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ASB head of rural banking Aidan Gent is encouraging farmers to speak to their banks when they are struggling.
The current Parliament has under a year to run.
He says Finance Minister Bill English, for example, has played a key role in the settings of fiscal and economic policy.
“He, and other senior ministers, will remain as senior leaders guiding policy decisions."
This comes with some speculation that Bill English could be the next PM.
“The Government’s policy settings have been focussed on returning the Crown accounts to surplus, setting clear goals for government departments to achieve, and making policy changes incrementally. There has been a focus on economic efficiency and on value for money out of government spending.”
However, longer term, the broad economic strategy of the National Party will depend on the guidance of the new leader.
But Tufley points out that under a Bill English government (for example) the differences might not amount to much given the influence he has been having.
“The fiscal viability of current NZ Superannuation would potentially be more open to debate, as John Key has long said he would resign rather than change the current scheme.”
Tuffley says there is now greater uncertainty over economic policy for the next parliamentary term, mainly through greater uncertainty over which parties will form government. “Whether the probability of a change in government is increased or reduced will depend on the incoming PM. John Key’s popularity with the electorate, and his ability to ‘sell’ policies, has been high, though after 8 years at the top he is no longer a fresh face.”
A National-led government in the next term would still be a largely known quantity, though its exact policies will still be influenced by its coalition partners.
A Labour/Green-led government’s policies have yet to be clearly defined this far out from the election but would tend to be more interventionist and more redistributive than the National-led government has been to date.
“It is possible that business confidence will dip slightly in the short term, and the usual pre-election slowdown of business investment decisions may be larger than normal,” says Tuffley.
