We asked political veterans from the left and the right to give us their Budget 2022 wish-lists. Now they're back with their verdicts.
Jonathan Coleman: No plan for growing the economy
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We asked political veterans from the left and the right to give us their Budget 2022 wish-lists. Now they're back with their verdicts.
This is a curate's egg of a Budget – good in parts, but unfortunately there is no plan for how we are going to grow the New Zealand economy and raise living standards.
On the face of it, it's good to see the massive investment in health, including more money for medicines and ambulances. However, the bulk of the new money goes to wiping DHB deficits- which is an accounting adjustment to give the new entity Health New Zealand a clean slate; it won't actually buy extra operations or pay for more nurses or doctors.
There is a nod to the cost-of-living crisis but it's only $27 a week if you earn less than $70,000. It's better than nothing, but effectively more welfare. A better approach would have been inflation-adjustment of tax brackets to let people keep more of their own money, and incentivise work. The already small impact of these payments will soon be swallowed up by inflation.
Looking at the detail, our debt is going up, and so is our spending; it is going to take longer to get back into surplus. That is no recipe for economic growth.
There is nothing here that improves New Zealand's competitive position internationally. It is not an outward-looking Budget that is going to attract investment and people to New Zealand and that translates to no plan for increasing our wealth in real terms.
I suspect most people will like the sound of the health investment, but won't feel there is anything particularly significant in this Budget for them. If you are a 25-year-old with skills, you're probably thinking Australia looks pretty good right now.
Apart from the ongoing focus on health reforms, this Budget will soon be forgotten. However, the negative long-term economic effects won't be.
• Dr Jonathan Coleman is a former National Party MP and minister in the John Key-led Government from 2008 to 2017, including Health and Defence.
This year's Budget is an outstanding demonstration of just how much National's recent gain in the polls has spooked Labour. Grant Robertson's fiscal conservatism shines through with no meaningful new initiatives on housing, poverty or mental health or any serious steps on, for example, public transport in the wake of the completely inadequate climate change measures announced on Monday.
The expected major spend on health is in there but it's really sleight of hand, paying down DHB debt and maintaining operational costs as the new structures get under way. The pitiful $42 million a year allocated to the new Māori Health Authority is just 0.7 per cent of the health budget, making this potentially groundbreaking step symbolic rather than meaningful, and quite insulting in the face of the promise the MHA held as a step towards improved Tiriti-based relationships.
Lifting the emergency dental grant from $300 to $1000 is long overdue, but won't cover more than a fraction of the cost of care for any serious conditions. The extra $27 a week for three months for people who aren't on main benefits or super and earn under $70,000 will be welcomed, but is not the answer to ever-rising energy costs. Reversing privatisation and competition in the energy sector would be the meaningful response.
Labour has once again missed an opportunity to make even a few of the radical changes needed in this time of accelerating health, climate, housing and inequality crises. With an absolute majority in the House and the support of their Green partners, Labour could have chosen a very different suite of measures this year. There is a lot of nice talk about "securing our future" and facing "multi-generational challenges" but unfortunately this Budget does neither.
• Sue Bradford is a social activist and anti-poverty advocate and was a Green Party MP from 1999 to 2009.
READ MORE:
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• After families plead for help, Pharmac gets major funding injection
• Changes to benefits will see 6000 to 14,000 more children out of poverty, nearly $1b to disability sector
• Budget 2022: 10 things you need to know
• Nearly $3b to education, decile changes and pay parity
• First-home buyer loan scheme shaken up
• Budget 2022: Billion-dollar cost-of-living bonanza
This is the Blackadder Budget that represents a cunning plan with weasel words. A tax rebate whilst you are telling everyone there will be no change to tax rates. A $350 hokey-pokey hit that will rapidly melt under inflationary heat. Unfortunately, such a rebate could have been used to meet a long-term reprieve on the cost of gas.
There is no recognition that climate change requires us to give the RMA (Resource Management Act) a kick in the teeth. Clean-energy projects should have been exempted from the RMA and consented by Parliament. Transmission upgrades paid for by ETS (Emissions Trading Scheme) revenue offer transformational benefits rather than trading clunkers for trinkets.
Wasteful money on light rail and, wait for it, an Auckland port study! A proposal to establish our next global port in the Manukau Harbour where many a vessel has been shipwrecked. Portentous given there are electoral taniwhas in that Tāmaki Makaurau tide.
Sadly there is nothing of significance to tune the engine of growth otherwise known as the private sector. Subsidies for the industry to cope with rising carbon prices. As geopolitical uncertainty grows we needed investment to shore up our economic resilience.
Health spending is overdue but will require flinty change managers. However, money thrown at a separate Health Runanga is cultural confetti, it belongs on the frontline. Oh well, the dental subsidy is useful - however it is unlikely to suppress the electoral bad breath coming Labour's way.
• Shane Jones was Minister of Regional Economic Development in the Labour-NZ First Government of 2017-2020. He has been an MP for NZ First and Labour in the past.
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