Budget 2024 fails to deliver investment that New Zealanders need

Budget 2024 is placing this governments ideological wants before real New Zealanders’ needs.

“Tax cuts and spending cuts are favoured over addressing the cost-of-living crisis and delivering the investments that New Zealanders need,” said NZCTU Economist Craig Renney.

“Nicola Willis has failed her own tests that she set herself, such as when she said her tax cuts would “not require any additional borrowing” said Renney. According to Treasury, the Government will borrow an additional $17.1bn by June 2028. Tax cuts will cost nearly $10bn. Future taxpayers are going to pay for tax cuts today.

“Willis also claimed that she would be able to deliver on all National’s election promises. Yet the tax cut programme doesn’t include the Working for Families changes promised by National in opposition. The gambling tax changes were supposed to bring in $716m over the next four years. They now bring in $190m. It’s now clear that the tax package isn’t being delivered as promised.

“The Budget also fails the test of not cutting front-line services. Real terms cuts are made to operating grants to education. Vote Customs sees only cuts, no investment at all. The same is true for Agriculture, Biosecurity, Fisheries, and Food Safety, as it is for Māori Development and Pacific Peoples.

“The Budget fails the test of helping to end child poverty. Officials now forecast that targets on child poverty will be missed significantly. The Government states that, “A key driver of child poverty is living in a benefit-dependent household”. In reality, the key driver of living in poverty is being poor – something that is not helped by real terms cuts to the minimum wage, and cuts to welfare payments.

“This Budget fails the test of preparing New Zealand for the future. Investment to support business, science, and innovation is cut by $1.4bn – and only $700m is returned. This includes cutting large elements of the Warmer Kiwi Homes programme, which improves the energy efficiency and health of New Zealand’s ageing housing stock. Tackling climate change is no longer a concern, with $180m cut from the Energy Efficiency and Conservation Authority. The National Resilience Plan, established to help with future natural disasters, is ended.

“The Government has clearly signaled its values with this Budget. Short-term benefits for some in the form of tax cuts will come at the cost of long-term borrowing, rising child poverty, and increasing insecurity from challenges such as climate change and rising unemployment.

“This is a Budget for the few. It doesn’t deliver for the people who need it most. The Government has failed the most important test of all – delivering a better future for Aotearoa,” said Renney.

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