David Cunliffe
Finance Spokesperson

19 May 2011
MEDIA STATEMENT

Budget 2011: Zero ideas, zero leadership

Budget 2011 provides zero leadership, and won’t create a stronger, export-led economy, more jobs, higher wages, or more fairness for struggling Kiwi families, says Labour’s Finance spokesperson David Cunliffe.

“Bill English and John Key have failed to take our economy forward.” David Cunliffe said. “They promoted Budget 2011 as a zero budget. In terms of new ideas, zero is the right word.

“There is zero plan to lift growth, credibly close the savings and capital deficit, or deliver much-needed assistance to low- and middle-income New Zealand. In fact, budget documents show debt, the current account and growth rates all deteriorating over the next four years.

“Budgets are always about choices,” David Cunliffe said. “In the last two, National chose to give away $23 billion in tax cuts, much of which went to upper income earners who needed them least.

“Budget 2011 continues the same selfish theme --- a free ride for the wealthy, but higher costs for Kiwi families through changes to KiwiSaver, Working for Families and student loans.

“Unspecified cuts of $1 billion over four years to public services will hit education and health, and there will be no alternative to service cuts or a return to the failed user pays policies of the past,” David Cunliffe said.

“Amazingly, National is spending the proceeds of a fire sale of state assets --- $5-7 billion --- even before they are sold, and in complete contradiction of its promise to seek an electoral mandate first.

“National has failed four basic tests for a responsible budget in tough times:
• There is no credible plan to build a strong export economy, no coherent economic development programme, no monetary reform, no game-changing innovation.
• There is no plan to grow savings and capital sufficiency and improve investment incentives for a modern high-value economy.
• There is no plan to deliver much needed relief to hard working families stressed to the max by runaway living costs.
• And its unconvincing deficit and debt reduction plan is built on a repeat of rose-tinted Treasury forecasts that have proven illusory in each of the last two Budgets.

“Budget 2011 leaves struggling Kiwi families worse off,” David Cunliffe said.

“National has broken nearly all its election promises from 2008. It is barren on ideas and leadership, and has foregone the right to be trusted. Labour will provide leadership in delivering a comprehensive package of costed economic policies before the election.

“This budget hurts many but solves nothing. It steals from the future by booking the proceeds of assets it has no mandate to sell.”

ENDS

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