Govt spending decision signals crisis and cuts – NZCTU

The decision to nearly halve the amount of new investment being made in the next Budget signals that this Government doesn’t care about the users of public services, said NZCTU Te Kauae Kaimahi Economist Craig Renney.

“$1.3bn in operating allowance isn’t enough to pay for cost pressures in health alone ($1.55bn). There is no money for cost pressures in education and other public services, or proposed defence spending. This is a Budget that will be built on cuts to essential services,” said Renney.

“The fact that this announcement has come only three weeks away from Budget suggests that there is no agreement around the cabinet table about what government should be doing.

“We now know that we are looking at a Budget where departments will be asked to make further rounds of deep cuts – just after cuts at Budget 2024.

“The Minister of Finance is blaming borrowing for the need to make cuts. At the last Budget the government borrowed $12bn to pay for tax giveaways, including to landlords and tobacco companies.

“This decision to cut investment is a choice. When child poverty rises, as it currently is, it’s a choice to not increase support. When we can’t support people losing their job, that’s a choice. This Government’s choices are now very clear.

“We implore the Government to rethink this decision. It doesn’t help solve the public investment gap that already exists. It doesn’t help tackle unmet need in health and education. It’s time for a better approach, and to rebuild our public services,” said Renney.