Media statement Thursday, October 11th, 2007

Tax cuts needed to restore government's fiscal discipline

Tax cuts are essential if for no other reason than to get financial discipline back into the government sector, the Employers & Manufacturers Association (Northern) says.

"The danger of the tax take becoming so large has led to massive increases in government spending and slack fiscal discipline," said Alasdair Thompson, EMA's chief executive.

"In the past eight years the Government has taken on an extra 25,000 public servants without any increase in productivity, according to Treasury figures.

"Government spending over the term of the present administration has risen from 29 per cent of GDP to over 32 per cent.

"The Government spending blowout has been paid for by increases in personal tax rates, bracket creep, rising employment, and falling numbers of beneficiaries on the unemployment benefit.

"The figures give the lie to Dr Cullen's reputation for conservative fiscal management."

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