24 September 2008 Media Statement

National can't credibly cut taxes and keep services

John Key's claim that National can promise a further $5 billion of tax cuts and leave public services unaffected is not credible, Progressive MP Jim Anderton said today.

He said National's plans, outlined at the PSA this morning, meant interest rate increases, runaway debt, asset sales and slower growth.

"Money used for one thing must come from somewhere else. If you cut taxes, there isn't as much money available to fund services. Trying to fund the same level of services from reduced revenue must mean increased debt or higher user charges such as road tolls, and even the sale of assets such as Kiwibank, ACC and the roads themselves.

"As debt increases, debt servicing costs increase, inflation increases, interest rates rise, growth slows and unemployment rises.

"Mr Key appears to be too weak to make explicit policy choices. He won't say tax cuts are better than a particular service such as health care for all. Instead he pretends you can have everything. His economic policy has no credibility."

ENDS

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