The ACT Party's annual conference opened in Auckland tonight with a message from its founder Sir Roger Douglas - the Government's strategy for dealing with the recession isn't going to work.
"Pretending we can avoid the pain of economic contraction may make us feel better in the short term, but pretence will add to the pain we feel when the inevitable adjustment occurs," he said in a speech to delegates.
"Borrowing beyond our means, to increase the amount of spending, is what households have done over the past 10 years, and has led to our current recession.
"Now the Government wants to try the exact same strategy to get us out of the recession."
Sir Roger said New Zealand's economy had been shrinking since the beginning of 2008 because of failed government policies.
"We have been moving in the wrong direction - we've moved from a government geared towards growing our wealth to a government geared towards redistributing it," he said.
"This pushed us into a recession and now the financial crisis will hurt us further."
Sir Roger had a list of lessons on how to handle the recession.
Among them were:
* Don't blame the free market. If a company fails it is because consumers do not want to buy its products.
* Reverse the trend towards low productivity growth by making the labour market more flexible.
* Making work does not make people wealthy. The proposed cycleway will divert people from productive work to less productive work. "That is a recipe for poverty, not prosperity."
* Lower taxes across the board to encourage people to work more.
* Aim high for prosperity. Beat Australia by 2020, achieve sustainable economic growth of 5 percent a year.
* Don't protect the public sector, it should carry the cost as much as the private sector.
Prime Minister John Key will get the chance to defend the Government's policies when he speaks at the conference tomorrow.
ACT leader Rodney Hide will speak in the afternoon and the conference winds up in the evening.
