1 00:00:00,200 --> 00:00:02,280 Speaker 1: With us right now, as Nikola willis the Finance minister. 2 00:00:02,360 --> 00:00:05,120 Speaker 1: Nicola Alo, hello here that do you know much about 3 00:00:05,120 --> 00:00:07,480 Speaker 1: this announcement on the building from Chris Pink today? 4 00:00:09,320 --> 00:00:11,680 Speaker 2: He is your expert on that one. But look, this 5 00:00:11,800 --> 00:00:14,400 Speaker 2: is all part of our mission to make it simpler 6 00:00:14,760 --> 00:00:17,160 Speaker 2: and quicker, to get a building consent and to build 7 00:00:17,200 --> 00:00:17,560 Speaker 2: a house. 8 00:00:17,640 --> 00:00:19,480 Speaker 1: Yeah. Because the reason I'm raising it with you is 9 00:00:19,480 --> 00:00:20,960 Speaker 1: because we spoke to him about an hour ago. But 10 00:00:21,000 --> 00:00:23,040 Speaker 1: since then I've been getting a lot of texts suggesting 11 00:00:23,079 --> 00:00:26,239 Speaker 1: that his plan's not going to work because basically it 12 00:00:26,280 --> 00:00:28,319 Speaker 1: puts the risk on the builders in their insurers. But 13 00:00:28,360 --> 00:00:30,920 Speaker 1: insurers don't ensure for defective work. Do you know if 14 00:00:30,960 --> 00:00:31,600 Speaker 1: that's the case. 15 00:00:32,920 --> 00:00:34,960 Speaker 2: Well, I know that he will have taken a lot 16 00:00:35,000 --> 00:00:38,080 Speaker 2: of advice on this and he is intending to make 17 00:00:38,159 --> 00:00:42,000 Speaker 2: it simpler, but lock feedback from those building industry is 18 00:00:42,000 --> 00:00:44,159 Speaker 2: always relevant, and I'm sure that he'll keep working with 19 00:00:44,240 --> 00:00:45,880 Speaker 2: those at the caul face. Yeah. 20 00:00:46,000 --> 00:00:49,279 Speaker 1: Also, what happens if, for example, Duval is listed as 21 00:00:49,320 --> 00:00:51,160 Speaker 1: one of these trusted builders that can check their own 22 00:00:51,200 --> 00:00:53,360 Speaker 1: work right, but then they end up in the situation 23 00:00:53,440 --> 00:00:56,959 Speaker 1: that Duval has there is defective work. Who pays then 24 00:00:57,160 --> 00:00:58,680 Speaker 1: does it not just come back on you and I 25 00:00:58,760 --> 00:00:59,480 Speaker 1: the taxpayer. 26 00:01:01,280 --> 00:01:05,520 Speaker 2: Well, how those liabilities for depends, of course, in terms 27 00:01:05,560 --> 00:01:08,520 Speaker 2: of the whole receivership situation and where the funds sit 28 00:01:08,680 --> 00:01:11,920 Speaker 2: and who's responsible at the various bits. So I'd hesitate 29 00:01:11,959 --> 00:01:15,000 Speaker 2: to answer that example without having worked all of that through. 30 00:01:15,040 --> 00:01:17,399 Speaker 1: Yeah, fair enough, Okay, listen, Kiwibank. Do you like this 31 00:01:17,440 --> 00:01:19,320 Speaker 1: listing idea? 32 00:01:19,520 --> 00:01:22,080 Speaker 2: Well, as you know, I like the idea of Kiwi 33 00:01:22,240 --> 00:01:25,280 Speaker 2: Bank getting bigger. To get bigger, it needs the capital 34 00:01:25,319 --> 00:01:28,680 Speaker 2: for growth, and my viewers that capital can come from 35 00:01:28,840 --> 00:01:32,200 Speaker 2: more places than just the government. I've been seeking advice 36 00:01:32,240 --> 00:01:34,720 Speaker 2: from Treasury on what the best way is to raise 37 00:01:34,800 --> 00:01:38,080 Speaker 2: that capital and I'll be taking some recommendations up to 38 00:01:38,160 --> 00:01:40,119 Speaker 2: Cabinet in the next little while. 39 00:01:40,560 --> 00:01:42,760 Speaker 1: Why do we need another bank if we've got four? 40 00:01:42,880 --> 00:01:44,920 Speaker 1: I mean, was actually quite a lot right to be 41 00:01:44,959 --> 00:01:47,280 Speaker 1: competing against each other. If we've got four and we're 42 00:01:47,280 --> 00:01:48,960 Speaker 1: not happy with what they're doing, why do we think 43 00:01:48,960 --> 00:01:50,360 Speaker 1: of fifth one's going to change things? 44 00:01:50,960 --> 00:01:53,240 Speaker 2: Well, what the Commis Commission have said is that before 45 00:01:53,320 --> 00:01:57,120 Speaker 2: we have are a functional oligopoly. So rather than competing 46 00:01:57,120 --> 00:01:59,160 Speaker 2: for market share, which is when you get all of 47 00:01:59,160 --> 00:02:02,280 Speaker 2: the good things of com petition like better prices, more innovation, 48 00:02:02,440 --> 00:02:06,360 Speaker 2: better services. They're feeling very cozy and relaxed about just 49 00:02:06,400 --> 00:02:09,560 Speaker 2: hanging on to their current market share and competing around 50 00:02:09,600 --> 00:02:12,919 Speaker 2: the edges on on making as much profit as they 51 00:02:12,919 --> 00:02:15,840 Speaker 2: can as individual banks. That's not a good situation for 52 00:02:15,919 --> 00:02:19,400 Speaker 2: New Zealand bank users. So what the Commerce Commission have 53 00:02:19,400 --> 00:02:22,240 Speaker 2: said is, look, you need someone else in that market 54 00:02:22,320 --> 00:02:25,560 Speaker 2: to be disrupting. There's a couple of ways that can happen. 55 00:02:25,639 --> 00:02:29,400 Speaker 2: One through a big disruptor such as Kiwibank. Another way 56 00:02:29,600 --> 00:02:33,760 Speaker 2: is through getting more other financial companies competing on different 57 00:02:33,840 --> 00:02:36,400 Speaker 2: kinds of products. So we want to achieve both of 58 00:02:36,440 --> 00:02:38,440 Speaker 2: those things. And if you look over to Australia, they 59 00:02:38,480 --> 00:02:44,080 Speaker 2: had a similar cozy oligopoly situation happening. Macquariebank played quite 60 00:02:44,080 --> 00:02:48,280 Speaker 2: a disruptive role in that market and the result better 61 00:02:48,360 --> 00:02:49,960 Speaker 2: deal for everyday bank users. 62 00:02:50,160 --> 00:02:52,200 Speaker 1: But how do we know that New Zealand Post, once 63 00:02:52,240 --> 00:02:56,240 Speaker 1: it's kind of reached its maximum share market share, won't 64 00:02:56,240 --> 00:03:00,440 Speaker 1: just settle into a nice little ol oligopoly situation as well. 65 00:03:01,639 --> 00:03:04,880 Speaker 2: Well. What you ultimately want is each of those entities 66 00:03:05,000 --> 00:03:08,960 Speaker 2: to be competing harder and from my perspective. I don't 67 00:03:09,000 --> 00:03:13,760 Speaker 2: just want Kiwibank offering innovative products and services and good pricing. 68 00:03:14,200 --> 00:03:15,960 Speaker 2: I want it to be nipping so hard at the 69 00:03:15,960 --> 00:03:18,680 Speaker 2: heels of the big banks that they are forced to 70 00:03:18,760 --> 00:03:20,960 Speaker 2: do the same. And so I don't just see that 71 00:03:21,080 --> 00:03:23,880 Speaker 2: as sitting on the shoulders of Kiwi Bank. I also 72 00:03:23,919 --> 00:03:26,320 Speaker 2: want to see some of these new FinTechs coming through 73 00:03:26,440 --> 00:03:29,560 Speaker 2: offering more disruptive products. I think there can be a 74 00:03:29,600 --> 00:03:33,000 Speaker 2: bigger role in the future for non bank deposit takers 75 00:03:33,320 --> 00:03:36,680 Speaker 2: and non bank lenders, So the likes of the finance companies, 76 00:03:36,760 --> 00:03:39,800 Speaker 2: the building societies, that sort of thing. And what the 77 00:03:39,840 --> 00:03:43,280 Speaker 2: Comments Commission report helpfully said was, look, if you actually 78 00:03:43,320 --> 00:03:45,920 Speaker 2: got the regulation in this area a bit better, a 79 00:03:45,960 --> 00:03:48,280 Speaker 2: lot of which is done by the Reserve Bank, there's 80 00:03:48,360 --> 00:03:51,920 Speaker 2: every reason to believe those entities will compete more. So, 81 00:03:52,000 --> 00:03:54,360 Speaker 2: this is a classic one heither where that boring word 82 00:03:54,480 --> 00:03:58,480 Speaker 2: regulation actually really matters. If we get the ground rules right, 83 00:03:58,680 --> 00:03:59,960 Speaker 2: will get better competition. 84 00:04:00,200 --> 00:04:02,360 Speaker 1: Do you know yet who your Wellington Crown observer is 85 00:04:02,360 --> 00:04:02,720 Speaker 1: going to be. 86 00:04:03,760 --> 00:04:06,160 Speaker 2: No, And that is a decision for Simmon Brown, and 87 00:04:06,200 --> 00:04:07,520 Speaker 2: it's one that I'm leaving him too. 88 00:04:07,760 --> 00:04:08,960 Speaker 1: And do you know how long he's going to take 89 00:04:09,000 --> 00:04:09,800 Speaker 1: making that decision. 90 00:04:11,240 --> 00:04:14,160 Speaker 2: No, but I do know there's a ten day period 91 00:04:14,200 --> 00:04:17,200 Speaker 2: between him having informed Wellington cit he counts forul of 92 00:04:17,240 --> 00:04:20,960 Speaker 2: his decision and leaving them to give feedback on that. 93 00:04:21,080 --> 00:04:22,960 Speaker 2: So we still haven't run out that too. You don't know. 94 00:04:23,160 --> 00:04:24,560 Speaker 1: I don't know if they're going to be able to 95 00:04:24,560 --> 00:04:26,719 Speaker 1: meet the ten day thing, because I don't know. If 96 00:04:26,760 --> 00:04:28,359 Speaker 1: you saw they had a twenty three minute meeting and 97 00:04:28,360 --> 00:04:30,440 Speaker 1: then they broke for morning tea today. 98 00:04:32,360 --> 00:04:34,880 Speaker 2: Well, I can tell you that kit kevnet doesn't take 99 00:04:34,920 --> 00:04:35,480 Speaker 2: good approach. 100 00:04:35,800 --> 00:04:38,159 Speaker 1: No, well, thank god, because otherwise would sack the lot 101 00:04:38,200 --> 00:04:41,120 Speaker 1: of you. And fortunately we get that opportunity with them soon. Hey, 102 00:04:41,480 --> 00:04:44,279 Speaker 1: have you been surprised by the reaction to the school lunches? 103 00:04:45,600 --> 00:04:47,960 Speaker 2: I have been, because to me, this is just a 104 00:04:48,080 --> 00:04:51,840 Speaker 2: win win win. You get your school lunch program continuing 105 00:04:51,920 --> 00:04:54,560 Speaker 2: into the future. That by the way, Labor didn't put 106 00:04:54,600 --> 00:04:56,719 Speaker 2: money aside to fund, but we found the money to 107 00:04:56,760 --> 00:04:59,599 Speaker 2: fund it, and you get it done at a much 108 00:04:59,680 --> 00:05:02,840 Speaker 2: lower cost per pupil, so down from as much as 109 00:05:02,920 --> 00:05:06,040 Speaker 2: nine dollars ahead to more like three dollars ahead, and 110 00:05:06,400 --> 00:05:09,800 Speaker 2: it's nutritionally good food. So I think this is a 111 00:05:09,839 --> 00:05:12,479 Speaker 2: good solution and it's something that where the government should 112 00:05:12,480 --> 00:05:13,560 Speaker 2: be proud of totally. 113 00:05:13,320 --> 00:05:14,880 Speaker 1: And people are weird about it. But here's the one 114 00:05:14,880 --> 00:05:17,280 Speaker 1: thing that I see as being a problem. Right, are 115 00:05:17,279 --> 00:05:20,400 Speaker 1: you absolutely absolutely sure that you have done all of 116 00:05:20,440 --> 00:05:22,240 Speaker 1: the things you need to do? Dotted the eyes and 117 00:05:22,360 --> 00:05:24,480 Speaker 1: cross the tea so that Compass group doesn't stuff you 118 00:05:24,560 --> 00:05:25,799 Speaker 1: guys in the end with crap food. 119 00:05:26,839 --> 00:05:30,200 Speaker 2: Well, look, they're required to meet a series of guidelines, 120 00:05:30,240 --> 00:05:33,400 Speaker 2: and the nutritional guidelines are the same as they were 121 00:05:33,440 --> 00:05:36,599 Speaker 2: for the program previously, so there hasn't been a change here. 122 00:05:36,680 --> 00:05:40,039 Speaker 2: And realistically they'll need to use a range of local suppliers, right, 123 00:05:40,720 --> 00:05:43,960 Speaker 2: getting good nutritious products from them. So I think this 124 00:05:44,040 --> 00:05:47,279 Speaker 2: is a situation where there's no guarantee that a contract 125 00:05:47,279 --> 00:05:49,599 Speaker 2: continues forever. They need to perform in order to get 126 00:05:49,640 --> 00:05:53,039 Speaker 2: that contract. But by being more efficient, by getting a 127 00:05:53,200 --> 00:05:56,919 Speaker 2: decent competition up, we're getting a better price for everyone, 128 00:05:57,000 --> 00:06:00,640 Speaker 2: and that benefits the tax payer. And actually David Simol's 129 00:06:00,640 --> 00:06:03,159 Speaker 2: managed to get the program running in a way that 130 00:06:03,200 --> 00:06:04,760 Speaker 2: it can be more sustainable for the future. 131 00:06:04,839 --> 00:06:06,760 Speaker 1: Hey, so I loved your speech where you told the 132 00:06:06,800 --> 00:06:09,560 Speaker 1: public servants to give you some bold ideas. Do you 133 00:06:09,600 --> 00:06:11,440 Speaker 1: reckon that that is it going to happen. I mean, 134 00:06:11,480 --> 00:06:13,240 Speaker 1: it's one thing to say to them, I'm here to 135 00:06:13,279 --> 00:06:15,760 Speaker 1: hear your crazy, kooky ideas, but it's quite another for 136 00:06:15,800 --> 00:06:17,680 Speaker 1: them to have the courage to come to you with them. 137 00:06:18,279 --> 00:06:21,640 Speaker 2: Well, it needs two things. The first is it needs 138 00:06:21,680 --> 00:06:25,080 Speaker 2: ministers who are prepared to listen. And I can tell 139 00:06:25,080 --> 00:06:27,839 Speaker 2: you honestly, we are talking to all of the New 140 00:06:27,960 --> 00:06:31,000 Speaker 2: Zealanders who feel the same frustration that we do that 141 00:06:31,080 --> 00:06:33,600 Speaker 2: New Zealand hasn't been growing as fast, it hasn't been 142 00:06:33,600 --> 00:06:36,520 Speaker 2: delivering as good as services as they want to see, 143 00:06:36,640 --> 00:06:39,080 Speaker 2: and New Zealanders want bold ideas, So I think our 144 00:06:39,120 --> 00:06:41,960 Speaker 2: ministers are poised to listen. The second thing that it 145 00:06:42,040 --> 00:06:47,440 Speaker 2: requires is that public agencies themselves put forward the disruptive ideas, 146 00:06:47,520 --> 00:06:50,560 Speaker 2: and that often means putting in lights the ideas from 147 00:06:50,600 --> 00:06:53,320 Speaker 2: the people who are second or third tier in the organization, 148 00:06:53,680 --> 00:06:57,360 Speaker 2: who are looking at problems differently from the way leaders 149 00:06:57,400 --> 00:07:00,279 Speaker 2: in the past have done. And look between me and 150 00:07:00,320 --> 00:07:02,120 Speaker 2: the Prime Minister and other ministers, we've put a real 151 00:07:02,160 --> 00:07:05,400 Speaker 2: emphasis on this. Bring forward the fresh thinking, bring forward 152 00:07:05,880 --> 00:07:10,160 Speaker 2: the young, disruptive people, the new people who have different perspectives, 153 00:07:10,280 --> 00:07:13,560 Speaker 2: because if we do things the way we've always done them, 154 00:07:13,960 --> 00:07:16,800 Speaker 2: we will get the same result and that is not 155 00:07:16,840 --> 00:07:18,840 Speaker 2: good enough. We need to do much better too. 156 00:07:18,920 --> 00:07:21,360 Speaker 1: Right now. On the performance pay, which is also something 157 00:07:21,400 --> 00:07:24,040 Speaker 1: that you've spoken about in the past week, are you 158 00:07:24,120 --> 00:07:25,880 Speaker 1: going to this is the bosses. Are you going to 159 00:07:25,960 --> 00:07:29,480 Speaker 1: drop their base salary back in order to then add 160 00:07:29,520 --> 00:07:31,720 Speaker 1: performance pay on top or does the performance pay just 161 00:07:31,720 --> 00:07:33,080 Speaker 1: get added to what they're already earning. 162 00:07:34,160 --> 00:07:37,400 Speaker 2: It has to be additional because there are existing employment 163 00:07:37,560 --> 00:07:42,120 Speaker 2: agreements that exist between the Public Service commission and chief executives. 164 00:07:42,160 --> 00:07:46,000 Speaker 2: So you can't after the fact renegotiate that and say 165 00:07:46,040 --> 00:07:49,800 Speaker 2: some of your pay is at risk. So the employment relationship, 166 00:07:49,800 --> 00:07:53,000 Speaker 2: as you'll appreciate, is not between ministers and chief executives. 167 00:07:53,040 --> 00:07:57,000 Speaker 2: It's between the Public Service Commissioner and chief executives. And 168 00:07:57,040 --> 00:07:59,880 Speaker 2: so what we've asked the Commissioner to do is to 169 00:08:00,040 --> 00:08:04,280 Speaker 2: designer performance pay scheme and so that will advised to 170 00:08:04,320 --> 00:08:06,560 Speaker 2: sit on top of their current pay arrangements. But we 171 00:08:06,600 --> 00:08:09,240 Speaker 2: want it to be very strict that they would only 172 00:08:09,240 --> 00:08:13,440 Speaker 2: get these bonuses if they deliver performance to New Zealanders 173 00:08:13,800 --> 00:08:17,000 Speaker 2: above and beyond the status quo. And I have been 174 00:08:17,040 --> 00:08:19,440 Speaker 2: working with the Public Service Commission to say, let's make 175 00:08:19,480 --> 00:08:22,840 Speaker 2: this as transparent and accountable as possible, so New Zealanders 176 00:08:22,880 --> 00:08:26,040 Speaker 2: can see for themselves what's required for a bonus to 177 00:08:26,080 --> 00:08:28,160 Speaker 2: be paid and whether or not it's been paid. 178 00:08:28,520 --> 00:08:31,520 Speaker 1: Nichola, listen to you. Guys at the ministerial level have 179 00:08:31,600 --> 00:08:33,439 Speaker 1: the ability to go to New Zealand posts and say, 180 00:08:33,480 --> 00:08:35,360 Speaker 1: all right, enough with the sort of like death by 181 00:08:35,400 --> 00:08:37,800 Speaker 1: a thousand cuts nonsense. Just cut the mail back to 182 00:08:37,920 --> 00:08:40,679 Speaker 1: one delivery a week for everybody for the rest of time. 183 00:08:40,800 --> 00:08:41,240 Speaker 1: The end. 184 00:08:42,920 --> 00:08:45,600 Speaker 2: Well, I guess that would be just middling at a 185 00:08:45,679 --> 00:08:49,720 Speaker 2: degree of operational detail that we don't think is necessary. 186 00:08:49,720 --> 00:08:51,600 Speaker 2: Because instead what we say to them is, look, we 187 00:08:51,640 --> 00:08:53,880 Speaker 2: want you performing well as. 188 00:08:53,800 --> 00:08:56,000 Speaker 1: A commissioner to tell you how many million dollars. 189 00:08:57,040 --> 00:08:59,640 Speaker 2: Yeah, so they haven't been performing well. So that's why 190 00:08:59,679 --> 00:09:02,079 Speaker 2: they've come to us and said, okay, in order for 191 00:09:02,160 --> 00:09:04,600 Speaker 2: that to happen, we're going to need to make some 192 00:09:04,720 --> 00:09:08,040 Speaker 2: changes to our business model, including reducing some of our 193 00:09:08,080 --> 00:09:11,120 Speaker 2: delivery days, and they've gone out for consultation on that. 194 00:09:11,320 --> 00:09:14,160 Speaker 2: So they go out for consultation on that with our blessing, 195 00:09:14,280 --> 00:09:17,320 Speaker 2: because we're realistic, you know, the male model has completely 196 00:09:17,760 --> 00:09:20,160 Speaker 2: changed and in order for that business to be viable, 197 00:09:20,200 --> 00:09:21,960 Speaker 2: to be sustainable into the future, they're going to have 198 00:09:21,960 --> 00:09:23,160 Speaker 2: to change the way they do some things. 199 00:09:23,160 --> 00:09:24,360 Speaker 1: Do you get any mail that you love? 200 00:09:28,160 --> 00:09:31,960 Speaker 2: No, I do. In my beehive office, I occasionally get 201 00:09:32,000 --> 00:09:34,520 Speaker 2: a lovely little handwritten note and it tends to be 202 00:09:34,640 --> 00:09:38,040 Speaker 2: from someone either very young or quite elderly, and it 203 00:09:38,040 --> 00:09:38,920 Speaker 2: can be very sweet. 204 00:09:39,920 --> 00:09:42,280 Speaker 1: I love it. Hey, Nicholas, thanks very much appreciated, Nichola, 205 00:09:42,280 --> 00:09:46,280 Speaker 1: Willa's Finance Minister. For more from Heather Duplessy Allen Drive, 206 00:09:46,440 --> 00:09:49,880 Speaker 1: listen live to news talks. It'd be from four pm weekdays, 207 00:09:50,000 --> 00:09:52,199 Speaker 1: or follow the podcast on iHeartRadio.