Economic • '
Economic Reform' On taking power, National discovered that the
Bank of New Zealand needed large and immediate government aid, and that outgoing Finance Minister
David Caygill's predictions of a small
surplus were very wrong. These problems gave Finance Minister
Ruth Richardson the opportunity and
caucus support for major cost-cutting. Richardson's first budget, delivered in 1991 and named by the media as 'the mother of all budgets', introduced major cuts in
social welfare spending. Unemployment and other benefits were substantially cut, and 'market rents' were introduced for
state houses, in some cases tripling the rents of low-income people. In some areas, governmental standards were relaxed in the expectation that market forces would assure quality via competition, such as in the Building Act 1991, which was seen as one of the steps leading to the
leaky homes crisis in the following decade. The government's economic programme became known as '
Ruthanasia' was massively unpopular, especially following the equally dramatic reforms of the 1980s. As a result, the government came extremely close to losing the
1993 election. Subsequently, Richardson was replaced as Finance Minister by
Bill Birch and left politics. National's period of major economic reform was over. •
Health reforms and hospital closures One of the most ambitious and controversial aspects of the Fourth National Government's programme was the comprehensive overhaul of the public health system. The system of democratically elected Area Health Boards was abolished and replaced with Crown Health Enterprises (CHEs), run according to the prevailing
new public management ethos that created an internal market for the provision of hospital services and required the CHEs to make a profit. The degree of corporatisation of hospital services was scaled back after the 1996 election.
Defence • In 1992, New Zealand sent nine military observers to join the
United Nations peacekeeping force in
Bosnia. This was soon reinforced in 1994, by a 250 strong infantry company, supported by 25 M113 armoured personnel carriers, 10 unimog trucks and 21 land rovers. This was New Zealand's largest deployment of military personnel since the
Vietnam War. In early January 1996, 200 New Zealand military personnel returned to New Zealand, while the remaining 50 were left to reconstitute equipment before returning to New Zealand in late January. Ultimately, New Zealand would remain involved in Bosnia through a small force of observers until mid-2007.
Social policy •
Human Rights Act In 1993, the
Human Rights Act was passed, outlawing discrimination on the grounds of sexuality. The government was excluded from the provisions of the Act, probably due to concern over the possibility of
gay marriage. Several National MPs, most prominently Police Minister
John Banks, opposed the Act on religious grounds. •
Work and Income Following National's coalition with New Zealand First in 1996, the Department of Social Welfare and the
New Zealand Employment Service were merged to form
Work and Income New Zealand (WINZ). Alongside these reforms was the introduction of a work for the dole scheme, known as the community wage.
Environment •
Resource management The
Resource Management Act 1991 (RMA) completely overhauled New Zealand's system of planning. Originally drafted by former Labour Prime Minister and Environment Minister Sir
Geoffrey Palmer and continued by
Simon Upton after Labour's electoral defeat, the RMA replaced many laws regarding the environment, zoning, land and water use and many other issues and provided one piece of legislation requiring developers (including state agencies) to have regard for environmental impacts and Māori and heritage values. Critics have since argued that the RMA gives too much power to opponents of development, who can slow down or halt projects even if they have no valid objections. Others have seen the RMA as a welcome means to prevent the destruction of sacred sites, heritage buildings and fragile ecosystems. •
Climate change In September 1993, the Fourth National Government ratified the
United Nations Framework Convention on Climate Change (the UNFCCC). In July 1994, four months after the UNFCCC came into force, the Fourth National Government announced a number of specific climate change policies. • a target of reducing
net emissions to 1990 volumes by the year 2000; • a target of slowing growth of
gross emissions by 20%; • increased carbon storage in plantation forests; • energy sector reforms; • an energy efficiency strategy and the Energy Efficiency and Conservation Authority (EECA)l • renewable energy sources; • use of the
Resource Management Act 1991; and • voluntary agreements with industry. The Fourth National Government said that if emissions were not stabilised at 1990 levels by the year 2000, a low-level carbon charge would be introduced in December 1997. By 1996, the National Government had established a new target for the reduction of greenhouse gases. This was to have either no increase in 2000 net emissions of carbon dioxide from 1990 volumes or a 20% reduction if it was cost-effective and had no impact on trade. ==Formation==