This Government inherited a very strong economy when they took over the Treasury benches in October last year and its natural that Treasury’s economic growth forecasts are still at the more optimistic end of the spectrum. However, independent commentators are more cautious about the economy’s growth over the next few years.
I believe that Labour’s over-promising during the election campaign has actually been rescued by New Zealand’s growing economy.
The Budget is all about borrowing more, taxing more and spending more. Net core Crown debt is $10.8 billion higher than expected under National. Despite promising no new taxes we find ourselves with regional fuel tax, fuel excise, GST on online purchases and brightline extension.
I think some of the Budget spending choices are very poor. For example, $900 billion over four years for diplomats, foreign affairs and a brand new embassy in Stockholm, $2.8 billion for first year fees free tertiary education (which has yielded 900 less students year-on-year) and a $3billion over three years Provincial Growth Fund which is quickly looking like a slush fund because nothing of substance is evident for regions.
Spending is the easy part. Governing is about delivering New Zealanders the public services they need and getting better results – more police on the beat, more operations in our hospitals, and our kids doing better at school. There is no sign this Government has any understanding of that approach.
The big thing missing in this Budget was any meaningful help for Kiwi workers. In fact middle-income families are steadily becoming worse off, with the cancellation of National’s tax changes and the coming big increases in fuel taxes that will take petrol and diesel prices to record levels.
But the most frustrating oversight in Grant Robertson’s budget is any plan to keep our economy growing and developing. In fact it’s quite the opposite.
This is a hugely disappointing budget of little imagination from a Government that is borrowing more, taxing more and spending more – but has no plans for how we as a country can earn more.
I am interested in hearing how the Budget affects you, so please continue to contact me with your feedback.