1 00:00:00,080 --> 00:00:03,680 Speaker 1: Right now. Nicola willis the Finance Minister. Good evening, Good evening, Ryn. 2 00:00:03,760 --> 00:00:06,520 Speaker 1: Great to have you on the show as always. Firstly 3 00:00:06,600 --> 00:00:10,800 Speaker 1: the defense spending stuff. Obviously, the Judiclons was on the 4 00:00:10,800 --> 00:00:12,880 Speaker 1: show Friday said, yeah, we want we basically want to 5 00:00:12,880 --> 00:00:15,160 Speaker 1: get to two percent. I mean that's going to take 6 00:00:15,520 --> 00:00:16,680 Speaker 1: a few budgets, isn't it. 7 00:00:17,560 --> 00:00:20,439 Speaker 2: Yes, it will take a few budgets. What we're working 8 00:00:20,480 --> 00:00:23,200 Speaker 2: on is a defense capability plan that sets out what 9 00:00:23,239 --> 00:00:25,360 Speaker 2: are the big bits of kit, the big investments we 10 00:00:25,440 --> 00:00:29,480 Speaker 2: need to make to get our defense force ready, and 11 00:00:29,920 --> 00:00:32,519 Speaker 2: that will take us out to twenty forty. So it's 12 00:00:32,520 --> 00:00:35,120 Speaker 2: about what order you do things in, and it's about 13 00:00:35,120 --> 00:00:38,000 Speaker 2: increasing spending in every budget between now and then. 14 00:00:38,479 --> 00:00:41,360 Speaker 1: Right So basically you'd try hit two percent by twenty 15 00:00:41,400 --> 00:00:42,760 Speaker 1: forty would be the goal. 16 00:00:43,479 --> 00:00:46,159 Speaker 2: Well, the exact date at which we hit two percent 17 00:00:46,400 --> 00:00:48,200 Speaker 2: is a decision for cabinets, so I won't get ahead 18 00:00:48,200 --> 00:00:48,360 Speaker 2: of that. 19 00:00:48,680 --> 00:00:52,959 Speaker 1: Fair enough, does this at all alter your new spending allowance? 20 00:00:54,120 --> 00:00:56,520 Speaker 2: Look, this is always something that I've been factoring in 21 00:00:56,680 --> 00:00:59,360 Speaker 2: as I've been thinking about how we put the budget together, 22 00:01:00,120 --> 00:01:02,800 Speaker 2: and I'm confident that we will be able to build 23 00:01:02,800 --> 00:01:06,320 Speaker 2: our defense capability while sticking to the fiscal commitments we've. 24 00:01:06,160 --> 00:01:08,280 Speaker 1: Made, which has remind two point three to two point 25 00:01:08,280 --> 00:01:09,440 Speaker 1: four billion. 26 00:01:09,040 --> 00:01:12,039 Speaker 2: Wasn't two two point four billion dollar operating allowance? 27 00:01:12,319 --> 00:01:16,280 Speaker 1: So that will stay and will include a commitment to 28 00:01:16,400 --> 00:01:20,040 Speaker 1: defense and increased commitment to defense. That's right, Ryan, Okay, 29 00:01:20,440 --> 00:01:23,200 Speaker 1: and then every year thereafter I suppose the thing is, 30 00:01:23,920 --> 00:01:25,720 Speaker 1: do you know what you want to spend it on 31 00:01:25,760 --> 00:01:28,720 Speaker 1: you or are we arbitrarily increasing the number for the 32 00:01:28,720 --> 00:01:29,240 Speaker 1: sake of it? 33 00:01:30,080 --> 00:01:32,520 Speaker 2: Well, that's the great question, because that's exactly what we 34 00:01:32,600 --> 00:01:35,680 Speaker 2: didn't want to do, just commit to spending on whatever whenever. 35 00:01:35,800 --> 00:01:38,160 Speaker 2: So that's the detailed work that's been happening in the 36 00:01:38,160 --> 00:01:40,760 Speaker 2: background with the New Zealand Defense Force to be really 37 00:01:40,800 --> 00:01:43,320 Speaker 2: clear about what are the particular bits of kit that 38 00:01:43,360 --> 00:01:46,640 Speaker 2: will make us most useful to our ally Australia, that 39 00:01:46,720 --> 00:01:49,320 Speaker 2: will most be able to deliver the functions we want 40 00:01:49,960 --> 00:01:51,520 Speaker 2: in our part of the world. What do we need 41 00:01:51,560 --> 00:01:54,240 Speaker 2: for our workforce, what do we need for our infrastructure, 42 00:01:54,560 --> 00:01:57,320 Speaker 2: and what order should we do all of those things 43 00:01:57,360 --> 00:01:59,960 Speaker 2: in so that we do the most important priorities first 44 00:02:00,280 --> 00:02:03,240 Speaker 2: and roll that out in a way that's deliverable. Because 45 00:02:03,320 --> 00:02:06,520 Speaker 2: even if we had a magic money tree emerged tomorrow. 46 00:02:07,040 --> 00:02:09,720 Speaker 2: The Defense Force wouldn't be able to just suddenly purchase 47 00:02:09,760 --> 00:02:11,840 Speaker 2: a whole bunch of kit So we need to do 48 00:02:11,880 --> 00:02:14,840 Speaker 2: this in a way that's logical, reasonable and gets good value. 49 00:02:14,919 --> 00:02:17,560 Speaker 1: The Overseas Investment Act stuff. Barbara Edmonds came out this 50 00:02:17,639 --> 00:02:20,080 Speaker 1: morning and said, well, she used the word fire sale 51 00:02:20,120 --> 00:02:22,520 Speaker 1: of our assets, and she also suggested that there'd be 52 00:02:22,520 --> 00:02:26,440 Speaker 1: problems with selling our water assets. Is that I've had 53 00:02:26,440 --> 00:02:28,839 Speaker 1: to read of the cabinet paper. It's very clear that 54 00:02:29,240 --> 00:02:33,079 Speaker 1: significant or strategically important businesses light Water would go through 55 00:02:33,080 --> 00:02:36,120 Speaker 1: a national interest test. So is this scare mungering or 56 00:02:36,160 --> 00:02:36,720 Speaker 1: what is this? 57 00:02:37,400 --> 00:02:40,200 Speaker 2: Yeah, that's right. Look, I was really shocked by the 58 00:02:40,240 --> 00:02:44,839 Speaker 2: alarmist tone of her press release and it actually made 59 00:02:44,919 --> 00:02:48,520 Speaker 2: me think that there's either ignorance at play or she's 60 00:02:48,680 --> 00:02:51,920 Speaker 2: genuinely trying to scare New Zealanders, because Barbara should know 61 00:02:52,720 --> 00:02:55,639 Speaker 2: that New Zealand has one of the most restrictive overseas 62 00:02:55,680 --> 00:02:59,240 Speaker 2: investment regimes in the world, and it's actually choking cash 63 00:02:59,360 --> 00:03:02,960 Speaker 2: out of our economy. It's making it harder for renewable 64 00:03:03,120 --> 00:03:05,880 Speaker 2: energy to be built, it's making it harder for new 65 00:03:05,919 --> 00:03:08,800 Speaker 2: factories to be built, it's making it harder for businesses 66 00:03:08,840 --> 00:03:12,720 Speaker 2: to access funding. And we're simply talking about streamlining the process, 67 00:03:12,760 --> 00:03:15,280 Speaker 2: making it fast and less complex, making this a more 68 00:03:15,320 --> 00:03:19,079 Speaker 2: attractive people place for people to invest, while also very 69 00:03:19,120 --> 00:03:22,799 Speaker 2: much keeping in place protections around keyes yet's and very 70 00:03:22,880 --> 00:03:26,000 Speaker 2: much keeping in place the screening process to protect our 71 00:03:26,080 --> 00:03:29,560 Speaker 2: national security. So I you know, when Chicken Little cries 72 00:03:29,600 --> 00:03:31,880 Speaker 2: that the sky is going to fall, it makes it 73 00:03:32,000 --> 00:03:34,680 Speaker 2: harder next time to take them seriously. And I think 74 00:03:34,720 --> 00:03:36,880 Speaker 2: that's the territory that Barbara's got itself into. 75 00:03:37,120 --> 00:03:40,640 Speaker 1: Will you ever tick do not return dividend on one 76 00:03:40,680 --> 00:03:43,400 Speaker 1: of these gen tailors. I spoke to Genesis on Friday. 77 00:03:43,480 --> 00:03:44,800 Speaker 1: They said, all you need to do is click do 78 00:03:44,840 --> 00:03:48,520 Speaker 1: not return dividend, reinvest it into new generation, and we'll 79 00:03:48,520 --> 00:03:49,000 Speaker 1: do just that. 80 00:03:50,080 --> 00:03:52,240 Speaker 2: Well, my focus is what do I do to get 81 00:03:52,400 --> 00:03:55,600 Speaker 2: cheaper prices for New Zealand electricity users? And what do 82 00:03:55,640 --> 00:03:57,880 Speaker 2: I do about we've got secure electricus? 83 00:03:57,880 --> 00:04:00,680 Speaker 1: Your generation would help right, Well, that. 84 00:04:00,640 --> 00:04:03,200 Speaker 2: Would raise a number of other questions about how you 85 00:04:03,200 --> 00:04:06,600 Speaker 2: would then make sure that that return dividend actually ended 86 00:04:06,680 --> 00:04:09,200 Speaker 2: up in your bank account and the bank account of 87 00:04:09,240 --> 00:04:11,320 Speaker 2: other New Zealanders with cheaper bills and so there'd be 88 00:04:11,400 --> 00:04:13,520 Speaker 2: quite a few steps to go through to make sure 89 00:04:13,880 --> 00:04:16,400 Speaker 2: that we were confident that that money that we were 90 00:04:16,400 --> 00:04:18,719 Speaker 2: giving back to the gent tailor was actually going to 91 00:04:18,760 --> 00:04:20,880 Speaker 2: end up in cheaper electricity prices. So I'd want to 92 00:04:20,920 --> 00:04:23,320 Speaker 2: step through all of that first. There is no question 93 00:04:23,400 --> 00:04:26,160 Speaker 2: for me we need to do more in this area 94 00:04:26,520 --> 00:04:28,760 Speaker 2: to make sure that people are getting a better deal 95 00:04:28,800 --> 00:04:31,360 Speaker 2: out of our electricity system. And we will have more 96 00:04:31,400 --> 00:04:34,080 Speaker 2: to say about it actually in the coming. 97 00:04:33,880 --> 00:04:39,880 Speaker 1: Days about are the electricity sector announcements you'll the sort 98 00:04:39,880 --> 00:04:42,040 Speaker 1: of raiser gang or the committee that's been looking at that, 99 00:04:42,240 --> 00:04:44,200 Speaker 1: not raise a gang, forgive me, that's coming out in 100 00:04:44,200 --> 00:04:45,119 Speaker 1: the next couple of days. 101 00:04:45,680 --> 00:04:48,839 Speaker 2: That's right. The Competition Task Force will have more to say. 102 00:04:48,960 --> 00:04:52,200 Speaker 1: Okay, good to note now, Andrew Bailey is can you 103 00:04:52,279 --> 00:04:55,440 Speaker 1: help explain this to us because it seems odd like 104 00:04:55,600 --> 00:04:59,479 Speaker 1: he's a minister. One minute, he literally just touches the arm. 105 00:05:00,279 --> 00:05:05,200 Speaker 1: There's nothing aggressive going on, he says, what's going on there? 106 00:05:06,040 --> 00:05:09,240 Speaker 2: Well, as he said today, concerns were raised with him 107 00:05:09,320 --> 00:05:12,680 Speaker 2: about an incident in which his behavior towards a staff 108 00:05:12,720 --> 00:05:18,159 Speaker 2: member was overbearing. He had those concerns animated as concerns 109 00:05:18,200 --> 00:05:22,200 Speaker 2: communicated to him. His reflection on that was that he 110 00:05:22,240 --> 00:05:24,960 Speaker 2: had taken the discussion too far, that he was wrong 111 00:05:25,080 --> 00:05:27,159 Speaker 2: to have placed his hand on their upper arm, that 112 00:05:27,200 --> 00:05:30,240 Speaker 2: it was inappropriate, and he made the decision that he 113 00:05:30,279 --> 00:05:33,080 Speaker 2: hadn't met the standards of behavior that he thinks should 114 00:05:33,080 --> 00:05:36,520 Speaker 2: be expected of a minister, offered his resignation and that 115 00:05:36,600 --> 00:05:37,480 Speaker 2: has been accepted. 116 00:05:37,680 --> 00:05:40,240 Speaker 1: Okay. The disaster insurance levy tell us we're not going 117 00:05:40,320 --> 00:05:42,240 Speaker 1: to be on the hook for another five or even 118 00:05:42,279 --> 00:05:43,360 Speaker 1: one thousand dollars a year. 119 00:05:44,440 --> 00:05:48,640 Speaker 2: Well, this is yet to be decided. We're consulting on it. 120 00:05:48,680 --> 00:05:51,840 Speaker 2: The basic issue is, right now we don't have enough 121 00:05:51,880 --> 00:05:55,200 Speaker 2: money in the kitty if there was a major natural hasard, 122 00:05:55,240 --> 00:06:00,400 Speaker 2: a major earthquake. So this is the old EQC, and 123 00:06:00,760 --> 00:06:03,479 Speaker 2: as it is, it only has five hundred and fifty 124 00:06:03,520 --> 00:06:05,880 Speaker 2: million in its kitty, and if there was a big 125 00:06:05,880 --> 00:06:09,280 Speaker 2: earthquake tomorrow, it would need two point one billion to 126 00:06:09,320 --> 00:06:11,680 Speaker 2: cover those initial costs before it could then go out 127 00:06:11,680 --> 00:06:15,440 Speaker 2: for reinsurance. So what has been consulted on by David 128 00:06:15,440 --> 00:06:18,120 Speaker 2: Seymour is how could we build that up over time? 129 00:06:18,160 --> 00:06:20,480 Speaker 2: Obviously we won't be able to do it overnight, so 130 00:06:20,520 --> 00:06:22,960 Speaker 2: that we actually can give new Zealand as confidence that 131 00:06:23,000 --> 00:06:24,760 Speaker 2: the government will have the money it needs when the 132 00:06:24,760 --> 00:06:25,920 Speaker 2: next big one strikes. 133 00:06:26,320 --> 00:06:29,279 Speaker 1: You're consulting on tax changes tax exemptions, I should say, 134 00:06:29,360 --> 00:06:33,480 Speaker 1: for the charities, including the Lights of Destiny Church, you're 135 00:06:33,520 --> 00:06:37,520 Speaker 1: saying you would stop their exemption, and we are asking 136 00:06:37,600 --> 00:06:40,560 Speaker 1: for us to see what we think about that. Is 137 00:06:40,600 --> 00:06:42,120 Speaker 1: that the gist of it all. 138 00:06:42,160 --> 00:06:44,880 Speaker 2: As if shed previously, my focus is, yes, you want good, 139 00:06:44,920 --> 00:06:47,760 Speaker 2: strong charities that are doing public good to be exempt 140 00:06:48,120 --> 00:06:51,000 Speaker 2: from taxation. That's a positive thing. But I'm concerned about 141 00:06:51,000 --> 00:06:54,159 Speaker 2: the fairness and integrity of that regime, and I want 142 00:06:54,200 --> 00:06:58,120 Speaker 2: to avoid people avoiding tax that they should pay. So 143 00:06:58,160 --> 00:07:00,800 Speaker 2: we have canvassed a number of issues, the idea of 144 00:07:00,839 --> 00:07:03,280 Speaker 2: put out a discussion document to get feedback on. One 145 00:07:03,320 --> 00:07:07,280 Speaker 2: of them is this issue where charity businesses are currently 146 00:07:07,440 --> 00:07:11,560 Speaker 2: exempt from income tax and we're asking the question, well, 147 00:07:11,600 --> 00:07:15,000 Speaker 2: actually should they, in fact, if they're running a commercial 148 00:07:15,040 --> 00:07:18,840 Speaker 2: business be subject to income taxes. We're also looking at 149 00:07:18,840 --> 00:07:22,640 Speaker 2: this issue of donor controlled charities, where a family potentially 150 00:07:23,160 --> 00:07:26,880 Speaker 2: have a foundation that they control and may not actually 151 00:07:26,920 --> 00:07:29,920 Speaker 2: be directly contributing to a charitable purpose. So there's a 152 00:07:30,000 --> 00:07:33,000 Speaker 2: number of detailed issues we want to get people's feedback 153 00:07:33,040 --> 00:07:36,320 Speaker 2: on should we fix these things? And as I say, 154 00:07:36,360 --> 00:07:38,040 Speaker 2: my focus is it's got to be fair, it's got 155 00:07:38,080 --> 00:07:41,240 Speaker 2: to have integrity, because otherwise people doubt whether or not 156 00:07:41,280 --> 00:07:43,600 Speaker 2: those exemptions for charities should even be there in the 157 00:07:43,600 --> 00:07:46,520 Speaker 2: first place. And I think in most cases they should be. 158 00:07:46,840 --> 00:07:48,840 Speaker 2: But where there's bad behavior, we've got to give the 159 00:07:48,840 --> 00:07:51,040 Speaker 2: ID the tools it needs to crack down on it. 160 00:07:51,720 --> 00:07:54,840 Speaker 1: All Right, Hey, just had a thought, lucks your bosses 161 00:07:54,840 --> 00:07:58,040 Speaker 1: off to Vietnam or he's potentially on a plane already, 162 00:07:58,160 --> 00:08:00,880 Speaker 1: and Winston Peters is over, says who's in charge of 163 00:08:00,920 --> 00:08:01,320 Speaker 1: the moment. 164 00:08:02,600 --> 00:08:05,120 Speaker 2: David Seymour will be in charge of the acting Prime Minister. 165 00:08:05,560 --> 00:08:08,640 Speaker 1: Thanks for your time, Minister. Nichola Willison's the Finance Minister. 166 00:08:08,680 --> 00:08:12,280 Speaker 1: With us for more from Hither Duplessy Allen Drive. Listen 167 00:08:12,360 --> 00:08:15,400 Speaker 1: live to news talks. It'd be from four pm weekdays, 168 00:08:15,480 --> 00:08:17,640 Speaker 1: or follow the podcast on iHeartRadio.