“A recession is when your neighbour loses their job. A recovery is when Chris Hipkins loses his,” says ACT Leader David Seymour.
“Today’s GDP figures mean that even with Grant Robertson irresponsibly putting the economy on Afterpay with $7 billion borrowing this year, New Zealand has been unable to avoid a recession. It's buy now, pay next generation, but the economy is shrinking anyway.
“Grant Robertson’s buy now, pay later approach of flooding New Zealand with borrowed money is condemning future generations of New Zealanders. Part of Robertson's grand illusion is an Afterpay economy, but it couldn’t hide the facts that have led to New Zealand’s weakened economy:
- Government spending next year will be 79 per cent higher – or $137 billion – than when Labour entered government
- Net core Crown Debt has increased by $92 billion since Labour took office, according to Treasury’s Budget Economic and Fiscal Update
“Meanwhile Australia is seeing growth in their economy. Last year, 28,000 Kiwis permanently moved to Australia. New Zealand risks people being its greatest export. Who can blame them when the Australian median wage is $23,403 more than the Kiwi median wage. Five years ago, it was $17,422.
“At the core of the problem is low productivity. Too much Government waste, too much red tape and regulation, means too much compliance time and not enough productive time. New Zealanders expect first world living standards, but the economy under Labour doesn't produce them, so Kiwis borrow the gap between a second world economy and first world living standards.
“The next Government needs to raise productivity and wages, make the government’s books sustainable, and create a culture where work, savings, investment, and innovation are rewarded. A fiscally-responsible Government can take the pressure of inflation and let Kiwis keep more of their money through tax cuts. All that is needed is a bit of political fortitude.
“The growth in the economy that New Zealand needs is strangled by too much regulation and red tape. ACT will get rid of it, whether it’s RMA regulations making it too hard to use land and discouraging investment, productivity-sapping workplace relations laws making it impossible to employ staff, or banking laws like the CCCFA that make it too hard to get finance.
“ACT has a fully costed tax cut package that is built on aspiration for New Zealand. We would cut wasteful spending by $38 billion without touching frontline services, and cut taxes by $34 billion over four years. These savings will put the Government’s books back in the black straight away, taking pressure off inflation.
“For a strong economy we need to create conditions for prosperity, the opportunity for people to get ahead. ACT would let people keep more of what they earn with a two-rate tax system – 17.5 and 28 per cent. If you’re a nurse on $70,000, our tax cuts let you keep $2,500 more a year.
“New Zealanders need not just an economically literate Government, but a Government that offers a vision of real change. Right now, ACT is offering that.”