Luxon Addresses Economic Challenges at Business Breakfast Event

Prime Minister Christopher Luxon engaged with East Auckland business leaders during his annual end-of-year breakfast at the Pakuranga United Rugby Club on November 28, 2023. The sold-out event focused on the state of the nation’s economy, allowing Luxon to share insights and strategies amidst ongoing financial challenges.

Luxon, representing the Botany electorate, described it as “the best electorate in the country” during a lively discussion with Zoe Wallis, an investment analyst from Forsyth Barr Investment Advice. The session was marked by his upbeat demeanor and assertive responses to questions, showcasing his grasp of economic issues affecting New Zealand.

The Prime Minister’s address began with a critique of the previous Labour government, which he claimed had increased spending by 84 percent and driven national debt to record levels. Luxon emphasized the responsibility of his coalition government to stabilize the economy, stating, “we need to fix the basics of the fiscals and get spending under control.”

Luxon likened managing national finances to personal responsibility, suggesting that just as mortgage holders maintain timely payments to avoid extra fees, his government seeks to reduce debt systematically. He projected a timeline of five years for the country to return to budget surpluses.

The conversation also touched on New Zealand’s economic recovery, which Luxon characterized as a “two-speed” process. He noted strong performance in the rural sector, particularly in red meat and horticulture exports, while construction and development in urban areas like Auckland faced difficulties. One construction industry representative mentioned to the Eastern Times post-event that their business had significantly improved recently, saying it has “taken off in the last six weeks.”

Luxon clarified that while he does not advocate for severe austerity measures akin to those implemented by the UK Conservative Party under David Cameron, there is a clear need to control spending. He outlined a strategy focusing on cutting unnecessary expenses and regulations, while also investing in essential sectors such as health and education, which together comprise a budget of $40 billion over the next two years.

The Prime Minister surprised attendees by revealing that the average cost of a classroom was $1.2 million when his government took office, and that they have successfully halved this figure. He reiterated the government’s commitment to enhancing economic productivity through technological advancements and infrastructure development.

Luxon cited examples from Australia, Ireland, and Singapore as models for New Zealand to follow in improving economic conditions. He highlighted the importance of attracting foreign investment, particularly from sovereign wealth funds in countries like Korea and Japan, to facilitate public-private partnerships for infrastructure projects.

In discussing retirement, Luxon announced upcoming changes to KiwiSaver minimum contributions, aimed at encouraging personal savings to complement national superannuation. He suggested that a broader conversation is necessary regarding raising the pension qualification age from 65 to 67, citing increased life expectancy as a key factor.

Concluding the hour-long session, Luxon addressed New Zealand’s energy policies, expressing confidence that the country should not face an energy crisis. He criticized the previous administration’s ban on oil and gas exploration, asserting that his government is working to rectify this situation. Luxon also shared optimistic news about the renewable energy sector, noting a surge in wind and solar projects intended to ensure “affordable, abundant energy for everyone.”

Following his speech, Luxon took the time to interact with attendees, taking photos and discussing issues with business leaders, a reflection of his strong support within the Botany electorate. His engagement at the Business East Tamaki breakfast underscored his commitment to fostering relationships with the business community while navigating the complexities of New Zealand’s economic landscape.