ACT Finance Spokesman Rodney Hide said today that Reserve Bank Governor Dr Don Brash has confirmed that real wages would
be down after a year of the Labour-Alliance minority Government.
“The December Monetary Policy Statement shows inflation of 4 percent for the year to March 31 but wage increases of only
3 percent. The Governor confirmed that wage earners would be worse-off at the end of year than at the start.
“The key problems are petrol prices and cigarette taxes. These hikes impact disproportionately on low-income households.
“Comparing this year with last year, interest rates are up 23 percent, the TWI is down 13 percent, and growth is down 40
percent.
“This is a savage indictment of the Cullen/Anderton-led economy.
“The projection is for tight monetary conditions for the next three years.
“At today’s Finance and Expenditure Select Committee Dr Brash confirmed that the real issue is aggregate supply.
“The way to lift the supply of capital and labour and to improve New Zealand’s economic performance is to reduce taxes
and free up the labour market – the exact opposite of the Cullen/Anderton prescription.
“The shame is that the entire country is paying for the Cullen/Anderton failure.
“What we need is lower taxes and less red tape – not more. That’s the message in the Reserve Bank’s Monetary Policy
Statement,” Rodney Hide concluded.
END