24 May 2012

Budget 2012: Burden not being shared out fairly

Budget 2012 fails to deliver any fundamental changes to the structural problems facing the New Zealand economy while ramping up the burden on lower and middle-income New Zealanders, the Green Party said today.

“The budget is a failure for the economy and a failure for our people. The average Kiwi will pay more to cover the Government’s economic mismanagement,” said Green Party Co-leader Russel Norman.

“If there is a burden to be shared, then it should be shared fairly. This Budget does not do that.

“This budget is full of cuts that will hit middle New Zealand in the pocket. Many Kiwis will be much worse off as a result of this budget.

“Budget 2012, with its mix of increased user pays charges, student allowance cuts, bigger state school class sizes and increased costs for early childhood education has simply made life a little more expensive for those least able to afford it.

“National has failed to rebalance the economy as it promised. It is focused on managing the finances but offers nothing by way of a plan to actually grow our economy and offer New Zealanders some hope.

“The National Government is more focused on political management than economic management. Budget decisions like spending on new motorways and subsiding pollution are politically motivated rather than economically motivated.

“Auto-enrolment in KiwiSaver has been delayed for political reasons in order to achieve a wafer thin surplus. A Government focused on acting in our economic interests would have done more to promote savings,” said Dr Norman.

The Green Party has previously released two reports that show that i) the Government has had to borrow an additional $2 billion to fund the tax cuts that went mainly to those on higher incomes and ii) that ordinary working families are more than $11,000 worse off this year due to cumulative Budget changes since National took office, while high income earners are much better off.

“Bill English once saw economic rebalancing as his number one priority. Today’s updated forecasts show the current account deficit worsening to 6.7 percent of GDP in 2016,” said Dr Norman.

“Borrowing to pay for tax cuts for the wealthy was fiscally reckless. Now asset sales will leave the Government accounts permanently worse off.

“The Green Party has a positive alternative – a smart green economy that protects our natural capital, enhances our quality of life, and shares our prosperity fairly.”

Link to the Green Party Co-leader Russel Norman’s 2012 Budget Speech
http://www.greens.org.nz/speeches/budget-2012-time-smart-green-economy

Link to the Green Party’s alternative 2012 Budget:
http://www.greens.org.nz/features/budget-2012-sharing-austerity-more-fairly

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