{"id":55840,"date":"2025-08-09T17:17:08","date_gmt":"2025-08-09T17:17:08","guid":{"rendered":"https:\/\/www.newsbeep.com\/au\/55840\/"},"modified":"2025-08-09T17:17:08","modified_gmt":"2025-08-09T17:17:08","slug":"simon-bridges-is-right-aucklands-economic-blues-require-special-attention-liam-dann","status":"publish","type":"post","link":"https:\/\/www.newsbeep.com\/au\/55840\/","title":{"rendered":"Simon Bridges is right, Auckland\u2019s economic blues require special attention – Liam Dann"},"content":{"rendered":"

Bridges\u2019 public call for fresh government policies \u2013 including more fiscal stimulus \u2013 was remarkable coming from a former leader of the National Party.<\/p>\n

It was a sign of some desperation. Bridges is head of the Auckland Business Chamber and is acutely aware of how bad things are looking for many retailers and hospitality businesses in the city.<\/p>\n

He has a different hat on these days, of course, and it is his job to lobby for Auckland business, but anybody who has spent time in downtown Auckland recently can see he\u2019s not exaggerating the problem.<\/p>\n

Let\u2019s face it, Auckland\u2019s CBD is a dismal place to be in the rain-sodden winter of 2025.<\/p>\n

AdvertisementAdvertise with NZME.<\/a><\/p>\n

Around the country, I can hear the tiny violins playing.<\/p>\n

New Zealand\u2019s largest city is often perceived as a brash and arrogant place, but with nearly a third of the country\u2019s total population within its regional boundaries, it\u2019s a bit hard to ignore.<\/p>\n

Politicians ignore it at their peril \u2013 as Labour found out after putting the city through a long and unpopular extended lockdown.<\/p>\n

I know the long-awaited Central Rail Link is supposed to turn things around, and I see the Prime Minister went for an advance spin on it last week.<\/p>\n

It looks great, and I look forward to it opening.<\/p>\n

But we haven\u2019t got a date yet, and it may well be later next year before it opens to the public.<\/p>\n

That means potentially another winter of waiting for struggling inner-city retailers.<\/p>\n

And perhaps a bigger worry than the timing is the risk that, if it opens in anything like the current CBD malaise, people will come to the city once, be disappointed by what they see and won\u2019t come back again.<\/p>\n

AdvertisementAdvertise with NZME.<\/a><\/p>\n

The same issues apply to SkyCity\u2019s long-awaited New Zealand International Convention Centre, and as Bridges points out, relying on these two developments to fix Auckland\u2019s woes won\u2019t be enough.<\/p>\n

But the central Government doesn\u2019t have a lot of money. So what to do?<\/p>\n

Bridges\u2019 suggestion of corporate tax cuts is fine in theory. But I don\u2019t think we can afford fiscal stimulus on that scale right now.<\/p>\n

And it\u2019s also not clear that it is needed right across the country.<\/p>\n

If you just looked at the economy in aggregate, it is flat but recovering \u2013 not too bad.<\/p>\n

I was pleasantly surprised to see the official unemployment rate land better than expected at 5.2% this week.<\/p>\n

My gut feeling was that it would be worse than that.<\/p>\n

When I saw the Auckland number, it all made sense.<\/p>\n

Auckland\u2019s unemployment rate has hit 6.1%.<\/p>\n

Of course, if you\u2019re taking your anecdotal evidence from business people in Auckland, you\u2019d assume the economic recovery has stalled.<\/p>\n

For better or for worse, Auckland\u2019s economy is driven by population growth and its service sector.<\/p>\n

It thrives on rising numbers of tourists and immigrants (international and from around New Zealand).<\/p>\n

The population growth drives property and construction. Building booms and property prices rise.<\/p>\n

Confident in the extra zeros on their house prices, Aucklanders go out and spend. The shops, bars and restaurants thrive, and Auckland is a fun place to be.<\/p>\n

That creates jobs and opportunities and attracts more tourists and more immigrants.<\/p>\n

That circle of economic growth has completely broken down.<\/p>\n

Meanwhile, in Otago, the June quarter data showed the unemployment rate had dropped to 2.9%.<\/p>\n

Christchurch is also, by all accounts, humming along right now.<\/p>\n

I\u2019ve written before about the stark regional divide that appears to be opening up as the returns from high export commodity prices bolster rural regions and the cities that support them.<\/p>\n

It doesn\u2019t seem like a great idea to be stimulating flush southern economies with either fiscal or monetary stimulus right now.<\/p>\n

Economists are currently making the case for one or two more cuts to the Official Cash Rate (OCR).<\/p>\n

If the Reserve Bank just looked at the South Island, it might not see a need to cut again at all.<\/p>\n

If it just looked at Auckland and Wellington, it might see a need to cut much further.<\/p>\n

But monetary policy doesn\u2019t work like that.<\/p>\n

That\u2019s where fiscal policy comes in.<\/p>\n

I think any fresh spending on Auckland would need to be very well-targeted.<\/p>\n

The Government doesn\u2019t have spare billions, but it might be able to find spare millions for projects that could make an outsize difference to the grim Auckland mood.<\/p>\n

We have a trifecta of dead buildings in the crucial mid-town intersection around Aotea Square.<\/p>\n

The remains of the St James Theatre have looked like a demolition site for years. Across the road, the old Smith & Caughey building is now empty and just up Queen St, the Sky World Indoor Entertainment is increasingly empty and run-down.<\/p>\n

There are plans in place for all of these buildings (the Government has already allocated funds for restoring the St James), but no signs of anything happening quickly.<\/p>\n

It might be time for the Government to look at getting involved \u2013 either with cash, some of that fast-track regulatory magic it has sprinkled around the regions (and, to be fair, on plans for Port of Auckland expansion).<\/p>\n

Bringing these buildings back to life would deliver a much-needed boost to a key area of the central city. It would also double as fiscal stimulus for Auckland\u2019s construction sector, keeping skilled workers employed while we wait for the broader economic cycle to turn.<\/p>\n

And perhaps most importantly, they\u2019d deliver a morale boost, providing another reason to believe that Auckland can and will find its mojo again.<\/p>\n

I\u2019m not necessarily wedded to any of these ideas; there might be better ones. Let\u2019s hear them.<\/p>\n

The point that Bridges is making is that things are now so grim that we can\u2019t afford to just wait for a recovery that might still be another year away. By then, it might be too late.<\/p>\n

Liam Dann is business editor at large for the New Zealand Herald. He is a senior writer and columnist, as well as presenting and producing videos and podcasts. He joined the Herald in 2003.<\/p>\n","protected":false},"excerpt":{"rendered":"Bridges\u2019 public call for fresh government policies \u2013 including more fiscal stimulus \u2013 was remarkable coming from a…\n","protected":false},"author":2,"featured_media":55841,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[11],"tags":[46192,64,46190,63,3925,12305,99,46193,15261,164,14015,1460,15448,46191,19398,36443,8124],"class_list":["post-55840","post","type-post","status-publish","format-standard","has-post-thumbnail","category-economy","tag-attention","tag-au","tag-aucklands","tag-australia","tag-blues","tag-bridges","tag-business","tag-dann","tag-economic","tag-economy","tag-facts","tag-is","tag-liam","tag-require","tag-right","tag-simon","tag-special"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/posts\/55840","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/comments?post=55840"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/posts\/55840\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/media\/55841"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/media?parent=55840"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/categories?post=55840"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/tags?post=55840"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}