
fall for traps. I'm giving it a bit more due diligence,
a bit more depth of word.
Speaker 1 (06:54):
And while your Minister of finance, Grocery prices will come
down as a result.
Speaker 2 (07:00):
I want to see an increase in competition, okay, and
so that will in itself create downward pressure on prices.
And look, here's the thing. I'm having good commercial conversations
behind the scenes about what might be achievable here. I
could put all of that at risk by racing at
one solution. I've been very careful to say, let's go
(07:22):
through all of the options, way them up, come up
with the best option.
Speaker 1 (07:25):
Hey, with tariff's lux of the Prime ministration so told
me a couple of weeks ago, he's sort of okay
with the ten percent. I mean it's not ideal. But
if Trump is talking about fifteen or twenty percent, do
we start paying more attention.
Speaker 2 (07:41):
Well, obviously we're aware of those media reports, but we've
had no direct communication from the US suggesting any change
to New Zealand's current tariff status, which is the ten
percent baseline tariff. Remember the context here is that our
trade is very well balanced with the US. The US
enjoys very strong access to our market, virtually tariff free
across all areas. The Minister of Trade has had a
(08:04):
constructive engagement with the US Trade Representative Greer, and that
relationship has been affirmed as a strong one, and so
there's no reason for us to be of the view
that we're at risk here. Okay, beyond what's already been stated, you.
Speaker 1 (08:20):
The CTU, the lobby groups being excluded from the budget.
At the time, you claimed it was Treasury's decision, when
it's now clear from OAA documents that on April second,
the Treasury Communications Advisor informed this colleagues that willis preferred.
That's the Finance Minister taking the exact same approach as
was used at HAYFU. Why did you say one thing
(08:41):
when clearly another was going on behind the scenes.
Speaker 2 (08:44):
This is such a mountain out of a molehill. Basically,
last year we said, look, let's be a bit more
selective about who comes to the lock up. Treasury set
wrote up some guidelines on that. I said, well, let's
just stick to the same approach for the budget. Then
there was a heack a lot of noise about it,
and eventually I intervened and said, oh, well, let's just
(09:04):
let them all come. I don't think it's a surprise
to anyone listening to your show right now that I
have a different view on how the economy should be
run than Grant Robertson's former advisor Craig Rennie. He came
to the lock up, he got to listen, he got
to say his piece, and no one is the worse
for it. But if you were listening to him, that's
on you even not to know what he's doing here.
Speaker 1 (09:25):
But did you not want him there?
Speaker 2 (09:28):
Well, my original position late last year was that restricting
the lock up to those who actually required timely information
to communicate market sensitive information seemed a sensible restriction to make,
and initially we stuck to those guns. But it became
clear over time that the amount of discontent, not only
(09:48):
from the CTU but from the Taxpayers Union and others,
actually outweighed any benefits from restricting the lockup. So eventually, look,
the outcomes clear, right, Agre I wanted to come back
to come.
Speaker 1 (10:02):
I know, but it's not about that. It's about your credibility,
isn't it. Because you came out and you rest you
saved the day. He said, Oh no, I've saved the day.
Everyone's allowed to come now when it was you trying
to stop them coming in the first place.
Speaker 2 (10:13):
Well, a decision had been made previously that would restrict
by you when and then I came in and saved
the day. So you've you've summarized for yourself.
Speaker 1 (10:24):
Fair enough some honesty. Can I get that kind of
honesty on the supermarkets?
Speaker 2 (10:29):
You know what? The question is this is any New
Zealander better off because of the attendance at the lock up?
And I put to you there are bigger issues for
the country and ultimately my decision was I don't want
this to be a distraction from a budget which is
actually about New Zealanders, their cost of living, how we
(10:49):
create jobs and grow the economy. And the fact that
other people are more focused on whether or not they
get to wear a special badge at the lockup is
on them, not on me.
Speaker 1 (10:57):
Finance Minister Nichola Willis, it's great to have me back.
For more from Hither Duplessy Allen Drive listen live to
News Talk SETB from four pm weekdays, or follow the
podcast on iHeartRadio.
Right now. Nikola White's Sponance Minister. Good evening, Good evening.
How was your break? You've had some time off? I understand, well,
not really.
Speaker 2 (00:08):
I had thirty six hours of the school holidays to
take the kids on some nature walks and the like.
But I've kept on working through the school holidays this time.
Speaker 1 (00:17):
And why is that cost of living still out of control?
Speaker 2 (00:22):
Such a busy agenda? Ryan and I love my work
so much, so it's been a joy to keep progressing
it while others have been taking some.
Speaker 1 (00:29):
Leat fair How do you rate your progress on cost
of living? What would you give yourself out of ten
right now?
Speaker 2 (00:39):
I would say that we have made good progress compared
to where New Zealand was at I e. We had
double digit food price inflation under labor and we've now
got it well down into the single figures. But there
is still more work to do. And that's what I
get up every day and think about, which is how
do we grow this economy, address the cost of living,
(01:03):
make it easier for keywis to get ahead. And some
of those issues take time to work on, you know,
the supermarket challenges built up over a series of decades,
the electricity market was trashed by a series of decisions
by the last government councils and their rating ways have
been creeping up on us for some time. So these
are not issues that I think New Zealanders think we
(01:24):
will resolve overnight. What they need to see is progress
and we are making it.
Speaker 1 (01:29):
Are you has the price of groceries come down?
Speaker 2 (01:34):
The amount of food price inflation has reduced under our
government from what it was under the last But I
remain concerns, as you're aware, with a lack of competition
in the supermarket sector, and I am working on reforms
to address that.
Speaker 1 (01:49):
How's that going? Have you had the report back yet?
Speaker 2 (01:52):
Look, it's going well. We received multiple responses to our
request for information from those who might seek to to
compete in the supermarket sector about what's holding them back,
both in terms of the way that the current monopolists
conduct themselves, the barriers to setting up new supermarkets and
the structural issues. And I will shortly be making recommendations
(02:16):
to Cabinet about next steps and will be announcing those
this quarter.
Speaker 1 (02:20):
Is there any need to bust up the supermarkets? Is
that something that you're seriously still considering or based on
the information you've got so far, will you take it
down and notch.
Speaker 2 (02:34):
Well, I've always started from the position which says, ultimately,
for this to be a more competitive market, you need
another national scale competitor. That's what all of the economic
evidence internationally tells us that for so long as you
have a duopoly, effectively, you're not going to get the
downward pressure on prices and the increased choice that consumers
want to see. So the question is how do you
(02:55):
get that third player. I've always been cards on the table.
My first preference be to do pretty much anything we
can to usher in a third player to ease the way.
But if that doesn't occur, then we need a backup plan.
And of course, if you went back in time, we
did have more than two players in each island, and
that was prior to the mergers of the existing brands
(03:17):
that occurred, and so there is a worthwhile exercise of saying, well,
what happens if we split them up again? But I've
always been clear, first preference, let's get a third player,
a new player into the market.
Speaker 1 (03:30):
So, because this is sounding very different, I mean, if
we look at the headlines, Nikola Willis threatens bust up,
what you're actually saying is we're going to try something first.
If that doesn't work, we will have the specter of
a bust up hanging in the background, waiting to fall
on your necks.
Speaker 2 (03:50):
Well, I'm doing the work on what a bust up
would look like because I think it's important that we
do that work. I'm also ensuring that where we have
existing laws, that we are enforcing them and are ensuring
that we've got enough teeth in the enforcement of them.
And then this next piece around what would it take
to usher in a third player actually goes to some
(04:12):
of these competition issues, because one of the things that
people who would potentially compete in New Zealand say to
us is that one of their concerns is about the
market power of the existing entities and what they might
do to them to stamp on that competition were it
to occur. So all of these issues need to be
considered together. My work on this has yielded some good
(04:37):
progress that I'm looking forward to sharing with New Zealanders
once Cabinet has considered it fully, and that will be
happening very soon.
Speaker 1 (04:45):
You're not using the confusion of your intention as a
pr tool to sound tough on supermarkets.
Speaker 2 (04:55):
No, it's really clear for me. New Zealand consumers aren't
getting a good deal because there isn't enough competition in
our grocery sector. And I want to use all of
the policy and legislative leaders available to the government to
encourage that basic thing, which is competition. And if you
write from the beginning say hey, look, we're going to
do a bunch of stuff, but I'm not prepared to
(05:16):
ever break them up, then what you're actually saying is
I'm not prepared to do everything it would take to
ensure competition, because actually my focus is on the New
Zealand shopper, who right now, in most parts of the
country has the choice between food stuffs and wire worse
in any other country in the world that have a
lot more choice than that. And what we have seen
again and again is that because there aren't those choices,
(05:39):
it appears that those big players misuse their market power.
New Zealanders pay more for their groceries, get fewer choices,
and it's harder to get the kind of innovation that
you see off shore. So I want to see more competition.
That's my starting place, and I'm considering all the ways
that you can get there.
Speaker 1 (05:55):
Okay, When will we have an answer?
Speaker 2 (05:59):
Well, I will be providing an update in the next
couple of months.
Speaker 1 (06:03):
Okay, and then we'll find out where you're going to
bust up the supermarkets Within a couple of months.
Speaker 2 (06:08):
Well, you'll find out what our next steps are.
Speaker 1 (06:09):
Run Why you why is this so hard? Why can't
you just say what you're going to do and when
you're going to do it.
Speaker 2 (06:15):
This is a problem that is literally decades in the making,
and whatever solution I put forward, I am testing very
carefully to ensure it will actually result in a better
deal to you, the shopper and other shoppers around the country.
And it's certainly an issue where you need more hastily speed,
which is to say that you need to carefully think
(06:36):
through your proposition. Let's remember the last government introduced massive
we know what they did, the Grocery Act, and did
it result in an improvement in competition or prices? No?
Jury is being prettle. So do I want to fall
for the same trap? No, No, I don't want to
fall for traps. I'm giving it a bit more due diligence,
a bit more depth of word.
Speaker 1 (06:54):
And while your Minister of finance, Grocery prices will come
down as a result.
Speaker 2 (07:00):
I want to see an increase in competition, okay, and
so that will in itself create downward pressure on prices.
And look, here's the thing. I'm having good commercial conversations
behind the scenes about what might be achievable here. I
could put all of that at risk by racing at
one solution. I've been very careful to say, let's go
(07:22):
through all of the options, way them up, come up
with the best option.
Speaker 1 (07:25):
Hey, with tariff's lux of the Prime ministration so told
me a couple of weeks ago, he's sort of okay
with the ten percent. I mean it's not ideal. But
if Trump is talking about fifteen or twenty percent, do
we start paying more attention.
Speaker 2 (07:41):
Well, obviously we're aware of those media reports, but we've
had no direct communication from the US suggesting any change
to New Zealand's current tariff status, which is the ten
percent baseline tariff. Remember the context here is that our
trade is very well balanced with the US. The US
enjoys very strong access to our market, virtually tariff free
across all areas. The Minister of Trade has had a
(08:04):
constructive engagement with the US Trade Representative Greer, and that
relationship has been affirmed as a strong one, and so
there's no reason for us to be of the view
that we're at risk here. Okay, beyond what's already been stated, you.
Speaker 1 (08:20):
The CTU, the lobby groups being excluded from the budget.
At the time, you claimed it was Treasury's decision, when
it's now clear from OAA documents that on April second,
the Treasury Communications Advisor informed this colleagues that willis preferred.
That's the Finance Minister taking the exact same approach as
was used at HAYFU. Why did you say one thing
(08:41):
when clearly another was going on behind the scenes.
Speaker 2 (08:44):
This is such a mountain out of a molehill. Basically,
last year we said, look, let's be a bit more
selective about who comes to the lock up. Treasury set
wrote up some guidelines on that. I said, well, let's
just stick to the same approach for the budget. Then
there was a heack a lot of noise about it,
and eventually I intervened and said, oh, well, let's just
(09:04):
let them all come. I don't think it's a surprise
to anyone listening to your show right now that I
have a different view on how the economy should be
run than Grant Robertson's former advisor Craig Rennie. He came
to the lock up, he got to listen, he got
to say his piece, and no one is the worse
for it. But if you were listening to him, that's
on you even not to know what he's doing here.
Speaker 1 (09:25):
But did you not want him there?
Speaker 2 (09:28):
Well, my original position late last year was that restricting
the lock up to those who actually required timely information
to communicate market sensitive information seemed a sensible restriction to make,
and initially we stuck to those guns. But it became
clear over time that the amount of discontent, not only
(09:48):
from the CTU but from the Taxpayers Union and others,
actually outweighed any benefits from restricting the lockup. So eventually, look,
the outcomes clear, right, Agre I wanted to come back
to come.
Speaker 1 (10:02):
I know, but it's not about that. It's about your credibility,
isn't it. Because you came out and you rest you
saved the day. He said, Oh no, I've saved the day.
Everyone's allowed to come now when it was you trying
to stop them coming in the first place.
Speaker 2 (10:13):
Well, a decision had been made previously that would restrict
by you when and then I came in and saved
the day. So you've you've summarized for yourself.
Speaker 1 (10:24):
Fair enough some honesty. Can I get that kind of
honesty on the supermarkets?
Speaker 2 (10:29):
You know what? The question is this is any New
Zealander better off because of the attendance at the lock up?
And I put to you there are bigger issues for
the country and ultimately my decision was I don't want
this to be a distraction from a budget which is
actually about New Zealanders, their cost of living, how we
(10:49):
create jobs and grow the economy. And the fact that
other people are more focused on whether or not they
get to wear a special badge at the lockup is
on them, not on me.
Speaker 1 (10:57):
Finance Minister Nichola Willis, it's great to have me back.
For more from Hither Duplessy Allen Drive listen live to
News Talk SETB from four pm weekdays, or follow the
podcast on iHeartRadio.
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