Kyoder and welcome to Shared Lunch, brought to you by Chairsa's. My name's Sonia Williams, and I'm one of the co founders and co CEOs at chairs EA's and we're on a mission to create financial empowerment for everyone, which is a big part of why we do these conversations. It's a chance to pick behind the curtain of what's going on in our world today. We're speaking to Labour's finance spokesperson Barbara Edmonds.
The politics is the hard stuff to be friend. Ultimately you break it down. It's a Greek word. It's about people.
So who is Barbara Edmonds?
I was brought up in a family that didn't have much circumstances happened like my mom passed away when I was four. Dad was a widower with four children under the ages of eleven.
What's your vision for the future of Malta.
And that's a big question, I mean, and I know it's a big question.
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Well, welcome Barbra, Thanksanks having here.
Ton of for lover. If you're quite honest, thank you.
Oh yeah, well we stoke that you're here. So well, first we'll talk about you. You've experienced a lot in life. You've dabbled in physiotherapy and insurance before completing joint law and arts degrees. You're a parent of eight children, keep me busy, and we're a public servant before becoming MP of the Mana electorate in twenty twenty. Is there anything else you'd like to add or well done?
Good good, good work, you know, staff for the researcher.
Yeah.
I mean I've had a varied life before coming into politics, and if I'm really fair, actually having that varied life and different experiences just makes you a bit more I think, centered and grounded in what you want to achieve while you're there here and now.
Yeah, now you are a politician. What does that mean?
The politics is the hard stuff to me, Frank, I find that for me politics ultimately and this is the geeker me you break it down. It's a Greek word.
It's about people. And if I look through a lot of the commentary that I do, whether it's on a podcast or whether it's a media interview, or it's in the way that I do policy decisions, Ultimately I'm looking through that sort of decision and thinking about what's the impact on people, who are the winners, who are the losers, where are the unintended consequences as part of that decision making. So politics in some ways comes easier to me because
I always look through things about the people lens. But at the same time, that's sort of debating adversarial side. Yeah, I'm trying to hit my straps on.
It because that's a big part of it too.
Oh yeah, it's massive. It's massive. And the great thing is, for the most part in New Zealand, we don't take it personally, where you know, we're having a debate of ideas and having a debate of decisions as opposed to attacking one another as politicians. I think if we can keep it that way in New Zealand, then we're going to be Okay.
Yeah, that's great, and we you know, we're all for creating empowerment and that's part of you know, part of that is taking control of your financial future yourself. And I think when it comes to politicians, and you know, we live in a democracy, and so I think learning you know from you, like, how do politicians shape the lives of Kiwi?
Every way, every shape and form, every decision, whether it's going to impact on a person straight away or whether it's later on down the line, every decision that policy makers, not just the politicians who are in government, but also like for example, my role is opposition to highlight perhaps where there's errors or where things need to be a
bit further, be pushed a bit further. We impact everyday lives, just the differences though for those in the general public they might not think that it affects their everyday lives, but ultimately the money you get in your hand at the end of the week, you know, with your pay packet, that's been impacted by politicians' decisions.
Yeah, so what tools do you have to work with to shape those decisions?
Some life experience. I was brought up in a family that didn't have much and it was very much because circumstances happened, like my mom passed away when I was four. Dad was a widower with four children. Under the ages of eleven at the age of forty, you know, and Mum was thirty five when she died. So growing up my father was an amazing man and loved my dad even when he brings me at random times. Learnt that sometimes money isn't necessarily an abundance, but you don't have
with money, you can have with time. So my father taught me a whole thing a lot around community service. Because, for example, my dad sent us to really great schools on Awklands North Shore. They weren't cheap schools, they were integrated, they were Catholic schools. My dad was paying off our
school fees for ten years after I had finished. He had struck that deal with the school to pay off the school fees because his wider purpose was making sure that we had a good education despite what had happened to mum passing away. But what my dad didn't have in money, he gave in time. So he was that dad, you know. Eventually on the board of trustees. He was the father that the school went to when they were having problems with Pacific families and children. My dad would
advise them on that. He's also the one driving the school van going to pick up goods and stuff and fruit and veggies from all the different suppliers to sell at the school fair. So I learned really quickly that sometimes money isn't everything because you don't have much, but actually what you have in abundance of is your time and being really purposeful with that time.
And so when you think of what life's like for Kiwi, now, Howard, what are you seeing around people in their financial situation?
Really tough? I am seeing coming through my office every day in Pottydoer, so I have an electro office and Pottydoer one of my two officers. I am hearing people like I was at netball on Saturday and a couple of people said to me, like they've never experienced it this tough. It is really hard for a group of people out there who are struggling that despite being working or working or having one or two jobs, sometimes three,
that they're struggling just to make ends meet. So we've just had recent inflation figures come out and you can see where that problem is is because when inflation is high on food, on rates, on insurance, on energy, those are the core basics for what any family or any person needs to live a life. So it's really really tough out there.
What do you think that we can be doing better?
When I speak to businesses in particular, I'm asking them to think about how they give back. A lot of them know they work on a social license and a lot of them are doing some great programs to support community organizations. I believe as the role of government at a time when the economic cycle is on a low, so as the private sector pulls back, that's when the public sector pushes forward. So that's the timing of investment
I think is really important right now. But we're seeing a whole bunch of kiwis, you know, a planeload a day leaving New Zealand because they think that the grass is green, are somewhere else, And to be fair to them, yes they will get better wages in Australia, but that's not what we want. The concern for me is that who is leaving and we're starting to see that it's really that workforce is starting to move with their feet.
And my concern is that whenever labor decides to whenever we win and we take over the books, is we're going to have to rebuild some of that capability that we are losing, particularly for example, in the infrastructure and construction space, where there's been a huge loss of jobs or roles. So it's a big piece of work that
we have to be mindful of. But also if we're not connected to our communities, we have no idea as politicians, and really we shouldn't be in that space if we're not connected to the communities and the people that we're serving. So the broad brush cut right across all agencies is my view, not a prudent approach. When you're, for example, a business and you know if times are tough and you want to cut back spending, you don't necessarily cut
back across units. You think, actually, if I put a bit more of my money in this unit, it means I can produce a bit more goods because I know that that element of my business is doing really well or is returning better than what other elements of my business are. So the broadbush just cut everything, I think was very cruel. Where the government should focus on is one,
services to community. We know people are doing it tough, so removing areas that make it easier for people to either get to work, get their kids to school, make them healthier, be being able to access prescription fees, etc. Those are the areas that I would keep in if I was the Minister of Finance, because I know that it has a return to the community in which a service area where I wouldn't have done though, is taken money from one area and then put it in areas
where there is less productive activity, for example gas subsidies or putting it through a tax break for tobacco companies for e cigarettes. So cuts have not been great because they've been quite blunt, they've been quite cruel, and they haven't been considered because as much as the government has said it's not going to cut back on frontline services, that's so not what we're hearing. And when you see their social issues such as growing homelessness, jobs being lost.
In the infrastructure specter a sector, those are the areas that you want to keep investing in, which is continuing to build houses, continuing to invest in infrastructure projects because that has a longer first, longer term return, but second it keeps the economy ticking over because there's certainty for these big you know, multimillion dollar you know sometimes billion dollar projects, which means that the money is still in the economy from my perspective, the cuts have been cruel.
They haven't been considered enough. And if Labor comes in again, it's about looking at everything on the table, not stopping and starting infrastructure projects like we've seen in the last eighteen months. And it's about our community, our services to community. Where do we need to strengthen those areas in order to able to have a more functioning society because everybody is being looked after.
And so in your time in Parliament you're an advisor and you've worked under both the National and the Labor Party, so you've seen different views. And now you're not only the Finance in Economy spokesposting for Labor, but you've now taken on a new portfolio, savings and investing. Why was that role created and can you tell us a bit about that.
It's really a good sign post for where our focuses that we will take to the next election. Savings an investment. We know that some of the best policies that that has survived governments as they come and go. With some of Labour's policies such as care we Saber the Superfund, So for us we know with Kiwi Saber there is
some unfinished business. There are some areas that we want to really look at in relation to how do we increase the uptake of kei we saber, how do we support both employers and employees to contribute a bit more. Where is the iniquity in ki we saber? And it's the same with investment again, being able to have income that's of a sufficient level that you can actually choose to invest. That's a really important part of what Labour wants to offer in the next election.
So we started chairs eas to try and create more opportunities for key we to grow their wealth outside but also alongside property. What's your view on how that's playing out or how that plays out for people being able to invest in different things.
Thank you as as a person who grew up thinking that owning your own home is the only way to wealth or working your way to wealth was the only way. Thank you so much because it provides an opportunity for and I'd say my children who actually have a Chezy's account, for my children to do access something that doesn't isn't just this big beast of a trading thing that happens on Wall Street or you know, down the road here in Wellington at our stock market. It gives choices and
that you don't just have to invest in land. You know, when I speak to the index, I speak to the indid X, they talk about the returns through equities as just as the returns are just as good as land return but it's not that accessible. And so Chezy's has definitely opened up the opportunity for anybody and everybody to be able to access a market which probably traditionally was inaccessible to everybody. So yeah, huge he to you all for that.
Thank you. How do you see kind of money flowing into those businesses?
It's so important because it all so there's an issue with New Zealand and the way that we invest in land and that there is an it's almost an automatic
like land is going to give you the return. But as a result, it means that our economy is very much based off people investing in what is a less productive part of the economy, whereas if we're investing in shares or in equities or in you know, basically the capital that businesses will be able to access because people are backing them, it means they can grow more jobs, they can do more things, they can create more widgets
or innovate more so that they call it. There's a technical word for it, but basically that turning of the mind to thinking I don't just have to invest in land. I can have another option to invest and it's easy to invest in that. That is a great mindset for New Zealand future investors will investors now to have and it's a mindset that through a platform like Chasis, all through platforms that allow for crowdsourcing or crowdfunding, it allows people to have easier access to it.
And so you've already been the Minister for Economic Development and Associate Minister of Finance, but not for long though. Did you feel like you got enough time to sink your teeth into it?
Yeah, definitely not want to do so. I was a minister my first term, so I got it in twenty twenty and then in twenty twenty three, just under our durn step down and Chris Hipkins was nominated through our party to be the leader, he came Prime Minister. I was a minister for ten months. So within that ten months I had nine portfolios, so drop some, pick some up, you know, and then others I carried through. Definitely not
enough time at that stage of an electoral cycle. Your job there is just to make sure that the pathways that has been decided probably about eighteen months beforehand is you know, continuing. So not enough time and I'm hoping the next time I get it and We'll have plenty of time to do the things that I want to do.
Yeah, so you are in the running to be the Finance minister at the next election. What would a Barbara Edmunds economic plan look like?
And Barbara Edmunds economic plan would probably look at some key sectors in the economy, think about where is New Zealand's competitive advantage. If it requires us putting something on a boat or on a plane, then we've lost that advantage given where we are geographically. And there's been a lot of commentary around why New Zealand's productivity is low. And my very first speech as the Finance spokesperson seems
like ages ago, but it was just last year. Beginning of last year, I talked about productivity will be our focus, not just on the productive side, thinking where are our competitive advantage areas, but also we know energy is huge. Energy is basically underpins any of that productive sector. We don't have sufficient supply of energy, then we get what's happened in the last year with factories closing down. The other major focus for me is the human capability of that.
What are the skill sets that we need for jobs of now, for jobs of the future, and what's coming towards us, whether it's AI, whether it's other technology changes, whether it's geopolitical changes. That ensures that we have a workforce that is able to build, develop and create the society we want to thrive here in New Zealand.
Well, when you talk about competitive advantage of New Zealand, you know, what are the things that are popping up for you?
Renewable energy. We clearly have high sources of renewable energy. There's still a percentage there that will need to work through and the transition through that. There's also the really great thing about New Zealand and I believe it's our superpower to the world and that's our marty economy. The fact that our MARDI businesses here in New Zealand is the fastest growing sector. I think we need to unlock some of the issues there to allow them to access
their asset base. So, for example, to today, Fenoa is an area that we're keeping a close eye where the government looks too to be able to unlock Mardi Land so it can be used to its potential. The other major issue, and which is why I'm so glad that Chippy made it or Chris Sipkins made it a portfolio, is the creative economy. The creative economy is not just the things that make us feel good and the social
cohesion benefits that come with that. It's also the things that Keywis are so good about good at doing, which is the dreaming and then the innovating to develop it, to make it a thing, to be able to make things easier for us. So the creative economy does include AI, It does include research and development, it does include science
and innovation. But then it also includes the gaming sector, which we've seen you through a little bit of support previously in twenty twenty three, they have grown into quite a competitive sector. So those are some of the key competitive advantages that we're actively looking at for policies in those spaces.
And then on AI, like, what are you saying as some of the opportunities for alto are in that.
I don't know about. Most people buy use AI every day, and when you're in opposition and you have low resources. AI is a great tool because it's always like another person that's helping you formulate the structure of ideas. And then you do need the human element to make sure that it's been quality reviewed, that it's you know, the references that it brings up are actually accurate or not. And so you do need to have that human at
the end of that assessment period. But AI has huge opportunities for us both here, I mean in countries around the world. Corporates are already using it. It's about making sure that we bring everyone on that AI journey because we already have a digital divide here in New Zealand. And if you haven't spoken to edit or La f Aili, she is New Zealander Young New Zealander of the Year.
She's been working in the last couple of year years around trying to bring together that digital divide, particularly for Pacific people. But we have a large group of people who are being left behind on the digital space. We need to bring them with it, and we also need to bring AI with it. It also provides us an opportunity to think about what are the jobs of the future. As AI starts to. You know, some people will say,
we'll start to take some jobs. I'm thinking about if I was a law graduate, you know, whether I'd still have a job. But we have to think about what actually a law graduate might not have to do all the research that's involved in the due diligence, but actually the law graduates their job now is to do the quality assurance from it. So it does. There is definite opportunities in AI, but we need to make sure that everybody has access to those opportunities too.
Another on the technical side, we see crypto, you know, obviously being talked about a lot. How does that affect your future thinking or do you think about that?
No matter how I personally feel about crypto or how other people may be personally feel about crypto, it's here and I think, you know, I've had a lot of conversations over the last couple of years, and there's a lot of skepticism around cryptocurrencies from sort of more traditional areas.
The thing that makes me wake up though, to the role of cryptocurrency is that we have the president of the first world talking about cryptocurrency and whether that's for their benefit or not, and also putting it through legislation in their legislature in America, but also in trade deals there is references to crypto currency. I think there needs to be a greater understanding that Yes, okay, if you
believe it's speculatory, that's that's your gig. But don't let that be a barrier to understanding crypto and what are the regulatory settings for crypto because I think of lawmakers just push it aside as that's just a speculator. While back in the late eighteen hundreds, so was land was speculatory, so was shares speculatory. You know, there's always a speculative
market for investment in assets. But ultimately, as decision makers, you need to probably take a serious look that if the president of the first world is taking it seriously, then our settings right here in New Zealand.
Yeah, So keeping an eye to the future, you know, we are here to help people set themselves up for there now but also their future retirement features in a lot of what we're helping people on the journey too. You've been quite vocal about the changes on the Kei saver and the budget. What are your thoughts on raising the minimum contribution and the employer contribution.
We are for raising the contribution by both employers and employees. But what you need to do, as you've seen it, as we've seen in Australia, is it needs to be a very clear pathway and not all at once. And I'm really mindful that right now it is tough for both employers and employees to be able to save for
their retirement. So when we come out with our que We Saber policy as we go to the election, it'll be quite clearly flagging as to Okay, we do believe contributions need to go up and we think perhaps that this is the best way forward by this time, by this amount over this period. But it's quite clear what we've learned from Australia is having it clearly signposted. It means that everybody has a bit of certainty and a bit of planning that they can do both as a
business and both as an employee. Because most people or some people will know, I'm a late comer to q We Saver, I'm a late comer to ki We Saver because we just didn't have the money to invest in my savings for retirement. And the reason being is because we want a security of tenure of a house. So for us, the ability to buy our first home was more important than saving for the retirement position as a family, And I say as a family, for me to be able to start saving for that retirement, but I will
also have a home. And for a lot of people, that ability to have savings plus a home is diminishing over time because home ownership rates are diminishing over time. So I think being really clear when you go to do your personal savings or investment is what is it for? There are no quick shortcuts to this. There's a long term purpose to it and being able to make sure that you keep checking in like is this the investment that I want? And is this give me the returns
that I want? And does this meet the initial purpose as to why I invested in this asset.
With your Kei Savor, you can withdraw for your first home. And you talked about, you know, whether your decision was is it for my retirement? Is it for a home? You know what what's your view on that?
So I think that's important that qwis be able to access it to get their first time or to help contribute towards their first home. I have been in ke we save long enough to be able to build up an amount that's actually going to be able to be contributed to them buying their first home. Ultimately, that's a policy which we've kept in since you know, came in under a previous government. We've kept it going as well.
Where my concern would be is that if you start to open up for first home withdrawals, if you start to open it up for other things, So for example, if they start to open it up for business purposes, you know, or to buy a farm, those of that starts to take away from what q we Saver was intended to be the first home. For example, again, the Retirement Commissioner did a review in twenty twenty two which showed that people's home ownership rates are starting to reduce.
When I think about my retirement, I've got a home, I've got q WE Savor probably would probably do a couple more investments, you know, to be a bit more to make sure I've just got enough enough for it. But ultimately that ability to buy your first time is really important because it can be part of your fuller retirement savings package.
We are keep we Save a provider, and we did some research around people and contributions. And I think you know, what you said completely lines up to what we saw as well that people were happy to was seventy eight percent actually said that they were support are raising contributions from their day to day you know, money they're taking
home now for that future. And you've already talked about time through this, and I think money and time there is that relationship there where even if you start small or with small amounts, over time, time is your friend when it comes to money as well.
Yeah, especially for retirement.
Yeah, totally. So what's your current read on how key we save is going for New Zealanders?
Could be better, absolutely could be better, But I'm also very cognizant we're in a downturn at the moment and it is hard on people. And like I said, like I am a later adopted, we save because I knew how hard it was. You know, we had eight dollars in the hand after everything was paid for, and if it meant that we could actually buy our first time and say for our first time, that was the priority because we needed that security of tenure. So I totally
understand why it's hard for people to save. But ultimately, as governments, if we can clearly signpost when increases may happen and over a certain period of time. It gives people time to prepare. It also gives governments time to think about, Okay, the Reserve Bank, the Treasury have forecasted this for the next forecast period, when is the right time to actually start implementing those increases and by how much?
You know, it could be zero point five, it could be a percent, or you could do what Australia did in sort of over a ten year period it started to increase considerably. The other element that we are very cognizant of, particularly in the labor party, is that ke we saver is starting to become a part of a total rem package remuneration package. So if we're going to be increasing employer contributions, ultimately that's actually coming out of
the pay of the employee. So they're say, for example, just hypothetically it's at four percent, which it is for some some may choose three percent. If we say, are we going to increase it to five percent next year, well, actually some employees that's ultimately ten percent, because the way that their contract has been written is they're actually contributing it as part of their pay. So those are some of the other elements that we need to consider as well.
What's the interplay between total remuneration packages. Can we say contribution increases the period in which we look to increase it, but then also the element of who's missing out and why, like the over sixty five year olds because they don't you know, the employer might not have to contribute. What about the mothers who've had to go on maternity You know, there are some really amazing employers who actually continue can
contribute while they're on maternity leave. So those are the elements we need to look at as those equity elements as well.
And we've talked about that the Australian contributions into their super and I think it's sitting in around twelve or over twelve percent at the moment. And what's your view on how we may look to like do you have figures in your mind and we see our contribution rates needing to get to to support people in their retirement.
Everybody will need a different amount right for their retirement depending on the lifestyle that they want to live when they eventually decide to finish work or finish their business or being a business owner. Some of the major benefits for Australia not just some of their higher retirement savings. It's actually it's created a deep pool of capital that can be accessed for other areas within the Australian economy.
So for us as coming into the way that we think about this policy is if we grow deeper pools of funds or capital within the country, whether that's through key WE Saver or you know, thank goodness for Sir Michael Cullen and Helen Clark for the super fund. That means that there's a bit more money in there to be able to invest in areas that we need to be invested in. It also gives governments different leavers as well to be able to push and pool on ultimately
greater savings. Is New Zealand is good for us. So with whether it's key WE say, where it's super funds, where it's a sec whether it's key WE Saber providers in the funds that they hold as well, that's all makes it a better thing for New Zealand. It's just a question of how much more do we need.
Can you envisage a future where superannuation is means tested.
I'm not under my watch and I really I say that, you know, quite in a relaxed way, but also in a way that I am an evidence and data person and when I read the information from the retirement commissioner commissioner around means testing, there's going to be a line in the sand that's gonna hurt someone. So we need to look at the retirement settings as a whole, not just at income testing and not just at increasing the age,
but how do we increase can we save savings? How do we ensure that the super fund is working as it's intended to and actually it isn't working as intended to because it's actually getting great returns and number one in the world for pension funds. But making sure we look at the full retirement system and that includes the family home because most people if they buy the you know, I think about a lot of the pensions. I know
in my area, they have their family home. When they need to go to a retirement village, they sail down that house and they move into a retirement village. So the retirement village setting as well as part of that whole retirement scheme and settings in New Zealand, So look at it as a whole not just as different elements of it, because they all work together very carefully, and if you pull in one place then there could be
unintended consequences somewhere else. So it's a conversation that we need to have more generally and more about open about not just in come testing, not just about raising the age, but about the whole settings for retirement in New Zealand.
So what's your vision for the future of are.
That's a big question. I mean, and I know it's a big question. And I hear that every time I have like a business dinner or a lunch or where I get to spend time with some amazing businesses that we in quy companies you have in New Zealand. Is that you know what's the vision, and my vision will be different to your vision. But ultimately, again if I go back to where my first principles laid, it's a
New Zealand where there's an opportunity for everybody. That's why I got into politics because I realized in my community there were opportunities that my children had that other children
didn't have. So making sure there is opportunities, making sure that you can if you want to live here, man, that you can have your own home, or that you have a security of tenure that you don't feel like you're going to be kicked out the next week, where you can lay down your routs in a community that you choose, that where you want to send your kids to,
where you want to be able to access healthcare. So it's a big question and for me, I can't yet quite articulate what the vision is for New Zealand, but I think about it as opportunities. This is an amazing country. We have some amazing people doing such awesome things. But it's just making sure that everybody has an opportunity, whether you're the factory cleaner on the factory floor or whether you're the retiree that wants to just see their grandchildren
come visit them. That's the New Zealand I remember growing up and where everybody had a chance, and that's the New Zealand, which when we come to the election, we want to make sure that everybody has that opportunity as well to be who they want to be and to be able to build their roots, grow their community and be that special place at the bottom of the world where we know that everybody wants to move to when things go bad, but also hold dear to us what makes us New Zealanders.
Thanks Haanks for joining us, Barbara, we've covered a lot of ground.
Yeah, lots always a good space though.
Yeah, and thanks everyone for tuning in. You can watch she Ad Lunch on YouTube or follow along on your favorite podcast app. Leave us a rating or comment about what you'd like to hear about next Khaki Deck