August 25, 2025 • 9 mins
Further work on tackling the supermarket duopoly is in the wings.
The Finance Minister claimed an update is imminent on plans to improve competition in the supermarket sector.
She says this has been an issue for decades - and she'll have more to say in coming weeks.
Nicola Willis says the announcement won't be a 'silver bullet' but it will reveal what the Government's been working on.
"I'm not going to be announcing an international supermarket chain with 50 stores that's going to be opening up next month."
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Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Speaker 1 (00:00):
With me. In the studio we have the Finance Minister
Nicolo Willis Nicola. Hello, hello, he thanks for coming in,
great to be with you. What brought you up to Auckland?
Speaker 2 (00:07):
Was it the I We did a press conference with
the Prime Minister and I had some meetings with some
Auckland based business.
Speaker 1 (00:12):
And very good. Okay, Now do you agree with the
Prime Minister and what he said this morning that the
Reserve Bank should have cut sooner?
Speaker 2 (00:17):
Well, I think he was making a retrospective comment. And
if you went and talked to the Monetary Policy Committee
today and said, knowing what you now know, could you
have done things differently? You might find quite a few
of them would say, well, maybe would have done things differently.
Speaker 1 (00:30):
Do you know fortunate that because you know that?
Speaker 2 (00:32):
Well, Unfortunately, the Monetary Policy Committee, when they make decisions,
don't get the joy of being retrospective. They have to
deal with what's happening in real time and they've often
got uncertain data. They're trying to predict a bit about
what the future will show. And what they clearly decided
at their last rate announcement was actually things have panned
out worse than we had imagined and therefore, more stimulus
(00:53):
is required and we need to lodge in another action
in the rate.
Speaker 1 (00:56):
It's not trampling on their independence because it's talking about
what they've done rather than what they share.
Speaker 2 (01:00):
Exactly. If the Prime Minister had said this is what
they should do next time, that would have been an overstep.
He did not say that. He said reprospectively, things have
played out differently than the Monetary Policy Committee might have imagined.
Speaker 1 (01:12):
What about your involvement with the Capital Requirements review? Is
that overstepping the independent?
Speaker 2 (01:16):
Absolutely not, because under the legislation, I get to issue
what's called a financial policy remit, and in that financial
policy remint I specifically asked that the Reserve Bank give
more emphasis to banking competition and efficiency. They've picked that up.
I also wrote them a letter of expectations about what
that might involve. They've picked that up and consistent with
their legislative requirements, they've said, okay, well, that's one of
(01:39):
the factors we'll consider here. They've also considered the Commerce
Commission's inquiry, they've considered Parliament's inquiry, developments that have happened internationally,
and the evolving deposit compensation scheme here. So all of
those factors contributed to the Reserve Bank doing a review
of capital settings.
Speaker 1 (01:55):
Would you plead you appreciate it? Would you accept you
guys at towing the line on the independence thing.
Speaker 2 (01:59):
I think we are supporting the Reserve Bank to be
independent because that's very important and we want to safeguard that.
Speaker 1 (02:06):
And well, do you have a preference on which of
the two outcomes come from the review.
Speaker 2 (02:10):
No, I'm not going to take a preference on that because.
Speaker 1 (02:12):
I think it was a trick question.
Speaker 2 (02:13):
Yeah, because I think it's important that the Reserve Bank
do this transparent feedback process to understand from the different
players involved, how would that affect them. Would it have
the impact they think it would on competition on the
price of lending, because what their report today says is
they think under all of these scenarios it will lower
the cost of borrowing for New Zealanders, lower it more
in particular segments, including some parts of residential mortgages, agricultural lending,
(02:38):
community housing providers, and that all things being equal, that
could actually be a supporter of more economic growth in
the future. So those are positive things. The detail is
where it counts. It's their job to understand that detail
and to make decisions on it.
Speaker 1 (02:54):
Now, have you heard about our confusion about when your
supermarket announcement is coming.
Speaker 2 (02:58):
I haven't heard about that confusion.
Speaker 1 (02:59):
But you see, to us, you said it would come
at the end of the quarter, which is the end
of August. But the quarter ends at the end of September. Correct,
So is the supermarket announcement coming at the end of
the August or the end of the quarter?
Speaker 2 (03:11):
Well, the Prime Minister's made clear it will happen this quarter,
which I view as the end of September. But I'm
not going to reveal on the show today when that
announcement will happen. What I will tell you, though he's
a little exclusive, is that when I announce it, it's not
going to be the grand silver bullet to solve all
supermarket issues. What it will be is an update on
the work that we have been doing as you know.
Speaker 1 (03:30):
No, it's an announcement of an announcement.
Speaker 2 (03:32):
No. No, there will be deliberate and specific actions that
you have not heard about before.
Speaker 1 (03:36):
Okay, but you're definitely tempering our expectations, aren't you.
Speaker 2 (03:40):
I'm not going to be announcing an international supermarket chain
with facts stores is going to be opening up next month.
All right, so when do we get the big silver bullet?
Speaker 1 (03:48):
Do we get one?
Speaker 2 (03:49):
Well, what we have to do is create the conditions
in which a new entrant or an existing player feel
that they can expand. Now that is a commercial decision
for that entity. I think the government's job is to say, Okay,
what is the red teap tape that would stop you
doing that? What are the regulatory barriers, what is the
uncertainty about the competition framework that might prevent you? If
(04:12):
we can clear all of that out of the way
and we turn up best stressed, what then would stop you?
And so that's the approach.
Speaker 1 (04:21):
Me like, you're never going to give us a silver bullet,
and there's going to be no big announcement. It's just
going to be laying the groundwork.
Speaker 2 (04:25):
Well, we are making very good progress and we have
a number of irons in the fire, and I'll be
looking forward to making an update on it, But not today.
Speaker 1 (04:32):
This quarter though, not right? And who are these merchants
of misery and doom and doom say it?
Speaker 2 (04:39):
Well, I'm a little bit frustrated by the way that
that has been taken out of context. My point was
that the Reserve Bank have given forecasts about the economic
future in which they say they see unemployment falling, they
see growth coming back and inflation stabilizing. My point was
it's not me saying that the Reserve Bank are independent.
They're politically neutral, as we've just discussed, and so those
(05:01):
who say, oh, no, we don't believe that, we don't
believe it. You know, sometimes they are coming from a
politically motivated perspective to say that. Equally, I get it.
New Zealanders have been through an incredibly tough few years
and for some of them it feels like there have
been a few false storms.
Speaker 1 (05:17):
Who well, there have been a lot of false storms,
aren't they? But who are these doomsayers?
Speaker 2 (05:21):
Are the people on the other side of me in Parliament.
They tend to come from the Greens and Labor And
if you were to believe Chloe s Harborough and Barbara Edmonds,
it doesn't matter what the government does. The end of
the world isn't I.
Speaker 1 (05:30):
Because because how it's been interpreted is that you're saying
everything is two is just absolutely fine.
Speaker 2 (05:35):
Not my view. Heither not my view.
Speaker 1 (05:37):
You acknowledge it's tough out there.
Speaker 2 (05:38):
Absolutely very tough. And particularly for some businesses. Particularly I
think of those small businesses who had to struggle through COVID,
often took on a lot of debt to stay open
and keep staff on, went through very big price spikes,
then got hit with high interest rates on the debt
they had outstanding, and are now struggling to keep going.
I do think that actually it is my responsibility to
(06:00):
look those businesses in the eye, as well as the
many households who depend on them, and say I can
with confidence tell you that the steps the government is
taking mean that we can forecast that conditions will be
objectively better. That is the case, and I think it's
important that I give them that sense of hope and purpose.
At the same time, I don't deny it whether you
are a big business a small business. In New Zealand household,
(06:22):
there are many people who continue to do it tough,
and they very much on our minds.
Speaker 1 (06:26):
Okay, cool, Now do you agree with Chris Bishop that
it is a good thing that house prices are falling.
Speaker 2 (06:31):
I agree with him that house prices needed to fall
from where they were. They went up thirty percent in
a year that is obviously objectively unsustainable, both from a
financial stability perspective, but also just from a what kind
of a New Zealand do we want to live up?
Because I'm with him, I want this to be a
property owning democracy in which normal working people look forward
(06:52):
to owning their own home. And so what that's about
is the ratio of incomes to house prices that had
become unsustainable in New Zealand.
Speaker 1 (06:59):
But also we're putting on my into the wrong stuff.
Speaker 2 (07:01):
Well, we want to see a productive economy being driven
by real growth, not just New Zealand's trading houses with
each So.
Speaker 1 (07:08):
Do you think like I do, that house prices will
never again increase at the rate that they were, not
even during COVID, during the weird years, but even before that,
when they were galloping along at a good rate. I
don't think that ever happens again.
Speaker 2 (07:20):
Well, our government is trying to correct the imbalances that
allowed that to occur, which in our view was that
we artificially in New Zealand constrained the amount of land
available for housing. The Resource Management Act became a massive
stop sign when it came to doing a new housing development,
when it came to building an apartment, and it slowed
down the supply of housing so that even when interest
(07:40):
rates were really low, there were lots of people wanting
to buy houses. No one could build quickly.
Speaker 1 (07:44):
So you're doing what you can basically as a government
also to stop house prices increasing at the rate that
they were, which is a steady little tick along for years.
Speaker 2 (07:51):
Well, what we're doing is what we can mean that
housing supply can respond to actual demands, so that with
a growing population, we're building enough houses for everyone. So
you don't get a situation where you have unsustainable rent increases,
where you have growing numbers of people depending on the
government for housing, where you have house prices being so
out of control that normal people on an average wage
(08:12):
can't even dream of owning a house. Now, what the
Treasury forecast is we are going to continue to see
moderate house price growth over the coming years. And I
know that that will be of some comfort to those
people who are sitting there looking at the big mortgage
that they racked up when prices were very high. But
over time, the best thing for New Zealand is that
we actually have house prices which are sustainable.
Speaker 1 (08:35):
Yeah, totally. Did Sumon have a boy or a girl?
Speaker 2 (08:38):
He had a boy? Did he Yeah, indeed he did.
He's got two boys and two girls now, which I
happen to think is the perfect arrange because you.
Speaker 1 (08:46):
Have this arrangement too. This is good. Hey, thank you
very much. Nicola really appreciated. Nichola will is the financement.
It's a sixteen past six.
Speaker 2 (08:53):
Thank you.
Speaker 1 (08:56):
For more from Heather duplessy Ellen Drive. Listen live to
new Talks. It'd be from four pm weekdays, or follow
the podcast on iHeartRadio.
With me. In the studio we have the Finance Minister
Nicolo Willis Nicola. Hello, hello, he thanks for coming in,
great to be with you. What brought you up to Auckland?
Speaker 2 (00:07):
Was it the I We did a press conference with
the Prime Minister and I had some meetings with some
Auckland based business.
Speaker 1 (00:12):
And very good. Okay, Now do you agree with the
Prime Minister and what he said this morning that the
Reserve Bank should have cut sooner?
Speaker 2 (00:17):
Well, I think he was making a retrospective comment. And
if you went and talked to the Monetary Policy Committee
today and said, knowing what you now know, could you
have done things differently? You might find quite a few
of them would say, well, maybe would have done things differently.
Speaker 1 (00:30):
Do you know fortunate that because you know that?
Speaker 2 (00:32):
Well, Unfortunately, the Monetary Policy Committee, when they make decisions,
don't get the joy of being retrospective. They have to
deal with what's happening in real time and they've often
got uncertain data. They're trying to predict a bit about
what the future will show. And what they clearly decided
at their last rate announcement was actually things have panned
out worse than we had imagined and therefore, more stimulus
(00:53):
is required and we need to lodge in another action
in the rate.
Speaker 1 (00:56):
It's not trampling on their independence because it's talking about
what they've done rather than what they share.
Speaker 2 (01:00):
Exactly. If the Prime Minister had said this is what
they should do next time, that would have been an overstep.
He did not say that. He said reprospectively, things have
played out differently than the Monetary Policy Committee might have imagined.
Speaker 1 (01:12):
What about your involvement with the Capital Requirements review? Is
that overstepping the independent?
Speaker 2 (01:16):
Absolutely not, because under the legislation, I get to issue
what's called a financial policy remit, and in that financial
policy remint I specifically asked that the Reserve Bank give
more emphasis to banking competition and efficiency. They've picked that up.
I also wrote them a letter of expectations about what
that might involve. They've picked that up and consistent with
their legislative requirements, they've said, okay, well, that's one of
(01:39):
the factors we'll consider here. They've also considered the Commerce
Commission's inquiry, they've considered Parliament's inquiry, developments that have happened internationally,
and the evolving deposit compensation scheme here. So all of
those factors contributed to the Reserve Bank doing a review
of capital settings.
Speaker 1 (01:55):
Would you plead you appreciate it? Would you accept you
guys at towing the line on the independence thing.
Speaker 2 (01:59):
I think we are supporting the Reserve Bank to be
independent because that's very important and we want to safeguard that.
Speaker 1 (02:06):
And well, do you have a preference on which of
the two outcomes come from the review.
Speaker 2 (02:10):
No, I'm not going to take a preference on that because.
Speaker 1 (02:12):
I think it was a trick question.
Speaker 2 (02:13):
Yeah, because I think it's important that the Reserve Bank
do this transparent feedback process to understand from the different
players involved, how would that affect them. Would it have
the impact they think it would on competition on the
price of lending, because what their report today says is
they think under all of these scenarios it will lower
the cost of borrowing for New Zealanders, lower it more
in particular segments, including some parts of residential mortgages, agricultural lending,
(02:38):
community housing providers, and that all things being equal, that
could actually be a supporter of more economic growth in
the future. So those are positive things. The detail is
where it counts. It's their job to understand that detail
and to make decisions on it.
Speaker 1 (02:54):
Now, have you heard about our confusion about when your
supermarket announcement is coming.
Speaker 2 (02:58):
I haven't heard about that confusion.
Speaker 1 (02:59):
But you see, to us, you said it would come
at the end of the quarter, which is the end
of August. But the quarter ends at the end of September. Correct,
So is the supermarket announcement coming at the end of
the August or the end of the quarter?
Speaker 2 (03:11):
Well, the Prime Minister's made clear it will happen this quarter,
which I view as the end of September. But I'm
not going to reveal on the show today when that
announcement will happen. What I will tell you, though he's
a little exclusive, is that when I announce it, it's not
going to be the grand silver bullet to solve all
supermarket issues. What it will be is an update on
the work that we have been doing as you know.
Speaker 1 (03:30):
No, it's an announcement of an announcement.
Speaker 2 (03:32):
No. No, there will be deliberate and specific actions that
you have not heard about before.
Speaker 1 (03:36):
Okay, but you're definitely tempering our expectations, aren't you.
Speaker 2 (03:40):
I'm not going to be announcing an international supermarket chain
with facts stores is going to be opening up next month.
All right, so when do we get the big silver bullet?
Speaker 1 (03:48):
Do we get one?
Speaker 2 (03:49):
Well, what we have to do is create the conditions
in which a new entrant or an existing player feel
that they can expand. Now that is a commercial decision
for that entity. I think the government's job is to say, Okay,
what is the red teap tape that would stop you
doing that? What are the regulatory barriers, what is the
uncertainty about the competition framework that might prevent you? If
(04:12):
we can clear all of that out of the way
and we turn up best stressed, what then would stop you?
And so that's the approach.
Speaker 1 (04:21):
Me like, you're never going to give us a silver bullet,
and there's going to be no big announcement. It's just
going to be laying the groundwork.
Speaker 2 (04:25):
Well, we are making very good progress and we have
a number of irons in the fire, and I'll be
looking forward to making an update on it, But not today.
Speaker 1 (04:32):
This quarter though, not right? And who are these merchants
of misery and doom and doom say it?
Speaker 2 (04:39):
Well, I'm a little bit frustrated by the way that
that has been taken out of context. My point was
that the Reserve Bank have given forecasts about the economic
future in which they say they see unemployment falling, they
see growth coming back and inflation stabilizing. My point was
it's not me saying that the Reserve Bank are independent.
They're politically neutral, as we've just discussed, and so those
(05:01):
who say, oh, no, we don't believe that, we don't
believe it. You know, sometimes they are coming from a
politically motivated perspective to say that. Equally, I get it.
New Zealanders have been through an incredibly tough few years
and for some of them it feels like there have
been a few false storms.
Speaker 1 (05:17):
Who well, there have been a lot of false storms,
aren't they? But who are these doomsayers?
Speaker 2 (05:21):
Are the people on the other side of me in Parliament.
They tend to come from the Greens and Labor And
if you were to believe Chloe s Harborough and Barbara Edmonds,
it doesn't matter what the government does. The end of
the world isn't I.
Speaker 1 (05:30):
Because because how it's been interpreted is that you're saying
everything is two is just absolutely fine.
Speaker 2 (05:35):
Not my view. Heither not my view.
Speaker 1 (05:37):
You acknowledge it's tough out there.
Speaker 2 (05:38):
Absolutely very tough. And particularly for some businesses. Particularly I
think of those small businesses who had to struggle through COVID,
often took on a lot of debt to stay open
and keep staff on, went through very big price spikes,
then got hit with high interest rates on the debt
they had outstanding, and are now struggling to keep going.
I do think that actually it is my responsibility to
(06:00):
look those businesses in the eye, as well as the
many households who depend on them, and say I can
with confidence tell you that the steps the government is
taking mean that we can forecast that conditions will be
objectively better. That is the case, and I think it's
important that I give them that sense of hope and purpose.
At the same time, I don't deny it whether you
are a big business a small business. In New Zealand household,
(06:22):
there are many people who continue to do it tough,
and they very much on our minds.
Speaker 1 (06:26):
Okay, cool, Now do you agree with Chris Bishop that
it is a good thing that house prices are falling.
Speaker 2 (06:31):
I agree with him that house prices needed to fall
from where they were. They went up thirty percent in
a year that is obviously objectively unsustainable, both from a
financial stability perspective, but also just from a what kind
of a New Zealand do we want to live up?
Because I'm with him, I want this to be a
property owning democracy in which normal working people look forward
(06:52):
to owning their own home. And so what that's about
is the ratio of incomes to house prices that had
become unsustainable in New Zealand.
Speaker 1 (06:59):
But also we're putting on my into the wrong stuff.
Speaker 2 (07:01):
Well, we want to see a productive economy being driven
by real growth, not just New Zealand's trading houses with
each So.
Speaker 1 (07:08):
Do you think like I do, that house prices will
never again increase at the rate that they were, not
even during COVID, during the weird years, but even before that,
when they were galloping along at a good rate. I
don't think that ever happens again.
Speaker 2 (07:20):
Well, our government is trying to correct the imbalances that
allowed that to occur, which in our view was that
we artificially in New Zealand constrained the amount of land
available for housing. The Resource Management Act became a massive
stop sign when it came to doing a new housing development,
when it came to building an apartment, and it slowed
down the supply of housing so that even when interest
(07:40):
rates were really low, there were lots of people wanting
to buy houses. No one could build quickly.
Speaker 1 (07:44):
So you're doing what you can basically as a government
also to stop house prices increasing at the rate that
they were, which is a steady little tick along for years.
Speaker 2 (07:51):
Well, what we're doing is what we can mean that
housing supply can respond to actual demands, so that with
a growing population, we're building enough houses for everyone. So
you don't get a situation where you have unsustainable rent increases,
where you have growing numbers of people depending on the
government for housing, where you have house prices being so
out of control that normal people on an average wage
(08:12):
can't even dream of owning a house. Now, what the
Treasury forecast is we are going to continue to see
moderate house price growth over the coming years. And I
know that that will be of some comfort to those
people who are sitting there looking at the big mortgage
that they racked up when prices were very high. But
over time, the best thing for New Zealand is that
we actually have house prices which are sustainable.
Speaker 1 (08:35):
Yeah, totally. Did Sumon have a boy or a girl?
Speaker 2 (08:38):
He had a boy? Did he Yeah, indeed he did.
He's got two boys and two girls now, which I
happen to think is the perfect arrange because you.
Speaker 1 (08:46):
Have this arrangement too. This is good. Hey, thank you
very much. Nicola really appreciated. Nichola will is the financement.
It's a sixteen past six.
Speaker 2 (08:53):
Thank you.
Speaker 1 (08:56):
For more from Heather duplessy Ellen Drive. Listen live to
new Talks. It'd be from four pm weekdays, or follow
the podcast on iHeartRadio.
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