Speech: David Seymour to Deloitte/Chapman Tripp/Business NZ Election Conference

Deloitte/Chapman Tripp/Business NZ Election Conference

Tuesday September 15, 2026

Hon David Seymour, Leader of ACT New Zealand

The ‘Debt’ Election

Commentators are already calling this a tax election.

As the OG No New Taxes Party, ACT, the Association of Consumers and Taxpayers, we would welcome such an election.

We can point to three new taxes we’ve stopped this term, and welcome new disciples to the church of No New Taxes. No matter what sins have gone before, or how recently, salvation lies within.

Unfortunately this won’t be the tax election, there is a bigger issue looming.

Before we can talk about tax, we must talk about debt. Tax is the bill Government sends you today. Debt is the bill it sends those currently learning their times tables, and even those not yet born.

ACT believes the real challenge facing New Zealand is how we can balance the books, fast, and sustain it, without giving in to the temptation of new taxes.

Many sacrifices have been made in the last few years with high inflation, high interest rates, and very little real growth. It’s hurt when lights at the end of the tunnel - remember “survive to ’25”? - have been snuffed out by events beyond our shores.

All the while, the Government has been running large deficits and accumulating debt.

I’m proud to be part of a Government that has slowed the spending growth we inherited and made savings so we can fund the things that matter. Our Party can point to $14 billion of savings this term, around $57,000 for each voter who gave their Party Vote to ACT in 2023. Considering it’s free to vote for us, I think that’s a good deal.

The Prime Minister has said we are doing a better job of ‘fiscal consolidation’ - saving money - than comparable countries. I think he’s right, and that is why it is so important to lock Labour and their allies out.

But, it’s like the old joke, “I don’t need to outrun a lion, I just need to outrun the slowest person it’s chasing”. That may be a good posture when a safari goes wrong, but our country should have bigger dreams for our fiscal balance. We need to aim higher than being the faster than the slowest.

The harder task is keeping the discipline year after year, making decisions that may not be immediately popular because they are right for the country in ten, twenty or fifty years. That, is how we unlock New Zealand’s potential.

The Upcoming Shock

Here is the sobering part.

Treasury’s Budget forecast puts net core Crown debt at about $192 billion. That is 42 per cent of GDP and roughly $35,000 for every person in New Zealand.

The interest bill is around $9 billion a year. The interest on debt costs more than police, courts and prisons combined. How many nurses could be employed for that bill? 72,106 on the average Health NZ salary ($125,000). We could build five new Dunedin Hospitals with the annual interest bill.

When we turn to global debt markets, again we find ourselves running from a lion. As every Western welfare state staggers into more debt, falling willingness to lend to Governments is reflected in rising Bond yields. We need to keep ahead of the pack, but we should aim higher.

New Zealand bonds broke five per cent this month, the highest in a decade except a brief period in October 2023. When the Treasury is pricing in 4.3 per cent, that is a big problem. To keep ahead of the pack we need to reduce our debt load.

Before Covid, net core Crown debt was $57.7 billion. Today it is more than three times that.

Covid, the 2023 cyclones, the Canterbury earthquakes, the GFC. Every crisis we borrow, but we don’t pay it back. Every crisis seems to set a more perilous baseline.

Before Covid, core Crown spending was about 28 per cent of GDP. Today it is 32.6 per cent. Treasury says around 60 per cent of the current operating deficit is structural. That means most of the deficit will not disappear just because the economy recovers.

This Government has slowed the problem. It has not yet stopped it. Under the current Budget forecasts, net core Crown debt rises to $246 billion by 2030.

An earthquake does not wait until the books are balanced, nor does a global financial crisis, a pandemic, an oil shock, or some new crisis we can’t anticipate just by looking at the last two decades.

In the 1990s, New Zealand demonstrated that resilience. Years of smart fiscal policy took our net core Crown debt from 55 per cent to just 5.4 per cent by 2008. Critics called it ‘austerity.’ It goes to show how much politics has changed. If Helen Clark and Michael Cullen were to reappear in the Labour caucus today, they’d be expelled. Meanwhile the usual suspects still cry ‘austerity’ when debt is 42.5 per cent.

We are entering the next unknown with far less room to move.

The Slow-Moving Crisis

Then there is the slow-moving crisis we can already see coming.

Our population is ageing. People are living longer and having fewer children. The ratio between the people paying most of the tax and the people drawing retirement income is shrinking.

Treasury’s latest Long-term Fiscal Statement says there are about four working-age New Zealanders for every person over 65 today. By 2065, there will be about two.

On unchanged policies, the cost of New Zealand Super rises from about 5 per cent of GDP today to around 8 per cent. Health rises from about 7 per cent to around 10 per cent.

And if nothing changes, Treasury predicts, government debt will be towards 200 per cent of GDP by 2065, when children born today are well into their careers.

Treasury is careful to say that is not a prediction. Of course it is not. No sensible future government will let it happen. The question is whether the changes we make will be planned, or forced on us by the bond markets.

We need a serious conversation about retirement income. This could mean gradually increasing the age of eligibility for New Zealand Super by two months each year until it reaches 67.

Someone already retired would see no change. Someone who is 64 would wait only two months longer. Younger New Zealanders would have decades to plan a two-year adjustment.

This would be a gradual change, signalled well in advance. ACT has engaged top quality pollsters from London for this campaign. They tell me, whatever you do, don’t talk about Superannuation again.

I’m a Kiwi and I cannot stand by and watch our country face the kind of fiscal crisis building in the U.K. I’d rather tell the truth and rally my fellow New Zealanders to support an intelligent response to the issues we face, than weasel my way through another three years.

It Starts at the Top

So, where do we start? Government cannot ask New Zealanders to make responsible choices while refusing to reform itself. If we want to balance the books, we need to start at the top.

It took political courage for Sir Roger Douglas to remove agricultural subsidies and tell farmers they would have to compete in the real world. It was controversial. Today you would struggle to find a farmer who wants to go back.

We should apply the same principle across the economy. End the slush funds, grants and subsidies that take money from successful businesses so politicians can give it to businesses they prefer.

And reform Government from the inside so it is smaller, more efficient and able to stand the test of time.

After nearly three years inside it, I can tell you Government is much crazier than I realised.

New Zealand has 267 regulatory bodies, 39 government departments, 28 Ministers, and two Under-Secretaries. We are a country of five million people.

Norway has 17 departments and 20 ministers. Ireland has 18 departments and 15 ministers. Singapore has 16 departments and 18 ministers.

You cannot convince me New Zealand needs an executive of thirty. It is a Cabinet, not a touring rugby squad.

ACT will campaign for a Cabinet of 18 Ministers and 19 departments. This will cost taxpayers less money and save them time. It is not that we’ll save a dozen Ministers’ salaries, although that will help. It is that we will change what it means to be a Minister.

At present one department answers to 23 Ministers. One Minister has 10 portfolios. The number of connections is staggering. In total there are 82 portfolios. No wonder the Government has made hard work of saving money, it’s never clear where the buck stops.

What it means to be a Minister needs to be redefined. Someone who is responsible for one department, and the only person responsible for that department. A Minister’s job should be to get value from a Budget for delivering specified services.

They should be able to fire the Chief Executive. Some people will bristle at Ministers having that power, but if we don’t believe elected officials should have that power over the unelected, then we are not democrats. The people have a right to demand effective change through elections, and we don’t get that when everybody and nobody is in charge.

We will take a simple proposition into coalition negotiations for fewer Ministers, fewer departments, clearer accountability and lower costs.

Happier Days Ahead

There is no reason New Zealand should not be the happiest, healthiest and wealthiest country on earth.

We live on stunning islands rich in natural resources. We are a democracy governed by the rule of law. New Zealanders are entrepreneurial, practical and decent. We have every ingredient required to succeed.

What we lack is a government willing to consistently live within its means and get out of the way of people who create wealth. But ACT wants to change that.

ACT’s goal is to keep the Government and make it better. We went into Government, but we never went into groupthink. Our job is to be the squeaky wheel saying where the Government must go further and faster.

That means ending Government waste and cutting red tape so businesses are free to flourish. That is the prescription to return the books to surplus and rebuild the buffer for the next shock.

And we can do it with no new taxes. That is how we unlock New Zealand’s potential.

I’ll have a lot more to say when ACT releases our alternative budget in coming weeks, but for now let me leave you with this. It is critical the Government does not levy new taxes, but for the future of our country it must balance the books, too.