Reserve Bank of New Zealand (Economic Objective) Amendment Bill

Members, the committee is resumed on the Reserve Bank of New Zealand (Economic Objective) Amendment Bill. When we suspended overnight, we were considering Part 1. Once again, the question is that Part 1 stand part.

Members, before we begin, I will inform the committee that we have received a number of tabled amendments on this part of the bill. Some are in order and will be voted on. A number of amendments are contrary to the objectives and principles of the bill. The bill has a specific intention that is to narrow the Reserve Bank’s economic objectives to a single focus on price stability. I have considered some amendments in the name of the Hon Grant Robertson that would expand the Reserve Bank’s economic objectives and are therefore out of order.

Tēnā koe, Madam Chair. Thank you very much for the opportunity to speak in this debate. This is my first contribution to the debate; I have not had an opportunity to speak in the first or second reading, so I’m very enthusiastic to speak with the Minister today. Now, I have one specific question that is really important for me to have some answers on before I speak to the House about my proposed amendments. There are a number of amendments proposed in my name which I think will help the House to improve the intentions of the bill. However, I need some answers on these specifically. Just to flag for the Minister, the specific question is about the November 2021 Monetary Policy Statement of the Reserve Bank, but before I ask my question, I’ll give a bit of context.

So, recently, New Zealand’s economy has been through a period of quite extreme fluctuation that, you know, fluctuated to a degree that we haven’t seen in a very long time. Late 2020 through to early 2021 saw widespread concerns about rising unemployment. This was a period where the country’s focus was on the immediate effects of COVID-19. We were in a period where both our fiscal and monetary policy had to respond to the concern that there would be widespread job losses in New Zealand, and that was focused, you know, in this global context of this happening all over the world. So we needed to act together as Government and as the Reserve Bank to guard against that. Then, continued weak economic activity in the wake of the initial shock from COVID-19 furthered that need to keep people connected with their jobs and their employers.

But some months later, the nature of what was worrying commentators actually changed. Policy makers had undergone this sort of whiplash shift between these extreme concerns looking overseas at job losses to then being worried about an economy with too much slack and that might have been in danger of overheating. It’s quite unusual in the economic history of New Zealand, and very unusual around the world, where not only are we shifting policy priorities over, you know, say a year or two but, actually, that same concern is playing out within six months. So you have this challenge of inflation over the past few years in all advanced economies dealing with those ranges of shocks, but then we get to this problem of whether repealing the dual mandate might have had some stabilising effect on that, and my contention would be that it did not. Returning the Reserve Bank to a single objective here, I would say, wouldn’t have had any effect on, you know, the way that the Reserve Bank was acting during that time period, and certainly not within the sort of 10 years preceding that. Had the Reserve Bank been operating under a straight inflation-targeting objective in recent years, it would not have had a different outcome.

But my question to the Minister is about whether she herself agrees with that contention, or whether, in her speeches to the House when she said that the change that she is proposing would have improved the situation with inflation, that’s the case, because if the Minister is correct in her assertion that the Reserve Bank would have been able to do something different about inflation, then there might be something else going on which would be really useful for the House to know.

So I come, then, to my question about the 2021 Monetary Policy Statement from the Reserve Bank that employment was above its maximum sustainable level. In more general terms, that means that unemployment was lower than it could be sustained. So my question to the Minister is: does she agree with that statement, and, if so, did she believe that the Reserve Bank was also acting in that way, because if the Reserve Bank was saying one thing and doing another, if they were in fact not acting to—you know, if they were continuing on a project of trying to bring unemployment down, then perhaps she’s right. She’s told the House that this change will have an impact on inflation. Is that because she believes that the Reserve Bank of New Zealand (RBNZ) was telling us in 2021 that maximum unemployment had been reached, but does she think that the RBNZ was not actually following what it was saying? This is important to my Amendment Paper that I’ve proposed to clause 4, which provides a more flexible approach to monetary policy. If the idea is that the RBNZ says one thing and does another, then that won’t work, and I want to hear from the Minister if that’s what she’s contending.

I move, That debate on this question now close.

Thank you very much, Madam Chair. There are many members on this side of the Chamber keen to contribute on Part 1 of this bill. I want to do two things in this call. I want to recap on two questions I asked the Minister last night that I have not had an answer to. The first of those is a very specific question on whether or not the Minister has had advice that there was anything in the dual mandate that caused the Reserve Bank to take its focus off reducing inflation. I asked that question twice last night and I haven’t had an answer. It’s a very important question because it goes to the heart of the Government’s argument for why they are putting this bill, and clause 4 in particular, in front of the House.

The argument being advanced by the Minister is that the Reserve Bank took its eye off the ball when it came to inflation. In fact, what we heard from the Reserve Bank Governor himself on multiple occasions is that that is not the case and that the dual mandate did not affect the focus on inflation. So I would like to know, again, whether or not the Minister has had advice to the contrary on that, because it is in fact the heart of what has been asked.

The second question that I asked last night and haven’t had an answer to was whether or not the Minister believes that the Reserve Bank should take into account matters to do with the impact of monetary policy on employment at all. We’ve established by the nature of the bill that’s in front of us that the Minister doesn’t believe it should be one of the two objectives of the bank. Having established that, then the question we want to know the answer to is: does employment have any role whatsoever?

Now, as I noted last night, it would be a radical departure by the Minister to not believe that employment had any merit for consideration, and in order to help shape this discussion, since the Minister declined to answer that question as well last night, I refer the Minister and indeed the committee to amendments in my name to clause 4 that would try to meet the Government halfway. It says to the Government, “OK, you no longer want two objectives in that clause that, arguably”—and I don’t agree with this, but the Minister has argued this—“cause confusion.” I think the people who work at the Reserve Bank are capable of dealing with two issues at once. But if we want to meet halfway, I have an Amendment Paper that would make the maximum sustainable employment objective subservient or subordinate to the inflation control objective. Because that seems to be the issue that the Minister has raised in the House—that somehow or other there’s this confusion.

So if the Minister does believe that employment is a factor the Reserve Bank should take into account, which, as I say, every Reserve Bank in the world does, so if she doesn’t believe that, we’ve got a bigger problem and she should tell us that. But if that is what she does believe, then here is the opportunity for the Minister to agree to the Amendment Paper that I have put up, which would make the economic objective to achieve and maintain stability in the general level of prices over the medium term and, subject to that subsection, supporting maximum sustainable employment.

So it does the thing that the Minister last night said she wanted, which is a hierarchy of objectives. And this is a point too, because the Minister relied a number of times last night on the letter that she has received from the Reserve Bank indicating their support for—and I believe this is the exact phrase—prioritisation.

Now, that’s actually quite different from what the Minister’s proposing, because she’s not proposing prioritisation; she’s proposing getting rid completely of the maximum sustainable employment objective. So if she is so keen on the letter that the Reserve Bank Governor and the chair of the board sent to her, here’s an opportunity to fulfil that by taking on board my amendment which would create the prioritised list that the Reserve Bank are looking for.

So just to recap on my contribution, I’m still after an answer to the question of whether or not the Minister has any advice or indeed any evidence of whether the Reserve Bank’s dual mandate meant that they didn’t take decisions on inflation control that they should have, and then, secondly, whether or not the Minister believes that employment should have a role in the decision making of the Reserve Bank when it comes to the official cash rate and its monetary policy. And if that is the case and she does think that, then there is now an opportunity here for her to adopt my Amendment Paper. But I would appreciate an answer to those questions.

Before I take the next call, can I just remind the member that if this is the third time he’s asked that question, it is leaning towards being repetitive.

Point of order, Madam Chair. With respect, last night I raised a point of order on this exact subject with the person who was the presiding officer in the Chair. I agree, and I raised it because I was concerned that a presiding officer would rule exactly the way that you just have. The new system that was brought in in last Parliament for the committee of the whole House relies on elements of cooperation around answering questions, and I sought a ruling from the presiding officer that if a question was not answered, referring again to the fact that it had not been answered, would not be repetition. The presiding officer said that would be a factor that he would take into account. I’d be very concerned if the failure of a Minister to answer a question led to the closure of a debate.

Thank you very much, Madam Chair, and a pleasure to be back debating this, this morning, after a late one last night. I still have a few points that I’d like the Minister to address, and I think that they are really salient points, because while it may seem as though we’re kind of splitting hairs here with this debate, the devil really actually is in the detail, because what this bill does is remove the dual mandate of the Reserve Bank of New Zealand—the focus on price stability and on maximum sustainable employment. As the former Minister was just elucidating, we have quite a strong reliance on a report on the remit and the mandate from June 2023 from the monetary policy committee, which spoke about the need to have a potential hierarchical ordering of that dual mandate. That is, I think, what is largely reflected in the letter which the Minister has now tabled.

So, to that effect, I just really think it’s important to drill into and to get some real clarity from the Minister on whether she thinks that employment, or maximum sustainable employment, or any iteration of that should be included within the considerations of the Reserve Bank when setting monetary policy. I heard from her very clearly in her answer last night that she does not believe that it should be, obviously, put in this legislative dual mandate, but the question still remains as to whether she thinks it should be within the broader monetary policy committee’s remit, the likes of which house price sustainability has also currently been considered within.

I also have a further and important and interesting point on whether house price sustainability should continue to be considered within that remit too. Secondly, and it may feel like we are labouring this point, but this is a really, really important one, because it goes to the heart of the question of the purpose of this legislation. Again, we have had this over-reliance on this letter from the Reserve Bank Governor on the fact that there needed to be some hierarchical ordering of that dual mandate or a prioritisation of the mandate, and that financial stability should always take that primacy.

But, again, I do ask the Minister if she has seen any evidence as to whether that dual mandate has changed the focus or has meant that there has been a deprioritisation of price stability. Because if that is the case, then the words we have heard from the Reserve Bank Governor, Adrian Orr, in the Finance and Expenditure Committee hearings over the last three years are to be taken as untrue, and that’s a pretty serious allegation which underlines the proposal herein.

The third thing is about that point of perception, and I think this is an important point that the Minister raised last night, and, obviously, it’s reflected in the regulatory impact statement and also in a number of contributions from members of the Government. It’s about how perceptions of the Reserve Bank’s focus on inflation and price stability in turn impacts the behaviour of market participants and that those market participants then may behave in ways that result in more inflation or less thereof or otherwise.

So I was just wondering if the Minister could elaborate on that point. I’m not here seeking to be obtuse but I think that it is a really relevant point. When we’re talking about the economy, which, as we all know, is just all of us and the things we create and what we trade and the value that we produce and the earth that we live on—and, you know, we have quite different ideological standpoints on how and where we should go and how we should create those rules and regulations. But none the less, who are those market participants and what kind of behaviour are we scared of them participating in which then results in that greater potential or inflation? What is the evidence that this decision is being made on? I think that is a valuable piece of information that the general public should be able to take from this that’s currently being debated, because, once again, it’s a fundamental premise of this legislation—that perception is really, really important to the behaviour of those market participants. So who are they and how differently are they behaving as a result of this dual mandate?

And just to potentially help move things along here with regard to getting more evidence on the table and therefore having a more thoroughly informed debate in lieu of not having a select committee process, the Minister has referred to the letter from the Reserve Bank Governor—and I thank her for tabling it—but may I ask her to table the letter that she wrote to the Reserve Bank Governor, because it feels as though there were a few options laid on the table therein, which means that potentially we could have a more informed debate if we were to understand what options she was seeking advice on and got a response upon.

So just to be really clear on those points I’m asking about. They are: what is the place for employment within the consideration of the Reserve Bank and the monetary policy committee when it comes to setting monetary policy? Is it to exist within the remit, and, as an addendum to that, where does house price sustainability sit within that if the general broader thrust is that there needs to be a laser-like focus on price stability solely?

The second is this outlying question—a question that still remains on the table—as to what evidence she has seen on whether the dual mandate impacted or meant that there was a lesser prioritisation of the price stability point of the mandate. Because, again, if that is the case, then are we to take it that Adrian Orr was not being forthright, upfront, or honest with the select committee? That is quite a serious underlying allegation.

The third thing is: who are those market participants and what is this perception that we’re scared about?

Madam Chair, I’m going to take this opportunity to spell out once again—and repetition that I hope the House will indulge me in—the answers to the repeated questions that clearly the former member for Wellington Central has failed to grasp the answers to.

So he has asked about when might price stability in employment objectives be in conflict and have they been in conflict, and as I’ve said in my contributions to the House previously, often the objectives of price stability and maximum sustainable employment will align. However, the objectives could move in opposite directions and one of the challenges that we have—

Hon Grant Robertson: Not the question I asked.

NICOLA WILLIS: —and if the member would listen, he’ll understand the answer—having a dual mandate can present challenges to decision makers where objectives are in tension. In turn, this makes it—and listen carefully here, Mr Robertson—difficult to assess monetary policy committee performance, monetary policy committee performance, and to ensure accountability for decision making. Which is to say it is challenging to understand the decision-making processes that have been undertaken where we have—this is, as I have been clear about providing clarity to everyone involved in the monetary policy regime, those assessing the decision-making processes of the monetary policy committee, the general public, and the members of that committee. And a single mandate makes clear what the objective of the monetary policy committee is, which is price stability—putting a lid on inflation. It also makes clear that other matters such as supporting New Zealanders with the cost of unemployment—that is the purview of fiscal policy, not monetary policy, because we don’t think it makes sense to ask the Reserve Bank to try to solve a problem which is actually the presiding role of the Government and its policy.

There’s also the issue that there are real challenges to including maximum sustainable employment that arise from measurement issues, because it is more or less impossible to measure maximum sustainable employment. And I’d note that some market participants, like Business New Zealand, have noted that with so many balls in the year, the bank can no longer concentrate on monetary policy’s prime purpose of ensuring relatively stable price levels over time. And that, unfortunately, could reduce New Zealanders’ confidence in the independence and predictability of the bank’s monetary policy settings.

I’d also note, and Minister Robertson—the former Minister Robertson may remember this, that when he introduced the maximum sustainable employment objective, it was recognised that at that time that if the bank put more weight on employment stabilisation at certain points in the cycle, that could lead to higher volatility in inflation. And I think everyone in this House knows that recent years have demonstrated the high costs of inflation and the impact that has had on New Zealanders.

Hon Dr Megan Woods: But have they? That’s the question you’re not answering. Why don’t you answer the question—have they?

NICOLA WILLIS: So reducing the possibility of volatility—Mrs Woods—in future rates of inflation is actually a priority for this Government.

I just want to move, second, to the question of the content of the remit and the charter. I want to assure the member Chlöe Swarbrick that we will retain the flexible inflation targeting regime under which the response of the Reserve Bank to inflation is tempered by considering the impact on other factors in the real economy. I will publish an updated remit and charter upon passage of this Act.

Finally, I want to note that there are a number of amendments that have been tabled and suggested by the member Hon Grant Robertson, who can’t seem to make up his mind what the purpose of the Reserve Bank Act has been, because I can count several different ideas he has, which is rather symptomatic of the member—that he couldn’t just land on one thing. Well, on this side of the House we can land on one thing, which is: we’re going to beat inflation, and this Act is going to help us do it.

Thank you, Madam Chair. I want to ask you, Minister, about what I heard last night from many of the speakers on the Government side of the House. They talked about helping hard-working New Zealanders and I wondered how that was possible if the mechanism used puts such New Zealanders out of work, and that is my concern. I come from a background of employment law and I know how important it is that people work for their wellbeing and the wellbeing of their families, but I also know how important it is to the economy that people keep working. My understanding of the Reserve Bank is that, ultimately, it’s there for the public good, so it’s incredibly important that what it’s achieving is done mindful of the full employment of people, if at all possible.

My understanding of the term “maximum sustainable employment” is that it’s a particular term used, because the “sustainable” part of that is that if there is any tension between full employment and price stability, price stability wins out. There is, in fact, a hierarchy built into the term itself. I wondered, when you talked about the objectives being intention, whether you’d taken that into account or had any advice, because my understanding is that there is no tension, and that is why the Reserve Bank Governor has always been clear that there has been no problem.

Now, I do take on board that there is an issue raised about the perception of others, but I wondered and I wanted to ask you: isn’t it our job as a Government and as a Parliament to lead, not to sap up the way that people misconceive things? We need to bust myths, not assist them.

So I ask you this: do you agree that it is our job to make sure that people understand that the maximum sustainable employment part of this commitment is for the public good and is, in fact, a nod to the fact that they are incredibly important to the economy and that we run institutions like the Reserve Bank and, in fact, the Parliament for the wellbeing of people? Aren’t we actually in a situation that will lead to the alienation of the very people that we seek to support if, in fact, they lose their jobs in great numbers because the Reserve Bank is untethered from any concern about their wellbeing through work—and isn’t that what we’re all here to do, Minister? Aren’t we here to make sure that hard-working New Zealanders stay engaged and stay empowered by the fact that they can earn a decent living, and isn’t that absolutely critical to whether they survive the economic ups and downs and the tides of inflation that we’ve seen around the world?

I want to know what is it that you think the Reserve Bank is really about: why is it there, and why do we have any measures at all in this? I heard the Hon Grant Robertson talk yesterday about an earlier, historical occasion which really concerned me. It concerned me because a Reserve Bank Governor actually paid—people paid the price in their work because the mechanisms of the Reserve Bank were being used to drive down inflation at the total expense of workers. That’s the last thing that I want to see, and I wondered whether it is the last thing that you want to see, Minister. Do you want to see more unemployment if, in fact, that means that there will be a lower inflation rate, and at what point is that unacceptable to you? That’s my concern—where is the commitment?

So I wondered whether you would consider that, and why you would reject the amendments that have been put up that focus on a compromise here which makes it very clear that the Government and the Reserve Bank remain committed to full and stable employment. That seems incredibly important to me, and it really matters to people out there. It’s all very well to talk about helping hard-working New Zealanders—and I heard your colleagues say that over and over again—and it’s all very well to talk about how there is this scourge of theft through inflation, but the greatest theft is actually the capacity, isn’t it, Minister—

The member’s time has expired.

Thank you, Madam Chair. I just want, first of all, to pick up on some of the reflections that the previous speaker, Helen White, just spoke about. Last night, I wasn’t able to be in the House for a number of reasons and one of them was because I was attending the graduation of one of my children. As the member of Parliament for Mana, I’ve been to a number of prize-givings over the last few weeks and there’ve been some very strong messages that are coming out through both families who are attending these prize-givings—in some of the lowest socio-economic areas in this country—and through a number of the principals and the teachers I was speaking to.

In one particular message last night, the actual principal of that school said, “Can someone please tell the three Prime Ministers that, you know, learning through play, learning through camp, is the equivalent of learning literacy and writing—there are other ways to be able to learn it, because they’re already teaching the basics of learning and writing.” But this links back to why I’m standing in the Chamber and wanting to ask the Minister a question; it’s around perceptions. And so there is a perception, sometimes—by this Government, who has only just started—that there are a couple of failings in the rest of society. And yet when you go out into a community and you talk to these people within this society—both teachers and principals and families, and again, in some of the lowest socio-economic areas of the country—the perception that they might hold might actually be very different to the truth that is being held by those within that community.

And the reason why I focus on the word “perception” is because in the regulatory impact statement that has been put together by—I think it’s Treasury—

Hon Grant Robertson: Yes.

Hon BARBARA EDMONDS: Treasury. And first of all, thank you very much for the Treasury officials for putting that together. I know it’s going to be a bit of a rarity over the next 100 days, but it clearly shows that you can put together a regulatory impact statement very quickly. Why I wanted to be able to focus on the word “perception” is because in paragraph 7 of that regulatory impact statement, it says: “Nonetheless, the dual mandate affects not only the policy decisions made by the monetary policy committee, but also perceptions of the effectiveness of monetary policy.” Perceptions. And again, I found it quite unusual that quite a subjective type of word was used in a regulatory impact statement, and what I wanted to understand was: the perceptions—when do they become evidence-based?

And I want to reference the speech by the Minister when she stood up and she had a long speech, trying to address the question that the Hon Grant Robertson asked her around “evidence-based”, but she didn’t actually address the question, and so I want to go back to the regulatory impact statement that references perceptions. In relation to that—perceptions—it’s actually talking about some of the Reserve Bank reports that have been done. But then if I go back to the evidence base, we need to go back to objectivity. So where does the evidence base come into this, and what advice has the Minister, again, received in relation to that evidence base? Because if you look at the relationship between our country’s inflation trajectory and our central bank—or Reserve Bank’s—mandate over the last two years, the evidence clearly shows a couple of things: that there is no such relationship that exists. Because if you look at other Governments which have higher inflation in countries with a dual mandate, but inflation is higher in those countries; and lower in countries with a single-mandate central bank.

So, unfortunately for the new Government, the perception that this dual mandate therefore makes it more difficult to focus on inflation seems null and void. Because again, in practice—and you’ve seen it through the Reserve Bank, the number of their documents, the Monetary Policy Statement. And I want to echo the sentiments of Chlöe Swarbrick, the MP for Auckland Central, who said, “What was that letter that their Minister actually sent the Reserve Bank Governor? I think it’s important that that gets tabled because that will be the context in which the response by the Reserve Bank Governor is received.” But when you look at New Zealand and Australia—both of which have central banks with dual mandates—inflation peaked at 7.2 percent and 7.8 percent respectively. But in Sweden—which has a central bank with a primary price stability mandate—it peaked at 12.3 percent. One mandate, higher inflation. Two countries: New Zealand and Australia, side by side in so many ways—and lot of Kiwis who are going overseas who want to chase that Australian dream instead of the New Zealand dream. Basically, we have the same settings, and I know the Australian federal bank also had its review quite recently actually, in the last few weeks.

So my question again to the Minister: what advice, what evidence-based advice—not around perceptions—as set out in the regulatory impact statement has she received?

I move that the debate on this question now close.

The question is that debate on this question ends.

Point of order, Madam Chair. Two points. The first is that the member incorrectly stated the motion to close debate, so therefore it was not in order. Secondly, Madam Chair, you’ll be very well aware, with the bill not going to select committee and a large number of my colleagues wanting to take a call about the concern we would have. But my primary point is the member did not close the debate correctly.

Thank you, Madam Chair. I appreciate I was unable to be in the House last night, but I do have an amendment, which I would like to speak to, so I appreciate the opportunity.

The amendment goes to the heart of what we object to in this bill. If I was to be really cynical, I’d say that the Government doesn’t care about people who don’t work, but they say they care about people who do work. The amendment restores the purpose of this monetary policy, and it would be to take out, remove in clause 7, the word “objective” and replace it with “welfare of working people”. It goes to the heart of what we are here for in Parliament. There might be some on that side of the House who say, “We’re just here for the economy, because the economy will deliver to all of the people of New Zealand.” Well, I’d like to think we could go a bit further and say, “We’re here for all the people of New Zealand.” A well-run economy, an efficient economy, indeed enables us to deliver benefits. But the purpose is for people, not for the economy. And if you get that back to front, you end up with monetary policy that is pure but not delivering for the purposes for which this Parliament is in existence. We’re here for the people of New Zealand—we would say for all New Zealanders.

Now, if we were to move in the direction of the current coalition Government, who say that we want everyone working, and those who don’t work we’d like to encourage them through incentives to get into work—well, if indeed that is the true objective of the coalition Government, then I would suggest that they vote for the amendment that we have tabled in clause 7 and reinsert the purpose of the monetary policy, yes—

CHAIRPERSON (Maureen Pugh): Excuse me, I’ll just interrupt the member. We are still focused on Part 1 of the bill.

Hon DAMIEN O’CONNOR: My apologies, Madam Chair—Madam Speaker—

CHAIRPERSON (Maureen Pugh): Chair.

Hon DAMIEN O’CONNOR: Madam Chair—sorry, I’ve elevated you already, such is the honour of being the West Coast - Tasman MP. A very important honour, indeed; that’s right.

I go back to the point that I made first, and it relates to Part 1 and Part 2, the purpose of this piece of legislation—monetary policy in this country is actually for the people of the country. If we are to indeed have a dual purpose, which we should, then it must incorporate some reference to the people of New Zealand, not just to price stability. If we are to indeed look at price stability and ask the question as to why inflation has been so high, the reality is that we’ve had a Ukraine war; we’ve had closed COVID environments. Why have some prices gone up? Well, it has been import costs in some ways, but also the reason some have put up their prices is because they can. So I suggest that if the Government is as determined to bring down inflation, then it provides as much focus on commerce law and ensuring that there’s indeed true competition across all parts of our economy.

I’m sure that this side of the House will support any attempt to expose opportunism, because I know opportunism—maybe people on that side do know of businesses that have put up their prices because they can, which, actually, from a business perspective is not a bad strategy. But what we try to have in this economy is a competitive environment that keeps the lid on inflation, that doesn’t allow people to exploit opportunities unfairly, and, indeed, I welcome that Minister’s input to ensure that those areas of the economy where profits have been very, very healthy, where some might say that there have been drivers upward of prices and inflation, that maybe an attempt to focus on those areas might help keep the lid on inflation.

But in terms of this piece of legislation, removing the dual purpose that we inserted into it is a backward step for a country that has prided itself on social justice, prided itself on ensuring that benefits flow to all New Zealanders, prided itself on being a leader in the world, and, at a time when other reserve banks have more than one purpose with monetary policy, we’re taking a backward step, which seems to be part and parcel of the direction of this Government.

It would be useful if members, in making contributions at this committee stage, had read the bills. The purpose of the bill already promotes the prosperity and wellbeing of New Zealanders and contributes to a sustainable and productive economy, so that is made clear.

I move, That debate on this question now close.

The question is that Arena Williams’ tabled amendment to Part 1 be agreed to.

The question is that Grant Robertson’s tabled amendment to clause 4 to include in section 9(1)(a) the words “supporting the economic policy of the New Zealand Government, including its objectives for growth and employment” be agreed to.

The Hon Grant Robertson’s remaining tabled amendments to clause 4 are out of order as being inconsistent with the objects and principles of the bill. The Hon Grant Robertson’s tabled amendment inserting new clause 4 to amend the purposes of the Reserve Bank of New Zealand Act 2021 is out of order as being outside the scope of the bill. The question is that Part 1 stand part.