Rob Hosking eviscerates Labour’s “alternative budget”

Rob Hosking from NBR tears apart Labour’s announced “alternative budget”:

Labour’s fiscal numbers are out – well, some of them.

Party leader Andrew Little and finance spokesman Grant Robertson today unveiled a package aimed mostly at making the party look like a fiscally responsible partner in a government which includes both the Green Party and New Zealand First.

The trouble with those numbers are, there is a strong sense of another fiscal shoe yet to drop.

It was more of a wake than a policy announcement. Once again Robbo has been exposed as lazy and out of touch.

As previously announced, Labour would cancel National’s family package announced in Budget 2017.

According to the “alternative budget” released by the Labour politicians, that reaps roughly $1.9 billion a year.

Labour also, after years in Parliament railing that National is “the most indebted government in New Zealand’s history,” proposes to push back.

It isn’t a large pushback but it will cost, according to Labour’s numbers, an extra $785 million over five years.

The claim about the extent of National’s debt was always a particularly ignorant one anyway: It is true in dollar terms, but that is meaningless because a dollar of debt in 1987 is worth rather more than a dollar of debt in 2017.

It’s only an argument you can run if either you are particularly economically illiterate or you think your audience is stupid.

However, there are some academics in New Zealand universities, who will parrot this line.

Labour does think that their audience is stupid, watch the left wing blogs as they parrot that endlessly.

Labour is committing to an extra $3 billion spending in its first year; $4.3 billion the following year, $5.4 billion the next year, and $6.7 billion in the fourth year.

That spending is linked to promises already made: There is also a line for other, unannounced spending increases, rising to $4.1 billion by the fourth year.

Oh, and it’s going to restart contributions to the NZ Superannuation Fund in its first year – mostly, it seems, because having made such a big deal about the current government cancelling those contributions until 2020, it feels it has to.

But the contributions as outlined in the fiscal numbers make a mockery of anything meaningful.

Even to keep pace with the level of contributions the Treasury worked out was necessary during Sir Michael Cullen’s time as finance minister, these would need to be at least $3 billion a year – probably more, given the 10-year hiatus since contribution stopped.

Labour is promising $500 million in the first year, $1 billion the second year, $1.5 billion the third year and then dropping to $48 million and $376 million in the next, respective two years.

In the context of the party’s rhetoric on the Super Fund, this is a joke.

Robbo is a joke. Andrew Little is going to regret keeping him on as finance spokesperson.

Oh, and Labour is going to boost wages by offering fair pay agreements, a return to centralised wage fixing by another name.

It isn’t clear, from the documents released the extent to which this is factored into the state sector wage bill.

Uh oh. Can’t wait to see the excesses of teachers, and the PSA on this.

Given state sector wages and salaries have broken the hearts and the fiscal plans of previous finance ministers – and given Labour’s electoral base is the teacher and state sector unions, it seems highly unlikely that a change of government would not see a surge in pay demands from those client groups.

The unions bought Andrew Little, now they want their pay back for their “investment”.

And none of that takes account of what its coalition partners, the Greens or New Zealand First, might demand.

All up, this is a set of numbers written in water. There will need to be some firming up before any claims of ‘budget responsibility’ can be taken seriously. 

To cap it all off they’ve announced this without the PREFU, so they have no idea what the real numbers are. Mind you they don’t care because they will just take other people’s money, like the nasty little socialists they are, to pay for all the excesses.



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As much at home writing editorials as being the subject of them, Cam has won awards, including the Canon Media Award for his work on the Len Brown/Bevan Chuang story.  And when he’s not creating the news, he tends to be in it, with protagonists using the courts, media and social media to deliver financial as well as death threats.

They say that news is something that someone, somewhere, wants kept quiet.   Cam Slater doesn’t do quiet, and as a result he is a polarising, controversial but highly effective journalist that takes no prisoners.

He is fearless in his pursuit of a story.

Love him or loathe him.  But you can’t ignore him.