INDEPENDENT NEWS

Government, not quake, caused greatest deficit in history

Published: Mon 28 Mar 2011 01:02 PM
Hon Jim Anderton
Member of Parliament for Wigram
Progressive Leader
28 March 2011 Media Statement
Government, not quake, caused greatest deficit in history
Claims that the ‘biggest budget deficit in history’ are all a result of the Canterbury earthquake are untrue and designed to conceal the devastating effects of last year’s bad economic decisions, says Christchurch MP Jim Anderton.
John Key told TVNZ today that the May 19 budget will include the biggest deficit in history "Mainly because of the cost of the rebuild and recovery in Christchurch. “We need to pay for the earthquake, it’ll get booked to the account straight away," he claimed.
But Jim Anderton says the Prime Minister's claims are untrue.
“The National Government is myth-making. Even Treasury said in its update that two thirds of the deficit was happening before the second earthquake hit. The recession was caused by the National Government, not by the earthquake.
“The earthquake is expensive, but the economy was already deeply in the red when the earthquake hit.
“That’s because the Government’s so-called ‘tax switch’ last year was not revenue neutral as it claimed. In fact it has given billions of dollars more to top earners than we could afford.
“To now blame Christchurch is an insult to the hardworking people who are trying to put the city back together.
"Nor is there a reason to take much of the entire cost of the earthquake in a single year. No one expects the rebuild to be completed in a year. The Government hasn’t even got temporary accommodation underway from the first earthquake, when Japan is already building hundreds of temporary homes within weeks of its quake. For John Key to then claim that this inaction is causing great expense is simply untrue,” Jim Anderton said.
ENDS

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