Answering the $64,000 question: Closing the income gap with Australia by 2025: First Report and Recommendations
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Conclusion

Sometimes it can be easy to despair of New Zealand's prospects. For a long time, New Zealand was one of the richest countries on earth. But that time is now far in the past, and in the intervening decades so many of our people have left for better prospects abroad. There has been too little sign of any sustained change of direction that would allow us to return to the first rank of developed countries. The great exodus of New Zealanders seems not to be sufficiently recognised as a mark of serious and sustained failure as a country, or as a reproach to successive governments. And some commentators, and some submitters, have been inclined to conclude that the 2025 goal itself is just not realistic and that, in some sense, we are fated to a future as a perpetually poor cousin to our trans-Tasman neighbour.

Members of the Taskforce, however, are united in their belief in New Zealand's economic potential. In reiterating his commitment to the 2025 goal, the Prime Minister has repeatedly expressed his confidence in New Zealand. We entirely agree with him. New Zealand has good economic and social institutions, abundant natural resources, hard-working, creative, and increasingly well-educated people, a relatively high birth rate, and innovative firms able to compete in world markets. We shouldn't be waving goodbye permanently to so many of our young people, who judge that the opportunities for them and their children are better abroad. There is nothing inevitable about continuing economic decline relative to Australia. There are so many areas where we can do things so much better.

But there is also nothing inevitable about once again matching the incomes of Australians or those of the rest of the advanced world. It is most unlikely to happen by chance, and the sort of reforms proposed in this report will not implement themselves. If it is going to be achieved, all government departments and agencies will need to be viewing policy development and advice through a 2025 lens. In all areas of life, it is the choices people make that reveal what really matters to them.

Matching Australia by 2025 will mean facing hard choices. We can be reasonably confident of closing the gap with Australia only if political leaders choose to make extensive, at times no doubt courageous, reforms, over a succession of years. Successful reforming political leaders find ways to do so in a way that takes the public with them. That means helping persuade people of the seriousness of the situation and the magnitude of the problems. It also means credibly convincing people that the sort of reform needed is not done to advance particular sectional interests, or to pursue some ideology for its own abstract sake. Groups like the 2025 Taskforce can outline the prescriptions, but political leaders make it happen, partly by their ability to inspire people to believe that catching Australia really is about improving opportunities and choices for all of us - a better country for us, and for generations to come.

There is apparently a belief in some circles that far-reaching economic reform means inevitable electoral suicide. That simply has not been the experience in New Zealand or in other countries - in Australia, in the United Kingdom, in Ireland, in the United States. Were it otherwise durable reform would never happen. We believe that New Zealanders hanker for something better. The Taskforce will continue to play a role over the next two years in helping to build a climate for reform. We commend this report to the public and to the political leaders of New Zealand. We trust that it will help to fuel a robust public debate and we hope that it helps spark action. Political leaders in successive governments have failed the people of New Zealand. That must change now.

Don Brash (Chairman)

David Caygill

Jeremy Moon

Judith Sloan

Bryce Wilkinson

30 November 2009

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