“COVID-19 will require the Government to stop the gesture politics, put its damaging policies on hold and cut taxes”, according to ACT Leader David Seymour speaking today on the Budget Policy Statement.
“The projections in the Government’s Budget Policy Statement are now worthless. Economic conditions will get worse before they get better. Sharemarkets are tumbling. Business and consumer confidence have taken a severe hit. BNZ is now predicting a recession and higher unemployment.
“ACT has always maintained that Jacinda Ardern is the world’s best political marketer, but the worst public policy deliverer. The Prime Minister is likeable, but she has not been effective.
“The Government’s Budget Policy Statement is symptomatic of this approach. None of the themes in the Budget Policy Statement – ideas like improving ‘wellbeing’ or a just transition – will get us through the coming crisis.
“The Government inherited good economic times. That meant its feel-good policies have done less damage than would otherwise have been the case. But the good economic times are over. We can no longer afford nice-sounding but counterproductive economic policies.
“The Government must first do no harm. That means ending its damaging policies.
“A higher minimum wage, the Zero Carbon Act, freshwater reforms and new tenancy laws must be put on hold while we grapple with the economic impacts of COVID-19.
“All of these measures add cost, risk and uncertainty to the economy at a time when we can least afford it.
“The Government must also cut wasteful spending and tax. Splurging $5.6 billion on Fees-Free and the Provincial Growth Fund was bad enough in good economic times. Those programmes need to go.
“One way or another, the Government will go into deficit as it attempts to stimulate the economy, but spending more isn’t the right approach.
“ACT also proposes to allow every worker and business to keep more of what they earn, with lower tax rates across the board:
• 10 percent on income under $14,000
• 15 percent on income between $14,000 and $48,000
• 25 percent on income above $48,000
• 25 percent company tax rate.
“Cutting taxes will help to promote economic growth at a time of great uncertainty.
“If the Government is serious about mitigating the worst economic effects of coronavirus, it will enact a mini Budget, and cut taxes and wasteful spending, as soon as possible. New Zealanders cannot wait until May.”