Media release

Labour's financial plan will make life fairer for working Kiwis

Labour’s Fiscal Plan shows a clear and positive difference from National.

“Those who earn over over 150,000 will pay more tax and applying tax to trusts to combat tax avoidance, are welcome steps to reducing inequality and the unfairness of the tax system. It’s a relief to see more effort in stopping the billions of dollars of tax evasion.” CTU President Helen Kelly said.

“Labour’s commitment to funding the real costs of Health and Education, taking account of rising costs and the changing population, forces National to front up and say what it is going to do to prevent our public services from deteriorating further. It cannot continue to pretend that it can squeeze more “efficiencies” out of a system that has faced five years of real cuts in funding and additional costs lumped on it by the Government. The Government’s claim that it has only hit “back office” staff has lost credibility with recent major problems in CYFS and Health.” Kelly said.

“If the present Government reduces spending as a proportion of GDP as its 2014 Budget says, its own Budget documents showed there will have to be major cuts in services in the next Parliamentary term. In Health, officials warned last year that major changes would be required saying that sustainability of the health system would require changes that are far larger than those achieved to date including more targeted services and funding. That would mean major cuts to services.” CTU Economist, Bill Rosenberg said.

“Budget spreadsheets show the government plans a real cut in Health spending of 12.3 percent in real terms between 2013 and 2018, Education sectors between 3 percent and 9 percent, Social Welfare excluding New Zealand Superannuation 6.0 percent if forecast cuts in beneficiary numbers are achieved, and other expenses by 10.3 percent. All these are falls after costs and population changes are taken into account. Only New Zealand Superannuation and Finance Costs rise in real terms.” Rosenberg said.

“Journalist and commentator Rod Oram has reported that Bill English said in a recent conference that “If National wins the election, English says his next budget will be the most radical restructuring of government spending in 50 years...”.” Kelly said.

“National cannot keep on cutting without consequences. It is sweeping under the carpet social, economic and environmental deficits for future governments to fix. They include high levels of child poverty and inequality, climate change, the needs of an ageing population, an unbalanced economy and increasing numbers of preventable diseases caused by poverty, poor nutrition and commercial pressures. Neither can it continue to underpay state service employees without loss of skills and morale. The Labour-led governments of the 2000s were left with a similar legacy in the 2000s.” Kelly said.

“Labour begins to address these problems without breaking the bank while introducing some useful programmes for economic development, better paid parental leave and help for families.” Kelly said.

ENDS

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