“The Deputy Prime Minister ran out of water at post-cab and the Government is out of its depth managing the economy. Today the Government put sticking plasters on the hard facts, life is becoming less affordable due to their poor economic management,” says ACT Leader David Seymour.
“The fuel and public discounts will end this week, while prescriptions will become free of charge, yet the underlying facts are hard.
- Inflation has been over twice the 2 per cent target for two years, currently sitting at 6.7 per cent. Prices keep squeezing New Zealanders
- The economy is in a technical recession that feels more real each month. Jobs feel less secure as businesses see worse support
- The Current Account Deficit just had its worst three quarters since records began in 1988, one out of every eleven dollars spent by a New Zealander is borrowed overseas
- Floating mortgage rates at 8.37 per cent are the highest in fifteen years, since the Great financial crisis
“The Government’s response is not credible. Where it needs to reduce spending, it is borrowing $7 billion this year and $7.5 billion next year. The best it can do is boost foodbanks by $6 million. For context that is enough for 30,000 families to buy one week’s shopping of $200.
“And yet, Government spending is adding to the inflation problem. It is spending more and more money for no outcomes. I asked Grant Robertston what improvements in services the Government has delivered for a 25 per cent increase in real per capita spending. Spending more and producing less is inflationary.
“The fuel and public transport subsidies were temporary and political solutions to a long-term economic problem. Their removal was inevitable and will have an equal and opposite effect on the consumer as their addition.
“The Government is not remotely realistic about the cost-of-living crisis faced by Kiwis, or its own role in creating it. The sticking plaster solutions and their inadequacy only highlight how out of touch this Government is with reality.
“Only ACT has produced a fully costed Alternative Budget that would reduce Government expenditure by $38 billion over four years, and taxation by $36 billion. This would take pressure off inflation, and give working Kiwis serious cash to deal with the price increases they’ve already faced."