"The National Party is clearly running scared after Helen Clark beat Jenny Shipley in the first of the leaders''debates last night," Labour finance spokesperson Michael Cullen said today.

"Their response to Mrs Shipley's defeat is to try to deflect attention from it by ratcheting up their cheap scare campaign against Labour even further. They more they do, the less credible they become."

Dr Cullen was responding to the latest piece of nonsense from Bill English regarding Labour's costings.

"Mr English should take a deep breath and calm down. We are finalising our figures now and will release them when it suits us to do so. That will be well before polling day because we believe the facts should be put before the public so that voters can exercise an informed choice.

"In the meantime, let me confirm our intention as the incoming Government to maintain spending very largely within the limits defined by the Prefu.

"That gives us $800 million a year more fiscal headroom than National will have - the $400 million we will save by not implementing their silly April fools day tax cut and the $400 million we expect to raise from our own modest tax increase on the 5 percent of New Zealanders who earn more than $60,000.

"Let me also confirm that our spending programme will be fully costed," Dr Cullen said.

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