Initiative applauds new coalition’s clarity and reforms

Dr Oliver Hartwich
Insights Newsletter
24 November, 2023

The outcome of New Zealand’s recent coalition negotiations marks only the beginning of the next three years of government. But the principles and policies outlined in the agreements suggest the country now has a reformist administration ready to rebuild the economy, refine regulations, and expand choice in social services.   

As a public policy think tank, The New Zealand Initiative welcomes the clarity around priorities like stimulating economic growth after recent disruptions and years of questionable policies.  

Underpinning the Government’s agenda are laudable guidelines for decision-making. We applaud the coalition’s pledge that policies will be grounded in clearly defined problems, rigorous cost-benefit analyses, and the pursuit of efficiency.  

The coalition’s self-imposed requirements to base proposals on empirical evidence rather than ideological positions reflect values at the heart of our work.  

After too many years of ad hoc and reactive policies, it is reassuring to see disciplined practices codified upfront. 

Drilling down into specific policies in the coalition agreement reveals close alignment with The New Zealand Initiative’s research.  

The pledge to scrutinise spending and pare back bureaucracy accords with our advocacy for fiscal discipline and accountability.  

We are happy to see the introduction of targets for the public service, and we hope to see more transparency and accountability around them. 

We also note that the coalition agreement contains steps towards liberalising New Zealand’s restrictive foreign investment rules. We could not agree more with these changes. 

The stated aim to inject more competition into social service delivery through initiatives like charter schools also mirrors our research into choice-based models. The return of the social investment approach is equally welcome. 

On education, we agree with the Government’s refocussing on the basics in numeracy and literacy, the rewriting of the curriculum and a new standardised, robust assessment of student progress.  

Our emphasis on lifting productivity growth through regulatory reforms is shared and now propelled by the proposed Regulatory Standards Act and a dedicated ministry for deregulation and regulatory reform. 

Restoring Reserve Bank independence with a single price stability mandate reflects the Initiative’s advocacy. Considering a single decision-maker model for monetary policy could also promote accountability.  

Abolishing Fair Pay Agreements and Labour’s resource management framework in favour of approaches grounded in property rights aligns with our research.  

Using property rights to guide RMA reform and exploring financial incentives for councils through GST-sharing have both featured in our writings for many years. Our work on empowering local government aligns with the coalition’s proposed city deals. 

Focusing Commerce Commission market studies on regulatory barriers implements our recommendation.  

Discontinuing the clean car discount accords with our argument it does not reduce emissions within the ETS.  

We also recognise our prescriptions behind changes to Pharmac funding rules and Medsafe approval processes for new medicines. 

We are thus happy to see many of the Initiative’s policy proposals and philosophical positions reflected in the coalition agreements.  

We wish the new Government success in implementing this ambitious reform agenda. 

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