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Dear John --
I hope you took time to enjoy the Queen’s Birthday weekend holiday
and the remarkable fact that it was Her Majesty Queen Elizabeth’s 70th
Jubilee celebration. What an inspiration she has been and still is, to
generations of Britons and people of the Commonwealth of Nations that
she heads.
Going Backwards
Recently,
the Government released Budget 2022 which confirmed that New Zealand
is going backwards under Labour faster than ever.
The focus of
this Budget should have been on helping the squeezed middle income
earners to overcome the escalating cost of living crisis and stop
Kiwis falling further and further behind.
What has been
delivered is a Backwards Budget.
New Zealand is experiencing a
cost of living crisis with inflation at a 30-year-high. It is expected
to last for years to come.
Mortgage costs are up because of
rising interest rates, rent is up $140 per week, food price inflation
is the highest in a decade at 6.4 per cent, and petrol is up over
$3.00 per litre.
More and more Kiwis are falling behind each
week, squeezed by growing costs and a Government that refuses to offer
them meaningful income tax relief while ramming through the biggest
spend-up in New Zealand history.
Labour’s temporary cost of
living package including the $27.00 per week to qualifying earners,
will do little to support Kiwi households through the current cost of
living crisis.
We know that Treasury has warned the Government
that the one-off cost of living payment is a poor mechanism for
addressing a long-term problem. The Reserve Bank says that access to
labour is ‘the key constraint on firms’ productive capacity’, leading
to higher prices for Kiwis. The National Opposition has a tax plan
that would inflation-adjust tax brackets, to allow Kiwis to keep more
of what they earn.
Labour have given themselves an extra $6
billion for this budget – the biggest ever spend-up in New Zealand’s
history and they are also spending $2 billion from Budget 2023 and
$0.4 billion from Budget 2024. On top of that there is climate
spending and the cost-of-living band-aid that will mean a total of $9
billion per year of government spending. Do they know where this money
is going to come from?
New Zealand needs a government with
financial discipline and a culture where government cares about how
every single dollar is spent and the outcomes it will achieve. Kiwis
across the country are having to tighten their belts and look after
every dollar they’re spending and the Government should be doing the
same.
Wages and salaries increases should be supported by
increased productivity and identifying new ways of doing business.
This has been my focus as I have visited many startups and new tech
opportunity businesses around New Zealand. I have also been fortunate
to meet with people in Britain and especially in Ireland who are
working on promoting Research, Science and Innovation. The use of
technology and innovation is the best way to provide future solutions
to some of the difficult problems facing the world at the moment,
especially post-covid.
It is unfortunate the current New
Zealand government has failed to deliver a sensible immigration reset
following the Covid-19 border closure. It is quite clear and the
Reserve Bank is saying it too, that labour shortages because of the
restrictions on immigration are preventing the growth of production
and economic activity while the Government is driving up labour costs
with its labour market policies around the minimum wage and pay parity
at a time when New Zealand is desperate for nurses, teachers, rural
contractors and farmworkers.
There is no clear plan or targets
for delivering better outcomes for New Zealanders. Under Labour, wait
times for surgery and specialist assessments have blown out, literacy
and numeracy achievement rates have hit alarming lows and violent
crime and gang numbers have exploded. They’ve added more than 10,000
bureaucrats to the public service, yet outcomes are getting
worse.
The Government’s lack of delivery has meant lower
productivity, higher prices and higher mortgage rates for Kiwis,
exacerbating the cost of living crisis.
One of my aims on my almost completed trip to Europe was to make
sure that European countries realised that our borders are open to
many of them through the Visa Waiver agreements we have. This makes it
easier for people of all ages to travel here and we particularly hope
young people will come to New Zealand rather than Australia for their
overseas experiences.
Best wishes,
Judith
Hon Judith Collins
http://judithcollins.national.org.nz/
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