19 November 2010 Media Statement

English admits recovery stalled

Finance Minister Bill English has just about given up on his denials that the New Zealand economy has stalled, says Labour’s Finance spokesperson David Cunliffe.

And Labour’s Economic Development spokesperson David Parker says Bill English has finally grasped the fact that savings are important to the New Zealand economy.

David Cunliffe said Kiwis had become used to John Key’s and Bill English’s manipulation of statistics to try to show their policies were closing the gap with Australia when the reality was the gap was widening in all the key measures like incomes, employment and growth.

“Today’s Statistics Department announcement that gross domestic product (GDP) in current prices increased just 1.2 percent for the year ended March 2010, the smallest increase since the year ended March 1992, shows just how stagnant our economy is.

“The same announcement shows that compensation for employees rose just 1.1 percent in the year, compared with the previous year's increase of 5.7 percent. This is a key reason for the decline in household spending.

“Hard-working Kiwi families who have had their incomes cut are naturally going to be spending less.”

“No wonder Bill English, asked yesterday whether next month’s half-year Economic and Fiscal Update (HYEFU) would again reveal that the economy was doing worse than he predicted just months ago, was forced to admit lamely that ‘it has been clear for some time now that the economic recovery has been a bit flatter’.

“Bill English and John Key will never be honest enough to admit they have no economic plan, but by now it’s becoming abundantly clear to Kiwis that National’s so-called economic re-balancing is actually all about making life even easier for the well-off and far tougher for low- and middle-income families struggling to pay at the supermarket check-out each week.

”Economic re-balancing is another meaningless phrase to go down in the short history of this government as one to rank alongside John Key’s promise of an aggressive recovery,” David Cunliffe said.
David Parker said: “National now says savings are fundamental to the long term performance of the economy. This is pitched as news by Bill English but has long been obvious to Labour. That is why Labour introduced KiwiSaver, and now, having cut KiwiSaver and after two years of mismanagement, National has belatedly convened yet another taskforce to cover for its lack of a credible economic plan.

“National is a one-trick pony. Tax cuts favouring those already best off are no substitute for a plan to grow the economy and jobs. National is failing.”

ENDS

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