Cuts in public services, not positive action, likely from Government’s Budget Policy Statement

The horizon for workers looks gloomy with the release today of the Budget Policy statement.

“Continuing real cuts in Government funding of public services are inevitable as a result of today’s Budget Policy Statement. The policy ignores the social, environmental and economic pressures that are building in New Zealand. Maintaining a $1b allowance for new spending in the face of these pressures is like putting a cork in a boiling kettle,” says CTU Economist Bill Rosenberg. “At some point it will blow out”.

Cabinet papers on the Health budget revealed this morning show the continuing pressures on District Health Boards to fund increased services promised by the Government and the increased costs of a population growing more rapidly than expected out of an inadequate budget.

“120,000 people will still be unemployed in 2017 which is an unemployment rate above 5 percent – nine years after the global financial crisis hit,” said Rosenberg.

“Despite well documented problems of children living in poverty, the Government is only looking at reprioritising current spending rather than putting considerably more money in as experts have repeatedly said is required. Just last week, the OECD advised that New Zealand’s level of income inequality is holding the economy back,” said Rosenberg.

“The Government has still not faced up to New Zealand’s responsibility for addressing climate change.”

“Clearly they are living in the past, focusing on Budget surpluses which are a side show compared to creating and funding social and environmental solutions which could have such positive economic consequences,” said Rosenberg.

ENDS

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