"The latest growth figures are much worse than any commentators were expecting and are an indictment of National's economic performance," Labour finance spokesperson Michael Cullen said today.

Dr Cullen was commenting on the GDP result for June showing the economy contracted by -0.3 percent over the quarter.

"The results have to be treated with some caution given that they relate to only one quarter and may be subject to later revision. But they do nothing to support National's claims that the economic recovery is strong.

"Taken together with yesterday's balance of payments result, showing a massive deterioration in the current account deficit between March and June, and the August merchandise trade data released today showing imports still galloping ahead of exports, the picture which emerges is poor indeed.

"It shows National's hands-off management and privatisation, cost-cutting agenda has reached the end of its useful life and has conspicuously failed to produce the sustainable growth New Zealand needs.

"It also makes nonsense of Bill English's claims that the economy can sustain - or would benefit from - another two rounds of tax cuts. The evidence of the last two years is that tax cuts give only a temporary stimulus while putting more pressure on New Zealand's already fragile external accounts," Dr Cullen said.

"It is unfortunate for National, but appropriate, that these figures should come out within days of the Prime Minister announcing the election date. They should become the epitaph of this sorry government.

"Any plans National had to campaign on its economic record are now ridiculous. Its bankruptcy of ideas stands cruelly exposed.

"The country desperately needs the change of economic direction and economic leadership Labour would provide," Dr Cullen said.

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