KEY POINTS:
What's the bother with putting an extra couple of hundred million dollars on to the tab when you are already going into hock for close to $7 billion?
Labour's promise to abolish the parental income test on student allowances might make it look as though going further into the red is neither here nor there as far as Helen Clark's team is concerned.
At first glance, the pledge would seem to fit the definition of fiscal recklessness that Labour applied to National's tax cuts.
Voters will surely be puzzled as to how Labour can be so brazen when the policy will ultimately cost about $210 million in 2012 - by which time the Treasury expects the cash deficit to have soared to around $6.8 billion.
Helen Clark's announcement prompted National to accuse Labour of being "in denial" about the gloomy forecasts in last week's Treasury-produced pre-election fiscal update.
But the push for a universal student allowance is the perfect illustration of Labour's struggle to balance intense fiscal pressures with political needs.
A universal student allowance has long been on its wish-list. But Labour has got real and will phase in the abolition of the income test over four years.
That means the policy will cost $15 million next year. This should fall easily within the $1.7 billion set aside for new spending in next year's Budget.
The problem comes in later years as the cost increases and the fiscal pressures intensify.
But Labour's immediate priority is this year, election year. Cancelling interest charges on student loans did wonders for Labour's vote in 2005.
So it is going back to the well. The threshold for the parental income test will rise from the current $45,700 to $70,000 by 2010.
It is a blatant pitch for the crucial middle-income vote.
National is expecting more such announcements. That is because Labour must make an impact this week - the first of the four-week campaign - if it is going to have any chance of winning the election.
It cannot wait until the final two weeks. By then it will be too late.
That is why Labour is advertising so heavily now. That is why it moved heaven and earth to be able to announce a plan for dealing with the international financial crisis.
And that is why Helen Clark will be out to deliver the knock-out blow when she faces John Key in tonight's TV One-YouTube debate.
John Key does not have to win. A draw might be enough to get momentum back into National's campaign.
But he cannot afford to lose. A defeat would further stall his campaign, which is already struggling to make headway against the Labour onslaught.
