"To expect honesty from Richard Prebble would be naïve. But a lie? That big? On the first televised leaders' debate of the campaign? That's pushing it, even for him," Labour state services spokesperson Trevor Mallard said today.

He was referring to Mr Prebble's statement on TV3 last night that Infometrics had found Act's tax costings added up - "and all you have to do, they say, is freeze government expenditure for just two years."

"That is a gross misrepresentation of the Infometrics report," Mr Mallard said.

"What it actually says is: "The tax cuts envisaged by Act require a substantial reduction in government spending, they cannot rely simply on a freeze in spending."

Infometrics says Act proposes to fund their tax cuts by three means:
· Severely reducing government spending on industrial assistance.
· Privatising all the remaining commercial activities owned by the Crown.
· Introducing voucher systems to education and health.

"The privatisation programme Act has in mind is extensive, according to Infometrics. Only Transpower would be left in public ownership. Everything else would be sold including: Radio New Zealand, TVNZ, New Zealand Post, the three "baby ECNZs," Metservice, Landcorp, Solid Energy, Timberlands, the Public Trust, Airways Corp, Terralink and the Vehicle Testing Authority.

"Labour believes that Infometrics' costings are kind to Act. But even Infometrics says spending cuts of $850 million next year and $400 million the year after would be needed on top of Act's proposed two year spending freeze to fund their tax cut agenda.

"Mr Prebble and Act would savagely cut social services and starve the core public service to the point that it could no longer function effectively. Before they force harsh economies elsewhere, they should learn to be a little less economical with the truth," Mr Mallard said.

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