Former finance minister Sir Roger Douglas calls for Finance Minister Nicola Willis to resign

Thursday, 18 September 2025

The Finance Minister has reacted to the 0.9% GDP contraction by saying the economy “suddenly had the stuffing knocked out of it” by the US tariffs.

Former Finance Minister Roger Douglas is calling for Finance Minister Nicola Willis to resign.

He and University of Auckland Matthew Abel chair of macroeconomics Robert MacCulloch said the contraction in GDP revealed by Stats NZ on Thursday was because Willis was 'sending New Zealand bankrupt by failing to get to grips with our ballooning fiscal deficits and public debt'.

'Her own Treasury contradicts her claim that NZ is on a path to surplus. It is not. Treasury's long term fiscal forecasts show out-of-control deficits due to pensions and health-care spending from an ageing population,' they said in a statement.

'Willis is not up to the job and is not levelling with the New Zealand public.'

Willis's office would not comment on the statement.

Sir Roger Douglas giving his valedictory speech at Parliament in 2011.

The Stats NZ data showed the economy shrank more sharply than expected in the June quarter, down 0.9%.

It is a longer and sharper downturn than that experienced in the global financial crisis.

Willis blamed the slump on global turmoil and uncertainty driven by the United States' tariff roll-out.

'The economy had been growing strongly in the previous six months, but suddenly had the stuffing knocked out of it,' Willis said.

'I feel for people and businesses who have been affected.'

Willis stressed that the data was 'backwards-looking' and there were signs the economy was growing again as interest rates fell.

Economists agreed that the outlook for the third quarter was better, but said given the sharp contraction, activity was still lower than had previously been expected.