Treasury’s pre-election economic forecasts show that six years of Labour’s economic mismanagement has taken a toll on
New Zealand, with forecasts showing a sustained economic slowdown, high inflation and high interest rates, National
Leader Christopher Luxon says.
“Treasury’s latest forecasts show the economy isn’t working for Kiwis. The economic slowdown is expected to last for
another 18 months, as interest rates stay high for longer in an attempt to combat persistently high inflation driven by
Labour’s addiction to spending.
“Government spending is up by $6.5 billion over the coming years, the return to surplus has been delayed for the third
time and Government debt has blown out by $13 billion, soaring above $100 billion next year.
“As Treasury says, ‘households and businesses are expected to remain under pressure’.
“New Zealanders deserve better. Wages have been growing slower than inflation, the fortnightly cost of a $500,000
mortgage has increased by $750 in the last two years, and food prices have been increasing at rates not seen since the
1980s.
“Sadly, there’s more pain to come with Treasury now forecasting:the economic slowdown to persist through to the end of 2024,inflation to stay above target levels until the end of 2024,interest rates to stay higher for longer in an attempt to combat inflation,a delay in the return to surplus to 2027 - meaning seven straight years of deficits, anddebt servicing costs rising to $11 billion per year.
“These figures assume Labour will stick to their proposed spending limits – something they have never done. In the 2020
PREFU, spending was expected to be $116 billion this year. But Finance Minister Grant Robertson’s excessive spending has
lifted this to $139 billion – a $23 billion blow-out. Indeed, Treasury even includes a scenario in their forecasts where
the Government does not stick to their Budget allowances.
“Overall, it all equates to Labour spending over $1 billion more per week than when they took office in 2017.
“The economic outlook is a distinctly New Zealand problem. New Zealand is the only country in the Asia-Pacific region in
recession and the IMF is forecasting that New Zealand’s economic growth prospects next year are among the very worst in
the world. In contrast, Australia’s books are in surplus.
“As a result of our economic conditions, too many of our people are looking at opportunities overseas, with nearly
40,000 Kiwis permanently leaving the country in the last year.
“It is clear that Labour is out of ideas and has no plan to turn things around. New Zealand can do so much better.
“This election is an opportunity for change and a chance to get the economy working for all New Zealanders. National has
a plan to do exactly that.
“National’s plan to rebuild the economy includes:stopping wasteful spending and get the books back in order,delivering tax relief to encourage hard work ease the cost of living crisis,cutting red tape to make it easier to invest and grow,building infrastructure for growth like roads and public transport,growing skills to expand our workforce,driving technology and innovation, andbeing open to the world by supporting trade and investment.
“National will rebuild the economy because that is how we lift wages, grow jobs and help Kiwis get ahead. A strong
economy is how we end the cost of living crisis and get mortgage rates under control. It is also how we afford the
quality public services we all rely on and deserve.
“New Zealanders now have a clear choice this election – a strong stable National-led Government with a plan to rebuild
the economy. Or three more years of a high taxing, high spending Labour-led Government with no plan to address the
economic issues facing New Zealanders.”