David Parker
Spokesperson for Finance

10 May 2013

Budget centrepiece a sign of failure

Rampant Auckland house prices are a symptom of National’s poor economic management, says Labour’s Finance spokesperson David Parker.

“Under National, rising inequality combined with out of date tax policy, and ineffective monetary policy have resulted in unaffordable house prices for ordinary New Zealanders.

“National’s answer – after five years – is to address only a fraction of the problem by bringing into effect changes to the Auckland City Plan they have until now blocked. This is a belated step, and one which Auckland City and Labour have been calling for.

“Moves by the Government today will not be enough to fix Auckland’s problems because they do not address the underlying economic drivers.

“The worst current account in the developed world, increasing debt, the narrowing of our export base, job losses in our export sector, and out of control Auckland house prices are all linked. They are the result of National’s inept economic management.

“Changing planning rules is not enough.

“National should admit it is wrong on both tax and monetary policy. A capital gains tax is essential. It will shift investment away from property speculation into productive businesses. That will drive our economy forward instead of driving house prices up.

“The Reserve Bank Governor Graeme Wheeler this week once more acknowledged a capital gains tax would help.

“Yet again the Government has shown it is incapable of making the right decisions. It won’t make KiwiSaver universal and boost our investment pool. It won’t reform monetary policy to make our exports more competitive, creating more jobs. And it won’t change the tax system to get investment into exports and jobs.

“This Government is failing New Zealanders and businesses. The fact that changes to planning in Auckland is a centrepiece of its Budget really is cause for reflection.

“Meanwhile, substantial parts of New Zealand stagnate and thousands of young New Zealanders continue to vote with their feet,” says David Parker.

ENDS

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