Chronic worker shortages due to Labour’s flawed immigration settings are driving inflation and pushing interest rates even higher, National’s Immigration spokesperson Erica Stanford says.

“Labour shortages have been referred to as a key driver of inflation in each of the nine consecutive OCR hikes.

“This morning, the day after announcing the largest OCR hike in New Zealand’s history, Reserve Bank Governor Adrian Orr said that current immigration settings are a handbrake on the economy and that interest rates will have to go higher as a result.

“Instead of opening up to desperately needed skilled workers, Labour’s immigration settings have essentially raised the drawbridge and made New Zealand a fortress.

“For longer than a year, the Government has ignored warnings from the Reserve Bank and Treasury that labour shortages are hurting the economy, but Labour has stubbornly continued to pursue its ideological agenda of restricting the number of workers entering the country.

“A weekly Treasury update from 1 October 2021 stated that labour shortages continue to pose barriers to growth and will keep inflationary pressures elevated.

“Despite this clear warning, the Government couldn’t get its act together and open the Accredited Employer Work Visa until July of this year - months after Australia opened to all visa holders on 7 February 2022.

“The delayed border opening was not due to Covid-19, but rather the inability of Immigration New Zealand to process visas. After two years of closed borders, the Immigration Minister should have had Immigration New Zealand firing on all cylinders and ready to re-connect our country with the world.

“The Government’s immigration policies have been a total disaster, and Kiwis are paying the price with higher inflation and higher interest rates.”