People are not there to give factories a market. Factories are there to give people the goods they want. Producers justify their existence by serving the needs and interests of the consumer. When they fail to do so, they quite rightly go out of business.

The pressure of personal choice on supplier systems is the best way to ensure that producers and providers extract maximum value from the resources they use. Nothing produces that outcome faster than finding that your customers or clients are voting with their feet for some rival supplier who is willing to do a better job of satisfying their personal needs.

The best safeguard for consumers against abuse or exploitation is the right to personal choice. If people have the opportunity to make their own free choice among competing suppliers whose livelihood depends on satisfying them, they will be safe from exploitation. But wherever the Government allows or licenses monopoly interests and allows them to prevail without threat of competition, then no amount of regulation or conscientious bureaucratic and political intervention will protect them successfully.

Opportunity for personal choice is therefore not merely central to the well-being of the individual. It is equally fundamental to the health and progress of the economy, society and the nation. ACT seeks to widen the opportunities of ordinary people for personal choice wherever practicable, in both the economic and social spheres, so that they have the power in their own hands to see that their needs will not be ignored in future.

The principle of tough love applies, a fortiori, to social welfare: Do what is right in the interests of the child's long-term growth and development, even if the child, through immaturity, does not immediately welcome it. The state, in giving help, should have the same aim as every caring parent not to make people dependent, but to help them become competent, reliable, self-reliant, contributing citizens.

The disadvantaged are worse off than other people because they lack skills, information, motivation and incentives to achievement. In their present condition, they are vulnerable to social and economic pressure and find it hard to survive without help. 1f the help we give locks them into dependency, then we make that vulnerability a permanent condition.

Ending the vicious cycle of dependency is critically important to them and everyone else. The disadvantaged need access to education, health care, housing and benefits that guard them against emergency, adversity or disability But forced education where they learn nothing, life on a benefit, or unproductive, dead-end jobs just perpetuate their problem.

Scope for constructive personal choice is basic to the dignity of human beings. It is just as important to them as it is to us. The most painful feature of disadvantage is not just lack of money it is lack of the human choices that other people take for granted. Equity matters to them not just as individuals, but also to ensure a better life later for their children and grandchildren. Because their motivation is low, they need incentives more than other people, to lift their morale towards personal achievement.

Jobs are the foundation of personal and family security. Growth is what safeguards the whole system of social provision. Policies that foster growth and share the rewards fairly are the biggest contribution we can make to help disadvantaged people. When policy sacrifices long-term growth prospects to deliver short-term palliatives, the outcome hurts everyone in society, but it hurts the disadvantaged most severely in the longer term.

The Centre-Right is often portrayed as putting heartless efficiency ahead of equity, but tolerating inefficiency is the most heartless thing a government can do. Without efficiency, improved equity is impossible to achieve. Waste consumes resources otherwise available to improve equity. Even the existing equity level comes under threat.

Some people get confused because everybody involved in wasting resources collects a rent, dividend or pay packet, and suffers a loss through reform. But those rents are at the expense of the whole community. Eliminating the waste necessarily reduces the employment and pay packets of those involved in producing it. People and money and physical resources are forced to relocate in activities of more benefit to the community.

But it is nonsense to pretend that such a change in the status quo for them is a reduction in the overall levels of equity in the community. The interest groups who make that argument are stating a case for gain to them at the expense of everyone else's well-being.

The key lessons learned by the OECD in the past 30 years about achieving successful structural adjustment for growth can be summarised as follows:

In an era when a new left-wing coalition has taken New Zealand back to the old practice of using public money to fund groups selected by politicians to entrench their own electoral advantage, we need to be very clear about who benefits from such privileges.

The benefits are always concentrated in the hands of well-organised vocal groups. So the winners have a large interest in defending their privilege. They object violently if anyone threatens their "rent". It is a mistake, moreover, to imagine that the only people who benefit from state privilege are capitalists or companies. Staff and unions in privileged sectors pick up a share of the rent paid at the expense of the rest of the community.

The cost of any particular privilege, per consumer or per taxpayer, is unlikely to be critical as an annual payment. But the hidden costs of the total privilege system are large and very damaging to the output and jobs potential of the economy. Moreover, costs accumulate over time. Finally, everyone suffers, even the recipients of the privileges. But the burden at every stage falls heaviest on the employment and incomes of the most vulnerable and least privileged groups. They are even less articulate and less organised than consumers or taxpayers in general, and incapable of defending themselves.

Governments acting on their behalf must recognise that they will be opposed, tooth and claw, by well-organised interest groups. Strong leadership, clarity of objectives and priorities, and good communications are crucial in achieving equity gains. Otherwise the rhetoric of the interest groups will dominate public understanding. Because our ideas have more to offer than other parties, we need credibility more, not less, than they do.