Debt growth equal to cost of Canterbury quakes
Simon Bridges - Leader of the Opposition
9 July 2018
The Government’s borrow, tax and spend attitude means they will be increasing public debt by the equivalent of the cost to the previous Government of the Christchurch earthquakes, Opposition Leader Simon Bridges says.
“Grant Robertson’s loose and untargeted spending promises means the Government is planning to increase its borrowing by $17 billion over the next four years. That’s the same as the cost the National-led Government faced to rebuild following the Canterbury earthquakes.
“We need to continue to prudently manage the books, to ensure we’ve got enough in the bank to cover the next Global Financial Crisis or natural disaster. Instead, the Government is spending billions on diplomats, a tertiary fees policy that doesn’t deliver any more students, and a slush-fund for New Zealand First’s pet projects.
“National carefully managed the books to guide New Zealand through the Global Financial Crisis and then rebuild following the Canterbury earthquakes. We borrowed to ensure we could rebuild and continue to support vulnerable New Zealanders but we made prudent spending choices in order to get back to surplus and then begin to reduce debt.
“But at the same time economic uncertainty is increasing internationally this Government is taking the opposite approach – spending up large now and hoping that the next rainy day doesn’t happen under its watch. That’s irresponsible. There’s a difference between borrowing to respond to economic shocks as National did, and borrowing to fund loose and untargeted spending as this Government is doing.”
The extra debt is made up of $11 billion of additional core Crown debt, and a further $6 billion hidden off the balance sheet in Crown entity borrowing.
“On top of the extra $17 billion of debt, the Government is also raising an extra $2 billion through higher taxes on fuel and housing, with more and higher taxes likely.
“This is a Government that is borrowing more, taxing more and spending more. Unfortunately it has no plans for how we as a country can earn more and in the meantime it’s reducing New Zealand’s ability to cope with international and domestic economic shocks.”