David Seymour
ACT Party Leader
Fresh from the news that Labour wasted $531 million on expiring Rapid Antigen Tests, the interim financial statements for May show a Government in serious fiscal trouble.
Previously damning forecasts can’t keep up with Grant Robertson’s fiscal incompetence. Looking at today’s interim financial statements, we can add an extra $2 billion to the projected deficit that was forecast at budget time.
The interim financial statement covering the eleven months to May 31 this year forecast a $6.5 billion Government deficit, up from only $4.4 billion that was forecast at budget time. This is significant because the budget time forecast for the full year was a $7 billion deficit. Logically the deficit for the year will now be over $9 billion.
The main reason for the growing deficit is slowing company tax receipts. The economy is bad, and Robertson’s irresponsible policies are finally affecting his own books.
A $9 billion dollar deficit this financial year would come on top of a $10 billion dollar deficit last financial year. What will happen next year? Well, the Treasury’s forecast was for a $7.5 billion deficit next financial year, has it risen, too?
Could Grant Robertson be responsible for borrowing $30 billion in the three years post COVID? If he isn’t he’ll be very close to it, and either way the next generation will pay the costs.
Robertson will go down in history as the most irresponsible Finance Minister since Muldoon.
Despite all this borrowing, the economy is bad, bad, bad. We are in recession, inflation remains high with 12.1 per cent increase in food prices over the last year, mortgage rates rose as recently as yesterday, and confidence is low in nearly every sector.
The real problem is productivity. There is not enough production in New Zealand to satisfy New Zealanders’ living standard expectations, so the Current Account Deficit is 8.1 per cent. The last three quarters have seen the largest current account deficits on record. When a Kiwi spends $11, one of those dollars is borrowed overseas.
The solution is to cut the waste. Start running Government with a simple question for every department and activity. If we didn’t already do this today, could we justify starting it tomorrow? If the answer is no, then stop. The next Government must cut bureaucracy that produces no value, it is wasteful.
Only when Government starts to tighten its belt will pressure come off inflation and mortgage rates. Only ACT has published a fully costed alternative budget that would do just that. We’d cut $9.5 billion per year in wasteful spending, and $9 billion per year in taxes, reducing the deficit and your tax bill. A person on the average wage of $78,000 would keep $2,200 more of their own money each and every year.
Taxpayers need real change, back from reckless Robertson’s unsustainable splurge, only then will life become affordable again.
