This Government’s Austerity Agenda is killing New Zealand economically, culturally and literally

By
Martyn Bradbury
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49
1594

This Government borrowed more than Labour, bit they borrowed for tax cuts and loop holes for the richest Landlords.

The borrow may have been huge, but it’s hollowed out spending on public services and that hollowing it is causing the economy to crash and the recession to get far worse.

Don’t believe me?

Here are the experts…

The Lead: When cuts beget cuts

Treasury’s Chief Economist Dominick Stephens warned yesterday the recession was worsening to be deeper than the one seen in the Global Financial Crisis and widening the Budget deficit. His comments echoed those of a group of 15 economists who yesterday called for a suspension to Government spending cuts, saying they weren’t needed and were creating a negative feedback loop of economic contraction.

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Stephens couldn’t have been clearer:

Economic growth has proved slower than anticipated. Weaker economic growth means a smaller economy and less tax revenue, increasing the challenge for the Government in balancing its books. Treasury’s Chief Economist Dominick Stephens in a speech to the Chartered Accountants Australia and New Zealand (CAANZ) Annual Tax Conference.

…the austerity of this Government is causing public services to collapse because this Government hasn’t borrowed for public services, they’ve borrowed for tax cuts!

 

Has managed to screw up a great deal and pretend that’s prudent economic management

The Criticism of how poorly the Government are doing economically is coming thick and fast now…

The Lead: Economists call for end to Budget cuts

A group of economists, including former Treasury Chief Economist and former Productivity Commissioners, published a letter to PM Christopher Luxon this morning calling for an immediate suspension of budget cuts to avoid further worsening a recession they say is hollowing out businesses and conflicts with the Government’s goal of doubling exports.

They argued fiscal policy was needlessly worsening the recession, saying there was no clear rationale for projected budget cuts and little consideration about the short-term effects. They wrote:

For example, your Government’s cancellation of key infrastructure projects and sinking-lid cuts to the public service are powerful contributors to the current severe and prolonged recession. This is substantially worsening the contractionary effects on the economy of the Reserve Bank’s use of the Official Cash Rate to contain inflation.

It is important to recognise that even prior to cutting back expenditure, government consumption spending was close to 20% of GDP. This covered spending on health, education, defence, administration, justice, transport, and culture. In addition, deferrals and reductions in projected infrastructure spending has further reduced employment and intensified the economic recession.

There is ample evidence that government spending, including the necessary infrastructure and allied networks, has for many years fallen well short of that required for population growth and demographic changes. The Infrastructure Commission has stated that New Zealand has a $104 billion infrastructure gap at present – and that this picture will significantly worsen given current spending projections.

These accumulating shortfalls put the nation in a poor position to improve its long-run economic resilience and to prepare for future challenges. If nothing is changed now, this under-funding simply passes the burden of adjustments, and investment spending, to future generations.

Failure to correct this course will lead to higher economic scarring, with the costs borne by those with the least ability to pay, as has been demonstrated repeatedly in New Zealand’s history. It will also undermine the resilience of the private sector – particularly exporters – and will continue to constrain the capability of firms to scale up. Economists letter to PM Christopher Luxon

They argued a focus on government debt ignored the impacts on private sector debt and external debt and also lacked a clear rationale.

They argued the Government’s fiscal policy of trying to get public debt and the size of Government both under 30% of GDP also conflicted with its aim of doubling the value of exports over the next decade

They called for an urgent suspension of spending cuts and further delays in infrastructure funding, along with “a clear economic rationale for fiscal policy” in next year’s Budget.

All National have as economic philosophy is whatever the fuck their donor interests are, and their donors interests are all about deregulation so they can rape the environment without have to talk to da Maaaris.

 

This Austerity is literally killing us!

Look at the official annual Health Survey released last week for the last year under this National Government:

  • One in four children (27.0 percent) lived in households where food ran out often or sometimes, up from 21.3 percent in 2022/23
  • 10.7 percent of adults had an unmet need for professional help for their emotions, stress, mental health or substance use in 2023/24 – more than double the rate of 4.9 percent in 2016/17
  • One in 11 adults (9.1 percent) and 8.2 percent of children aged 2-14 years ate the recommended amount of vegetables
  • Fewer than half of adults (46.6 percent) met physical activity guidelines, ie at least 2.5 hours of moderate-intensity activity in the past week – down from 50.9 percent five years ago
  • One in three adults (1.5 million) classified as obese, rising to nearly half of those living in the most deprived neighbourhoods
  • Nearly half of adults (44.9 percent) reported unmet need for dental care due to cost. Rates were worse for Māori, Pacific, disabled, people living in the most deprived neighbourhoods and those aged 25-54 years
  • One in four adults (25.7 percent) and one in five children (18.5 percent) reported that “time taken to get an appointment was too long” as a barrier to visiting the GP in the 12 months prior to the 2023/24 survey. This is higher than the previous year (21.2 percent for adults and 14.8 percent for children). In 2021/22, the figure was 11.6 percent.

This Government’s Austerity Agenda is killing New Zealand economically, culturally and literally.

 

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49 COMMENTS

  1. We need to implement strong austerity policies, starting with a maximum limit of 2 years within your lifetime to receive any benefits, excluding the pension. You must work and pay taxes for a minimum of 40 years to qualify for the pension.

    If individuals are struggling to survive without any benefits, we should expand the qualifications for euthanasia laws to give them the option of being euthanized. This would help remove the burdens from society.

    If we set a maximum time limit on benefits and remove societal burdens, we can reduce taxes.

    • Why give people the option of euthanasia? We could just make it mandatory. In fact, why bother with euthanasia. If anyone isn’t working and is struggling to survive we could just round them up into big camps and then execute them. Also, if someone doesn’t work we could disqualify them from access to any public services for them and their children.
      Actually why not round up the children of poor people and execute them as well – we could do it Gaza style just carpet bomb certain suburbs in our big cities – since statistically most of them will grow up to be poor anyway.
      I really think you’re onto something and this could very well be an election winning platform for Act or NZ First. And NZ society would be so uplifted and prosperous after implementation of these brilliant policies. A country of harmony and moral virtue for sure.

    • Ba ha ! You’re either as loopy as a stoned chicken or are hilariously funny in that dark dingy nightclub sort of way.

    • Crikey mate, I was about to agree until I saw the euthanasia statements…steady on.
      I do agree that some time factor on state support would be a good idea.
      If I were king for a day I’d put in a 5-year ‘Universal’ Benefit where you could CHOOSE how you use it throughout your life:
      – use it to pay for study in your youth
      – draw down on it if made redundant
      – Draw down on it for maternity/paternity leave
      – bring your pension forward 5 years (manual laborers whose bodies are knackered by 60)

      • You guys are really onto something here setting time limits on how long people can be poor. Also, if there are time limits set on how long people can be rich that would be a good move too. Then everyone could be averagely wealthy.

        • I wasn’t clear sorry. To clarify, my idea is over and above a very low basic unemployment benefit. The idea is it could be topped up to “living Wage level” for up to 5 years as per my post.
          In my view, the first goal of State support welfare should be to prevent people from starving and/or turning to crime (a very low-bar, bare minimum) but more importantly, be available to give people a boost when needed to improve society as a whole.
          Thats what student subsidies/loans are in essence, state assistance to boost people & improve society. I just think it should be available to a wider group than middle class uni students.
          Rather than bring people down to an average, I prefer the idea of boosting them up. But the boost cannot be permanent. Like it or not, there will always be some limits on state support for individuals, we just disagree where that should be.

    • So 99% of the population are already doing that so what will change .The biggest mistake ever in NZ was Muldoon stopping the retirement saving scheme set up by big norm in the 70s .There would be no one drawing the pension now because we would all have a million in our accounts and imagine how much NZ would have progressed on things like hospitals and schools with all those savings being invested over those 50 years .

      • We don’t just want to thank Muldoon for our poverty, include the insurance industry, all the other Nats, the farmers and Rob’s mob that reckoned having a huge sovereign wealth fund was communism. It would have been dollar awesome if Kirk’s legacy had included the Superfund as well as ACC, Nuke Free and No To Aparthied.

    • So the best way to implement your idea is to make people unemployed…

      https://www.nzherald.co.nz/nz/public-sector-cuts-health-new-zealand-planning-to-cut-nearly-1500-more-jobs/M5ZFZX422NBMFCQSFSECADPC4I/

      Your plan is being implemented by this government as we speak.

      In contrast, this government continues to use immigration as an economic tool yet axe vital services required to help service an ever increasing population.

      Our government are mismanagers of our country. They are simply clueless on how to run a country so therefore your idea whilst out of left field is right wing. I suggest you volunteer for your own idea of euthanasia and see if it works.

      • Whose means are you talking about, is it the rich who are coddled beyond belief with tax cuts in their warm retirement villas who are seen as having done no wrong give or take a bit of worker exploitation or some tax evasion on good years . They own multiple properties charging exorbitant rent to the bottom feeders et.al. These people vote national et.al because they know no poor person will get their not so hard earned money if they can help it as in higher taxes. Or the not so rich middle class who are seen as the back bone who usually work in public service on a good little earner who probably had a decent tax cut have a big mortgage just to keep up with the jones’s but oh dear me so sad they have now lost their jobs and many of these people are off to Australia where again they will be appreciated with a good job for their hard work. Then we come to the lowly bottom feeders who live hand to mouth who pay the exorbitant rents or live on the street,garages or cars. All of a sudden these people with no means do not exist in this government’s eyes because emergency housing has been scrapped ( no place to raise a child they say ) . Some of these bottom feeders are in low paid minimum wage jobs ( god forbid they get any pay rises with this government). The mantra being work hard to get ahead but these people are on a slow treadmill to nowhere and their life is austerity not the magical nirvana that the coddled rich experience on a daily basis.

      • Daniel. Ok, but when it comes to costs/outgoings which one has little control over, like electricity, bread, soap, petrol/ train fares, rates/rent, insurances, kids’ school stuff, this may be impossible, even in two income families. Few, if any, politicians experience this, and it’s an ongoing scenario which cripples lives. When Paula Bennett, I think it was, said that people could slip in and out of poverty on a daily or weekly basis, she hadn’t a clue what she was talking about, IMO.

        Luxon bleating away today about his tax cuts impacting positively on people’s lived didn’t know what he was talking about either. The biggest impact is on those already well provided for like him, and he’s an unashamedly greedy fellow himself IMO.

      • So you’re commenting against the treasury chief and the other economists that are roundly criticising the governments poor fiscal policies?

  2. At the end of the day, the Public Service got a lot bigger but with little discernible improvement in output or outcomes.

    Think of it as the annual non-performance review.

    • Agreed – of the people I know who switched votes , the conversations were about the colossal increase in debt and spending for no discernable improvements/things going backwards.
      Nobody I spoke with actually wanted tax-cuts, they were upset at what they viewed as waste when they were struggling with constant price increases.

      • they were to busy listening to luxon and co and did not bother to fact check anything clearly .They have no right to complain because they saddled the other 60% with this shit they owe us .

        • Factchecking?? You cannot be serious? Nearly every metric available went backwards under Labour – even by their own measures.
          The lefts continual denial of this is positively Trumpian.

    • Can you please provide evidence Henry, solid data and stats otherwise you are repeating Newstalk ZB propaganda. Roly Poly you could also provide more evidence to your ” by every metric “soundbite.
      The rights continual propaganda on Labour is positively Trumpian.

  3. Listening to Luxon yesterday was nausea inducing. He basically tried to claim credit for trade related inflation coming down and the bulk of his plan to increase productivity was teaching school kids maths. So nothing for the next decade then. On top of that they are cutting funding in science roles that could provide a future path way for all these new brains. The only plan they have is for the likes of Luxon. That and banging on about crime while fudging the numbers. Removing gang patches doesn’t provide jobs.

    • I refer to economists for the state of our country, not a reject CEO who turned a working Airline into one making a loss.

  5. Where is the massive economic boost that the tax cuts were going to give .?No where to be seen because the government just bumped up stuff like rego to take the money back .Wait till the 12 cents per liter fuel tax hike kicks in in one big hit in 2026 .No doubt at the same time RUCs will jump 10% at the same time .
    How much interest is no boats paying for the billion she dumped in the wellington harbour ?my guess would be 3 million a year for the next 30 years .

  6. The next step is we are going to make private charities borrow on the open market to build social housing and then make out that we never needed such housing .The winners are going to be private developers if any houses are even built .I even see paid pupets in the housing sector touting the old mantra of the right ,THERE IS NO SHORTAGE ,what a crock of shit just to line the pockets of the doners

  10. The reason why we’re alledgedly tanking economically is because the billionaires, the millionaires and the four now foreign owned banks being the second most profitable in the world never saw the internet coming. Our primary industry, in fact our only industry, our farmers have been mercilessly exploited for generations to give us 14 urban multi-billionaires, 3118 urban multi-millionaires and four now foreign owned banks being the second most profitable in the world free reign to fuck us as and when they like and now, thanks to The Daily Blog they’re caught red handed with their little panties down around their ankles and can be exposed and shredded. Aye Boys?
    The Loopy above ” @ Make NZ Great Again” I bet you he’s a farmer. I guarantee it. He’ll be a white natzo voting red neck farmer. OR he/she/it’s taking the piss. I hope it’s the former. Something to shock us out of the natzo induced malaise spanning 88 years. Or AI, come to think of it. Artificial without the intelligence.

  11. ‘We need to implement strong austerity policies, starting with a maximum limit of 2 years within your lifetime to receive any benefits, excluding the pension. You must work and pay taxes for a minimum of 40 years to qualify for the pension.’
    Actually this might work to the advantage of the victims of austerity.
    In their well fed, well cushioned arrogance Make New Zealand Great Again assumes the poor and oppressed will docilely endure such impositions – but this might finally be the breaking point that means they realise that in their numbers and their pent-up anger they have power and take action.
    Instead of waiting for crumbs from the table they take their seat at the banquet. Will a reduced police force and reduced armed forces stop them? (or, perhaps, even join them?)
    Will we abandon the useless lottery of voting for Tweedledum or Tweedledee and actually implement a government without political parties and without corporate donations?
    Make New Zealand Great Again speaks glibly of euthanising starving people(making no mention of the children they contribute to our nation and that are our future prosperity.) He also assumes they would go willingly to their deaths because the ruling class tells them to. What if they resist? What if instead of starving they steal? What if instead of begging they seize? Did the British convicts set to Australia meekly accept poverty was their destiny? Did the impoverished masses in France, Russia and China? Why did Rome fight the long and bitter Servile war?
    “Arise you criminals of want! Arise you slaves of ignorance!’
    And if a revolution here is successful?

    No need to kill class enemies when they can be utilised for their labour.
    There are forests that can be planted by them. Polluted environments that can be cleansed by them. Infrastructure that can be built by their labour.
    Instead of euthanising this set of useless parasites we can give them the opportunity of redeeming through honest toil.
    Long live Revolution. Aotearoa is always great!
    PS
    (I am assuming Make New Zealand Great Again is serious but if it is a wind up I do apologise).

  12. Where is the plan for NZ?
    How are we not looking at our economy (for instance) as a whole / deciding what we want this to look like going forward / tailoring education etc around that to assist with this plan?

  17. lol at all the economic numpties arguing for government austerity – the government is not the economy and could easily be replaced by an AI and a website

  18. Even the U.K rejected Liz Truss and her daft economic policies….but Willis and co had exactly the same ‘tax cuts,grow the pie’ austerity and it is embraced here in…NZ.

    • Nailed it. “Trussonomics”.
      It has been an utter disaster, and the worst is yet to come.

      Are the “squeezed middle” enjoying their new nirvana thanks to their “massive” tax cuts?
      Suckers………………..

      As Martyn consistently warned, a vote for National was a vote for ACT. And now NZ has to endure their sellout policies for 2 more years.

      • But if they are still here (ACT and nattynal) in two years the country will have lost all its marbles, not just some of them. We are going backwards with neoliberalism, that’s why Labour can’t do anything as they paved the way for it, built the Trojan horse for it, and out of it poured all the moneyed ‘investors’ to carry off our maidens (ooh no, sorry, our businesses large and small, jobs and bags of money actually).

        And the country will be a train-wreck? Or not; we may have few trains but the playthings of the patricians on land and air will provide meat for the mincer. We are left to provide the mincer and keep it running so the remains of our nation can still operate, just.

        Maintaining our pollies on land:
        28/11 https://www.rnz.co.nz/news/national/535069/investigation-launched-after-police-vehicle-crashes-into-limo-carrying-christopher-luxon-and-nicola-willis

        and
        Maintaining our trading business using air transport:
        6/22 https://www.nzherald.co.nz/nz/boeing-plane-crew-failures-risked-engine-failure-over-auckland-says-accident-investigation-commission/QQA7SZFDOBBXDDFKPVCMMYK3UY/
        A cargo plane faced the risk of its engines failing in the skies above Auckland and crashing because the Boeing aircraft’s crew did not turn on a key fuel pump.
        …It [TAIC] also said the flight plans and nominated alternate aerodromes, standard procedure before flying in case of poor weather conditions, were “not compliant with regulatory or company flight-planning requirements”.
        The Commission said, “the operator [Airwork Flight Operation Limited’s] … staff had not provided weather updates and flight planning for the flight as prescribed in their manuals”….

        The Transport Accident Investigation Commission (TAIC) has found “distracted” and “stressed” staff failed to carry out necessary pre-flight checks before a flight from Sydney to Auckland in June 2022.
        As a result, a key fuel pump was never switched on, meaning had the plane needed to circle before landing in Auckland, it would probably have run out of fuel leading to engine failure.

  19. Slightly disingenuous. A bunch of former labour appointees, who advised Grant Robertson to spend the country into the ground have a crack.
    If we continue borrowing at this rate, debt servicing will be 100% of GDP before 2050.

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