Budget 2024: Tax cuts can’t disguise austerity for many Kiwi families - Shane Te Pou

Shane Te Pou (Ngāi Tūhoe) is a commentator, blogger and former Labour Party activist.

OPINION

Is that it? After all the hype and build-up, the Luxon Government has finally announced its tax cuts and they’re a joke. We were told we were getting two fifty in tax cuts – they never said it would be two bucks fifty.

In fact, it’s only $2.20 a week for the median income earner on $49,000 a year. That works out the same as a seven cents an hour pay rise before tax. Even if you’re on a decent income over $78,000, you still only get $20 a week – that’s like a pre-tax pay rise of 75 cents an hour.

This is the solution to the cost-of-living crisis that we’ve been promised for so long? Give me a break.

Let’s face it, this is an austerity budget for many families. The minimum wage has been held below inflation, the rate of benefit and super increases was cut, and people are losing their jobs. The poorest 17 per cent of Kiwis get no tax cut at all, and those who get something will see them eaten up by higher rego, higher bus and train fares, charges back on prescriptions, and higher power prices.

That’s all increasing the cost of living for Kiwi whānau.

And it’s austerity for a lot of public service people rely on. The health budget increases just 1.3 per cent next year – that’s less than population growth, let alone inflation. Education gets just 1.9 per cent. Budget Advice Services get the chop. So does anti-child exploitation work. School lunches get less nutritious.

Every time this Government says it can’t afford to run public services properly, I just remember they had no problem finding $2.9 billion for landlord tax cuts.

While government ministers have spent the last six months looking down the back of the couch for every tiny cut they make to pay for the tax cuts, they haven’t had their eye on the ball – the economy is in serious trouble, and there is no plan, not even a hint of a plan, in this Budget.

Another 32,000 Kiwis are set to lose their jobs, with a total of 164,000 Kiwis out of work by 2025. Māori unemployment will go well north of 10 per cent. And the Government has no idea what to do about it.

Cut public services, increase charges, make tax cuts – that’s as far as the Government’s plan goes.

Meanwhile, the real economy is in deep trouble. And it’s not being helped by the Government cutting investment in infrastructure, freezing work on schools and hospitals, and cutting the Government house building programme from 6000 homes a year to less than 400.

So, that’s it. Six months in, and this Government is out of ideas. Where to from here now they can’t keep promising tax cuts will solve everything? Spin was enough to get elected but that’s collided with the cold hard fiscal reality, resulting in trifling tax cuts. We need to see some substance, not just two and a half years of drift.

It’s going to be a tough winter for many whānau.