Key’s speech to the Menzies Centre

Last night John Key spoke to the Menzies Research Centre. I understand it was the biggest audience they have ever had to an event. His speech is here. A couple of extracts:

As John F. Kennedy once said, we in government are not permitted the luxury of irresolution.

Everyone else can debate issues forever but, in the end, the government has to cut through all that and make a decision, which will invariably please some and disappoint others.

In making those decisions, my Government is very pragmatic.

We are guided by the enduring values and principles of the National Party, but we are also focused on what is sensible and what is possible.

Partly, that is the nature of the political system in New Zealand. It is sometimes said that politics is about convincing 50 per cent of the population plus one, and that has never been truer than under the MMP system we have in New Zealand.

But, in any event, I think government is a practical business.

You don’t start with a blank sheet of paper; you start with the country as it is.

And by making a series of sensible decisions, which build on each other and which are signalled well in advance, and by taking most people with you as you go, you can effect real and durable change, which won’t simply be reversed by the next lot who come into government.

Over time, a series of moderate changes can add up to a considerable programme.

This is to some degree what John Howard did also. Rather than do a big bang reform, he did steady reform over a decade. To be fair Hawke and Keating did some useful reforms also.

In terms of the fiscal outlook, we have effected a significant turnaround.

The advice we had from the Treasury when we first came into office was that if we continued with the settings we inherited, net government debt was likely to reach 60 per cent of GDP by 2026.

Now, after all the changes we have made, net debt is projected to be zero in 2026, despite the Government also picking up much of the cost of the earthquakes.

And sadly almost every single fiscal change was opposed, as if one could run massive deficits for ever.

I want to stress, however, that while I think government is about practical, considered decision-making, it is not a technocracy.

In the end, the biggest, most fundamental decisions governments are called on to make are not reducible to calculation in a spreadsheet.

Those decisions rely on the judgements of politicians around concepts like fairness, opportunity, and the balance between individual and social responsibility.

As a politician, my own gut-level judgements have been hugely influenced by my upbringing and my life experiences.

Almost all decisions involved trade offs, and it will be your values and experiences that guide you on those trade offs.

The Party’s founders were not people who saw the world in terms of a fundamental class conflict, where people’s destinies were largely foretold. In fact the Party was set up to oppose that view.

Now the opposition seems to be more about identity politics.

It is extraordinary how many people, including a lot of Opposition MPs in New Zealand, think the economy is something separate from the normal life of the country – something that will just keep chugging along while Parliament worries about supposedly unrelated social issues, like employment.

In fact – as I am at pains to point out most days in Parliament – jobs are only created when business owners have the confidence to invest their own money to expand what they are doing or to start something new.

Giving businesses that confidence is the most important thing the Government can do to ensure people have jobs, and that those jobs are sustainable and well-paid.

It is worth recalling that every public sector job has to be paid for put the taxes paid by all those in the private sector.

Sometimes voters have been thoroughly surprised by the government they elected.

Those governments have never worked out very well.

So one of the things my Government has tried very hard to do over the past three-and-a-half years is to be predictable, consistent and upfront with voters.

This is where the Governments elected in 1984 and 1990 went wrong. Their policies were necessary, and generally good. But you need to keep faith as much as possible.