February 3, 2025 • 9 mins
More details could be coming this week about the procuring company for the Interislander ferries.
In December last year, the Government announced it would set up a company to procure the ferries, freeing up Kiwirail.
It's committed to a March deadline.
Finance Minister Nicola Willis says she believes Minister-in-Charge Winston Peters has a handle on the process - and will be incorporating once the directors are appointed.
She says her alternative procurement plan is ready to go as a fallback.
"The Minister for Rail is doing the right thing, he is comparing that option with what else might be out there and he's running the process to do that."
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Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Speaker 1 (00:00):
Right now. Nicola Willis is here, the Finance minister. Minister,
good evening, good evening, Great to have you on the show.
Let's talk growth because it's a big focus at the moment.
There's been a lot of commentary about your government. Obviously
you're moving on the foreign investment stuff. That's good. There's
some tinkering to be done with immigration settings, with nomad
(00:21):
visas etc. Are we going to see anything transformational from
you in this role?
Speaker 2 (00:27):
Well, transformational is a word that Jacinda Ardern used to
use a lot, so it's not one I repeat in
my lexicon that much. But are you going to see
bold initiatives that will make it easier for firms in
New Zealand to invest, to hire people and to grow. Yes,
will it be one silver bullet? No, because what we
(00:48):
know from economies the world over is it's never just
one thing. You actually have to do a lot of
things right that are on the side of growth. You
have to educate your people, you have to have not
too much regulation, you have to have a tax system
that works well. You have to have good trading relationships.
You need to encourage people to come and invest in
your country. So we've got a lot of work to
(01:09):
do because for I would say successive decades, governments in
New Zealand have been complacent about growth. They've always been
able to trade it off against other things, saying we've
got to be careful about this, we've got to be
careful about that, and all of that may be true,
but right now New Zealanders are feeling poorer and if
we want to feel wealthier, we have to prioritize growth
(01:32):
and that's what our government is going to do across
a number of areas. So you will see a lot
of initiatives from us. You know, people have said, oh, well, tourism,
that's one small thing. If we got tourism just back
to the levels it was a few years ago, that
would be worth more than three and a half billion
dollars for the wealth of our economy. That means more jobs,
people being paid more. It also means hundreds of millions
(01:53):
of dollars more going into the government accounts, which is
then available to spend on schools and hospitals and the
things we can about. So we have to do lots
of things well run, and that's what we're going to do.
Speaker 1 (02:03):
Have we got our company tax settings right.
Speaker 2 (02:07):
Well if you compete Zealand with the rest of the world,
we're not as competitive as we used to be, which
is to say that our corporate tax level is reasonably
high when you compare it to the rest of the
developed world. So looking at that, our government says, okay, well,
what could we do to make sure that the tax
settings in New Zealand are supportive of businesses wanting to
(02:29):
invest and grow, realizing that on the other side of that,
we have to pay for it, because if we're taking
in less tax, then we have to find other ways
of getting that money so we can invest in the
things that really matter, our public services, and also ensure
that we're still on track to get our budget back
and balance and reduce debt over time. So as a government,
(02:49):
we need to work through all of those questions. But
the honest answer to question is we need to be
more competitive in that area.
Speaker 1 (02:55):
So you are looking at changing the corporate tax right.
Speaker 2 (02:58):
Well, there's many different ways we can approach the TEX system.
One thing is the corporate tax rate, but there are
all sort of tax rules that sit underneath that, and
I'm actually interested in the detail of the way the
whole system works, not just the headline rate.
Speaker 1 (03:13):
But you're looking at the headline rate and the other
things together to make it more competitive.
Speaker 2 (03:19):
My interest is how do we make sure that it's
competitive in New Zealand, that a when our small businesses
here are looking to grow or looking to invest, that
the tax system doesn't stop them doing that. But also,
as we look to be a country that other people
want to invest in and bring their businesses to, how
can we make this a competitive business environment. Tax is
(03:41):
one part of that, but it's also about red tape.
It's about the rules in the Overseas Investment Act, it's
about being able to get a resource consent, it's about
employment law, all of those things. Firms will tell you
they've got a list when they're looking at other countries.
Tax is one pullo point on the list. It's not
the only bullet.
Speaker 1 (03:55):
Point, hugely important one, though. Would you look at you know,
you mentioned international firms, multinationals, and you look at Ireland
and what Island's done, and we know lucks and likes
Ireland that you've got so much tax now they're putting
it into a sovereign wealth fund. Are we going to
do anything to be more competitive for that type of investment.
Speaker 2 (04:19):
Well, we have a sovereign wealth fund too, it's the
New Zealand Super Fund. It's got more than seventy billion
dollars worth of as sets as I talk to you today.
But when we look at Ireland's story, you're right, there's
a lot that we can take from it. They made
a real active decision to look out to the world
to attract investment, to be a trading nation, to vigorously
(04:39):
improve their education system, to get smart about innovation, and
they looked at tax. So we can't take tax off
the table because it could make a difference to our competitiveness.
We always have to balance that against our other pressing needs,
which include investing in frontline public services, ensuring we're getting
our deficit down, and taking other staf across the board
(05:00):
to make ourselves more competitive.
Speaker 1 (05:02):
And what about the fastest depreciation on manufacturing technology purchases.
The Employers and Manufacturers Association has been on this program
and told them, you know, that's doing that type of Yes,
it will cost you something, but you will add to growth, productivity,
wages will go up. Is that sort of stuff on
your radar too?
Speaker 2 (05:23):
Oh, look, that's on my radar. That's something that I
have listened to both the employer and manufacturers, but other
organizations have promoted that idea to me, and I'm keeping
my mind open to it. Ultimately, Cabinet needs to make
decisions about what our priorities are. We haven't made those
deliberations yet, but I think it is right when we're
(05:45):
saying we're a government going for growth, that we do
keep all of the options on the table and we
consider what we think will make the biggest impact. If
my mind's open.
Speaker 1 (05:55):
Okay, if you're going for growth and you're also trying
to get back to surplus, some of these growth ideas
will cost money. Are you willing to further push surplus
date out if it means will you prioritize growth? If
it means will you sacrifice surplus? If it means growth, We're.
Speaker 2 (06:20):
Going to prioritize growth. But it's not an either or scenario,
because if we don't run good books, ie, we don't
actually show the people who lend to us internationally that
we are going to have sustainable finances, then the result
of that can be that it becomes a lot more
expensive for New Zealand as a whole. And New Zealand
is individually to borrow and that's very bad for growth.
(06:43):
So there's always a balancing that goes on here in
terms of funding initiatives that support growth. That's why it's
so important we keep looking all across government and so well,
where are the areas that we're spending now that are
lower value, because if we did some reprioritizing, then we
could support the thing that will drive growth faster. And
that's our agenda. It's about saying, how do we get
(07:04):
the growth that will allow us to have more choices
in the future, about investing in more public services, and
on the way through, getting rid of the things that
aren't moving the dial, that aren't delivering good results for
New Zealanders, the parts of government that have become slow, wasteful, bureaucratic.
Let's get resource out of there so we can do
the exciting things that will make this a more prosperous
(07:26):
country where people can get ahead.
Speaker 1 (07:28):
The Interland of Faery to move on. Why the procuring
company for the inter island is still not set up well.
Speaker 2 (07:35):
Obviously, Winston Peters is now responsible for keep Rail and
the Fury Project, and I understand that he has the
appointment process underway. For that company and once directors are pointed,
he will be incorporating it. I think he's got something
to say about that this week.
Speaker 1 (07:49):
Ok, because it's still the March deadline, right, and if
we don't get the faery that he wants by March,
then we're going with your two Toyota ones right, Yeah.
Speaker 2 (07:59):
That's right. Sure, we had a fallback position so that
if the Minister for Rail doesn't come up with a
better option, then we've got something ready to go so
that New Zealanders can be confident. So boats in twenty
twenty nine.
Speaker 1 (08:11):
So is your package like good and ready to go?
Because it might come down to the wire with him
and we don't want to be waiting even more time.
So is your have you got your little toyotas ready
to go?
Speaker 2 (08:21):
Yeah? So Cabinet has agreed to a funding envelope, we've
agreed to a procurement plan. We've agreed that this fairy
company that's being set up could do the purchasing of
the ships. We know that there are ships available internationally,
so that's ready to go. But the Minister for Rail's
doing the right thing. He is comparing that option with
(08:42):
what else might be out there. And he's running a
process to do that, right.
Speaker 1 (08:45):
Okay, Hey, the Waikata Medical School Treasury Advice says that
they think it's a waste of money. Clearly you think otherwise,
well do you?
Speaker 2 (08:53):
Well, well, we've taken it to the next stage, which
is what they call a detailed business case. And I
know that's like gobbledy girk, but the idea is, let's
really dig into these numbers about what benefits it will bring.
How many more graduates we'd expect, will they be graduates
who might not otherwise have studied medicine, will we get
more people working in the areas of medicine where we
(09:15):
have shortages, What are the real costs of this? And
so that detailed business case is underway, it's been worked on,
then Cabinet will consider it before making a final decision.
We're dotting our eyes, we're crossing our t's, we're digging
into the detail as you'd expect.
Speaker 1 (09:29):
Minister, Thank you very much for your time. Thank you,
Finance Minister Nicola Willison. For more from Heather Duplessy Allen Drive,
listen live to news Talks it'd be from four pm weekdays,
or follow the podcast on iHeartRadio.
Right now. Nicola Willis is here, the Finance minister. Minister,
good evening, good evening, Great to have you on the show.
Let's talk growth because it's a big focus at the moment.
There's been a lot of commentary about your government. Obviously
you're moving on the foreign investment stuff. That's good. There's
some tinkering to be done with immigration settings, with nomad
(00:21):
visas etc. Are we going to see anything transformational from
you in this role?
Speaker 2 (00:27):
Well, transformational is a word that Jacinda Ardern used to
use a lot, so it's not one I repeat in
my lexicon that much. But are you going to see
bold initiatives that will make it easier for firms in
New Zealand to invest, to hire people and to grow. Yes,
will it be one silver bullet? No, because what we
(00:48):
know from economies the world over is it's never just
one thing. You actually have to do a lot of
things right that are on the side of growth. You
have to educate your people, you have to have not
too much regulation, you have to have a tax system
that works well. You have to have good trading relationships.
You need to encourage people to come and invest in
your country. So we've got a lot of work to
(01:09):
do because for I would say successive decades, governments in
New Zealand have been complacent about growth. They've always been
able to trade it off against other things, saying we've
got to be careful about this, we've got to be
careful about that, and all of that may be true,
but right now New Zealanders are feeling poorer and if
we want to feel wealthier, we have to prioritize growth
(01:32):
and that's what our government is going to do across
a number of areas. So you will see a lot
of initiatives from us. You know, people have said, oh, well, tourism,
that's one small thing. If we got tourism just back
to the levels it was a few years ago, that
would be worth more than three and a half billion
dollars for the wealth of our economy. That means more jobs,
people being paid more. It also means hundreds of millions
(01:53):
of dollars more going into the government accounts, which is
then available to spend on schools and hospitals and the
things we can about. So we have to do lots
of things well run, and that's what we're going to do.
Speaker 1 (02:03):
Have we got our company tax settings right.
Speaker 2 (02:07):
Well if you compete Zealand with the rest of the world,
we're not as competitive as we used to be, which
is to say that our corporate tax level is reasonably
high when you compare it to the rest of the
developed world. So looking at that, our government says, okay, well,
what could we do to make sure that the tax
settings in New Zealand are supportive of businesses wanting to
(02:29):
invest and grow, realizing that on the other side of that,
we have to pay for it, because if we're taking
in less tax, then we have to find other ways
of getting that money so we can invest in the
things that really matter, our public services, and also ensure
that we're still on track to get our budget back
and balance and reduce debt over time. So as a government,
(02:49):
we need to work through all of those questions. But
the honest answer to question is we need to be
more competitive in that area.
Speaker 1 (02:55):
So you are looking at changing the corporate tax right.
Speaker 2 (02:58):
Well, there's many different ways we can approach the TEX system.
One thing is the corporate tax rate, but there are
all sort of tax rules that sit underneath that, and
I'm actually interested in the detail of the way the
whole system works, not just the headline rate.
Speaker 1 (03:13):
But you're looking at the headline rate and the other
things together to make it more competitive.
Speaker 2 (03:19):
My interest is how do we make sure that it's
competitive in New Zealand, that a when our small businesses
here are looking to grow or looking to invest, that
the tax system doesn't stop them doing that. But also,
as we look to be a country that other people
want to invest in and bring their businesses to, how
can we make this a competitive business environment. Tax is
(03:41):
one part of that, but it's also about red tape.
It's about the rules in the Overseas Investment Act, it's
about being able to get a resource consent, it's about
employment law, all of those things. Firms will tell you
they've got a list when they're looking at other countries.
Tax is one pullo point on the list. It's not
the only bullet.
Speaker 1 (03:55):
Point, hugely important one, though. Would you look at you know,
you mentioned international firms, multinationals, and you look at Ireland
and what Island's done, and we know lucks and likes
Ireland that you've got so much tax now they're putting
it into a sovereign wealth fund. Are we going to
do anything to be more competitive for that type of investment.
Speaker 2 (04:19):
Well, we have a sovereign wealth fund too, it's the
New Zealand Super Fund. It's got more than seventy billion
dollars worth of as sets as I talk to you today.
But when we look at Ireland's story, you're right, there's
a lot that we can take from it. They made
a real active decision to look out to the world
to attract investment, to be a trading nation, to vigorously
(04:39):
improve their education system, to get smart about innovation, and
they looked at tax. So we can't take tax off
the table because it could make a difference to our competitiveness.
We always have to balance that against our other pressing needs,
which include investing in frontline public services, ensuring we're getting
our deficit down, and taking other staf across the board
(05:00):
to make ourselves more competitive.
Speaker 1 (05:02):
And what about the fastest depreciation on manufacturing technology purchases.
The Employers and Manufacturers Association has been on this program
and told them, you know, that's doing that type of Yes,
it will cost you something, but you will add to growth, productivity,
wages will go up. Is that sort of stuff on
your radar too?
Speaker 2 (05:23):
Oh, look, that's on my radar. That's something that I
have listened to both the employer and manufacturers, but other
organizations have promoted that idea to me, and I'm keeping
my mind open to it. Ultimately, Cabinet needs to make
decisions about what our priorities are. We haven't made those
deliberations yet, but I think it is right when we're
(05:45):
saying we're a government going for growth, that we do
keep all of the options on the table and we
consider what we think will make the biggest impact. If
my mind's open.
Speaker 1 (05:55):
Okay, if you're going for growth and you're also trying
to get back to surplus, some of these growth ideas
will cost money. Are you willing to further push surplus
date out if it means will you prioritize growth? If
it means will you sacrifice surplus? If it means growth, We're.
Speaker 2 (06:20):
Going to prioritize growth. But it's not an either or scenario,
because if we don't run good books, ie, we don't
actually show the people who lend to us internationally that
we are going to have sustainable finances, then the result
of that can be that it becomes a lot more
expensive for New Zealand as a whole. And New Zealand
is individually to borrow and that's very bad for growth.
(06:43):
So there's always a balancing that goes on here in
terms of funding initiatives that support growth. That's why it's
so important we keep looking all across government and so well,
where are the areas that we're spending now that are
lower value, because if we did some reprioritizing, then we
could support the thing that will drive growth faster. And
that's our agenda. It's about saying, how do we get
(07:04):
the growth that will allow us to have more choices
in the future, about investing in more public services, and
on the way through, getting rid of the things that
aren't moving the dial, that aren't delivering good results for
New Zealanders, the parts of government that have become slow, wasteful, bureaucratic.
Let's get resource out of there so we can do
the exciting things that will make this a more prosperous
(07:26):
country where people can get ahead.
Speaker 1 (07:28):
The Interland of Faery to move on. Why the procuring
company for the inter island is still not set up well.
Speaker 2 (07:35):
Obviously, Winston Peters is now responsible for keep Rail and
the Fury Project, and I understand that he has the
appointment process underway. For that company and once directors are pointed,
he will be incorporating it. I think he's got something
to say about that this week.
Speaker 1 (07:49):
Ok, because it's still the March deadline, right, and if
we don't get the faery that he wants by March,
then we're going with your two Toyota ones right, Yeah.
Speaker 2 (07:59):
That's right. Sure, we had a fallback position so that
if the Minister for Rail doesn't come up with a
better option, then we've got something ready to go so
that New Zealanders can be confident. So boats in twenty
twenty nine.
Speaker 1 (08:11):
So is your package like good and ready to go?
Because it might come down to the wire with him
and we don't want to be waiting even more time.
So is your have you got your little toyotas ready
to go?
Speaker 2 (08:21):
Yeah? So Cabinet has agreed to a funding envelope, we've
agreed to a procurement plan. We've agreed that this fairy
company that's being set up could do the purchasing of
the ships. We know that there are ships available internationally,
so that's ready to go. But the Minister for Rail's
doing the right thing. He is comparing that option with
(08:42):
what else might be out there. And he's running a
process to do that, right.
Speaker 1 (08:45):
Okay, Hey, the Waikata Medical School Treasury Advice says that
they think it's a waste of money. Clearly you think otherwise,
well do you?
Speaker 2 (08:53):
Well, well, we've taken it to the next stage, which
is what they call a detailed business case. And I
know that's like gobbledy girk, but the idea is, let's
really dig into these numbers about what benefits it will bring.
How many more graduates we'd expect, will they be graduates
who might not otherwise have studied medicine, will we get
more people working in the areas of medicine where we
(09:15):
have shortages, What are the real costs of this? And
so that detailed business case is underway, it's been worked on,
then Cabinet will consider it before making a final decision.
We're dotting our eyes, we're crossing our t's, we're digging
into the detail as you'd expect.
Speaker 1 (09:29):
Minister, Thank you very much for your time. Thank you,
Finance Minister Nicola Willison. For more from Heather Duplessy Allen Drive,
listen live to news Talks it'd be from four pm weekdays,
or follow the podcast on iHeartRadio.
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