The two politicians vying to be Aotearoa's next Finance Minister have re-written each other's fiscal plans, as the tit-for-tat over tax continues.
Labour's Finance spokesperson Grant Robertson claims his party's evaluation of National's fiscal plan found it'll require over $3 billion in cuts to the public service every year, "a third more than accounted for" in National's plan.
Meanwhile, National's Finance spokesperson Nicola Willis says her party's analysis of Labour's fiscal plan shows an "endless debt spiral", which it partly blames on a "blowout" the party found in Labour's "absurd policy of removing GST from fruit and vegetables".
Willis created 'Labour's real fiscal plan', and Robertson created 'Honest National Party Fiscal Plan', as both parties worked to discredit each other.
Labour's Robertson claims the hole he's identified in National's plan "means they need to cut far more than they have admitted".
"This will result in deep cuts to jobs and the services New Zealanders rely on."
Robertson's findings
- National’s policies would require more than $3 billion in cuts every year
- This would require an increase in baseline cuts from 6.5 to 14.3 percent
- 6000 job losses nationwide
- More kids in poverty, removing $2000 from the most vulnerable children by the end of a first term
- In contrast, landlords are set to receive $6000 a year on average in tax cuts.
Roberston said National had "40 days" to explain how their plan stacks up and that there's "only one explanation why they’ve chosen not to do so: It simply does not add up".
“Three of National’s major costing assumptions have now been blown out of the water, along with the remaining fig leaf of their financial credibility, and the sheer scale of cuts to make their plan add up are laid bare for the first time."
Robertson said a wealth of expert analysis has confirmed that revenue from National's foreign buyer tax is a "tiny fraction of what it needs".
"Independent analysis shows this leaves a $530 million per year hole," Roberston said.
"It’s widely accepted that its gambling tax is a worthless gimmick, (leaving a $132 million a year hole)."
“This true picture of costings will require cuts to public services of up to $3.1 billion a year. That’s nearly a third more than the $2.3 billion in cuts National initially claimed, with additional cuts of $716 million in 2024/5, then $743 million, $780 million, and $798 million in subsequent years."
Roberston said the extent of the cuts he's found "will have a massive impact on front-line services, which would be devastating for hundreds of thousands of families and businesses up and down New Zealand, leaving them worse".
“That’s on top of losing fully-costed free and half-price public transport, free prescriptions and ECE subsidies Labour has already delivered or is committed to – and financial support for sole parents, sickness beneficiaries and to keep kids out of poverty.
National fires back
Willis says Aotearoa will face the prospect "of never-ending deficits" and Government "debt rising forever" if Labour is re-elected to power.
Willis said her party's "corrected version" of Labour's fiscal plan fixes "errors in the original", including "a blowout in the cost of Chris Hipkins’ absurd policy of removing GST from fruit and vegetables, a woefully under costed dental policy, and the failure to account for Labour’s proven track record of overspending its budget allowances".
Willis's findings
- The real costs of Labour's GST and dental policies - an extra $736 million over four years
- Labour's track record of blowing its budget operating allowances $600 million per year each Budget
- Permanent deficits, with the books never getting back to balance
- Debt blowing out by $7 billion by 2027/28 and an endless debt spiral.
“Treasury has warned that Grant Robertson has blown his spending allowances by an average of $600 million a year because he is simply unable to maintain fiscal discipline," Willis said.
“This paints a bleak picture for New Zealand’s books, with debt rising every year and the Crown accounts never getting back to surplus. By 2027/28 debt would be $7 billion higher than in Labour’s uncorrected fiscal plan."
Willis claims Labour has "failed to set aside" funding for over $50 billion of policy commitments including Auckland and Wellington Light Rail, Lake Onslow, and the cost to the government of Labour's income insurance scheme.
“The only way Labour and its likely coalition partners will pay for all of their spending promises is obvious: taxes. Labour loves tax like a shark loves blood and the Greens and Te Pāti Māori have said new forms of taxes are bottom lines for coalition negotiations," Willis said.
She added Roberston's claims surrounding National's fiscal plan "are just not credible".
"National’s tax policy and fiscal plans have been independently checked by external experts and found to be cautious and consistent."
