Background

Manufacturing in New Zealand is in crisis. Jobs are being lost at an alarming rate and exports of manufactured goods are falling. There is a real danger that, if this trend continues, New Zealand will become a nation that only exports raw commodities. The value-added by manufacturing those commodities into products will be captured offshore and New Zealand will become even more dependent on imports for manufactured goods. That is not a path to prosperity. It is a path to unsustainable international debt and unemployment.

Inquiry into manufacturing in New Zealand

The importance of manufacturing to New Zealand’s future and the extent of the crisis makes it vital to inquire into the causes of the crisis and to explore potential solutions.  National Party members of the Finance and Expenditure Select Committee recently blocked a select committee inquiry into manufacturing, and so the leaders of the participating parties are instead co-sponsoring this Parliamentary inquiry into manufacturing in New Zealand.

Aims of the inquiry

The aim of this inquiry is to ascertain the problems confronting manufacturing and policies that political parties can adopt to best deal with those problems. While each party will develop its own policy platforms for the next election, this inquiry aims to provide concrete ideas that can get manufacturing in New Zealand working again.

Specific questions that the inquiry will seek to answer will include

  • Why have a net 40,000 manufacturing jobs been lost in the four years to June 2012?
  • Which industries and regions have been particularly hard-hit, and what specific factors have contributed to these jobs losses?
  • How has government policy contributed to the crisis in manufacturing?
  • What is the role of manufacturing in the economy?
  • What are the opportunities for New Zealand of a revived manufacturing sector?
  • What can government policy do to revive manufacturing? What roles can be played by:
    • Fiscal policy
    • Monetary policy
    • Economic development policy
      • Systemic business policies
      • Industry strategy
      • Regional development
  • Regulatory reform
  • Crown commercial activities (including SOEs)
  • Innovation, education, and skills

The Committee will not be limited to answering only these questions, but may explore any issues that arise in relation to the aim of the Inquiry.

Format

The Inquiry Committee will invite submissions from industry, stakeholder groups, and the public on the crisis in manufacturing. The Committee will also invite oral testimony from relevant experts. It is likely that the committee will hold hearings in centres around New Zealand to hear submissions.

Timing

Submissions will be open until 30 November and the Committee will hold hearings beginning in December.  Depending on the number of submissions, hearings may continue into the New Year.  The report will be released in 2013. [At the request of the independent chair, the deadline for submissions has been extended until 31/12/12 with hearings commencing in the new year.]

Composition of the Committee

The Committee will comprise up to two MPs from each party that joins the Inquiry.  As co-sponsors of the inquiry, the leaders of each participating party may also attend and participate.

The participating parties will appoint an independent person to chair the inquiry.

Committee decision-making will be by consensus.

Resources

The Committee will be supported by staff resourcing allocated from the participating parties’ existing staff. An independent expert will be contracted to advise the committee and assist in writing the report.

Output

The primary output will be the final report, which will be published in 2013.

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