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Labour Running Out Of Foreign Excuses For Inflation

Published: Tue 18 Oct 2022 10:44 AM
“The makeup of tradeable and non-tradeable inflation figures out today show that Labour can’t keep blaming the rest of the world for inflation,” says ACT leader David Seymour.
“Last quarter tradeable inflation was 8.7 per cent and non-tradeable 6.3, for an all-group inflation rate of 7.3 per cent. Today’s all-group rate of 7.2 per cent is slightly lower thanks to tradeables such as petrol getting cheaper, but non-tradeable inflation has increased to 6.6 per cent.
“For a long time Labour has said inflation isn’t its fault, blaming overseas factors. Now that inflation of tradeables, things that can be bought and sold overseas, is easing, the attention turns to non-tradeable inflation, which is going up.
“In today’s figures inflation is down because tradeable inflation is down. Largely because the price of oil is down. If Grant Robertson wants to take the credit, he need to explain how the New Zealand Government lowered the price of a barrel of Brent Crude.
“On the other hand, the Government is completely responsible for non-tradeable inflation. Things that are not bought and sold overseas, such as medical costs, housing, and hospitality are affected by domestic conditions, such as Government spending and monetary policy.
“The Government is entirely responsible for local conditions. This is the Government that indemnified the Reserve Bank after its insistence on a dual target helped encourage irresponsible monetary policy.
“The Reserve Bank distorted government policy making by giving it cheap credit, now we are all paying the cost, literally in the rising price of everything.
“There’s always a human cost to this sort of economic mismanagement, and sadly we are seeing it play out across New Zealand households as families decide whether to pay the rent or buy food. This is evidenced by Kidscan needing to feed 10,000 more hungry students than it was at the beginning of the year.
“The Government has to take responsibility for its policies, namely its spending, its Reserve Bank legislation and appointment of Adrian Orr, its long closure of the border and its expensive ideological experiment called the ‘immigration reset.’
“The next government will need to clean up Labour’s mess with sensible economic policy, restore credibility to the reserve bank, and rebuild the faith of the world with a welcoming immigration policy. These ideas and more are laid out in ACT’s paper New Zealand’s Cost of Living Crisis.”

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