A Bud­get of poor choices

The Press - - Opinion -

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.

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