A Budget of poor choices
Today Finance Minister Grant Robertson will present his first Budget – and he has certainly raised expectations for what it will deliver for New Zealanders. The Ardern-Peters Government inherited a strong economy with record new job creation and rising surpluses. But it wasn’t satisfied, and so plans to borrow an extra $10 billion, and impose $2.2b of extra taxes, in order to fund its extravagant promises.
What we’ve already seen of the spending it has announced shows it hasn’t got its priorities right.
It has promised $1b for foreign affairs – putting diplomats and foreign embassies ahead of doctors’ visits and rescue helicopters.
It is pouring billions into new untargeted programmes such as a year’s free tertiary education, a baby bonus and a winter energy payment – providing subsidies to people like me and my family rather than targeting it at those most in need.
That big-spending mentality means that, despite all the extra cash from borrowing and taxing, Labour is still finding it hard to meet all the excessive expectations it and its coalition partners have built up with voters.
Spending is the easy part. Governing is about New Zealanders getting the public services they need – more cops on the beat, more operations, and more of our kids doing better at school.
So far we have seen the Government look to blame everyone else for the promises it will break.
Broken promises such as no new taxes, universal cheaper GP visit in July this year, 1800 additional frontline police this term, 16,000 ‘‘affordable’’ Kiwibuild homes in the first three years, and the list goes on.
Borrowing more and taxing more in strong economic conditions makes no sense and risks undoing all the hard work New Zealanders have done over the last few years.
The Government has talked a lot about lifting people’s incomes, but not only does it refuse to let people keep more of what they earn, it is actively taking more cash out of people’s wallets.
If you just take the petrol tax increases, the new regional fuel tax, the five-year bright line test and the Amazon tax, then you have Kiwis paying around $2.2b more in tax over the next four years. And of course the Government also cancelled National’s planned tax cuts, which would have made an average income earner $1060 a year better off.
This is real money being hoovered out of the pockets of New Zealand families.
Ahead of the Budget, Labour continued its political attacks against the previous government.
The reality is National made big investments every year into health and education. Last year alone we increased health spending by $880 million a year – the highest increase in 11 years.
It’s clear that not only is this Government wasting the opportunities rising surpluses present, it has no plan to grow New Zealand and is on track to slow it. Independent economists are already saying GDP growth could halve in 18 months.
This Government has choices. It will have some serious explaining to do if it fails to meet its lofty promises or presents watered-down versions of its commitments.
National would continue to invest in health and education with a focus on getting results. What we wouldn’t do is increase debt and add more taxes on hard-working New Zealanders.