Productivity Commission report underlines the need for smart green innovation

A report released today by the Productivity Commission underlines the need for New Zealand to change its economic direction and invest in smart green innovation, to improve New Zealand’s economic performance, create well paid sustainable jobs, and protect the environment, the Green Party said.

The report shows that New Zealand’s labour productivity performance has been poor in recent years and that little of the limited productivity gains have been passed onto workers in increased purchasing power.

“The Productivity Commission working paper shows that New Zealand can’t continue with business as usual if we’re to have a clean environment and the kinds of wage growth that will make New Zealanders better off in the long term,” said Green Party economics spokesperson and co-leader, Russel Norman.

“We need to invest more in research and development, so that we can protect the environment and have better living standards at the same time.

“But National is doing the opposite – cutting research investment in real terms by 10.2 percent from 2014-2016. New Zealand currently invests just 1.27 percent of GDP in research and development, well below the OECD average of 2.4 percent.

“Globally, the market for clean technology is forecast to be worth NZ$8.8 trillion in just three years. New Zealand needs to get a bigger piece of that instead of banking on dairy and oil which both have volatile international prices and large environmental problems.

“The report finds that a high quality education system is ‘critical’ so that New Zealand workers have the skills needed to adapt to changing technologies in the workplace. But the Government is underinvesting in education across the board – from early childhood to the tertiary system.

“The Green Party has a plan to create 1000 new tertiary places for our young people to become engineers, scientists, and high-tech specialists so that they can drive the transition to a smart green economy. National, on the other hand, is cutting tertiary funding to 2018 by 10.4 percent in real terms.

“The report also makes it clear that one factor driving the reduction in the share of national income going to labour is the erosion of workers’ bargaining power. The current government’s relentless legislative program to remove worker and union rights only makes this worse.

Dr Norman said: “National’s simple pollution economy will continue to increase pollution, inequality, and undermine productivity gains. We need a smart green economy that creates real value, safeguards the environment, and shares the outcomes with all New Zealanders."