Fiscal realism message from Joyce on govt debt

Steve Joyce
Steve Joyce
National  was on track to stay well within the parameters of the pre-election fiscal update and reduce the government net debt to $56 billion by 2022, Finance Minister Steven Joyce said yesterday.

Mr Joyce, who got himself into bother last week by denigrating Labour's fiscal plan, said his announcement was in marked contrast to the Labour Party which, by its own admission, would have debt $11.4 billion higher at $68 billion by 2022.

"And that's before you consider how unrealistic they are being about their revised fiscal plan and its projected zero budgets outside of education and health.''

Labour's policies would also have negative effects on economic growth and tax revenue, which would further increase debt, he said.

The policy announcements National had made since August 12 until Sunday had a total effect on the Government's operating budget of $424 million in the 2018-19 year, against a budget operating allowance of $1.7 billion.

Across the four-year period, the amount allocated through the policy announcements equated to 11%, or $1.98 billion, of the $17.34 billion reserved in the Pre-Election Fiscal Update (Prefu), Mr Joyce said.

Recent announcements

Education: National's package required additional capital investment of $25 million. The funding would come from the $39.9 billion of unallocated capital available from Budget 2017.

Christchurch Metro Stadium: $120 million for building a new stadium from unallocated capital.

Auckland and Wellington commuter rail: $267 million for upgrades to Auckland and Wellington's urban commuter rail networks from unallocated capital.

Roads of national significance: The new roads were expected to cost about $10.5 billion over the next 10 years. They would be funded from the separate National Land Transport Fund and the use of public private partnerships. The transport fund's annual budget was $4 billion a year.

Nelson southern link: The new road was expected to cost up to $125 million from the National Land Transport Fund and some Crown funding.

Whanganui velodrome: National would spend up to $6 million from the existing regional growth programme on the Whanganui Regional Velodrome redevelopment programme.

The Taxpayers Union said Mr Joyce's claims might technically stack up but they were misleading.

A better comparable figure was the $8 billion in promised spending included in the Taxpayers' Union Bribe-O-Meter, Taxpayer Union economist Mac Mackenna said.

Unlike Mr Joyce's figure, the Bribe-O-Meter took into account promised capital spending by all parties.

"The promises still represent money taken from households through higher tax, higher Crown debt - which is simply deferred tax - or less money for other spending areas.''



Given Joyce's appalling academic record, I wouldn't put him in charge of an outhouse, let alone any country's finances.