Bill English MP
National Party Finance Spokesman

9 March 2007

Cullen and Bollard at odds over Govt spending

"Finance Minister Michael Cullen and Reserve Bank Governor Alan Bollard appear to be at opposite ends of the pitch over Labour's spending programme," says National Party Finance spokesman Bill English.

"In what can only be described as an 'Emperor has no clothes moment' Dr Cullen claimed today that he was 'still running a very tight fiscal policy over all'.

"Michael Cullen must be living in a different reality. The Reserve Bank explicitly singled out 'expansionary fiscal policy' as one of the factors driving interest rate rises.

"The Reserve Bank Governor also said in his statement yesterday 'recently, fiscal policy has become more stimulatory. Government spending (as a share of output) rose significantly in the 2006 fiscal year, and is expected to record another significant rise in the 2007 fiscal year'.

"Yet Dr Cullen seems to be arguing the complete opposite. He is living in complete denial."

Mr English says that as a first step the Finance Minister needs to start tending to Labour's own low quality spending.

"Dr Cullen and Helen Clark are putting the foot down on the spending accelerator, while ordering homeowners to slam on the brakes.

"It's time they took some responsibility."

ENDS

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