The Reserve Bank recently announced a further reduction to the Official Cash Rate (OCR) – a cut of 25 basis points to 3.5%
This follows other recent positive economic news, with Stats NZ announcing that GDP grew by 0.7% in the December 2024 quarter, showing New Zealand’s economy is turning the corner.
Our main focus as a Government is to deliver economic growth, because a growing economy puts more money into your bank account to help with the cost of living.
A growing economy means more opportunities, more jobs, higher incomes and ultimately better health, education, and public services.
We’re working hard to lift economic growth by backing our farmers and growers, promoting tourism, investing in infrastructure, and making New Zealand an outstanding place to do business.
We’ve put a stop to wasteful government spending and are making sure that the public service is focused on its most important goal – delivering the world-class services that Kiwis deserve.
We’ve delivered tax relief for the first time in over a decade, and FamilyBoost is helping thousands of families put their kids through early childhood education.
We’ve also tamed inflation – which is now at 2.5%, down from a high of 7.3% under Labour.
This drop in inflation has made it possible for the Reserve Bank to cut the OCR cuts, which now sits at 3.5%. In turn, these cuts are allowing banks to lower mortgage interest rates.
The 2% drop in the OCR since we came into Government means that, for an average 25-year mortgage of $500,000, repayments could be around $300 lower per fortnight – putting more money back into your bank account.
We know there’s still more work to do – but the economic outlook is improving, with forecasts predicting further growth in the coming quarters.
We’re working around the clock – pulling every lever and building every relationship to secure new trade deals, attract foreign investment, build and improve infrastructure, and keep driving economic growth.
We’ve also just announced New Zealand’s first ever Health Infrastructure Plan – setting out a national, long-term approach to renewing and expanding the country’s public health facilities.
Our health system is under significant pressure from ageing infrastructure that hasn’t kept pace with the needs of a growing and ageing population.
The average age of our public health estate – 1,274 buildings across 86 campuses – is around 47 years. This is creating some significant challenges.
The Health Infrastructure Plan identifies the more than $20 billion investment required to meet future health needs and introduces a more efficient way of delivering large hospital projects.
Instead of building single, large-scale structures, our plan proposes a staged approach – delivering smaller, more manageable facilities in phases. This will mean patients benefit from modern healthcare environments sooner, while providing greater certainty around delivery timeframes and costs.
The plan outlines a comprehensive, phased programme of hospital and facility developments across the country to be delivered in three to four stages. This includes major new builds and expansions across the country, featuring new acute services buildings, inpatient units, expanded emergency departments and wards, and upgraded facilities.
It also includes the planning and initial build of the recently announced new hospital in South Auckland – a critical investment for one of the country’s fastest-growing regions.
While the infrastructure deficit will take time to address, this plan is a critical step forward. It outlines what needs to be done, and how we will do it – ensuring New Zealanders have access to modern, safe, and reliable health infrastructure across the country.
-Rt Hon Christopher Luxon, Prime Minister of New Zealand.
