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Less Government = Higher Wages

Less Government = Higher Wages

Press Release by ACT Leader John Banks
Wednesday, May 23 2012

ACT Leader John Banks today called on those campaigning for a ‘Living Wage’ to get behind policies that reduce the size of Government.

“Last year the Government’s financial statements showed that 49.9 per cent of every dollar spent in our economy was spent by the Government or a government entity,” Mr Banks said.

“Every dollar spent by government is a dollar that must first be taken out of the pockets of New Zealanders.

“That’s a dollar that could have gone towards the weekly grocery bill, the mortgage, or towards a deposit on a home. That’s also a dollar that business owners could have spent hiring staff, increasing wages or investing in valuable research and development.

“If we want a better standard of living – including higher wages – we need less Government, not more. The Government must do less, spend less and grow less if wages and productivity in the private sector are to rise.

“In a recent survey, Hospitality New Zealand found that 48 per cent of its members paid themselves less than the minimum wage last year. How can we ask these business owners to pay staff more, when they can barely afford to pay themselves?

“Under Labour, from 2000 to 2009, core crown expenditure increased from $35 billion to $64 billion – that’s $29 billion over nine years.

“Under National, core crown expenditure has only risen by $8 billion in four years, which is far better but still not enough. ACT would like to see more done to reverse Labour’s huge growth in Government spending that is stifling our economy.

“ACT’s proposed Spending Limit, which would put politicians on a budget, would be a good start.

“The goal of a ‘Living Wage’ will be achieved through less Government, not more. Rather than oppose reductions in Government spending, those campaigning for a ‘Living Wage’ should support them,” Mr Banks said.


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