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Govt throws debt target out window

Opinion Piece

Right now it feels as though every week the Government breaks another promise to New Zealanders, whether it’s fees-free, the lack of KiwiBuild houses, and now Finance Minister Grant Robertson scrapping his self-imposed debt target.

Instead of a fixed target of reducing Crown debt to 20 percent, Mr Robertson has given himself a “range”. You can almost guarantee this means debt at the upper end of the range of 25 percent, loosening the purse strings by tens of billions of dollars. That isn’t wriggle room.

The Finance Minister is admitting defeat, after repeatedly using these rules to give himself the appearance of being fiscally responsible.

The Minister has been backed into a corner by allowing the economy to slow, overpromising, and his Government spending up large on things like Shane Jones’ slush fund and other poor spending choices like fees-free for tertiary students and KiwiBuild.

This is a blunt admission the Government can’t manage the books properly, and the Minister is conceding to what National has been saying for months — the Government has overpromised and cannot deliver.

Mr Robertson is giving the Government a licence to spend up large, at the taxpayer’s expense.

Debt isn’t free. It will have to be paid for by higher taxes in the future. Labour is putting a heavy financial burden on our children and grandchildren.

National believes in paying down debt when the economy is in good shape so we have the ability to support New Zealand during a crisis, like we did during the Global Financial Crisis and the Christchurch earthquakes. That’s what has kept New Zealand out of trouble historically.

Instead Labour has wasted the surpluses they inherited and weakened our economy through poor economic management. New Zealand could have had enough money to meet our needs.

The debt target is the latest broken promise by the Government as its “year of delivery” continues to be an embarrassing string of failures.

The Government is 18 months in and Mr Robertson has given up any pretence of fiscal responsibility, showing you just can’t trust Labour with the economy.

Anne Tolley

MP for East Coast