25 Jan 2023

Watch: Chris Hipkins holds first post-Cabinet media briefing as PM

3:32 pm on 25 January 2023

Chris Hipkins - in his first meeting with ministers as prime minister - has reiterated the absolute focus over coming weeks will be the reprioritisation of the government's policy programme, he says.

Hipkins and incoming deputy prime minister Carmel Sepuloni were sworn in to their new roles, at a ceremony at Government House this morning.

"Today that work started in earnest and we had a good discussions about the next steps we'll be taking to reprioritise, refresh, and refocus the government's work programme so we can move our resources where we need to so that we can address the bread-and-butter issues that New Zealanders are most concerned about.

"I've already said publicly that we will be reining in some of our plans, putting them on a slower track, giving us more room to move and greater capacity to focus on the immediate priority issues facing New Zealand, particularly the cost-of-living pressures that have been caused by the global economic situation."

Today's unchanged inflation figure confirmed this is the right immediate focus for the government he led, Hipkins said.

"The inflation level that we are seeing is not unexpected nor unusual, with many economies around the world feeling the same economic effects. We stack up pretty well against most of them with an inflation rate below the OECD average but regardless of where we sit compared to the rest of the world, here in New Zealand household budgets are being stretched and we do need to do as much as we can to help with that."

The government was doing its bit to address the underlying causes including at the petrol pump and the supermarket, and it was having an impact, Hipkins said.

Chris Hipkins first post-Cabinet media briefing at Beehive

Chris Hipkins Photo: RNZ / Angus Dreaver

"The Treasury is forecasting real government consumption will fall by about 8.2 percent over the next couple of years which they say indicates that fiscal policy is supporting monetary policy in dampening inflationary pressures - but there's more to do and the fight must and will continue."

The level of inflation we were seeing at the moment was clearly not sustainable, he said.

"We're not changing the Reserve Bank's target ... but if you look at our overall rate of inflation 7.2 percent here in N Z, 7.8 percent in Australia, 10.5 percent in the United Kingdom, the OECD average is 10.3 percent, the European Union is 11.1 percent. New Zealand is not immune to those international pressures and they will continue to have an impact on our rate of inflation.

"We will do everything we can to bring inflation down as much as we can but acknowledging those international pressures we will also be seeking to support New Zealanders through this."

The prioritisation of Budget bids had not yet concluded, "so there is an opportunity for us to make sure that the Budget reflects the priorities that I've set out".

Hipkins said he would honour the commitments that have been made "for this term of Parliament and that people will be absolutely clear on that as we head towards the next election".

He refused to rule in or out changes or continuation of public transport subsidies.

"In terms of our tax policy for the next election New Zealanders will know it well in advance of the election. I'm not going to announce a tax policy on day one."

He did want to acknowledge one of the causes of inflation in food and groceries in New Zealand and Australia was caused by the weather affecting the growing of fresh fruit and vegetables.

"New Zealanders will certainly see over the coming weeks and months the evidence of the fact that we've made it our number one priority."

"I absolutely acknowledge the pressure that Kiwi families are feeling, and of course we're not starting from zero, we've done a lot over the last year or so."

He listed fuel tax cuts, and changes to benefit rates as examples.

Hipkins said his talks with businesses in Auckland tomorrow would be his first major engagement as prime minister, and one of the main topics he was expecting was the global shortage in workers.

Those meetings would be with a "broad cross-section" of business community leaders.

"That will include some small business leaders, some ethnic business community leaders. We recognise that we all want New Zealanders to be in work, to be earning a good income so that they can get ahead."

Immigration settings were changed a month ago and it was too early to see the results yet "but we've already heard positive feedback about them from businesses".

The government would not stop there and would continue to make changes, he said.

However, responding to questions, he said he would not be making up policy on the fly.

"I'm not going to start making announcements only a couple of hours into the job, so I think you will accept that will need to take a little bit of time to work through what our options are."

On Covid-19, he said he still encouraged people to follow the rules.

"Bear in mind the seven-day isolation period is designed to result in fewer people getting Covid-19 in the first place. I think one of the things businesses don't want to see happen is a whole lot of their workforce go down sick because someone who had covid-19 came to work rather than staying home and isolating. So there is a reason for it, it is actually a pro-business, pro-employer reason."

Colleagues and family members watched as the process for replacing Jacinda Ardern was completed.

Hipkins said the swearing in this morning was an immensely proud moment for both himself, Deputy Prime Minister Carmel Sepuloni, and their families.

"I did take a few moments to reflect on that and reflect on the incredible privilege and the responsibilities that come with this job - and then it was time to get on with it."

The new prime minister has a hefty to-do list, with a ministerial reshuffle to be announced next week and a full policy reset.

Hipkins has signalled tackling the "inflation pandemic" will be a top priority for his Cabinet's slimmed-down work programme.

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