Grant Robertson on the budget

 

Labour’s finance spokesperson Grant Robertson keeps his criticism up of Thursday’s budget. I guess he couldn’t praise it, but if he disses it too much he risks being seen as too negative.

He has promoted this Radio NZ interview:

And from the Labour website:

Nats’ budget a double-crewed ambulance parked at the bottom of the cliff

National’s election year Budget shows that there’s no coincidence Finance Minister Steven Joyce doubles as National’s campaign manager, says Labour’s Finance Spokesperson Grant Robertson.

“The 2017 Budget reveals a lack of vision, and is simply an election year budget with an eye for September 23, not the 21st Century.

“It’s irresponsible to dangle tax cuts that actually benefit the wealthiest more than low-income New Zealanders, instead of investing in the social foundations that are critical to our country’s future.

“The people who gain the most from the tax changes are people like Steven Joyce and me who earn far more than the average wage.

“The richest families get $35 a week from the Budget bribe, the poorest get $5 a week. Someone on the average wage gets $11 a week, and around 800,000 New Zealanders on taxable incomes below $14,000 get nothing.

“Steven Joyce has failed to deliver a plan to fix the housing crisis, build affordable homes for first home buyers, end homelessness, or fund our hospitals and schools properly.

“The big spending from the Government comes in the form of nearly $800 million for prisons. This is actually a sad indictment of National’s failure to invest in New Zealand.

“We would not have to build billion dollar prisons if the Government would adequately invest in early childhood education, get better support to help our vulnerable children, and provide mental health services to New Zealanders before their problems overwhelm them.

“The Government has said they want to double crew ambulances, but when it comes to social services, sadly those ambulances are still parked at the bottom of the cliff.

“Labour has different priorities to National. We will fund our health system properly to meet the needs of a growing population. We will build houses for first home buyers that they can afford, and invest in education instead of building prisons. This Budget offers nothing new. It’s time for a fresh approach,” says Grant Robertson.

The real costs of National’s election bribe

The cost of National’s poorly-targeted election year budget bribe is that there’s nothing to fix the housing crisis, health funding is cut, and funding for schools is cut, says Labour’s Finance spokesperson Grant Robertson.

It’s no coincidence that Robertson targets the three election issues that Labour has chosen to focus their campaign on.

“As the dust begins to settle on the Government’s massive PR exercise, it’s becoming clearer than ever that National has no plan for New Zealand’s future.

“The reality is that $5 of every $7 in National’s package is poorly-directed through the tax cuts. Labour can’t support an approach that perpetuates inequality.

“Around 800,000 New Zealanders on taxable incomes below $14,000 get nothing from this. The 500,000 low income workers currently getting the Independent Earners’ Tax Credit lose that $10 a week, and are left with just an extra dollar a week.

“National’s answer to the housing crisis is building only one new affordable house for every 100 new Aucklanders. They’ve funded just 1200 houses in this Budget.

“Health gets $439 million when it needed $650 million simply to keep up with a growing and ageing population, as well as inflation. This adds further to the existing $1.7 billion of underfunding over the past six years.

“School operational grants needed $140 million to keep up with roll pressures and inflation, but they got $60 million – a shortfall of $80 million.

“And once again, National is refusing to restart contributions to the NZ Superannuation Fund. National is selling out this country’s future for a cynical election-year bribe.

“But the real winners in the tax cuts are those like the Finance Minister and Prime Minister, who will gain 20 times what a single person working fulltime on the minimum wage gets.

“That’s simply not fair. Under nine years of National the gaps between rich and poor have only grown wider. Labour has the fresh ideas to ensure all New Zealanders get a fair share of prosperity,” says Grant Robertson.

The problem with this criticism is that Labour doesn’t have an alternative to suggest, they don’t have a new tax policy, apart from reviewing tax if they become government.

Robertson pre-empts budget

Labour’s finance spokesperson has pre-empted the deliver to the budget today with criticisms in advance and a promise of much better things if Labour forms the next government (if that happens shouldn’t he have pre-empted jointly with Greens and NZ First?).

Grant Robertson: Labour ready to deliver a fresh approach

These are the key questions New Zealanders need answered in today’s Budget:

  •  After nine years of denial, have they done something that will finally fix the housing crisis and get New Zealanders affordable homes?
  •  Have they done enough to turn around their legacy of neglect in mental health and their $1.7 billion of health service cuts?
  •  Have they given schools the operational funding they need to they can keep the lights on, pay their bills and make up for last year’s funding freeze?
  •  Have they given the Police the resources they need to keep our communities safe?
  •  After nine years of failing to contribute a single cent to the Super Fund, will they finally do the right thing by future generations?
  •  Have they finally recognised New Zealanders birth right – to swim in clean rivers and streams and properly resourced making all waterways swimmable?

When Labour has the opportunity to lead the next Government, the budget that I deliver will set out a plan to give New Zealanders some hope for them and their families and to begin to address the shortfalls and shortcomings of National’s approach.

Our Kiwibuild programme will deliver homes to first-home buyers. They will be sold at cost, and the proceeds used to build more homes. 100,000 over 10 years – all affordable, all within reach of young New Zealanders.

Labour will close the tax loophole that effectively amounts to a taxpayer subsidy to speculators of $150m a year and helps them outbid home buyers, and then pump those savings into grants for home heating and insulation.

Labour’s next budget will invest in health, including funding primary healthcare, homecare, breakthrough life-saving cancer medicines and mental health services.

It will end the freeze on operational funding, which is a huge strain on already stressed school budgets. Parents are forking out more and more in “donations”.

Labour will invest in education, so schools can get on with teaching, not begging for money. We will introduce three years of free post-school education to help prepare our young people for the changing world.

Our budget will also be the first where a government is held accountable by an independent body to a set of Budget Responsibility Rules. We understand that the public needs to know that we will be responsible and prudent, with our spending phased and focused to achieve results.

New Zealand is a relatively wealthy country. We are blessed with wonderful natural resources and talented people. Now is the time to harness the potential of every single one of us, and give everyone a fair shot at success and a share in prosperity. We can do better than what will be put on offer by National today. It’s time for a fresh approach.

It’s not time yet – that will be next May at the earliest, if Labour forms the next Government with either or both the Greens and NZ First, and if Robertson is the new Minister of Finance.

Labour targeting social and infrastructure deficits, not financial

Finance spokesperson Grant Robertson says that a Labour government would target infrastructure deficits and social deficits’ and revise the Government targets on lowering financial deficits.

NZ Herald: Debt targets to be revised under Labour-led Government says Robertson

National increased the debt as a result of the global financial crisis and the Christchurch earthquakes from 5.4 per cent of gdp in 2008 to 24.3 per cent now. The deficit peaked at a record $18.3 billion in 2011.

The current target of reducing net debt to 20 per cent of gdp by 2020 will be replaced by getting it down to 10 to 15 per cent by 2025, Joyce recently announced.

But Robertson says that Labour will have a different priority and will revise that.

If Labour’s Grant Robertson is the next Finance Minister he will ditch the new ambitious net debt target set by Steven Joyce as part of the 2017 Budget or the current target.

“We believe there are infrastructure deficits and social deficits that are going to need some investment before we can get to the 20 per cent target,” Robertson said.

“We will review and revise those targets once we are in Government and we’ll see where we get,” said Robertson.

“The last time Labour was in office we got debt down close to zero so of course we are in favour of reducing debt.”

He said the numbers Joyce had “plucked out” for the 2025 target was where Treasury’s longer term forecasts were going anyway.

Greens are on the same page as Labour. This was been written into the Labour-Green fiscal responsibility code.

The wild card is Winston Peters.

Meanwhile New Zealand First leader Winston Peters says the Government will present a surplus on Thursday only because it has underfunded many public services including in health, education, police, conversation and housing.

“The Government will have to explain how there is a surplus after addressing all the reasonable demands that need money spent on them,” he said.

“If this Thursday’s Budget does not do that, then claims of a surplus will be without credibility, plausibility or integrity.”

What that means in practice, and whether Peters will come out of coalition negotiations with credibility, plausibility or integrity, won’t be known until late September at the earliest.

 

“An extremely unparliamentary term”

MPs often get grumpy in pPrliament during question time, but Steven Joyce took that a bit further than usual today when he used what was described as “an extremely unparliamentary term”.

Government Financial Position—Debt and Measures to Address

2. TODD MULLER (National—Bay of Plenty) to the Minister of Finance: What is the Government’s plan for reducing net debt as a percentage of GDP?

Hon STEVEN JOYCE (Minister of Finance): So far we have made very good progress in reducing the Government’s debt, as measured against the size of our economy. Net debt peaked at just under 26 percent of GDP, following both the global financial crisis (GFC) and the Canterbury earthquakes. It is expected to be around 24 percent of GDP by the end of this year. We are forecasting to achieve our short-term target of reducing net debt to around 20 percent of GDP by 2020. All this has been achieved after New Zealand was forced to weather the shocks of the global financial crisis and the Christchurch earthquakes, and, of course, more recently, the Kaikōura earthquakes. Supporting Kiwi families through these events resulted in the country borrowing significant sums of money—approximately an extra 20 percent of GDP.

Todd Muller: Once the Government has achieved its net debt target, what will the new medium-term goal be?

Hon STEVEN JOYCE: I announced last week that the Government will set a new medium-term fiscal target of reducing net debt to between 10 and 15 percent of GDP by 2025. We are a geologically young country and we are also a small country in an often turbulent world, so there are plenty of risks and shocks ahead of us. The GFC and the Christchurch earthquakes taught us that they come along at any time, and sometimes together.

Rt Hon Winston Peters: I raise a point of order, Mr Speaker. You will notice that the Minister of Finance is taking an extraordinarily long time to answer questions—for example, he was asked in the primary question: what is the plan for reducing net debt? It is not a history lesson; it is a question about the future plan.

Mr SPEAKER: Order! The member will resume his seat.

Rt Hon Winston Peters: Why?

Mr SPEAKER: Because I asked him to resume his seat. I am the judge of the length of answers and I am judging the relevance of a subsequent supplementary question. The supplementary question was definitely in order. The Minister has every right to answer it, and I will judge whether the answer goes on for too long.

Rt Hon Winston Peters: You may well judge that, but I am entitled to raise under the Standing Orders a point of order and outline why some members of this House find that his answers are not satisfactory. We have an entitlement to do that. Yes, you can judge whether or not we are making out the case, but you will not stop us from making it out.

Hon STEVEN JOYCE: I appreciate the member’s point of order, but I am a bit confused because I would have thought that New Zealand’s resilience to natural disasters is a very important issue, not just for this House but for this country. The member may want to make a point about saying that it is not of interest to him, and that is fine. But I do think that most New Zealanders would consider our ability to respond to earthquakes and other natural disasters to be very important. [Interruption]

Mr SPEAKER: Order! I have heard quite enough from both members. As I have—[Interruption] Order! As I have said, I will judge the length of answers. I want them to be relevant, but I thought the subsequent supplementary question was an important one. I would have thought most of the House was interested in future net debt targets. Does the Minister wish to complete his answer?

Hon STEVEN JOYCE: Thank you. With net debt at around 10 to 15 percent of GDP, New Zealand would have the capacity to absorb more than one shock without extra taxes and without slashing people’s entitlements, and that is what will be important to New Zealanders.

Todd Muller: How achievable is a net debt target of between 10 and 15 percent of GDP?

Hon STEVEN JOYCE: This is achievable because the Government’s books are now in good shape, and rising surpluses are predicted over the forecast period. It is backed up by a New Zealand economy that has now experienced nearly 6 years of continuous growth, together with unemployment falling yesterday to 4.9 percent. This is one of the dividends New Zealand gets from an innovative economy that allows us to reduce debt so we can respond to whatever the future has in store not just for the current population but, of course, for our children and grandchildren.

Todd Muller: How will this new debt target help New Zealand respond to major shocks?

Hon STEVEN JOYCE: You only have to look as far as the front page of the Wellington newspaper this morning to see the importance of ensuring that New Zealand has buffers against major shocks. It was suggested in that report that there is a new report produced saying that a major earthquake in Wellington would force the capital city to move to Auckland. I do not agree with that, and I think most Wellingtonians would not agree with that. The reality is that if you can afford to protect urban centres like Wellington after a big earthquake, then we do not have to consider moving the capital city. So, with sensible investments in infrastructure and prudent levels of debt, Mr Peters, then we can make sure that the capital city stays in Wellington.

Rt Hon Winston Peters: What are you going on about now?

Hon STEVEN JOYCE: Grumpy old prick.

Grant Robertson: I raise a point of order, Mr Speaker. I know there is a robust exchange in the House, but the Minister of Finance did use an extremely unparliamentary term to describe the leader of New Zealand First.

Mr SPEAKER: I heard the interjection; I did not hear where it came from, but now that it has been identified, I require the Minister to stand, withdraw—[Interruption] Order! The member is not yet in this position; he might be at some stage in the future. I require the member to stand, withdraw, and apologise.

Hon STEVEN JOYCE: I withdraw and apologise.

Mr SPEAKER: Thank you.


 

Peters: “he’s got his own problems, he’s going through his hair… and a lot of people don’t like that when they look like him!”

Joyce: “aww nooo it’s just robust debate and he was being a fairly grumpy chap wasn’t he?”

Poor reports on poorest households

Things may not always be quite as they seem at first glance.

Stuff: Poorest Kiwi households face much larger cost of living increases than big spenders

A recent jump in the cost of living hit the lowest paid Kiwis much harder than the big spenders, new figures show.

In the first three months of the year, inflation for all households jumped 1 per cent, bringing annual inflation to 2.2 per cent, the highest since 2011.

On Thursday Statistics New Zealand released the household living-costs price indexes, giving a breakdown of how price increases hit different groups.

The figures showed that the rise hit the lowest earners the hardest. Beneficiaries saw their overall costs rise by 1.4 per cent, almost three times the increase faced by the 20 per cent of households with the highest spending.

That sounds like a significant disparity for poor households. But what comes next changes the perspective somewhat.

While overall inflation rose partly because of increases in the cost of fuel and food, Statistics New Zealand said inflation was especially high for beneficiaries because a greater proportion of their income went on tobacco. Each January, the excise on tobacco products increases by 10 per cent.

So inflation went up more for poor households that used a significant amount of tobacco.

Whether tobacco taxes should keep going up is another matter.

But one of the key pieces of information about households was not revealed until well into the item.

“Higher costs for cigarettes and tobacco had a greater effect on beneficiaries,” Statistics New Zealand’s Nicola Growden said.

“About 5 per cent of their spending went up in smoke, proportionally more than most other types of households spent.”

Predominantly Maori households faced a 1.3 per cent increase in inflation – higher than average – while superannuitant households faced a 0.9 per cent increase, slightly below average.

Maori are over represented in poorer households, and also smoke much more than non-Maori.

And superannuitants are also less likely to be smokers as they don’t die as young.

Meanwhile Labour’s finance spokesperson Grant Robertson put out this on the same topic.

Cost of Living increases hit those with least the hardest

Posted by on May 04, 2017

Beneficiaries, superannuitants and people on the lowest incomes continue to bear the brunt of higher inflation, according to the latest data from Statistics NZ, says Labour Finance spokesperson Grant Robertson.

So he’s also referring to the latest inflation data from Statistics New Zealand.

“Since National came to office (December 2008) inflation for those on the lowest 20 per cent of incomes has increased by 17 per cent. But for those with the highest 20 per cent of incomes, it has increased by only 10 per cent.

“The cost of core inflation items like food, fuel and rates are all soaking up an increasing chunk of the incomes of the lowest paid people. These are costs that Kiwis can’t avoid – and they are rising faster than other costs in the economy.

No mention of one of the most significant factors, tobacco use and tax.

“High housing costs, rising rents are all eclipsing the mediocre wage increases for New Zealanders. Yesterday the latest wages data showed that 67 per cent of Kiwis got a pay rise of less than inflation, which means they effectively are working harder for less.

“Rather than address these problems National doesn’t have a plan for the economy, to help boost our notoriously low productivity, nor to help Kiwi families.

“Only a Labour-led Government will help address the growing cost of living crisis in New Zealand for low income Kiwis and we’ll deliver the shared prosperity that all New Zealanders deserve,” says Grant Robertson.

Robertson either didn’t pick up on the tobacco part of the statistics, or he deliberately left it out of his post.

But the Stuff item quoted him in their article, and also managed to, eventually, highlight the impact of tobacco on poorer households.

 

Q+A suggest new Labour deputy

Yesterday @NZQandA tweeted:

QARobertsonDeputy

Just a mistake?

Or was someone getting ahead of themselves?

That was deleted and replaced by:

But not before some responses:

 

The Nation – James Shaw and fiscal responsibility

On The Nation (9.30 am Saturday, 10:00 am Sunday)::

Green Party of Aotearoa New Zealand co-leader James Shaw MP on the party’s joint fiscal responsibility pledge with Labour and its plans for election year.

See Labour-Green ‘budget rules’

Shaw and Grant Robertson put up a good show yesterday, but Shaw has to contend with Metiria Turei and the potential cost of her social agenda.

The left hasn’t wholeheartedly supported this move, with some dismayed that it seems to be little change to the so-called ‘neoliberal’ agenda.

NZH: Higher spend needed than under Labour/Green rules: Council of Trade Unions

Higher spending is needed than allowed for under an agreed set of economic rules between Labour and the Green Party, the Council of Trade Unions (CTU) says.

…the CTU, which represents more than 320,000 union members in 31 affiliated unions, is concerned about the limit on new spending the rules impose.

“We support higher levels of Government activity and investment than these rules permit. There is an urgent need. Many countries who are more successful than us socially and economically have much greater government activity,” CTU president Richard Wagstaff said.

“If an incoming Labour/Green Government is serious about fixing the problems we have in our education, health, housing and other public services, if it’s going to correct the imbalances we have in terms of pay equity, if we are going to really tackle income inequality and our environmental challenges together as a nation, then it will need to be prepared to invest significantly. That will test these rules as they stand.”

Also hovering over the joint Labour-Green campaign approach is Winston Peters and NZ First.


Shaw – the rules are new, and the first time two parties have a shared framework.

The Greens are still doing the numbers on their own tax package – it will be broadly in line with what they’ve said in the past.

Shaw supports Labour’s idea for a review of the tax system.

Shaw is promoting maximum votes for the Greens to ensure they have more say in a coalition arrangement. But the Greens are the credibility weak link.

Shaw won’t talk about specific cost cuts in relation to roading and to defence.

That’s a problem promoting something without any specifics at this early stage of the election year.  Shaw is trying to promote Green fiscal responsibility but can give no details.

“I will accept that will not get everything we want… and neither will the Labour Party” says Shaw on coalition negotiation.

SAS – should we have special forces?

Shaw says it’s important we should have an inquiry.

He doesn’t have any particular view on any particular part of the military.

New Zealand troops in Iraq? Would you pull the pin on that? “Not up to us….coalition”.

James Shaw says Kiwi troops could stay in Iraq with Donald Trump’s forces if Labour-Greens take power.

Paddy indicates what the likely news story on at 6:00 pm will be about:

Labour-Green ‘budget rules’

Labour and Greens, headed by Jamews Shaw and Grant Robertson, have launched a joint attempt to present themselves as economically responsible.

Liam Dann at NZH has Big Read: Can these politicians be trusted with the economy?

They aren’t revealing tax policy detail or spending plans, so what exactly have Labour and the Green Party cooked up with the Budget Responsibility Rules they’re signing up to today?

The parties have formally committed to staying in surplus, paying down debt and keeping core crown spending at about 30 per cent of GDP.

“It’s an important signal,” says Labour finance spokesman Grant Robertson.

“We understand that voters in September are looking for parties that are responsible with the finances but will also address the big issues around housing and health and education.”

The rules aren’t specific on policy – for example, the statement on tax is pragmatic and vague enough to allow the Greens to keep campaigning on a carbon tax.

But they do represent a statement of intent, one which is politically notable for the way it has been handled, in tandem by the respective party machines.

The message is clear, simple and directed at business and the financially comfortable middle classes who have been stubbornly loyal to National for the past nine years: vote for us and we promise won’t ruin the economy.

As the headline suggests, it is a big and detailed read.

Not addressed is an obvious difference between Labour and the Greens – Andrew Little has made it clear Labour won’t increase tax (but with some caveats) while Greens have a big shopping list.

Greens announced through Facebook:

We’ve created new budget rules with the New Zealand Labour Party to help us build a sustainable and stable future for everyone.

This links to:

Budget Responsibility Rules

The Budget Responsibility Rules will allow us to govern responsibly.

Economic sustainability goes hand in hand with environmental sustainability. Both are about living within our means and leaving the world better than we found it.

Our Budget Responsibility Rules show that the Green Party and the Labour Party will manage the economy responsibly while making the changes people know are needed, like lifting kids out of poverty, cleaning up our rivers, solving the housing crisis, and tackling climate change.

  • Deliver sustainable surpluses
  • Reduce debt
  • Prioritise long-term investments
  • Be careful with expenditure
  • Build a fairer tax system

We will judge the success of our policies by improvements in the living standards of New Zealanders, improvements in key environmental indicators, and improvements in the economy.

We will establish a body independent of Ministers of the Crown who will be responsible for determining if these rules are being met. The body will also have oversight of government economic and fiscal forecasts, shall provide an independent assessment of government forecasts to the public, and will cost policies of opposition parties.

For New Zealanders to have enduring quality of life, prosperity, and security, governments need to manage revenue and spending decisions carefully. Good fiscal management is a core part of what it means to be a good government.

The Budget Responsibility Rules enable us to govern responsibly and transparently with Labour, while we invest in our priorities.

Read the full Budget Responsibility Rules here.

 

 

Interesting Wellington Central contest

Wellington Central was always going to be an interesting electorate to watch this election, with Grant Robertson going up against  James Shaw.

While the Green Party has historically sought party votes only and nodded and winked at the Labour candidates for the electorate votes now he is party co-leader Shaw will want to be seen as popular with voters.

Results from 2014:

wellingtoncentral2014

While Robertson won the electorate vote easily Labour came third behind National and Greens in the party vote.

National’s candidate for the last two elections, Paul Foster-Bell, was challenged for candidacy and withdrew, announcing he would resign at the end of this term.

National’s canddiate has now been announced. Stuff: National chooses Nicola Willis for Wellington Central seat

Former John Key adviser and Fonterra executive Nicola Willis has been selected unopposed as National’s candidate for the Wellington central seat.

She replaces Paul Foster-Bell who pulled out once it became clear she had the numbers.

Robertson must still be clear favourite to win, but Willis will be wanting to give things a good nudge.

And much may depend on how Shaw approaches his campaign. How much help will he want to hand Robertson?

The electorate result won’t change the overall outcome of the election.

In association with Labour’s Memorandum of Understanding with the Greens Andrew Little has said that Robertson as Finance Minister is not negotiable.

Robertson is likely to get a high list placing, his current ranking of 3 seems likely. And if his re-election via the list is at risk (that’s possible if Labour support collapses further) then Labour are unlikely to form the next government.

But what if he loses his electorate seat? That would give Greens some justification for arguing for a more significant say in Finance.

Are Greens happy to be subservient to Labour this election? Or will they campaign more strongly in electorates?

It is likely to improve their party vote if the fight for electorate votes as well. When they imply ‘vote for my party but vote for them’ then there must be more chance of both votes going to ‘them’.

National MP stands down from challenge

In November it was announced that someone would challenge list MP Paul Foster-Bell to be the National candidate in the Wellington Central electorate – see National MP challenge in Wellington Central.

National list MP Paul Foster-Bell, who stood in Wellington Central last election against Grant Robertson and James Shaw, is being challenged by Nicola Willis, who appears to be backed by John Key.

Foster-Bell has just announced that he will stand down from selection and won’t contest the election.

It sounds like he may be jumping before he was shoved aside.

Foster-Bell was ranked 46th on the National party list in the 2014 election. He is currently ranked at that same 46 on National’s website.

Candidate votes in Wellington Central in 2014:

  • Grant Robertson 19,807 (Labour 9,306)
  • Paul Foster-Bell 11,540 (National 14,689)
  • James Shaw 5,077 (Greens 11,545)

Will a better National candidate convert more party support into electorate votes? With a higher profile Shaw may split  more votes with Robertson.