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Incentives are important to every human being, and the way you structure them changes behaviour. Wheat prices rise, farmers grow more wheat. In an oil crisis, petrol rises. What happens? People cut inessential mileage and car pools mushroom overnight.

Ford and General Motors, after that crisis for the first time in history, begin to build fuel-efficient vehicles. Oil companies worldwide double or triple their investment in new exploration. On a global basis, that one change of incentive creates a new view of the world for millions of people and a whole new set of behaviours.

The constructive response thus liberated overcame the shortage of supply and by the early 1980s, that ancient crisis was ancient history. That's the raw power of a change of incentive.

Okay, look at the present health system. The RHA buys a certain number of operations from each hospital. The surgeons perform them. That's the end of the story. What incentive has the surgeon got to shorten the hospital's waiting list? None whatsoever.

But under ACT you'll have your own health insurance policy and your company will want you treated at the earliest stage of any disease because:

• If they don't get you treated promptly, you'll switch to another company.

• If they let your disease develop, treatment becomes expensive, that costs their company money.

• Why should the surgeon wait two years, if he can earn the money by treating you now?

Take another example:

At the moment, hundreds of youngsters bunking school are absolutely safe all day in the games arcades. Their teacher has no incentive to care. The teacher has the rest of the class to look after. But if that boy's mum has, let's say, $5,000 in her education account for her 14-year-old's education during 1994, then he's not just a dropout playing games all day. He's $5,000 worth of potential income to any school or teacher willing to reclaim him.

Pick up 40 kids like that, create a class designed to attract, not repel them and that's a $200,000 dollar income. I do not mean to imply by that example that teachers are mercenary. A lot of them would like to do a good job for the kids who're falling through the cracks. Under the present system they can't afford to do so.

Under the new system, if a good teacher wants to take that route it's not just a living; it's a viable business. Teachers can, for the first time, be real professionals, as architects, doctors, lawyers or dentists, all in the business of helping people, already are.

At a broader national level, we need the best skill we can get, and a lot of investment money, to transform the resources of this nation into competitive, profitable products in a rapidly changing world.

Where immigration is concerned, I think ACT should put a price on that. The key objective of any immigration policy must be that it benefits New Zealanders. There is no real justification for it, other than that.

Any overseas person who comes here to live automatically inherits all the benefits created by New Zealanders over the last 150 years, the roads, airports, ports, railways, schools, hospitals, city facilities, system of law and law enforcement and a thousand other costs we paid for.

We have a sensible immigration system, in that we bring in roughly the right number of people per year from a wide and sensible spread of countries. We rightly accept our quota of refugees, our Treaty obligations and play our part in reunifying immigrant families. All that should stand.

But outside those humanitarian classifications I see absolutely no reason why other immigrants should not pay an up-front charge as their contribution towards the cost of what New Zealanders have already built here, to make the lives of those immigrants fruitful and pleasant in this country.

For the average New Zealand family, ACT offers a new world where incomes in this country instead of lagging the world will match Asian rates of growth. Over 35 years, from 1995 to 2030, the difference between 3% growth and 6% is worth $510,000 in real terms, for every $10,000 of 1995 income.

I can a lot of young New Zealanders sitting down with an ACT manifesto and a calculator, when they start to think about that. ACT will give them, and every other New Zealander, the information they need to do that at our policy launch early next year.

Right now, we have 200 people trained by ACT in policy and organisation. We aim to add 50 a month to the number and have 650 of them by this time next year.

ACT will put ten or a dozen of those advocates into every electorate, responsible for 1000 to 1200 households each. They will be trained to ensure that, anywhere, anyone who wants to know how our policies affect their incomes personally, will be able to find out very easily.

National, Labour, the Alliance, ROC, the Dunne Party or New Zealand First, all those parties are variants on a single theme: 'we can spend it better than you can" and the evidence is clear that they can't. Like the young couple in that dismal house, change the light bulb and enjoy a new view of this country's future.

Ladies and gentlemen, we've a lot to do in the next two days. Enjoy every minute of it. Add your best thoughts to the ideas we've evolved over many years, and we can make this country a much better place for our children to live in.

Thank you.

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