“Chris Hipkins’ first policy decision is to carry on deficit spending, continuing the petrol, RUC, and Public Transport subsidies. Carrying on spending without a plan to control Government spending is a recipe for more inflation,” says ACT Leader David Seymour.

“Liz Truss got in trouble for promising to cut taxes with no plan to cut spending. Hipkins is a mini-Truss with his plan to keep handing out subsidies on transport, with no plan to make it up elsewhere.

"If Hipkins wants the political sugar hit of giving away money with one hand, where is he going to make savings? Deficit spending in an inflationary environment is irresponsible, hardly the leadership needed in a cost of living crisis.

“Hipkins’ Government is forecast to spend $129 billion this year, up from $87 billion in 2019. The deficit this year is forecast to be $3.6 billion. Spending is 33 per cent of GDP this year, up from 28 per cent then. Five per cent of GDP is a massive increase in spending, the economy is overheated by Government spending.

“If Hipkins was any different, he would be saying, my Government can continue the transport subsidies, but we will have to make savings elsewhere. That would be honest, but Hipkins is not in this case.

“The added irony is that oil prices are low. When Labour denied there was a cost of living crisis, right before it introduced the transport subsidies, oil was over $100 USD/Barrel. Today it is down 20 per cent to less than $80 USD/Barrel. Fuel is no longer driving inflation, the problems are closer to home, but Hipkins is still fighting the last war."

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