Labour accuses Nicola Willis of ‘political manipulation’ over timing of RBNZ Covid review
Wednesday, 11 February 2026
Labour leader Chris Hipkins has criticised the timing of the Government’s review of New Zealand’s monetary policy response to the Covid-19 pandemic, with the findings to be released shortly before the election.
Finance Minister Nicola Willis said the independent review would help identify any lessons the country could learn to improve the monetary policy response to future major events.
But Hipkins described it as an “exercise in cynical political manipulation”.
The findings of the review will be published in September, weeks before the November 7 election.
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“If this is a genuinely independent review that provides some lessons learned, it could be useful,” Hipkins said.
“But doing it right in the middle of an election campaign suggests that’s not Nicola Willis’ primary motivation here.”
The review constituted “an attack on the Reserve Bank’s independence”, Hipkins also said.
A spokesperson for Willis said the review was budgeted to cost $500,000 “but it is possible the final cost will be lower”.
Willis rejected the suggestion she had dragged out commissioning the review to make it an election issue.
It had been on the agenda early on in the Government’s term but it had taken time to determine the terms of reference and find the right people to conduct it, she said.
There had also been other priorities, such as refreshing the Reserve Bank’s mandate, appointing a new governor and negotiating the bank’s new funding agreement, she said.
A Royal Commission into the handling of the Covid pandemic suggested in 2024 that the Reserve Bank and the Treasury could have worked together better to help manage the economic fall-out from the pandemic.
Former Reserve Bank governor Adrian Orr has also acknowledged the central bank made an error “in retrospect” by keeping monetary policy too loose, too long into the pandemic, after it looked into its own performance.
But Willis said an independent review meant the conclusions can be “objective and constructive”.
The Reserve Bank lowered the Official Cash Rate to 0.25% during the pandemic and increased the money supply through a policy of quantitative easing.
“Those who don't learn the lessons of history are doomed to repeat them and I am yet to meet a New Zealander who says they want a repeat of 7.3% inflation, $10 billion poured down the drain in losses from quantitative easing instruments and house prices spiking 30% in one year,” Willis said — while acknowledging the bank’s actions “helped to preserve jobs and keep businesses afloat”.
“If it is the case that the Reserve Bank's actions, overseen by the last government, led to financial harm to New Zealanders … New Zealanders deserve to know,” she said.
The review will be conducted by Athanasios Orphanides — a former governor of the Central Bank of Cyprus — and former Reserve Bank assistant governor David Archer.
“It will focus on decisions by the Monetary Policy Committee and analysis provided by the Reserve Bank to support those decisions. This includes MPC decision-making and communication, the use of additional monetary policy tools, and the coordination of monetary and fiscal policy,” Willis said.
Reserve Bank governor Anna Breman welcomed the review in a statement supplied to The Post.
“I am proud to lead an institution that is open to learning from its past actions and I look forward to the insights that this review can offer,” she said.
She noted the bank’s own five-yearly review of monetary policy had found the period between 2017 and 2022 was “uniquely challenging as monetary policy makers globally faced widespread uncertainty due to the unprecedented disruption caused by the Covid-19 pandemic”.
That review was peer reviewed by international experts and found that the bank’s Large Scale Asset Purchase (quantitative easing) programme was successful in correcting financial market dysfunction and reducing long-term interest rates, she noted.
“The review also found that in hindsight, earlier, or stronger monetary tightening could have curbed the subsequent hike in inflation,” she noted.
“It is important for us to continue to learn from the past to ensure that we can fulfil our mandate of maintaining low and stable inflation.”
Willis described the internal review Breman was referring to as a “window-dressing exercise”.
“They gave themselves essentially full marks,” she said.
“When I was in opposition, I was frank. I said ‘they’ve marked their own homework; that’s not good enough — if I was the finance minister, I would commission an independent review’, and today, that’s what I’ve done.”