Episode Transcript
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Speaker 1 (00:00):
With us. Now is Nikola, willis the finance minister. Evening, Nikola,
good evening, welcome back.
Speaker 2 (00:05):
I've had to go two weeks without talking about Willn
Carpett's and I've really missed it.
Speaker 1 (00:10):
I wasn't going to raise it. But now that you've
raised it, have you got us the number?
Speaker 2 (00:15):
No? But what I can tell you is we're delivering
better value for the taxpayer all round.
Speaker 1 (00:19):
Okay, wonderful. Now do you reckon that this inflation spike
is temporary?
Speaker 2 (00:24):
Well, that's what the Reserve Bank and the people advise
me think. They think they could continue to be upward
inflation pressure into the next quarter, but they're looking through
it and the medium term. They're still seeing capacity in
the economy, which gives them confidence that this isn't going
to be a long run thing.
Speaker 1 (00:41):
How do you write the chances that this economy is
humming when we go to the polls next year?
Speaker 2 (00:47):
I think it will be in much better shape when
we go to the polls next year. And that's based
on all of the forecasts I see, which tell me
that growth is going to be picking up on a
per capita basis in real terms, that inflation will be
under control that jobs will be being created and based
on the fact that between now and the next election,
this government's going to be doing a lot to drive.
Speaker 1 (01:08):
Growth because Jesus, it's got to be worrying you, right,
it's going to be a close run thing.
Speaker 2 (01:13):
Yeah. Look, I think we've had a really challenging quarter.
You know, the six months September through March. We know
that the economy was growing fast, faster than many countries
around the world, faster than one is being forecast in
the first three months of this year, four times as
fast as Australia. But come April, come Liberation Day, I
think a lot of New Zealand firms and households battened
(01:35):
down the hatchets. They saw that global uncertainty and they
went back into the defensive position. Now my view is
that actually, looking ahead, New Zealand has been less affected
by those tariff wars than many other countries, and we
have every reason to feel confident about our growth prospects.
But we're going to get that confidence back and we
(01:56):
need businesses feeling confident.
Speaker 1 (01:57):
On the White Cutle Medical School, can you get guarantee
that the cost is not going to blow out on
this thing?
Speaker 2 (02:05):
Well, the Crowns made it clear we're contributing eighty million
in capital cost. Wykato University have said that they will
stump up the rest. The cost has been brought down
from the original three hundred and eighty million to two
hundred and thirty million, and y Kuttle have committed that
they'll be stumping up one hundred and fifty of that.
So that's up to them.
Speaker 1 (02:23):
And can you guarantee that the eighty three million from
the government is all that we will put in.
Speaker 2 (02:30):
Well, that's what the business case is based on. And
I think the other side of this you need to
remember is that these students are there for four years
rather than the six years that is traditionally the case
at Otago in Auckland. So overall, that ongoing cost of
creating these doctors is lower because there's a fewer years
that they're studying.
Speaker 1 (02:50):
If y Cuttle University and philanthropists cannot find the one
fifty million, can you guarantee that we're not going to
bridge the gap as taxpayers?
Speaker 2 (02:58):
Well that the commitment that Waikato has made to us
is that they will stump up that money. That is
the basis on which this is going for everything here
am no, I'm not keeping my options open.
Speaker 1 (03:10):
Guarantee guarantee it's not going to blow out, and guarantee
we aren't going to stump up what they what they
are short on.
Speaker 2 (03:16):
Well, I'm guaranteeing you that the entire business case is
based on that eighty million dollar Crown contribution and that way,
Katto University have made undertakings that they will be funding
the rest. And the good news is they expect to
get construction under way later this year. That's exciting for
white cattle.
Speaker 1 (03:33):
Yeah, now yeah, and I am excited for them. But Nikola,
mark my words, this is going to blow out and
the estimates you've given us are never going to stand,
are they.
Speaker 2 (03:43):
Well, they have been through a very thorough business case process.
The every eye was picked out of it to see
what was involved in those costs and what it looks like.
And we were very clear with Waikato University that if
they were saying they were going to contribute a significant
of the funds and they needed to make that rail,
they I understand have had undertakings from philanthropists and others
(04:06):
or helping them make that contribution, but ultimately they really
want this thing to happen that Crown said, this is
how much will punt up, and of course we will
fund the ongoing costs of those future students, but it's
up to them to deliver.
Speaker 1 (04:19):
If they come to you and they say we haven't
got the money, what are you going to say to them.
Speaker 2 (04:23):
I'm going to say, well, you said you would, so
you're in trouble now and you're going to have to
find the money.
Speaker 1 (04:26):
Okay, Look, why are you guys paying Sonny Kochal for
ideas that he was giving you for free?
Speaker 2 (04:33):
Oh look, he's done a great job, so he's.
Speaker 1 (04:36):
There's no disputing, no disputing. But but he was giving
you these ideas for free, Nikola because they benefit his business.
Why did you then offer to pay for them?
Speaker 2 (04:46):
Well, let's be clear, it's not you, the taxpayer that
is paying him. He is being paid out of the
proceeds of crime fund, which would be criminals are literally paying.
Speaker 1 (04:56):
Yeah, but what there's an opportunity cost That money would
have been used for something else.
Speaker 2 (05:01):
Yeah, it would have been used on crime prevention activities
in the community. And I'd say that Sunny Koschal has
made a very significant contribution to crime prevention in our community.
Speaker 1 (05:11):
But on these issues, we're broke, right, we're broke, and
that money could be used for a very urgent problem.
So why are you handing it out to somebody who
has given you this helpful free.
Speaker 2 (05:22):
Because the assessment we made was that retail crime had
got so out of control under the last government that
we needed people who were actually at the front line,
who understood what that looked like giving us advice on
what needed to change. Now, we could have gone to
all of our policy advisors in the Ministry of Justice
here in Wellington and I'm sure they would have wrung
their hands and come up with some delightful over you
(05:43):
that's every human right.
Speaker 1 (05:44):
Would have given you these ideas for free and continued
to give give you these ideas whether whether you paid
them or not.
Speaker 2 (05:50):
Yeah, well, I think you're being unfair because this is
a group of people that he has been sharing that
represent a range of interests from the retail sector, and
he's brought them together where they've been able to make
joint recommendations to government, but have given us the confidence
that we're acting on the interests of the people affected
by these issues. And actually, I think too much of
government is done by advice provided by people who are
(06:14):
not affected by the issues. So we're sitting here in
Wellington in their offices who have a theoretical idea. Well, actually,
people who are being affected should be listened to, and
this forum has provided us a way to do that.
Speaker 1 (06:25):
Hey, if the school comes to you and says we're
fed up with the open plan, we want to go
back to single cells, do you pay to put the
walls back up or do they Look.
Speaker 2 (06:34):
I have to ask Erica Stanford about that. What we
have said is, look, we're not going to be doing
any more of those barns in future. We don't think
they stack up, and we think single cell is better. Certainly,
I've had four kids through the school system, still going
through the school system, and I've experienced both, and I'd
go single cell every single time. In some cases, schools
(06:56):
do have the ability to use the spaces they already
have and divide them up and take more of a
single cell approach, and I expect many boards of trustees
are going to move in that direction. In the company years.
Speaker 1 (07:06):
Now, are we still handing out cash or handing out
loans through Crown Regional Holdings?
Speaker 2 (07:12):
Crown Regional Holdings holds the loans both from the old
Provincial Growth Fund which we have stopped, also the North
Island Weather Event loans which were made to a number
of horticulturalists following cyclone Gabriel so that they could get
their businesses up and running, which has been pretty successful,
you know, Apple and Pierre had a record year. And
then we have the Regional Infrastructure Fund, which has been
(07:35):
set up quite differently from the Provincial Growth Fund, and
that does continue to provide some loans to some projects
and they are managed through this entity. But it's important
to note that we in December agreed to implement a
very detailed monitoring and evaluation framework for that fund, and
that follows feedback from the Officer of the Order to
(07:57):
general lessons learned from the province.
Speaker 1 (07:59):
So are you confident that your Regional Growth Fund is
not going to fall into the same trap as the
Provincial Growth Fund, which is like fifty percent of its
loans are at risk of impairment.
Speaker 2 (08:08):
Well, we are being much stricter about what we lend to,
so it's a very focused fund. We've been very much
focused on infrastructure, so in particular we've been helping councils
build stock banks around the country and flood protection mechanisms.
We've been investing in water storage projects where we know
(08:28):
that getting that water storage project up and running means
that many farmers in a region will be more productive
and ultimately will be able to pay for those facilities themselves.
And so in general, we've been very careful about the
way that we invest in as a group of ministers
involved in that good stuff.
Speaker 1 (08:45):
Hey, it's very good to talk to you. Thank you
so much for your time. That is Nicola Willis Finance Minissystem.
Speaker 2 (08:49):
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