Labour leader Chris Hipkins is set to respond to Prime Minister Christopher Luxon’s State of the Nation address in which the country’s leader claimed a “culture of saying no” is holding back economic growth.

Hipkins is expected to give a press conference about 3pm. A livestream can be found below.

Hipkins, speaking from Labour’s caucus retreat in Palmerston North, is likely to give his view on Luxon announcing the creation of Invest New Zealand, an agency to attract foreign investment amid the Prime Minister’s focus on economic growth.

In his latest ministerial reshuffle, he gave Finance Minister Nicola Willis the portfolio of Economic Growth. Luxon often referenced the Government’s eagerness to tap foreign pools of capital.

While Luxon was giving his speech to members of the Auckland business community, Hipkins was leading his party’s caucus retreat, telling MPs they will need to have better answers to the questions voters will have ahead of the next election as he accepts Labour “over-promised and under-delivered” while in government.

A relaxed-looking Hipkins, striding into the Distinction Hotel in shorts and jandals, gave a fairly frank assessment of Labour’s missteps in government that led to a heavy defeat at the 2023 election.

Labour leader Chris Hipkins during his opening remarks at the Labour caucus retreat in Palmerston North. Photo / Mark Mitchell

In the weeks after the election, Hipkins stated Labour would spend the next year listening to the electorate to find out where it went wrong, which he said today was “really important” so the party could hear the “hard truths”.

“We heard pretty clearly from New Zealanders that in the big challenges that they saw going into the last election campaign, they didn’t see the best answers coming from us,” Hipkins said to his MPs.

He cited Labour’s inability to articulate how it would address the high cost of living, manage crime, grow the economy and create jobs.

“That’s one of our challenges as we develop our policies for the next election, we’ve got to have more to say on all of those things.

“But we also heard some home truths from them, that they felt that across our six years in government, we’d often over-promised and under-delivered.”

Labour leader Chris Hipkins strolling into his caucus retreat in shorts and jandals. Photo / Mark Mitchell

Aside from those reflections, Hipkins focused largely on what opportunities he saw where Labour could gain public support as the coalition Government implemented its own agenda.

“I think what we can already hear from New Zealanders is that they’ve seen enough of this Government to know that they don’t like it,” Hipkins said as his MPs murmured in agreement.

He pointed to the number of New Zealanders moving to Australia, the level of unemployment, the state of the health system and a painful recession as key indicators the Government was failing.

Hipkins also referenced the Government’s cuts to the public service. MPs were set to hear from former Public Service Commissioner Peter Hughes about how to extract the best from the public service.

Another of Hipkins’ priorities in 2024 had been to refrain from “barking at every passing car”.

While he cautioned against embracing that strategy completely in 2025, Hipkins declared Labour would be “ramping up the pressure”.

“We’re going to make sure we’re looking at using every avenue that we have available to us to dial up the volume there a little bit.”

Ahead of his opening remarks, Hipkins told reporters there would be no policy announcements made at the caucus retreat. Instead, there would be more high-level policy discussions.

Tax remained a policy area of interest with Labour given the failings of the party’s policy it campaigned on ahead of the 2023 election and Hipkins’ decision to scrap plans for a wealth tax policy, which had been developed by current MP David Parker and former MP Grant Robertson.

Hipkins wouldn’t be drawn on what Labour’s policy would be, nor would he comment on whether it would be discussed by MPs today.

Labour MPs listening to their party leader's address at the caucus retreat. Photo / Mark Mitchell

Parker today acknowledged policy items including tax were being worked through.

“What the outcome will be, I think, will be clearer by the end of the year, but there are clearly unfairnesses in the tax system, which I think Labour will address in the next election,” he said.

Parker said he wouldn’t walk away from the party if Labour settled on a tax policy he wasn’t satisfied with.

“I’m confident we’ll get to a good outcome.”

Adam Pearse is a political reporter in the NZ Herald Press Gallery team, based at Parliament. He has worked for NZME since 2018, covering sport and health for the Northern Advocate in Whangārei before moving to the NZ Herald in Auckland, covering Covid-19 and crime.