Barbara Edmonds’ déjà vu economics will deliver rent hikes and a debt crisis

“Labour Finance spokesperson Barbara Edmonds has offered New Zealand big promises, old mistakes, and no ideas on how to pay for anything. Her déjà vu economics are a recipe for rent hikes and a debt crisis,” says ACT Leader David Seymour, responding to Edmonds’ interview with the Herald published this morning. 

“On pay equity alone, Labour is talking about restoring a regime Treasury costed at $12.8 billion over four years, yet Edmonds still can’t say where the money comes from. She may be able to fool herself, but she won’t fool the debt markets, and one way or another New Zealanders will pay. We’re just left to wonder whether it will be through higher interest rates, higher taxes, cuts to services, or a combination of all those.

“Then there’s housing. Rents are actually down under this Government because a punitive tax on the rental sector was removed. Edmonds apparently wants to recommence the war on landlords by banning interest deductibility again. Labour’s policy is a tax on rentals that will be paid by renters. Restricting interest deductibility will squeeze household budgets, leaving less for food on the table.

“Edmonds is also teasing the return of the Reserve Bank’s dual mandate, or in other words, taking the Bank’s eye off the inflation ball. Grant Robertson already tried this, and New Zealanders remember what came next: inflation spiked as high as 7.3%. Meanwhile, Barbara Edmonds is running on déjà vu economics.

“Most telling of all, Edmonds still won’t accept the basic reality that too much money was printed during Covid. If Labour won’t acknowledge what went wrong, they’re not capable of making the hard decisions to stop it happening again.

“New Zealand risks drifting into the second tier of developed economies, and Labour would speed up the decline. ACT will pull us out of it, by making the bold choices needed to restore affordability, reward work, and unleash productivity.”