Grant Robertson.

Labour finance spokesman Grant Robertson wasted no time yesterday taking aim at the Government’s financial performance after economic growth figures came in lower than expected.

The second quarterly fall in gross domestic product (GDP) per person growth showed the need for a fresh approach to give all New Zealanders a fair share in prosperity, he said.

Statistics New Zealand figures showed GDP rose 0.5% in March, following an increase of 0.4% in December.

Much lower building activity, combined with mixed results for the service sector, took the shine off higher dairy production. That meant a second quarter of moderate overall GDP growth, national accounts senior manager Gary Dunnet said.

At an industry level, 11 out of 16 industries increased in the quarter. Agriculture and retail trade had the largest increases. Construction was significantly down.

GDP per capital decreased 0.1% in March following a 0.2% fall in the December quarter, he said.

Annual GDP growth for the year ended March was 3% and the size of the economy in current prices was $265 billion.

Mr Robertson said National was asleep at the wheel after nine years in Government.

"The economy is going backwards on a per person basis, the export sector is in recession and, now, construction is falling, too.

"Relying on population growth and an overheated housing market to prop up the economy is a dangerously complacent approach."

The fall in the construction sector was particularly worrying, he said.

There was already a shortage of 60,000 houses and that was growing daily. Houses were needed more than ever but building sector activity was shrinking.

The complete failure to address the housing crisis was National’s biggest economic legacy, Mr Robertson said.

Finance Minister Steven Joyce said the moderate GDP growth during the past six months was a reminder every economic gain was hard won in what was still a challenging international environment.

"This is not the time to rest on our laurels and start considering policies that would damage growth in key sectors or across the economy."

The GDP figures followed on from Wednesday’s release of New Zealand’s external accounts for the March year, which showed a current account deficit of 3.1% of GDP, the same as the March 2016 year.

ANZ senior economist Philip Borkin said the GDP result was well below consensus expectations and the Reserve Bank’s forecast of 0.9% and represented only a mild rebound from the soft end to last year.

Mr Borkin acknowledged the poor growth in per capita terms but took a more sanguine view.

Migrants, the key driver of population growth, did not instantly slot into the economic system. Like any worker who started a new job, they took time to fit in and deliver added value.

The disruptive impact of natural disasters should also not be discounted when viewing the economy’s disappointing productivity performance, he said.

Hours worked contracting in the first quarter implied productivity growth did post a "decent bounce".

"Stepping back, although the headline result is a clear disappointment, we don’t believe it is a true reflection of growth momentum across the economy at present."

The lack of reaction on the part of the New Zealand dollar to the figures suggested the market was taking a similar view.

Importantly, putting aside the historical nature of March’s figures, forward indicators remained positive overall, he said.

Despite a backdrop of softer housing activity, difficulties finding staff and increasing capital constraints, momentum was likely to accelerate in the quarters ahead to a rate that would continue to eat into spare capacity.

The figures allowed the Reserve Bank to remain cautious and watchful, Mr Borkin said.

At a glance

• Economic growth slowed again in March.

• Agricultural production rose by 4.3%.

• Poor growth in per capita terms highlighted.

• Forward momentum expected to be strong.