Hon Jim Anderton

Progressive Party leader

10 July 2008 Media Statement

Research is a "nonsense"

The ANZ Bank's research alleging that large amounts of government spending was unproductive was filled with glaring errors, Progressive leader Jim Anderton said today.

He said the report, by chief economist Cameron Bagrie, was so hedged with qualifications as to be ridiculously nonsensical.

"On the one hand, he says that some funding is good - "frontline" or "non-departmental funding", compared with "back office" or "departmental funding" - but omits that more than 60 per cent of the "departmental funding" he complains about is the funding for services he says the government should be providing, such as defence and law and order.

"This is explained away as "a degree of overlap between front-line purchase and spending on departmental outputs" - well, $6.85 billion out of $11.4 billion is one hell of an overlap in my books!"

Jim Anderton said it was quite clear the report had started from an ideological position, and had struggled to find any evidence to justify that position.

"When the Labour-Progressive Government began its work in 1999, there was significant underinvestment in our public services and infrastructure. We have worked hard to rectify that - as was mandated by the people of New Zealand.

"This research shows how out of touch with reality this Australian-owned bank is."

Jim Anderton said there was a need to scrutinise public spending, as it was taxpayers' money, but such scrutiny had to be evidence-based, not ideological.

ENDS

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