Hon Steven Joyce
Associate Minister of Finance
11 August 2014 Media Statement
Labour spending up to $17.9 billion
Updated figures today show that Labour’s election-year spending spree is now up to almost $17.9 billion over four years
– and counting, Associate Finance Minister Steven Joyce says.
“Labour’s own numbers show spending promises to date of $16.4 billion over four years,” Mr Joyce says.
“However, they have woefully underestimated the costs of introducing compulsory KiwiSaver, dismantling the electricity
sector and paying a 12.5 per cent R tax credit.
“For example, Labour claims to be bringing 500,000 extra people into KiwiSaver from 1 October 2015, and would be paying
them a tax credit that averages around $370 a year plus a $200 a year kick-start for the first five years. A simple
calculation shows that the cost of this must be approaching $250 million in the first year, rather than $141 million as
Labour is claiming.
“It’s interesting that Labour’s costing of exactly the same policy in 2011 was more than two-and-a-half times higher
than it is now in 2014, so it looks like they’ve cut a few corners this time around.”
Mr Joyce says when you put more realistic costs on these policies it takes Labour’s numbers to $17.9 billion over four
years.
“More will be added to this bill as Labour makes more desperate promises – and that’s not counting the big spending of
their prospective coalition partners the Greens,” Mr Joyce says.
“Labour is making very big spending commitments despite New Zealand being yet to post its first surplus since the GFC
and the Canterbury earthquakes.
Kiwis will recall Labour’s previous big spend-up in the late 2000s. It left us with a large Budget deficit and pushed up
interest rates and the cost of living for households and businesses across the country.
“The New Zealand public will see Labour’s spending plan for what it is – reckless.”
ENDS