Mr Key said that would result in more borrowing and rises in interest rates.
He also took aim at Labour's potential coalition with the Green Party, including the Greens' desire to put the decriminalisation of cannabis into coalition talks.
"They are Labour and the Greens. They are a high-spending, high-taxing government, if they ever get there. Which is good, because that is the only high Labour and the Greens look like they can agree on at the moment."
Mr Key said Green Party co-leader Russel Norman had spent the summer trying to angle another invitation to Kim Dotcom's mansion.
He had a poke at Hone Harawira's attendance record at Parliament: "Hone Harawira took a public tour of Parliament to see what it was actually like."
Labour, apparently under instruction not to respond to Mr Key with the usual heckling, remained largely silent until Mr Cunliffe stood up to speak.
In reply, Mr Cunliffe asked what Mr Key's legacy would be.
"It might be for his half-finished, user-pays cycleway, it might be for the holiday home in Hawaii, aka Planet Key, a place with lots of golf courses and no toilets.
"I think John Key is actually going to go down in history as what the international press calls him: 'unidentified guest'. His photo ops are about as flaky as his commitment to reducing unemployment."
Mr Cunliffe returned to the theme of the gap between rich and poor that he also hit in his State of the Nation speech yesterday, saying Mr Key was "the last gasp of an old and tired, failed way of doing things".
He said Mr Key's government was out of touch, arrogant "and patently just in it for their mates". He said the economic recovery had been propped up by two factors the Government could not take any credit for: the Christchurch earthquake and the price of milk.
"Putting that aside, what are they doing with what there is? They are making sure it goes to the top few. That is the kind of recovery we are seeing. The recovery in luxury car sales, sales of million-dollar homes, profits of big corporations and the record highs on the Rich List."
He said the trickle-down theory did not work and levels of child poverty in New Zealand were proof of that.
Dr Norman said the election would give New Zealanders a stark choice of governments.
"While on the one hand we have the choice of a genuinely progressive government, the alternative if the current Government is given a third term will be a very different government to the one elected in 2008. It will be a hard-right government - economically, environmentally and socially, beholden to the damaged and discredited ACT, United Future, and Conservative parties. John Key's claim to be a moderate has evaporated over the course of the last couple of years."
NZ First leader Winston Peters criticised Mr Key for politicising his speech, saying it was supposed to be an outline of National's measures and the issues facing the country. He also gave a prediction: "I suspect a leadership change in the National Party is not far away."
He also said he did not believe the recent claim that New Zealand was a "rockstar economy".
"Treasury has never won a Grammy for the accuracy of its forecasts."
He said National should not be proud of its plan for the country, saying house prices were spiking so fast that no young couple had a chance of keeping up with their savings. He also hit out at power prices and employment laws, saying jobs should stay with New Zealanders instead of going to foreigners.
