National Party Leader Judith Collins at her State of the Nation speech in Auckland yesterday. At left are MP Nicola Willis and MP and former finance spokesperson, Paul Goldsmith (with a new beard)

National’s Leader Judith Collins’ State of the Nation speech yesterday contained some surprising revamps of some traditional National policies.

And she is promising more.

She told POLITIK last night that she will be making a speech about why world-class cities matter.

But what was particularly notable was her reframing of the economic debate.

National Party finance spokespeople from Bill English to Paul Goldsmith, particularly Stephen Joyce, have talked about economic policy in terms of numbers.

That led to the party’s long-time emphasis on getting debt down and setting a debit target of 20 per cent of GDP.

That frustrated some Ministers in the Key/English Government who could see voters moving away from National as, driven by the numbers, the Bill English and Joyce imposed an austerity programme on New Zealand which allowed Labour later to capitalise on the under-investment in health and education infrastructure that flowed from that austerity.

Collins hinted during the election campaign that she was going to change that when she did not endorse the debt targets that the party’s former Finance spokesperson, Paul Goldsmith was talking about.

And in outlining her political philosophy, she put the Government in a much more prominent position than former National MPs like Ruth Richardson might have.

 “As Kiwis, we know the importance of working hard to help our families get ahead, and I strongly believe that if you are willing to put in the hard yards, then you should enjoy the benefits,” she said.

“But we also have a strong sense of responsibility toward each other, to help those who need it.

“That is a role for all of us in New Zealand, but particularly for the government.”

She said that the country needed to be thinking about how people were placed once the borders opened again.

“A strong business sector is central to this but, frankly, it’s not about business for business’ sake,” she said. 

“Too often, National has talked about its economic priorities as if these are the end goals in and of themselves – bigger economy, fewer regulations, smaller Government, stronger businesses.

“On their own, these things aren’t what is really important.

“They are only important because they are what ultimately drives prosperity, creates jobs and lifts incomes.

“A strong economy means more opportunities for New Zealanders.

“A strong economy is what will ultimately help lift children out of poverty.

“A strong economy means more money to invest in our health system.

“A strong economy will help our kids into their first job and give them the chance to do things and be things we’ve never even dreamed of.

“That’s what matters – the things that a strong economy allows us to do.”

Collins has finally conceded that the Reserve Bank and demand might be playing a role in the current house price explosion.

Throughout the election campaign, she focussed solely on loosening the Resource Management Act to allow more houses to be built.

But the Government is doing that anyway.

Her new finance spokesperson, Andrew Bayly, has an often eclectic approach to economics and he tends towards centrism.

His hand is evident in her new approach to the bank.

“You will remember that the Reserve Bank was slashing interest rates long before Covid-19 arrived,” she said.”This adds fuel to the fire of a housing market that is already out of control.”

So would she go so far as to remove Labour’s “maximum sustainable employment” requirement in the Bank’s Policy Targets’ Agreement which places downward pressure on interest rates?

“While we have always been uncomfortable with the second element of their remit, right now the pressing issue is how money is being directed into buying existing houses, and away from the productive sector including property development,” she said.

“We are keen for the Reserve Bank to review its prudential requirements (capital adequacy ratios) to ensure enough money goes into development and the rest of the productive sector and not just into the buying and selling of existing houses.”

Those are themes that Bayly was talking about at the end of last year.

And instead of proposing landlord-centred policy, as National did during the campaign, Collins is now talking about the social impact of high house prices.

“The housing emergency is driving up inequality, and it is hitting young New Zealanders the hardest,” she said.

“We are already seeing a major increase in the working poor here in New Zealand, where people put in the hard yards but still can’t get ahead.

“These house price increases just make it worse.”

However, she is still arguing that the Resource Management Act is in the way.

“Today, I am calling on the Government to introduce urgent temporary legislation to make it easier to build a house, until the permanent RMA reforms are completed,” she said.

“The legislation would give Government powers to rezone land and avoid frustrating consenting delays.

“It was done by National following the Canterbury earthquakes.

“It’s now urgent for the rest of the country.”

This, however, drew immediate fire from National’s centre-right ally, ACT, whose housing spokesperson, Brooke van Velden said National was ignoring the infrastructure issues surrounding new houses.

“At present local authorities don’t zone more land for development in part because they feel financially constrained in dealing with the associated infrastructure costs like roads and water services,” she said.

“There’s little point offering ideas about how to build more houses if you can’t drive to them.

“The same goes for intensifying development in existing urban areas if the wastewater and sewerage is just going to overwhelm existing infrastructure and end up in the sea.”

Collins said she had referred to infrastructure and the need to “get it going” and promised that she had more to come.

And she finished her speech by saying National would be kind, but “not at the expense of getting things done.”

That may be her undoing, though. Her enthusiasm for getting things done may eventually test the patience of her caucus.

It would seem yesterday’s subtle change in emphasis is the product of Collins and Bayly while few others in the caucus have been in on the development of the new ideas.

But she may be given some space. At least the party is, at last, starting to sound like it is refreshing itself.

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