Government slams Labour’s social welfare spend
The Government has claimed that the electoral promises by the Labour opposition could see a spend of up to $17.9 billion.
The Labour electoral promises detailed at the weekend were clearly aimed at luring swinging voters and it brought a predictable response from the Key Government through Associate Finance Minister Steven Joyce.
Joyce claimed Labour’s election-year spending spree was now up to almost $17.9 B over four years - and counting.
“Labour’s own numbers show spending promises to date of $16.4 B over four years,” he said.
“However, they have woefully underestimated the costs of introducing compulsory KiwiSaver, dismantling the electricity sector and paying a 12.5% R&D tax credit.
“For example, Labour claims to be bringing 500,000 extra people into KiwiSaver from October 1, 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 M as Labour is claiming.”
Joyce said when you put more realistic costs on these policies it takes Labour’s numbers to $17.9 B 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,” Joyce said.
“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, he said, 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.”
National’s claim on Labour’s spending is attached:
http://webcache.googleusercontent.com/img/icons/pdf.jpg Labour_Party_Spending (18.3 kilobytes)