The 2014 Budget

May 15th, 2014 at 2:00 pm by David Farrar

Forecasts

  • Growth to almost hit 4%
  • An extra 170,000 jobs by 2018
  • Average annual wages to go up by 14% to $62,330. Inflation projection is 10% over four years so net 4% gain.
  • surpluses to grow from $372 million to $1.3 billion in 15/16 and $3.5 billion in 17/18
  • Net debt to be under 20% of GDP by 2020
  • NZ Super Fund contributions to resume in 2019/20

The growth projections are positive, and are the most important aspect. Without economic growth, a surplus becomes a deficit. The projected increases in jobs and real wages are also a positive.

The net debt to be under 20% by 2020 is a huge turnaround. The last projection in 2008 had it ever increasing to 70% or so.

However the surplus is still fragile. There isn’t any wriggle room in 2014/15, but I believe 2015/16 should have room to consider tax cuts.

Last year

  • 84,000 more jobs
  • Average weekly wages up 3.2%
  • Inflation has been 1.5%, so real increase in average wages is 1.7%

This Year

  • New spending of $5.7 billion over four years, including $1.6 billion of reprioritisation ore revenue measures
  • Budget surplus projected to be $372 million
  • Operating allowance of $1.5 billion a year, growing at 2% a year, Under Labour they ranged from $2 billion to $7 billion, averaging $3.5 billion over last five years – so under half the previous rate

2008 was the shocker year. A $7 billion increase in annual spending, which meant that when the recession kicked in, we got the projected decade of deficits.

Treasury has released advice that spending increases in excess of $1.5 billion a year will force interest rates to rise more quickly. So political parties promising spending in excess of that will need to explain how they will stop interest rates increasing more quickly.

Tax

  • The 6% who earn over $100,000 pay 37% of income tax
  • The 12% who earn over $80,000 pay 51% of income tax
  • The 51% who earn under $30,000 pay 5% of income tax
  • Cheque duty to be abolished, reducing revenue by $4 million a year

Remember when Labour introduced the rich prick tax on those earning over $60,000. Well 23% of New Zealanders now earn over $60,000 and they now pay 69% of all income tax.

The only tax cut in this budget is abolishing cheque duty. Next they’ll be abolishing excise duty on horses and carriages!

Sure tax cuts are not affordable in the 2014/15 year. But they are in the out years, and hopefully all political parties will outline policies to reduce income and other taxes in the lead up to the election.

Spending

  • Total spending now $73.1 billion
  • $375 million loan to NZTA for Auckland transport projects
  • $69 million for trade & enterprise
  • $57 million for science
  • $58 million for research and development
  • 6,000 more apprentice places
  • $136 million for tertiary education science and research
  • $100 million more to assist people from welfare into work
  • $536 million for Defence
  • Of $4.7 billion raised from asset sales $200 million for health capital projects, $198 million for Kiwirail, $172 for school property and $40 million for irrigation infrastructure

Nothing too surprising here. As with previous budgets the focus is on science, research & development, schools and hospitals.

I do wish they would stop throwing good money after bad into Kiwirail.

Families

  • $500 million more spending on families
  • Additional four weeks paid parental leave (to 18)
  • Parental tax credit goes from $150 a week to $220 a week and from eight to ten weeks for $42 million
  • $90 million more to extend free GP visits to under 13s
  • $156 million more for early childhood education
  • $33 million to assist vulnerable children

This is the major focus. The paid parental leave was well signalled. The extending of free GP visits to under 13s was a surprise (and a better policy than merely paying more to parents), as was the extra $1,000 for the parental tax credit.

Education

  • $858 million over four years more spending
  • $359 million to pay top teachers and principals more
  • $85 million more for school operations
  • $11 more for school property

No extra details on the package announced in January around up to $50,000 per year more for the top principals. Lots of interest in the final package.

Health

  • $1.8 billion more over four years
  • $110 million more for 4,000 more elective surgery ops
  • A new Grey Base Hospital for $200 million a week

Tony Ryall remains determined not to have Health become an area of weakness for the Government.

Overall

Overall I can’t imagine this will go down as a controversial or memorable Budget. It is significant as the first Budget to project a surplus since 2008, and the difficulty of achieving that should not be under-estimated.

The Australian Budget on Tuesday shows what happens, when you don’t have a Government that can’t impose fiscal restraint, as happened with Labor. It also shows the political danger of responding to a huge deficit with a huge slashing of spending (and tax hikes), rather than a gradual reduction in spending increases.

Sometimes slow and steady does win the race, and in New Zealand’s case it looks like it will.

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109 Responses to “The 2014 Budget”

  1. berend (1,715 comments) says:

    DPF Sometimes slow and steady does win the race

    Sorry, didn’t get that, you mean the slow and steady borrowing of $250 million A WEEK for the last 5 years?

    [DPF: As opposed to doing what Tony Abbott just did, and destroying his Government within a week – absolutely yes]

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  2. KiwiGreg (3,259 comments) says:

    …and thus National’s occupation of the centre-left is complete, as is the foregoing of any vestigal principals it may have had. Tax, spend and borrow.

    The only thing they have going for them is they are less terrible than the alternative.

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  3. berend (1,715 comments) says:

    DPF, thanks for clarifying that John Key either had to borrow $50 BILLION or destroy the government. I mean, there was really no other choice imaginable. Or maybe John Key isn’t very imaginative and knew that borrowing and doling out money never brought down a government. It only destroyed the next one.

    ‘m really sorry, but you can’t claim that one party is completely irresponsible in spending (Labour in AU) and the next government now has a big problem; and that borrowing and spending $50 billion is absolutely the responsible thing to do if you are John Key. That’s very special pleading.

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  4. virtualmark (1,536 comments) says:

    How about if we only build one new Grey Base Hospital, rather than one a week :)

    Will that bring tax cuts in faster?

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  5. Cunningham (845 comments) says:

    Pretty good effort. Nothing too dramatic but I think the vast majority will be pretty happy (you will always have the whingers).

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  6. gump (1,659 comments) says:

    No changes to National Superannuation?

    That’s politically understandable, but fiscally negligent.

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  7. Kea (13,317 comments) says:

    As a single white male I can not wait to see what goodies are in store for me !

    LOOOOOOOOOOOOOOLLLLLLLLLLLLLLLLLLLLLLLLLLLL bah ha ha ha ha :(

    I just told my breeder friend I will transfer my income directly into his bank to save admin costs.

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  8. srylands (414 comments) says:

    Berend the difference is that Labor in Australia created a permanent structural deficit through poor quality spending. The current New Zealand government borrowed to reflect the cyclical downturn while gradually improving the quality of spending. So you are now seeing the deficit unwind, with higher quality spending. We don’t need the enormous new operating allocations every year. Yet public satisfaction with services is at a record high.

    Yes I would like to see them do much more to reduce spending. But I would also like them to stay in office. Because the alternative doesn’t look too flash.

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  9. Manolo (14,026 comments) says:

    Not without reason Labour Lite (today’s National) is only a lighter shade of red than loathsome Labour.

    Extending paid parental leave and free doctor visits for all children under 13 are key features of a $500 million family package at the heart of the budget.

    Cutting taxes and letting people do whatever they want with THEIR OWN money is a better way. But no, nanny state knows better. No, do not tell me I have to pay extra for others’ breeding habits either.

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  10. stephieboy (3,376 comments) says:

    kiwi Greg , tell us about the budget initiatives you would like to see.?
    Maybe you and our libertarian wingnuts here might like to consider the electoral implications re ACT etc.
    Manolo, get of your butt for a change and start a Party or whatever

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  11. virtualmark (1,536 comments) says:

    KiwiGreg … National is very much a centre-right party. John Key and Steven Joyce are smart enough to work out you win elections by holding the centre. Many of us here would naturally feel more comfortable with a strong right-wing emphasis. But that won’t win an election.

    But you can achieve more by being a pragmatic chap in Government rather than being a idealistic chap in Opposition.

    Meanwhile, if we want National to be tugged more to the right then ACT need to get their sh*t together and behave like a group of grown ups. I’d hoped their new faces would start to deliver a more disciplined focus. But as I watch them get tripped up on stupid irrelevant issues like incest I am rapidly losing faith with that hope.

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  12. Ryan Sproull (7,259 comments) says:

    Cutting taxes and letting people do whatever they want with THEIR OWN money is a better way. But no, nanny state knows better.

    You don’t have to look far on Kiwiblog to find people who will argue that just about anyone knows better than some parents in New Zealand.

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  13. Ryan Sproull (7,259 comments) says:

    Bill English is all class in this Budget announcement.

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  14. Ryan Sproull (7,259 comments) says:

    Cunliffe stuck with a very hard act to follow.

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  15. stephieboy (3,376 comments) says:

    virtualmark, here, here. Well said but don’t expect crusty dogmatic ideologues to comprehend the patently obvious.

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  16. NK (1,253 comments) says:

    Cunliffe stuck with a very hard act to follow.

    Of course. It’s a left wing budget.

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  17. Kea (13,317 comments) says:

    This is on top of the Benefit !

    Families

    $500 million more spending on families
    Additional four weeks paid parental leave (to 18)
    Parental tax credit goes from $150 a week to $220 a week and from eight to ten weeks for $42 million
    $90 million more to extend free GP visits to under 13s
    $156 million more for early childhood education
    $33 million to assist vulnerable children

    Kea never knew he had that much money up his arse. Trust Nanny State to find it :)

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  18. Lindsay Addie (1,587 comments) says:

    The facial expressions and body language of the Labour MP’s is interesting to watch while their esteemed leader speaks.

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  19. Chuck Bird (4,923 comments) says:

    I would like to see some big cuts in legal aid in all courts. Below is a quote from a sworn affidavit from the nut case I am up against who is trying to get legal aid. It appears he is lying about being granted legal aid but legal aid should only be granted in matrimonial and civil courts where not granting it would be manifestly unjust. There could also be big cuts in criminal cases for repeat offenders.

    66) On that ground as well as the ground that Hxxxxxx had forgiven the receiver his claim for costs against the receiver and therefore Hxxxxxx’s claim under the indemnity must fail.
    67) Hxxxxxx should not be enabled to be advantaged by is breach of trust by the indemnity.
    A Gross Miscarriage of Justice
    68) Even if there has not been a premeditated campaign to bankrupt me and I still allege that there has been, this has been the effect of the consequences of Hxxxxxx’s insanity and the advantage taken of it by others. Hxxxxxxx knew what he was doing even if he was morally and emotionally barren.
    69) The damage has spilt down my family where my sons have seen their friends and associates all have educational advantages, career opportunities and opportunities in life and gone that they have missed out on without health treatments, hearing aids and so on which they have been deprived of and not understood why they have been left behind while others have had those things sometimes from money improperly taken from their trust’s funds. Bird’s and Hxxxxxxx’s families are examples. But not the only ones.
    70) We have been subjected to orchestrated abuse for nearly a decade. These were crucial years in the lives of my children and I have been reduced at 71 to penury.

    Kick for touch. Grant a rehearing in front of a new judge
    71) Too much misleading evidence or lack of it has been heard and too many convolutions have taken place since the debt collector to the High Court appeal.
    72) The parties and the judges have been presented with a file that is about a half a meter thick and although the evidence was on the file it had been buried and forgotten or attention misdirected away from the crucial terms of the documents by debt collectors clerks to barristers who came into the matter late and never understood it.
    73) The only way to start putting this right is to grant a rehearing and start from scratch. The High Court judge who heard the matter on appeal has retired. This matter, if taken to the court of appeal will be a not be the straight forward approach needed.
    74) I have applied for Legal Aid on another matter and have been granted it subject to a barrister agreeing to take the case. This is in progress and the Legal Aid can then be extended to this case.
    75) I do not have access to a law library and can only access legal authorities that are available free over the Internet as to cases and so on.
    76) If this application is given a call over date I will ask for an adjournment depending on the progress with legal aid and keep the court advised.

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  20. stephieboy (3,376 comments) says:

    kea, there are some options for you.
    Join either ACT ( O.05 % ) or the Conservatives ( 0.8 % ).
    But the better option ,why not a first a sole founder and member of an Islamic Front Party.?

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  21. Huevon (223 comments) says:

    Well, clearly political expediency won out over principle in this Budget. I completely understand Key and English, given how accustomed your average Kiwi is to receiving government handouts. Abbott-style would just guarantee a Labour/Green nightmare government come September. But can they not ease people into self-reliance??? At least a gentle nudge in the Right direction? Cap interest free student loans at 5 years or something? Capitalise the Cullen Fund into individual accounts? Tax rebates for education spending at school of parents’ choice (oh, the day!). I mean, anything…

    I suppose optimistically the Key/English approach will help to entrench National as the natural party of government. My big worry is that now people will now start to believe they can risk a Labour govt for a few years, and then bring back National to lock in the new handouts.

    In sum, we need a decent classic liberal party on the Right to keep National in line…looking at you ACT…

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  22. BeaB (2,142 comments) says:

    Cunliffe pathetic with his set piece and voice roughened by fake emotion. What a phoney.

    And what’s that about what’s under the kimono. I wouldn’t like to look under his!

    But a speech for the Labour echo chamber.

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  23. Kea (13,317 comments) says:

    “kea, there are some options for you.”

    stupidboy, here is one for you: Fund your own lifestyle and keep your hands out of my pocket.

    Why should Kea have to pay for stupid kids like you ? Ungrateful little brat :)

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  24. ShawnLH (5,661 comments) says:

    It’s a good budget overall. It will make it impossible for the Left to claim “slash and burn” or “war against the poor” but also make it very difficult to promise much more without looking financially irresponsible.

    The claim that it’s a Left wing budget depends solely on what is supposedly considered Right wing, and in reality that is extremely subjective.

    I would argue that it’s a small-c conservative budget, with an eye to the election.

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  25. Pete George (23,680 comments) says:

    A pragmatic budget, and politically cunning, some on the left acknowledge this. Labour are just spluttering “but we would do more” which means spend more. They don’t have anywhere else to go.

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  26. lastmanstanding (1,300 comments) says:

    3.5 Billion reasons not to elect a Socialist government come 20 September. Why see what the LEFT did to the Aussies

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  27. mikenmild (11,648 comments) says:

    Don’t we already have a socialist government?

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  28. stephieboy (3,376 comments) says:

    milkenmild,

    no but yes, purely from a paranoid libertarian perspective .!
    kea, tsk,tsk, tisk.. there be a good boy pick those toys up your thrown from your playpen.!

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  29. Kea (13,317 comments) says:

    I am trying to explain to the breeders that these things are not FREE and that someone else is paying for it all. The entitleitis is so ingrained they just don’t get it. I shudder to think what attitudes their kids will have !

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  30. mikenmild (11,648 comments) says:

    stephieboy
    I’m serious: if you call Labour ‘socialist’, so too you must call the Nats. Their economic and social programmes are practically identical.

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  31. Ryan Sproull (7,259 comments) says:

    My favourite part was when Cunliffe said, “National have done the Dance of Six Veils and they’re not even left wearing a kimono.”

    Really connecting with the everyman by lumping in a dance from Biblical Galilee with traditional clothing from Japan.

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  32. lastmanstanding (1,300 comments) says:

    The difference between the Aussie Budget and the Kiwi Budget can be summed up as follows;

    Aussie economists reckon Aussies on single income family on $50K pa will be $5K WORSE off per annum. That’s a 10% hit.

    Contrast with Kiwi family on $50K pa. Long list but better off and when tax cuts for low/middle earner kick in 17/18 will be at least $5K BETTER off.

    Can hear the planes full of returning expat Kiwis revving up at Aussie airports.

    Aussie economy knackered by Krudd Gillard LEFT wing morons. Will take at least 10 years for Aussie economy to get out the red. Forget minerals going to China. China now looking at Africa for its minerals.

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  33. Frankie Lee (12 comments) says:

    Why do so many people on this blog insist on referring to themselves in the third person? It makes you look like a complete tosser.

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  34. Ryan Sproull (7,259 comments) says:

    stephieboy
    I’m serious: if you call Labour ‘socialist’, so too you must call the Nats. Their economic and social programmes are practically identical.

    They’re both variations of taxed capitalism. With not much variation.

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  35. Pete George (23,680 comments) says:

    Class from a Green MP…

    @janlogie

    John key says Bill English has produced as many budgets as children.. Begs the question who he has f&%d to produce it. #nzbudget

    Jeanette will be rolling in her armchair.

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  36. infused (658 comments) says:

    “The only tax cut in this budget is abolishing cheque duty. Next they’ll be abolishing excise duty on horses and carriages!”

    No, you forgot ACC. Virtually a tax cut.

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  37. dime (10,094 comments) says:

    Herald headline – beneficiaries left out

    lmao good.

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  38. virtualmark (1,536 comments) says:

    So, who here reckons Wussell wrote his speech yesterday, and doesn’t have the chops to change it on the fly?

    WTF has “Cabinet Club” and corporate pollution got to do with what Bill English has said? And does he really think National govern “for the 1%”??? Must be a surprise to Wussell then when he sees the Nats with 48% voter support …

    And how does he keep a straight face talking about mountains of debt? Given his party’s penchant for social spending? And how hard he would complain if we’d cut social spending to avoid the debt incurred in the last 5 years …

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  39. dime (10,094 comments) says:

    “Why do so many people on this blog insist on referring to themselves in the third person? It makes you look like a complete tosser.”

    Dime almost agrees. Unless its for a very special reason, only Dime should really be speaking in the third. Maybe the rock if he posts here.

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  40. Pete George (23,680 comments) says:

    Herald headline – beneficiaries left out

    Except it’s wrong. Free doctors and prescriptions up to 13 will help beneficiaries with kids. That’s good, it could pay for itself quite quickly with better healthcare sooner.

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  41. Simon (758 comments) says:

    Given the shower of shit to the left of National time to declare John Key as NZ greatest ever Labour PM.

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  42. Kea (13,317 comments) says:

    Frankie Lee (9 comments) says:

    May 15th, 2014 at 3:21 pm
    Why do so many people on this blog insist on referring to themselves in the third person? It makes you look like a complete tosser.

    Kea would like to thank you for signing in to share your thoughts on the budget semantics :)

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  43. Manolo (14,026 comments) says:

    @Simon: and you would not be off the mark!

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  44. mikemikemikemike (331 comments) says:

    I think its a pretty good budget. All I’m hearing from the left is ‘lets give more to people who don’t make any’

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  45. gump (1,659 comments) says:

    To all the people voting down my comment about reforming National Superannuation.

    We are currently borrowing hundreds of millions of dollars each week to fund payments to a sector of society that is not contributing to our prosperity. This is the definition of insanity.

    Superannuation needs to be reformed. We cannot afford the current system today, let alone afford it tomorrow.

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  46. OTGO (559 comments) says:

    Not a bad budget if you have kids under 13. I don’t so where’s my tax cut then?

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  47. RJL (146 comments) says:

    So, we’re still waiting for our 170,000 new jobs — right?

    http://tvnz.co.nz/national-news/budget-2011-govt-predicts-170-000-new-jobs-4181124

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  48. Than (487 comments) says:

    Their economic and social programmes are practically identical.

    Even assuming that is true (and I’d dispute it), Labour cannot govern alone. On current polling the Greens will make up between a quarter and a third of the MPs in a Labour-Green coalition, and will have a huge say in policy.

    If the current National government is Labour-lite then a Labour government would be Greens-lite. And far to the left of the government we currently have.

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  49. mikenmild (11,648 comments) says:

    I don’t think it would actually be that much further to the left. The Greens would have an influence, sure, but I doubt they could direct economic policy to the extent that the current National-Labour consensus shifted markedly.

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  50. srylands (414 comments) says:

    “And does he really think National govern “for the 1%”??? ”

    If he does, it is disturbing. The tenet of about half of Government spending is about redistribution. Look at the $30 billion + on welfare. And WFF, and health and on and on.

    It is depressing that in 2014 we can have a political leader adopt such a ridiculous slogan and not get called out on it. Even worse it catches on so (about) 30% of the electorate actually believes it to be true.

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  51. mikenmild (11,648 comments) says:

    I don’t actually think they govern ‘for the 1%’, but one could do so and still maintain the welfare state – to retain power.

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  52. srylands (414 comments) says:

    “The Greens would have an influence, sure, but I doubt they could direct economic policy to the extent that the current National-Labour consensus shifted markedly.”

    Is there really a Labour-National consensus? I think there is more at stake for New Zealand in this coming election than at any time since 1984. Much more so than 1999.

    Also if the left cobble a coalition with Labour on 29% and the Greens on 14% the latter will have an influence.

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  53. Steve (North Shore) (4,587 comments) says:

    Winstone is off topic, 100 demerits

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  54. Sir Cullen's Sidekick (894 comments) says:

    Rich pricks of this land – I am not a great fan of John Key (only because I think he is too mild, too lazy to shut the opposition non-sense). But after watching his performance in the house today responding to the clown they call Labour Leader…….boy oh boy…if I were David Cunliffe, I will not agree to go on a one-on-one debate with uncle Key. He made mince meat of Cunliffe and numbers and statistics roll off his tongue like a machine gun in full flow….

    Pathetic, really pathetic start from Green joker Norman. “This is a budget which delivers to the top 1%”. For heaven’s sake, get a life your moron.

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  55. igm (1,413 comments) says:

    Instead of having a WoF for rentals, there should be a WoF for prospective breeders, then we will be in constant surplus, having no chance of a Green/Labour government.

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  56. mikenmild (11,648 comments) says:

    srylands
    One could make a list with 2 columns: policies on which National and Labour agree and policies on which they disagree. The ‘agree’ column would be much the longer one.

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  57. igm (1,413 comments) says:

    milkenwimp: Are you using your laptop in the Naenae pub again, trying to look as though you are a learned type? Your kind is easily seen through by successful people, that being the reason you pander to losers.

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  58. dime (10,094 comments) says:

    “Instead of having a WoF for rentals, there should be a WoF for prospective breeders”

    everyday Dime likes igm a bit more heh

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  59. mikenmild (11,648 comments) says:

    I am constantly surprised that igm can operate a computer: given his evident intellectual disabilities.

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  60. Judith (8,534 comments) says:

    @ Frankie Lee (9 comments) says:
    May 15th, 2014 at 3:21 pm

    perhaps because they are?

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  61. Kleva Kiwi (289 comments) says:

    Wussel says National govern for the 1% because he thinks the 1% is not paying its fair share in tax.
    To the Gweens, the fair share is all of it.
    Once you understand this mentality you can understand why he says the BS that he says

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  62. Judith (8,534 comments) says:

    “Instead of having a WoF for rentals, there should be a WoF for prospective breeders”

    Is that such a good idea?

    Would a debt ridden drunken father be able to pass?

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  63. srylands (414 comments) says:

    mikenmild “One could make a list with 2 columns: policies on which National and Labour agree and policies on which they disagree. The ‘agree’ column would be much the longer one.”

    How about you have a go then?

    Education, social welfare, tax policy trade policy. There are 4 big areas where there is now no consensus beyond the basic fabric. Those differences will affect outcomes in a big way.

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  64. mikenmild (11,648 comments) says:

    Ah, but the ‘basic fabric’ is most of it: the very basis of the economic and social consensus. Differences in the areas you cite will not affect overall outcomes to any large degree.

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  65. RightNow (6,995 comments) says:

    srylands, mikenmild isn’t that big on analysis

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  66. gump (1,659 comments) says:

    @igm

    “Instead of having a WoF for rentals, there should be a WoF for prospective breeders”

    ————————

    Yes – because what we all need is an expansion of government bureaucracy and further intrusion into the lives of NZ citizens.

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  67. mikenmild (11,648 comments) says:

    I guess we’ll just wait for Right Now’s extended analytical comment on the substantive differences between National and Labour on economic and social policy.

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  68. Sir Cullen's Sidekick (894 comments) says:

    I think the left wing is stunned by the surprise package of free GP and free prescription for 13 year old children. Now wait for Labour to announce that they will extend this scheme to 16 year old children…….

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  69. mikenmild (11,648 comments) says:

    SCS
    That’s the kind of tinkering that I’m on about…
    I’m not saying it’s bad thing – New Zealand is pretty well off and the last thing we need is zealots on the right or left getting a chance to ‘reform’.

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  70. Judith (8,534 comments) says:

    @ Sir Cullen’s Sidekick (610 comments) says:
    May 15th, 2014 at 4:33 pm

    It makes very little difference, when there is such a shortage of GP’s. Free visits are not going to get any child assistance, when there are none available, especially at weekends and after hours, forcing them to go to the emergency departments to get assistance – which is free anyway.

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  71. RightNow (6,995 comments) says:

    why don’t you do what you said mikey? I’m already paying your salary, not the other way around

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  72. Sir Cullen's Sidekick (894 comments) says:

    BeaB (1,983 comments) says:
    May 15th, 2014 at 3:04 pm
    “Cunliffe pathetic with his set piece and voice roughened by fake emotion. What a phoney.

    And what’s that about what’s under the kimono. I wouldn’t like to look under his!”

    I think he almost started to put on his “bro” accent….

    I don’t think looking under his kimono is a good idea. Could be termed death wish…..

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  73. mikenmild (11,648 comments) says:

    RN
    ‘One could’ does not mean ‘I will’. I’m on holiday today, anyway.

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  74. srylands (414 comments) says:

    ” Differences in the areas you cite will not affect overall outcomes to any large degree.”

    Well I call bullshit on that.

    Changes at the margin are important because those changes affect either incentives or productive capacity for a large slice of the population. e.g. Both Labour and National could agree that there will be a social welfare system. But “marginal” changes to rules around social welfare and work testing can affect incentives to work and skill acquisition, and 20 years down the track your labour supply looks very different.

    “Marginal” changes in policy can make the difference between sustained growth rates of 3% versus 2%. Again, over 20 years that adds up to a big difference in prosperity levels.

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  75. mikenmild (11,648 comments) says:

    You have a point, but I do not believe the differences in policy are such that prosperity would be markedly affected over the medium to long term.

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  76. Southern Raider (1,831 comments) says:

    The rabid crazies are out on the Herald site. Half of them claiming English is lying by claiming a surplus when we owe $60 billion and making out he has just spent two electoral cycles on a spending spree.

    Since when was a surplus the same as being debt free FFS.

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  77. igm (1,413 comments) says:

    milkenwimp is a beneficiary, and a real loser, just look at his comments. Bet he has never held a real job!

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  78. Than (487 comments) says:

    Ah, but the ‘basic fabric’ is most of it: the very basis of the economic and social consensus.

    Using that logic I could prove that ACT and the Greens are politically the same. After all they both believe in free primary/secondary education, human rights, independent police/judiciary, some degree of social welfare…

    National and Labour have policy differences that are already the better part of a billion dollars in government spending just on what Labour has already announced. By the time we actually get to the election it’s likely to be at least several billion dollars of extra spending (paid for by tax increases on “rich pricks”), plus of course the promise to effectively nationalise the power grid and whatever concessions the Greens get. The differences you so casually dismiss as irrelevant are actually major shifts to the left.

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  79. Elaycee (4,403 comments) says:

    Haha…. very good. From DPF’s Twitter sidebar:

    Morgan Godfery ‏@MorganGodfery ·8m

    Is it true when Bill English passed David Cunliffe at the media scrum he could be heard muttering “three more years boys, three more years”?

    Not bad. :D

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  80. mikenmild (11,648 comments) says:

    Than
    You talk about a billoin dollars of spending as though it was a big thing, instead of being less than 2% of government expenditure. An Act or a Greens government would see radical changes. Perhaps fortunately, we are very unlikely to ever see either in full control of our destiny.

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  81. ross411 (861 comments) says:

    Kea (11,652 comments) says:
    May 15th, 2014 at 2:33 pm
    As a single white male I can not wait to see what goodies are in store for me !

    LOOOOOOOOOOOOOOLLLLLLLLLLLLLLLLLLLLLLLLLLLL bah ha ha ha ha :(

    I just told my breeder friend I will transfer my income directly into his bank to save admin costs.

    I’m sorry, didn’t anyone tell you that your place as part of the slave class, is to keep your head down, mouth shut and to earn the money to pay the unemployed, the allegedly sick, the old, the parents, the parents who need a free special holiday to raise their children, and the whomever else either needs to be paid off or deserves money for being your betters. When the employed as unemployed get their long overdue living wage, I’ll tell them to be sure to thank you as they head off to watch their sky tv.

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  82. dishy (248 comments) says:

    What’s the definition of “first home buyer”? If somebody can’t afford to buy their first house, on what basis are they a first home buyer?

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  83. dishy (248 comments) says:

    Craggy Gower wasted no time nailing his red colours to the mast on TV3 News tonight (I know, criticise me for watching). When talking about the budget, he used the word “shameless” within about 3 seconds. He also reckons National is “stealing” Labour’s ideas. What the hell?

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  84. Than (487 comments) says:

    mikenmild,
    Act’s alternative budget calls for $4 billion in cuts to government spending. That’s not much greater than the level of increased spending Labour is likely to promise (and almost certainly less than the increase would actually end up being). Yet to you one is radical, the other is the same as National.

    But you’ve clearly already made up your mind, so don’t let the facts get in your way.

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  85. ex-golfer (166 comments) says:

    Hone Harawira on TV1 News – “nothing in this budget for Maori”.
    Newsflash John – Maori have kids and access the same things everyone else does!

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  86. mikenmild (11,648 comments) says:

    Than
    I don’t believe that Act’s ‘alternative budget’ is what they would desire to see over the long term. It would be just a start.

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  87. Scott1 (575 comments) says:

    Saw “ACT” leader John Banks talking about the Budget. It is a sad day when your far right party leader stands up and gushes about how awesome John Key is after delivering an apparently left leaning budget is. The ACT party should have more dignity.

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  88. Scott1 (575 comments) says:

    Sorry I mean ex leader – but leader in the house…

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  89. Than (487 comments) says:

    mikenmild,
    Fair enough, everybody is entitled to believe what they like, even when there is no evidence to support it.

    But on objective fact Labour and Act have policy platforms that are about equally far to the left and right respectively of National. And that’s without Labour being pulled further left by the Greens.

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  90. mikenmild (11,648 comments) says:

    So you would see Act as being a very mild right-wing alternative to National. I see them as a bit more radical.

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  91. Kea (13,317 comments) says:

    A typical struggling family man ( from South Auckland ) post budget 2014 ;)

    https://encrypted-tbn1.gstatic.com/images?q=tbn:ANd9GcS05FIxYFZfVXJTvEP3WvmIq3sjJxczTCCOjgaG_VrCa_2z3Z1K

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  92. OneTrack (3,213 comments) says:

    mike @3:14 “Don’t we already have a socialist government?”

    Yes we do. So why are you still voting for those numpties in Labour?

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  93. Colville (2,298 comments) says:

    I would have been extreemly dismayed if there wasnt significant ranting on here that this budget proves that National are “Laour Lite” (Yes Manolo :-) )

    Great budget, well aimed, enough small bags of lollies, enough to leave Cun*liffe nowhere to go.

    Next three years a few well placed lurches to the right but all the time keeping on nailing Labour until they are fucked.

    Can you imagine being a lefty looking at politics at the mo, ? you would need to be mad to throw your hat into the ring, you are looking at forever in oppisition!

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  94. OneTrack (3,213 comments) says:

    mike @3:59 – “One could make a list with 2 columns: policies on which National and Labour agree and policies on which they disagree. The ‘agree’ column would be much the longer one.”

    One could make a list with 2 columns: policies on which National and the Labour/Green/Manaip/Winston coalition of envy agree and policies on which they disagree. The ‘agree’ column would be empty. fify.

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  95. mikenmild (11,648 comments) says:

    I’m wondering whether a better comparison would be between the policies of that coalition and those likely to be adopted by the winning National/NZ First coalition.

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  96. CharlieBrown (1,027 comments) says:

    John Key has kept the rich prick tax of 33%. He increased other taxes to enable the headline income tax “cuts”.

    National party supporters are fools if they support John Key. John Key’s national government is nothing more than a continuation of Helen Clarks Labour government, but the blue sheep seem to be suckered into believing that because the party is called “national” then they are not red socialists.

    Make no mistake, the current National party in parliament is just as socialist as Labour, their MP’s are just better at being socialist than Labours.

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  97. CharlieBrown (1,027 comments) says:

    “[DPF: As opposed to doing what Tony Abbott just did, and destroying his Government within a week – absolutely yes]”

    Roger Douglas did the same and they survived two terms and his policies have only undergone some small reversal (by the pink clark and Key governments).

    You national party supporters seem to think being in government for 3 terms equates to a good government, in reality it equates to SFA if you don’t make any changes. How many significant policies did John Key oppose in opposition that he hasn’t reversed?

    Cullen and Clark implemented the socialist mess, Key ensured its survival. He will go down in history with the same sense of uselessness that Neville Chamberlain did.

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  98. mikenmild (11,648 comments) says:

    I think he will be rembered as a second Keith Holyoake.

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  99. adze (2,129 comments) says:

    Harawira: “Nothing for Maori in this budg… er-, cough cough I meant POOR people. Mana is for people in poverty now, I keep forgetting!”

    As someone else pointed out – Maori will certainly benefit from being able to take their kids to the doctor for free till age 13, and saving $130 on ACC levies when they renew their vehicle licence every year. They will benefit from increased health and education spending. Just like everyone else, especially those with families. Harawira is just being a tosser as usual.

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  100. RRM (10,001 comments) says:

    Facebook is full of the sort of people whose understanding of the economy is roughly as follows:

    :arrow: The government has all the money, which they keep hidden in a money bin quite like Scrooge McDuck’s place. (The Reserve Bank, I think it’s called…)

    :arrow: Any dollar the government doesn’t spend on the poor, or schools, or whatever, is a dollar that John Key himself personally pockets, to put towards his next property deal.

    :arrow: Therefore, if the government does not spend more, then they are in effect STEALING FROM US!!!

    :neutral:

    THAT’S why Key & English have to take a slow and steady approach and not radically cut services… they have to sell their ideas to these morons as well as to anyone else.

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  101. duggledog (1,580 comments) says:

    Adze in a way Harawira is right, there is nothing in this budget for Maori; Maori are appalling at taking their kids to the doctors free or not. Or getting them to school or feeding them etc. And who cares about saving $130 a year on a rego when you never bought one in the first place?

    I suggest you visit the far North, East Cape, Porirua, Mangere…

    What Hone wants, and all he wants, is for Whitey to f*** off back where he came from or
    Hand over anything and everything Maori want

    Never forget that

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  102. igm (1,413 comments) says:

    mikenwimp: Your B/s is getting boring.

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  103. berend (1,715 comments) says:

    Danyl’s comment:

    This is what an election year budget looks like when the opposition is winning the ideological debate. What are National’s big ideas for their third term? There aren’t any. … So no, Labour aren’t winning in the sense that they’re convincing people to put them into government – but they’re winning the ideological battle. The government are implementing their policies because they’re afraid they’ll lose the election if they don’t.

    And he is exactly right.

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  104. berend (1,715 comments) says:

    RRM: THAT’S why Key & English have to take a slow and steady approach and not radically cut services…

    What planet are you living on????? Key is only spending more! Hasn’t made a single cut (because he gets to borrow $50 billion), and is actually spending more and more on “services”.

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  105. All_on_Red (1,643 comments) says:

    “What are National’s big ideas for their third term? There aren’t any”

    Good, big ideas are for Hollywood Producers, what NZ needs is slow steady conservative fiscal management. Just like most successful businesses.There is no “big idea”.
    Daryl is just showing why he’s a dumb lefty and working in the Public Service.

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  106. berend (1,715 comments) says:

    One more reaction, didn’t even know that number:

    At the start of the GFC, New Zealand’s net Crown debt was an enviable 5.5% of GDP. This low net debt, and the headroom it gave the government to run deficits and borrow during the bad times, played a key part of New Zealand coming through the GFC in a much better position than many of our contemporaries.

    So who was responsible for the enviable 5.5% number? Ah the they-are-not-us party. John Key kept Labour’s policies, and borrowed, and borrowed.

    Obviously I don’t like to see Labour back in power either. But neither do I like to see National in power.

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  107. ShawnLH (5,661 comments) says:

    “Hasn’t made a single cut”

    Well. that’s not really true. National has made cuts to spending and to the public service, and made quality spending a priority over just spending.

    Moreover the gov has signaled tax cuts to be announced when they hit the campaign trail.

    This may not be enough for those that think the gov should commit suicide and hand over the country to a Labour/Green/Mana government by pursuing radical cuts, but purist ideologues don’t win elections.

    If you cannot take middle NZ with you, you won’t govern, which is why ACT is on 0.5%

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  108. All_on_Red (1,643 comments) says:

    Berend
    That number seems low. NZ was technically in recession before the GFC.

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  109. berend (1,715 comments) says:

    SwawnLH: National has made cuts to spending and to the public service,

    I suggest you look up the number of public servants just before National came into office, and now.

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