Finance Minister Bill English is promising ''jam tomorrow''
for wage earners, as long as the Government is re-elected on
In a hark back to the days when Sir William Birch was finance
minister and Mr English was his humble assistant, Mr English
is looking to the future.
The average annual wage is expected to increase by $7500 to
about $62,000 a year by 2018 ''if New Zealand achieves its
economic growth forecasts over the next four years''.
Back in the days of Sir William, New Zealanders were promised
tax cuts, as long as National was re-elected and other
Tax cuts eventually came, but were reversed by the next
It seems obvious, according to Mr English's pre-Budget 2014
speech yesterday, wages will rise because the Budget next
month will be about thoughtful targeted spending, not a
Mr English was in campaign mode in his speech, not beating
around the bush.
In effect, the campaign has started already, with Labour
releasing policies as leader David Cunliffe goes on a
whirlwind tour of the country.
Mr English also took a swipe at local body planners and
councillors for contributing to the country's housing
unaffordability in the least-affordable cities.
He also promised to keep spending down to a $1 billion of new
spending in the Budget as the Crown accounts return to a
paper-thin surplus in 2014-15.
''Imagine the effect on interest rates - and the rest of the
economy - of a return to the $3 billion-plus annual spending
allowances we saw under the previous Labour government from
2005-08,'' he said.
Every 1% movement in mortgage interest rates was worth about
$40 a week - or $2000 a year - for a family with a $200,000
''So when you hear politicians promising to ramp up spending
to pay for expensive election promises, you should remember
this would come at a significant cost to households and
Mr English is playing a cool game on spending promises.
As a list MP from September 20, chances are Mr English will
depart for overseas sometime in the next electoral term, no
matter who wins.
But after 24 years as an MP, he will not want to let a third
term slip away from Prime Minister John Key.
However, many New Zealanders rely on the Government for help
with their accommodation needs through various forms of
As the economy recovers, voters may feel they deserve some
While the country has got out of the way of huge election
bribes in the past six years, Labour only needs to find one
trigger for the game to change.