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Summarised by Centrist
A Treasury briefing has laid bare the scale of Labour’s overspending during the COVID pandemic, revealing a $66 billion cost over six years.
This is equivalent to 20 percent of New Zealand’s GDP.
The report warns that the previous government’s uncontrolled spending spree has left the country saddled with soaring debt and weakened its ability to respond to future crises like natural disasters and biosecurity threats.
Despite early advice from Treasury officials to limit stimulus and focus on targeted support, Labour repeatedly ignored warnings, pushing broad spending programmes far beyond the pandemic’s immediate needs. Treasury identified nearly half of the fiscal response as unrelated to Covid-19, including lavish investments in infrastructure projects, welfare increases, and “shovel-ready” schemes that have proven difficult to unwind.
National’s Finance Minister Nicola Willis described the briefing as “damning,” accusing Labour of saddling New Zealanders with the ongoing consequences of an “extended big-spending approach” that was never intended to last. Willis criticised the “very diplomatic” language of the report for understating the damage done.
The briefing calls for clearer rules on government fiscal policy, recommending pre-defined spending plans, cross-party agreement, and independent watchdogs to prevent future fiscal irresponsibility.
Labour has yet to respond.
