Mr Quigley hits at Govt again

Press, 26 August 1982, Page 6

Mr Quigley hits at Govt again

PA “ Wellington The ousted Cabinet Minister. Mr Derek Quigley, reiterated last evening that a more open economy was needed. Mr Quigley, who was effectively sacked from the Cabinet’ partly for criticising the Government's level of economic intervention, said that the Government’s past “inward-orientated" strategy and associated controls had been given more than a fair trial and had been found badly wanting. In an address to the Association of Economists,

he said that evidence showed .that the strategy and controls had cost New Zealand heavily in terms of balance-of-payments problems, stand-ard-of-living rises, and unemployment. “It is high time that we paid more regard to what has been learnt from other countries' experiences,” Mr Quigley said. “This does not imply drastic upheavals. It does, however, require a general commitment to a more open economy as a matter of necessity,” he said. Mr Quigley drew partfcu-

lar attention to the. Government's intervention in housing, an area he formerly controlled by portfolio. Government ’ intervention in housing was in many cases unjustified now or where it was justified, interest concessions were an inappropriate way of doing it, he said. There was a tendency for Government intervention to be directed at easing problems arising from a lack of finance. This intervention was associated with concessional interest rates. Mr Quigley advocated an alternative subsidy, carefully

defined and controlled, to be delivered to the borrower as a direct payment, and allowing borrowers to choose between freely competing lenders to increase efficiency. "A more straight-forward way of delivering housing assistance than the method now would be a lump sum payment equivalent to the capitalised value of the annual subsidy,’-’ he said. Mr Quigley said that that would also be paid',.as the building industry suspensory loan and secured “against the borrower's title.