Cullen's Xmas Present - Gross Debt To Rise To $43 Billion

Dr Cullen has become Dr Debt with the figures released in today's December Economic and Fiscal Update says Nationals Associate Finance Spokesperson David Carter.

"Gross debt is now forecast to rise $6.6 billion over the next five years. That means overall the gross debt goes from $36billion to $43billion.

"What this means is that every New Zealander has an extra debt burden of $1800 and shows clearly that this Government is finding it harder and harder to make the figures add up.

"It is important now that we move beyond a shallow analysis of just the operating balance and focus on the entire balance sheet position. The real fiscal slippage is occurring in the capital side of the account.

"Dr Cullen is wrong to lead people to believe the increase in debt is all about Air New Zealand. It is much more than that.

"National shares the growing anxiety of financial markets about the debt position, and it is easy to see why some feel that the deterioration is leading to an increased risk premium on New Zealand interest rates.

"Prudent fiscal policy is all about making tough choices. Dr Cullen has opted for the easy choice of letting debt rise as a percentage of GDP. That is an option I would not have chosen.

"Another worrying trend from today's announcement is that Government is partially prefunding next years borrowing requirement. They are now prefunding borrowing to prefund super. That's now two prefundings too many.

"This is certainly starting to damage Dr Cullen's credibility and highlights the problem every Labour Government appears to have with managing the economy. They just can never get it right and Dr Debt and his team are no exception," says Mr Carter.

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