MORENA, GOOD MORNING AND WELCOME TO Q+A. I'M GREG BOYED. WELL, THEY'RE BOOKED INTO THE NIGHT, IF WE HAVE TO. THE WAIT CONTINUES ` THE MYSTERY MEMBERS OF THE NEW ZEALAND FIRST BOARD WILL MEET ON MONDAY TO MAKE THEIR CALL. WHAT'S LIKELY TO HAPPEN ONCE A GOVERNMENT IS FORMED? THEN, U.S. AMBASSADOR SCOTT BROWN JOINS POLITICAL EDITOR CORIN DANN TO EXPLAIN AMERICA'S THINKING ON THE LATEST STAND-OFF WITH NORTH KOREA, AND WE'LL TALK ABOUT HIS PLANS AS TRUMP'S MAN IN WELLINGTON. THEN WE'LL BE TALKING ABOUT THE ECONOMY WITH ANZ SENIOR ECONOMIST SHARON ZOLLNER ` THE INTERNATIONAL OUTLOOK, EXPORT PROSPECTS AND OUR HOUSING MARKET. WHAT MAY A NEW GOVERNMENT HAVE TO CONTEND WITH? AND A MONTH ON, WHENA OWEN HAS AN UPDATE ON THE INQUIRY INTO RUAKAKA'S RUPTURED FUEL PIPELINE THAT CAUSED MAJOR AIRPORT DISRUPTION. THERE ARE A LOT OF QUESTIONS AND NOT A LOT OF ANSWERS. CAPTIONS WERE MADE WITH THE SUPPORT OF NZ ON AIR. COPYRIGHT ABLE 2017 AND WE'LL HAVE ANALYSIS FROM OUR PANEL POLITICAL SCIENTIST DR JENNIFER CURTIN FROM AUCKLAND UNIVERSITY, AUCKLAND COUNCILLOR EFESO COLLINS, AND FRAN O'SULLIVAN, HEAD OF BUSINESS FOR NZME. AND WE'LL START WITH OUR PANEL, AND POLITICAL EDITOR CORIN DANN JOINS US HERE. The Thursday deadline went well. I was okay with the process up until that point. It was running reasonably well. It unravelled and there was this idea that the board couldn't fly and and this was the reason for delays. None of that mattered. Winston Peters has given himself a couple of days to get his head around the two policy proposals. He gets them ready then goes to the board tomorrow. We should see it by at the earliest Monday 6 p.M. But possibly Tuesday lunchtime. Is this down to the board or Winston Peters? It says the consensus is on the board, but would the board members go against his will? What have you made of this, Jennifer? Winston set himself that deadline and it wasn't met. He didn't do himself any favours by calling it on Thursday, But we know that since we have had MMP, since we've had bilateral talks, this is the way. Minor parties are far more likely to consult with the caucus. A lot of this was predictable because it is Winston Peters, and he is unpredictable. I am not surprised, and I think it is unfortunate that we have seen so much speculation and he has allowed speculation to happen when we are well within the 30 days. Fran, all of this is not what business likes. They like to know how things are going. There has been a bit of angst at how Winston Peters own agenda gets taken. Consensus from the two major parties, Labour and National, that we have a free market economy, that we have open markets. He has wanted to put controls around this. The uncertainty is not so much what Winston wants; it's what the major parties will concede to stay in power. Efesa, you are a labour man. As the confidence this will happen for Jacinda? last night she put out, they may feel quite confident. I have enjoyed see people like Paddy Gower not go crazy on TV. Regardless of what government is formed we will have a much stronger opposition this time round, and there is an exciting prospect. Labour has increased its Mps by 12 or 13. You have a greater group of people that will form a stronger position. Either way he goes, we will have a strong opposition and it will be interesting to see when he makes the announcement. The last three or four Labour leaders, there is no question that Jacinda Ardern will stay as leader. It is the tier two that need to step up. We didn't get an idea of that because of Jacinda-mania. We will make judgements on who that tier two group are. You have been in Wellington all week. It is incredibly sealed. Nobody is leaking. Bill English has been nowhere. We can't get camera access to Parliament. He can go from his office into the meeting room without us seeing him. He could come out and talk to us if he wanted to. Winston was doing four or five media events a day. Every time he walked past the cameras, he would stop and talk to us. He was enjoying that element of it. Jacinda Ardern would stroll pass and give a brief comment. Both leaders saw no benefit in saying anything to upset Winston. Do we have any idea on what he is wanting? Fran's point is interesting. He has pushed it very hard on policy this time. He has seemed to put a lot of emphasis on policy and he forced the two big parties to come to the table with policy over this last period. It is whether or not he has talked about economic and social change; he talked about 1984; he talked about market reforms. It is whether he can make any changes to the fundamentals of running this country. To actually follow through with a Singaporean model of reserve bank. There will be some tweaks with the Reserve Bank and study. Employment and the policy targets agreement. It is how far he can get to see if he can rollback time and take the edges off. If he does go with labour, will it be in coalition with Greens? I don't think that is set in stone. I think what's possible is that they can be in cabinet. They don't have to be an cabinet. It will be likely that they are off to the side. I don't know if he wants to go into any formal coalition. The economic points that Corin mentioned, is that what you're thinking? He is the only one who has given any sense of what is on the table. He talked about immigration and monetary policy. If you looked at the policies they put up at the election, the economic plan and the comments he's made as NZ first leader, they are pretty strong challenges to the status quo. It would be harder for National to go down that route. There is commonality with labour, especially looking at the Reserve Bank settings. It is good for that times we are in and also immigration. National wanted to move on things like housing policy, inequality. To concede on too much of those big broad policy areas could be alarming to their own base. What about the future of New Zealand first? Winston said either way people will be disappointed. How important is the future of New Zealand first, where he goes? I think there is two parts of this. He is going hard on policy because he wants a legacy for the party beyond this. He wants to set them up for the future. Centre parties in the system like we have are always at risk, from the two major parties scooping out their policies. People like to put New Zealand first as a populist party, but they sit at the centre. And they have much more trouble maintaining a presence over several election cycles, and he will be aware of this, especially because his voter base does not have a core like the greens. They are a little bit left and right. Keeping those voters happy is really difficult. SEND US YOUR THOUGHTS ` WE'RE ON TWITTER @NZQA. YOU CAN EMAIL US AT Q+A AT TVNZ.CO.NZ OR TEXT YOUR THOUGHTS AND FIRST NAME TO 2211. KEEP THEM BRIEF ` EACH TEXT COSTS 50C. AFTER THE BREAK ` AFTER MONTHS OF ESCALATING TENSION, NORTH KOREA THIS WEEK ACCUSED PRESIDENT TRUMP OF LIGHTING, QUOTE, 'THE WICK OF WAR'. U.S. AMBASSADOR SCOTT BROWN IS HERE NEXT TO EXPLAIN THE U.S. APPROACH. WELCOME BACK. AND JOINING ME NOW FROM WELLINGTON IS SCOTT BROWN, THE U.S. AMBASSADOR TO NEW ZEALAND AND SAMOA. Good morning. It is a pleasure at a slightly strange time. What do you make of our MMP system? I respect the process and understand it. We are waiting for the seating of the new government So we can move forward with a whole host of issues. Let's start with North Korea. You mentioned in interviews that you thought New Zealanders weren't aware of the dangers that North Korea pose in terms of a nuclear bomb. I was commending Kiwis on their leadership with nuclear issues. When I am out and about, I am listening to folks at the gym, at the local pub, and they are in tune in that regard. Actuality, your government has shown leadership, and they are condemning that any time a missile is launched. You say North Korea is wrong. As you know, Australia is in the sights of North Korea. They are siding with Britain and the United States. I commend the Kiwis and I am listening and learning about additional policies. Some may have thought this is an attempt to soften New Zealand up, that New Zealand should support a pre-emptive strike against North Korea. Are you trying to get a message to New Zealand? Absolutely not. The opposite. I was commending the Kiwis on their leadership with nuclear issues. We understand it and respect it. We still do our training exercises with those issues. So there is no expectation from the US that New Zealand has to support you and any action against North Korea? We are supporting the Kiwis in regard to their strong stances. Your government has been the first 1 to come out and condemn these illegal missile launches that crosses over nations and threatens to kill people and blow them out of the world. Bill English was one of the 1st to describe Mr Trump's tweets about fire as unhelpful. People either love the presidents tweets or hate them. I look at facts. If you look at the facts, referring to a Washington post that came out, saying that the president's policy of languishing, were actually working. We have votes unanimously condemning these actions, and I want to thank the Kiwis for condemning these actions. As referenced in the article, there is unprecedented action ` boats being turned away and North Korea. It is waking the world up to the threats. Bob Corker has said the tweets from Trump are castrating the Foreign Secretary. It can't be useful in terms of diplomacy. I have a lot of respect for Bob and I can't comment on that. According to Tillerson, there are back channels open with North Korea. What happens to North Korea is up to North Korea. They have been in violation of US sanctions for 12 years, and there is always room for them to come to the table. The world is echoing together ` people who care about their families. We are working together and it is a positive thing. Is there an issue here for the rest of misstep? Nobody wants a catastrophic and disastrous outcome. Is it the danger that somebody misinterprets something? This is what diplomats are worried about, and Donald Trump's tweets are not good in terms of the risk of a misstep. North Korea is launching missiles over Japan. That is the misstep. Any actions over what Trump is doing are all reactions to North Korea. He has been in office less than a year. North Korea has been doing this for 12 years. The Iran deal, saying he won't certify their latest findings as to whether Iran is sticking to their part of the deal with uranium and a nuclear programme, that was set with countries ` China etc ` what is North Korea to make of that if US pulls out of that deal? I have not voted to support that Iran deal. They could develop some very serious weapons and use this for terrorism like they have historically done. The president is also against it. He is sticking to his campaign pledges. That is appropriate that he has raise those concerns, set it back to Congress for them to take action. If they disagree with him, so be it. But if they agree they have the authority to go to other countries and sign on, saying that Iran is not honouring that part of the deal, to stir things in the rest of the world. Other nations believe Iran is complying. A lot of members of Congress don't feel they are adhering to the spirit of the deal. The fact that the president has sent it back to Congress as the appropriate mechanism. That is a positive step. From a New Zealander's perspective, as the danger here that the US is becoming more isolationist? Is it less interested in being the global policeman? There is a lot of pressure. We rely on countries to police themselves and join forces when appropriate. We need to solve problems ` not a partner, not the people who are always in charge. There is appropriate to check and balance and make sure we are always trusting and verifying deals. The president made his position clear ` this is not news. When you talk about North Korea, I remind folks that they have been in violation of this for 12 years. The way they can come to the table is to stand down, start using natural resources, do what Vietnam and Singapore have done ` be part of it, not the bully. America is not signing up to the TPP. They are taking isolationist issues on Iran. I wonder from your perspective are you concerned that New Zealand is becoming too aligned economically with China? That is up to the Kiwi government and term and the relationships they have. New Zealand needs to explore all trade opportunities. We are a big trading parter with China. We need to question them when they are destroying coral reefs and militarising islands affecting fishing and air travel. It is a problem, and I commend your government` we don't speak up as much as Australia. We have a fantastic relationship with not only Australia but especially New Zealand. We had Tillerson come here. I was sworn and immediately. Australia doesn't have an ambassador yet. Look at the fact that I am working with the visa issue to stimulate trade. I was opposed to the steel because I am more in favour with bi, trilateral agreements. Does that mean that New Zealand is at the top of the queue for those bilateral deals with the US? I will comment on that when the new government is in place. They will learn what the priorities are. My number one priority is to increase trade and listen and learn what the needs are for the new government. I will try as hard as I can with your leaders. The E1, E2 visa, it is the number one thing that will help stimulate and create amazing opportunities for businesses to grow in the US and visa versa. Iran have a higher ability to do that. I am working on that with ambassador Grosser. Thank you very much for your time. INTO THE RUPTURED RUAKAKA PIPELINE. AND THEN CORIN'S BACK, TALKING ABOUT THE ECONOMY WITH ANZ SENIOR ECONOMIST SHARON ZOLLNER. WHAT MAY BE IN STORE FOR OUR NEW GOVERNMENT? THAT'S NEXT. JUST ONE MONTH AGO, OUR AIRLINE SERVICES WERE IN TURMOIL AS ENGINEERS, COMPANY EXECUTIVES AND POLITICIANS SCRAMBLED TO MANAGE A MAJOR BREACH OF THE AVIATION FUEL PIPELINE FROM MARSDEN POINT TO WIRI. ALTHOUGH THE PIPE HAS NOW BEEN FIXED, FUEL IS FLOWING AND FLIGHTS ARE DEPARTING. IS IT ALL OVER? Q + A REPORTER WHENA OWEN WENT TO RUAKAKA AND FOUND THERE ARE STILL MANY QUESTIONS YET TO BE ANSWERED. HIGH TIDE AT THE RUAKAKA ESTUARY. THE BIGGEST NEWS AROUND HERE IS THAT THE GODWITS ARE BACK ` SOMEWHERE. OH, AND THERE'S THAT, THE INCIDENT. IT'S THE NEW NORMAL HERE. SECURITY AND THE HIGH-VIS TEAMS ARE ON THE MAIN ROAD DAY AND NIGHT. AND ONE OF THEM IS BUSTING OUT SOME MOVES. (HIP-HOP MUSIC) ON SEPTEMBER THE 14TH, THE PIPELINE FROM MARSDEN POINT OIL REFINERY, A LIFELINE FOR THE AVIATION INDUSTRY BURST ON THIS PROPERTY IN RUAKAKA. IT CAUSED MAJOR DISRUPTION TO FLIGHTS AND FINANCIAL LOSSES FOR AIRLINES AND A LOSS OF AROUND $10M FOR REFINING NEW ZEALAND. RESIDENTS CLOSE TO THE SITE ARE STILL EVACUATED. AMONG THE LOCALS, THERE'S A LOT OF SPECULATION AND NOT MANY FACTS. THERE'S A LOT OF QUESTIONS AND NOT A LOT OF ANSWERS. WE'RE NOT GETTING MUCH IN THE WAY OF CLARITY AS TO WHAT THE PROCESS IS FROM HERE ON IN. SO, WE'VE JUST ARRIVED IN RUAKAKA, AND WHAT SEEMS ODD IS THAT ONE MONTH AFTER THE FUEL CRISIS, THE REGIONAL COUNCIL STILL HASN'T SPOKEN TO THE OWNER OF THE LAND WHERE THE PIPE RUPTURED. A COUNCIL OFFICER HAS LEFT A MESSAGE ON THE LANDOWNER'S PHONE, COUNCIL TOLD US, BUT THE OWNER HASN'T RESPONDED. THE NORTHLAND REGIONAL COUNCIL WOULDN'T TALK TO US ON CAMERA, BUT ALSO TOLD US IN A STATEMENT THAT IT HAS SPOKEN WITH NEIGHBOURS THAT SAID DIGGERS HAD BEEN ON THE PROPERTY FROM TIME TO TIME OVER THE LAST SEVERAL YEARS. SO YOU'VE HAD THE FINGER POINTED AT YOU? YES. DOWN THE ROAD FROM THE PIPE RUPTURE, BOB HISLOP IS ONE OF THE LOCAL CONTRACTORS SOMETIMES INVOLVED WITH SWAMP KAURI RETRIEVAL. HE'S NOW USED TO DEFENDING HIMSELF FROM ACCUSATIONS HE MAY HAVE BEEN INVOLVED. I'VE MADE A POINT OF MAKING IT QUITE CLEAR THAT WE HAD NOTHING TO DO WITH THE EVENT, AS SUCH, AND WE HADN'T BEEN IN THERE IN THE PAST DOING SWAMP KAURI EXCAVATION. THE TALK AROUND HERE HAS MOVED ON TO LEGAL ACTION AND WHO'S LIABLE. THIS IS INTERESTED LAW PROFESSOR BILL HODGE. FIRST OF ALL, WE NEED TO KNOW WHO THE DEFENDANTS ARE. AND THE FIRST POSSIBLE DEFENDANT IS THE OPERATOR OF THAT DIGGING MACHINE THAT SEEMS TO BE THE PERSON RIGHT ON THE SPOT DOING SOMETHING STUPID. PROFESSOR HODGE SAYS THE REFINERY COULD POTENTIALLY SUE FOR PHYSICAL DAMAGE AND LOSS OF PROFITS. REFINING NEW ZEALAND DIDN'T WANT TO TALK ON CAMERA. BUT THEY TOLD US NOTHING HAS COME TO LIGHT TO CHANGE THEIR INITIAL ASSESSMENT THAT THE PIPE WAS DAMAGED BY A DIGGER. AND IT'S IMPORTANT TO NOTE HERE, AS YET NEITHER THE REFINERY NOR THE COUNCIL HAVE IDENTIFIED WHO DID THAT DAMAGE. THE WHOLE CASE APPEARS UNIQUE, BUT THERE MAY BE PRECEDENCE OVERSEAS. CALTEX HAD A PIPELINE. IT WAS OVER IN SYDNEY. THE PIPELINE WAS BROKEN. AND CALTEX HAD AN OPEN-AND-SHUT CASE FOR DAMAGE TO THE PIPELINE. THE MORE DIFFICULT QUESTIONS ARE THE ECONOMIC LOSSES TO THOSE DOWNSTREAM USERS, FOR EXAMPLE AIR NEW ZEALAND. FOR EXAMPLE, EVERY INTERNATIONAL AIRLINE. FOR EXAMPLE, PASSENGERS WHO HAD TO PAY A HOTEL BILL BECAUSE THEY COULDN'T FLY. SO THERE'S A WHOLE RANGE OF DOWNSTREAM POTENTIAL PLAINTIFFS. ARE YOU SURPRISED THAT THE LANDOWNER IS KEEPING A VERY LOW PROFILE, HASN'T RETURNED ANY CALLS? I WOULD SAY THAT HE'S OBVIOUSLY IN DISCUSSIONS, OR TALKING WITH THE REFINERY AS TO THE EXTENT OF THE PROBLEM BOTH WAYS. THEY'VE GOT THEIR PROBLEM AND HE'S SUBSEQUENTLY GOT HIS. I WOULDN'T WANT TO BE IN HIS SHOES. THE OWNER DOESN'T LIVE ON THE PROPERTY. HE MOVED THIS RELOCATED HOUSE THERE THREE YEARS AGO, BUT DISCONTINUED WORK ON IT. HE LIVES IN THE DISTRICT, AND MOST OF THE TIME IS ON A CONTRACT REPILING A WHARF ON A HAURAKI GULF ISLAND. HIS NUMBERS AREN'T LISTED. Q+A TRIED TO CONTACT HIM WITH NO LUCK. AND THE LAST BIT OF LAND THAT WAS TAKEN WAS UP THE BACK THERE FOR ABOUT 75. ON A HILL OVERLOOKING THE HARBOUR IN THE REFINERY, ANI PITMAN IS EXPLAINING HOW THE LAND THE OIL REFINERY IS ON WAS CONFISCATED BY THE GOVERNMENT. HER IWI, PATUHARAKEKE, ONCE HAD 100,000 ACRES. NOW IT'S DOWN TO THIS 5-ACRE, OR 2HA, SITE. WE SEE THE LEVEL OF DEVELOPMENT IN INDUSTRY ON OUR DOORSTEP, THE IWI HAS CONCERNS OVER THE REFINERY'S INFRASTRUCTURE AND HAS BEEN MONITORING OIL SPILLS INTO THE ENVIRONMENT. THIS IS THE THIRD MAJOR ENVIRONMENTAL INCIDENT. I THINK I'VE COUNTED IT AS 70 TO 90 WEEKS SINCE THE LAST INCIDENT, WHICH WAS AN OIL SPILL, AT MARSDEN POINT ` AT NORTH POINT. AND THEN 50 WEEKS PRIOR TO THAT WAS ANOTHER OIL SPILL FROM BUNKER OIL THAT LEAKED INTO THE HARBOUR. FROM A TANKER? FROM A TANKER. OVER AT THE RUPTURE SITE, CONTAMINATED WATER IS STILL BEING TRUCKED IN TANKERS TO THE REFINERY PONDS, AND THE SOIL TRUCKED SOUTH TO A LANDFILL FOR CONTAMINANTS WHERE THE LEACHATE WILL BE COLLECTED. WELL, THERE'S STILL A LOT OF ACTIVITY. THE PIPELINE, I BELIEVE, IS STILL EXPOSED AND WATER IS BEING PUMPED FROM IT AS THE CONTINUED EVACUATION OF THE MATERIAL TAKES PLACE. YES. THERE'S A VERY HIGH WATER TABLE AND WE'VE HAD A LOT OF RAIN, SO IT'S JUST GONNA KEEP COMING UNTIL THE WATER LEVELS REDUCE. THERE IS A SMELL STILL THERE, SO IT'S LINGERING AND ONGOING. SO IT'S GONNA TAKE SOME ENERGY, FOR SURE. PEOPLE LIVING THERE OR NOT WANTING TO LIVE THERE WILL BE THE QUESTION IN TIME. LAST WEEK, THE COUNCIL TESTED BORES AROUND THE RUAKAKA DISTRICT AND FOUND NO TRACE OF PETROL HYDROCARBONS. BUT DESPITE THE REASSURANCES NOW, THERE ARE THOSE IN THE COMMUNITY WHO AREN'T SO CONFIDENT. IN TERMS OF OUR RESPONSIBILITY AS THE LOCAL GUARDIANS, OR KAITIAKI, OF THIS ENVIRONMENT, WE COMPLETELY ARE CONCERNED WITH WHAT THE ACTUAL IMPACT'S GONNA BE. ARNIE PITMAN ENDING THAT REPORT. AND JUST AN UPDATE ON WHENA'S FOOD PRICE STORY ON LAST WEEK'S Q+A. STATISTICS NEW ZEALAND RELEASED ITS LATEST STATS THIS WEEK, SHOWING THAT FOOD PRICES HAD INCREASED 3% IN THE YEAR TO SEPTEMBER. THAT FOLLOWS A 2.3% INCREASE IN THE YEAR TO AUGUST. THE MAIN CULPRITS? DAIRY PRODUCTS ` BUTTER, FRESH MILK, CHEESE AND YOGHURT WERE ALL MORE EXPENSIVE. WHICH ISN'T GREAT FOR YOUR HOUSEHOLD BUDGET, BUT IT IS A SIGN OF THE GOOD PRICES OUR FOOD EXPORTERS ARE GETTING IN THEIR OVERSEAS MARKETS. HOW LONG WILL THAT LAST? IT'S A GOOD QUESTION FOR MY NEXT GUEST, SHARON ZOLLNER, A SENIOR ECONOMIST FOR ANZ BANK. That is one bright spot for the economy that our export prices have held up well. That is true and it is held up better than hard commodity prices the price of our dairy exports whole milk is doing better than iron ore in Australia and that is been showing up in our cross rate. What is the outlook for the next government coming in and being confronted with a briefing from Treasury. It is looking softer going forward? I think that is fair. The summary would say the economy is doing rather well and there is plenty of talent tailwind but a lot of those are running out of puff. They are not particularly falling but growth is flattening out. And that is from strong immigration, tourism and construction/ as the outlook for all of them coming off? The housing market I would add to the list. That is tied into construction. House prices are falling in Auckland. West and consumers remain resilient when you talk to them about personal finance. We have seen weakness and spending. Talk to me about the housing market. And people will be thinking it is about the uncertainty of the election. And it is a late spring bounce. For that happen? I am sceptical of that will happen. They are high compared to incomes. They are world leading in an area we don't want to lead. The LVR restrictions for investors have made a big difference. We have seen investments lending pull back sharply. Banks also pulling back on lending, and is not looking like that will free up any time soon. 2 to 3 year fixed mortgage rates are coming down. Is there a mortgage war starting up? I think things have eased up. The reserve Bank is on an extended holiday. We have pencilled and one in the second half of the next year. But it is not a strong conviction view. Monetary policy is on hold. And now I think banks are starting to compete a little bit more for some of that mortgage lending. The next government will be New Zealand first flavoured, but there will be spending promises. And we will see more spending from a government. How was the account me likely to respond to that? The reserve Bank might be looking front elation. We haven't seen that flow through to more inflation. And that model on inflation and that strong leads to strong inflation, and that you can kill inflation by cutting the model. And that's happening all around the world. And it is true that some of the other drivers of activity coming off, then as a bad timing for a fiscal boost. Do we need is an amount that we need. All the economy roll with it? The economy does its own thing to a large extent. There is a tendency to get people more credit and blame to the government than they deserve the business cycle is more driven by interest and in commodity prices more than fiscal policy. It is important in the long run in terms of education and those things that determine long run trend growth. But the business cycle isn't easy to steer. Our markets and foreign investors freaked out if there is radical change shown monetary policy. I don't think there will be radical change, but as a risk? If that does happen then markets might do a double take. But there is an expectation that New Zealand is no longer the rockstar and we might be coming off that pedestal. And any negative news might have a larger negative impact. People are looking for an excuse to sell rather than by the New Zealand dollar. The global economy is doing better now. And growth rates are very narrow around the world. And New Zealand's like we lead into the upswing may be the first peak and growth. Let's talk about potential shocks that the new government could face. There is always a risk around China and its debt, the US stock market, are there scary risks that we need to think about? Certainly there are. Ssome things are starting to smell like 2007 and the global financial market. There has been a bull market and everything. And that is understandable because the price of borrowing has been at record low and the price to buy has been pushed up, and that is property. Collector cars and fine arts have benefited from this extreme monetary policy. And just not wages. But the quality of the growth that were seen since 2008 has not been great. It has been fuelled by debt and leverage. And at some point it has to be paid back. How well-prepared is New Zealand for that? That is interesting. We are in some ways better than 2007. Our current account as well contained. An accumulative addition to the debt to the world is low. It is lower than in 2007. Our major vulnerability is Auckland house prices. And also consumer debt and mortgage is at a record high relative then comes. The best case scenario is that dampens growth going forward in a smooth even fashion. And the worst-case Nari oh is that everyone is tomorrow arrives at the same time and consumers go into a panic about mortgage. We would like house prices to sit flat and wages to catch up? That is, but not historically happens. Real house prices tended to go up. What are you forecasting Auckland housing? We don't forecast them specifically, but unless you get a negative shock, they should hold up okay. Unless we get an immigration shock. But what is happening in Australia is that we may see a change in the historic strain to Australia. Those with University a children might not afford to stay in Australia. They can't stop New Zealanders coming back from Australia. It is very difficult to target net migration numbers, because passports come and go as they wish. And there is a loss in Australia. The government is in good position with debt to deal with crisis. They aren't in a two bad shape by the reserve Bank doesn't have a lot of room to move? Our official cash rate is at record lows. Even lower than following the global financial crisis. It is a remarkable statistic, but we aren't the only ones in that position, but that doesn't mean our position is any better, we are just in the same boat. The last time the recession had to the OCA are was at eight, and now we can cut it maybe 100 base points. And we could undo the quantitative easing. And we would be laughed out of town as a small risky nation. We are not the nation's default asset like the US. THANKS, CORIN. The panel and thoughts after the break. WELCOME BACK TO Q+A. BACK WITH OUR PANEL NOW. It smells like 2007, would you agree that things are heading that way? It is interesting what she is saying. The economist said asset prices is coming to an end. And raises concerns about what might happen. If had quantitative easing and that has to change out. Reserve banks around the world has been slow to do that. You have overpriced assets, and it's interesting that the bankers and forecasting prices in Auckland, but it has a range of risk scenarios about what that might mean. I think there is a risk around housing. It is hugely unaffordable we have had slumps in house prices before around the time of the GF see things flattened out. And also went the 70s when they flattened in Auckland. These things can occur. I think it is an issue where the next government will have to tread carefully. Because we are plugged into an international environment. will need deft management. If we go down the road before with the GSE we could see negative equity it is a disaster if you have to sell. You can wait these out. And the bank won't want negative equity on their own books. But we will see things like debt and farming sector. Banks had a hand held in a situation. Such as milk prices and freefall, when the dairy industry was overreached the banks that come to the party. I think if you go back to periods where things have been stretched before either through recessional slump UC loans might be capitalised and there might be interest on holidays. People don't want to force people out of homes. The issue is when you sell and have to take the loss. As Sharon mentioned, wages aren't going up. Everything looks rosy, but how confident are you that the next governments might address that. They have to do that regardlessand it might not be on the immediate radar. When you got a price to income ratio of 10. The average house prices $840,000. And in the communities that I represent your people earning 30% below the average wage. The expectation is that the government will come in and start to define how to do better. Wages have to go up and that has been lagging behind. To be heading the OECD on housing and affordability is embarrassing. You are a labour man. As the team having three terms at bat will do something or doesn't need to change. If they come in with the right policy settings. To lift wages and stall house price growth. We have seen it starting to happen but when not in a situation where the poorer communities are going to have representation. The left should be buoyed by this result, but we have to have a government that comes in and says we accept an affordability and I think the labour team is coming and saying we can do better than the national. But they are forced down to what happens on Tuesday or later. Red hot is not want to government wants neither slumping. Where is the balance? As a non-economist I can't talk about that. But the OECD in a broader report still ranks New Zealand is likely to have growth. The concerns are around we have these two-year fixed-rate mortgages and if interest rages have been moved renegotiation causes difficulty. I think Phil Goff on a city level talking about raising wages in the public sector. As Southall it will happen in a hurry even if Winston Peters gets his $20 an hour. It is over three years. And something else might needs to come in sooner than that. The other thing is around the OECD talks around skills and jobs and training and unemployment insurance. There are other policy settings to consider in terms of putting safeguards in place. In the here and now there are signs that the mortgage war could be starting. Lenders are starting to get excited. To a degree. I think the real issue on housing is building. We will never be able to put wages up to the extent wwhere people on the average wave can afford the average house. A lot of houses are under the average price. I think the bigger she was to get on and build the houses and build them at speed. I was distressed to see a leak out of news on housing that they might be negotiating with an industry out of Ireland for mass housing. We need houses built in an affordable rate. And land prices at an affordable rate. Let's talk about what the US ambassador said. What did you make out of it generally of where he saw New Zealand and our place with America and the rest of the world. He kept talking about the wonderful relations with the current government and government to come, but you can still see the politician and the man. The president only tweets the facts. And we have a president saying like I will totally destroy million people. And that might be a fact that he has the ability to do that. They are setting a global scale. - I wonder if he is the equivalent - of Jong-UN. They are having a public battle. As global leaders are saying step back from Trump with the Iran Dell. I think everyone is looking for calm, but there is extremes on both ends and no one is meeting in the middle. And I don't think they are interested in getting's effective dialogue. STAY WITH US ` YOUR FEEDBACK AND THE FINAL WORD FROM OUR PANEL LET'S TAKE SOME OF YOUR FEEDBACK NOW. VINCE ASHWORTH TWEETED. THERE IS SOMETHING DEEPLY FLAWED IN A SYSTEM THAT ALLOWS A 7% PARTY TO DECIDE WHO WILL BE THE GOVERNMENT. ALSO FROM TWITTER... TO NEGOTIATE MULTIPLE POLICY, MANAGE PARTY SOCIOLOGY & MAKE A SIGNIFICANT CHOICE IS COMPLEX - NEW ZEALANDERS NEED TO BE PATIENT! FROM FACEBOOK KAREN SAYS... US AMBASSADOR BROWN THINKS ALL HE NEEDS TO DO IS COMPLIMENT NZ AND WE ARE GOING TO FALL INTO LINE AND BLINDLY FOLLOW THE US. DAVE BUTLER EMAILED. CAN ANY OF YOUR PANEL TELL ME WHY A PARTY REJECTED BY 93% OF THE VOTERS HOLDS SO MUCH INFLUENCE AND SO MUCH AIR TIME? Jennifer, explain MMP and 30 seconds or less? I don't agree with that binary way of representing MMP. We have had government formation in this way before. This is a new and we have had negotiations like that. Where parties with under 10% AB been involved in discussions. It is because we want to see 51% minority governments aren't uncommon in Europe. We see 37% with Greens and labour equivalent. And then they do crossbench. We are getting flappy for no reason. On the time thing, and not a lot of attention has been paid, Germany have a similar situation. They aren't going to sort anything till Christmas. And patience is driven by the media. There is poll after poll before. And now people can sit back and start to wonder what is being talked about. There is a whole bunch of conjecture. I think MMP has been really good for New Zealand. I want to go backon something. Apec you will be going to. Well the door be left open to Trump changing his mind coming on board is with TPP? I think that is the big if. He is trying to pull off bilateral. I think if he has a renewed mandate from the snap election this week in Japan. He and New Zealand are driven TPP 11. I want to see the government formed quickly and that we get back to the talks which are essential. New Zealand is positioning in the region. It is important that Trump is there. He surrendered the to China and the issue. Hits and misses. Hits. We have had a rest from the detritus of politics. Normally a lot of press releases about not much. It is nice to have a bit of rest, and on the converse is that we are missing leadership in areas politically geopolitical. There is not much time on big issues in North Korea. We don't have a voice. Winston is all over the news as a hits. And Sean Plunkett is a miss. Only if American adults with their Leader the same way. The amnesia over this policy process. And the hits was talking to Geoffrey Palmer and Dr Palmer on why we need a written constitution. We could have filled up speculation on consideration about how to change the process. And change how the long discussion works. And involve citizens. With a time with at Winston's deadline. If he just said not till the end of October would anyone mind? I think they still would have complained. Do you both agree? Not necessarily, but we are heading towards a new conversation about a new convention. This is the most ludicrous situation. You talked about Germany, and that is Merkel making the play. MARAE IS NEXT. REMEMBER ` Q+A REPEATS TONIGHT AT 11.35PM. THANKS FOR WATCHING AND THANKS FOR YOUR CONTRIBUTIONS. THOSE WERE THE QUESTIONS, AND THOSE WERE THE ANSWERS ` THAT'S Q+A. SEE YOU NEXT SUNDAY MORNING AT 9. CAPTIONS BY JAKE EBDALE AND ANTONY VLUG.