Labour’s ‘Roadmap’ A Tax And Spend Dead End

ACT New Zealand Leader Dr Don Brash today described Labour's 'Roadmap for the Economy' as a dead end policy of yet more spending, more borrowing, higher taxes, and more unemployment, saying it was exactly what got the economy into its current state, and that it would do nothing to improve living standards for hardworking New Zealanders.

"Labour's 2005 election bribes saw government spending skyrocket, leaving New Zealand completely unprepared for the global financial crisis. They have failed to learn from their mistakes and have today reiterated their promise of more of the same," Dr Brash said.

"The policies to raise the envy tax on top earners back to 39 percent and impose a capital gains tax is nothing new from Labour, and neither are the inevitable consequences. Higher taxes scare away investment, drive down productivity and growth, and export jobs overseas.

"Equally destructive is Labour's proposal to raise the minimum wage to $15 an hour. When Labour abolished youth rates it was a disaster. The Department of Labour estimates that, as a direct result of this policy, up to 9000 youths were priced out of the job market. Canterbury University economist Eric Crampton estimates the impact to be as high as 12,000 jobs. This will be replicated en masse under Labour's $15 minimum wage policy.

"ACT knows that growth is the key to raising incomes and that to grow the economy we must bring spending under control. ACT will put politicians on a budget by pushing for the passage into law of its Spending Cap Bill and will reduce spending as a portion of GDP to the level it was in 2005.

"Both National and Labour have tried the tax and spend approach and it has not worked. ACT has a plan to get the economy back on track, because in uncertain times New Zealand needs a real roadmap for growth, not Labour’s dead end," Dr Brash said.

ENDS

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