National’s “Budget Rules” Announce Nothing, Promise Less – Alliance Party

The Alliance Party says National’s Budget Responsibility Rules simply repackage fiscal targets the Government has already published.

“All three goals are already on Treasury’s books,” Alliance leader Victor Billot says.

Budget 2026 forecasts an OBEGALx surplus in 2028/29 and core Crown spending falling to 30.3 percent of GDP by 2029/30.

Net core Crown debt is forecast to decline to 44.4 percent of GDP in 2029/30.

National has set no date for getting debt below 40 percent.

“A target with no date is not a rule. It is a vibe.”

Mr Billot says National has announced the shape of its campaign argument without publishing the policy choices needed to meet its targets.

“The Government has told us what the argument will be, then asked everyone else to publish their numbers first.”

National’s preferred surplus measure, OBEGALx, excludes ACC revenue and expenditure.

“Changing the headline measure does not improve the underlying position, repair infrastructure or staff a hospital.”

Mr Billot says pushing core Crown spending towards 30 percent of GDP, while the population ages and infrastructure costs mount, means cuts elsewhere, whatever language National uses.

“Sewage is running into our harbours. Wastewater plants are operating on expired consents. Hospitals are short-staffed and emergency departments are full. That backlog was created by forty years of governments treating spending restraint as an achievement in itself.”

He says costs do not disappear when they are squeezed out of the Crown accounts. They reappear as higher rates, prescription charges, road user charges, and repair bills that arrive later and larger.

“You can make the books look tidy by refusing to fix the pipe. The pipe still bursts.”

The rules also say nothing about employment or New Zealand’s productive capacity.

One of the National-led Government’s first legislative acts in December 2023 was removing maximum sustainable employment from the Reserve Bank’s objectives, leaving price stability as its sole monetary-policy objective.

The Alliance would restore the employment objective and add a mandate to support productive capacity. It would use financial regulation to discourage speculative lending and support manufacturing, clean technology and regional industry.

“A bank should find it cheaper to finance a factory than a fifth rental property. Fiscal rules alone will not fix incentives that favour speculation over production.”

Mr Billot says New Zealand’s fiscal debate must also address revenue.

“New Zealand has no comprehensive tax on wealth or capital gains. Instead, the system relies heavily on taxing wages and consumption.”

The Alliance is campaigning for a comprehensive wealth tax, capital gains tax and financial transactions tax to fund public ownership, state housing and infrastructure investment through KiwiWorks, a Ministry of Works for the 21st Century.

“We will not sign up to rules designed to make another round of cuts sound responsible.”

“Set a rule for reducing child poverty. Set a rule for cutting surgical waiting lists. Those numbers measure whether a government is doing its job.”