Fran lets loose:
John Key's celebrated faux pas at his first National Party conference as leader (“Under a Labour Government I lead … ) was portrayed as simply an inadvertent slip born out of nervousness.
But after Key's outright panning of the Don Brash-led 2025 Taskforce report his 2007 slip-up is starting to look almost Freudian.
What I would like to know is how the Government thinks it will close the gap with Australia, if it does not adopt some of the recommendations of the 2025 Taskforce. The gap will not close by magic. Action is needed, not rhetoric.
Brash and his four taskforce cohorts: former Labour Finance minister David Caygill, Wellington economist Bryce Wilkinson, Icebreaker CEO Jeremy Moon and Australian productivity commission part-time member Judith Sloan, were deliberately cute in delivering Key and English a ready rationale for cutting spending back to 29 per cent of GDP.
This after all was the level of core Government expenditure registered in 2004-2005 before former Finance Minister Michael Cullen opened the floodgates on social spending.
All it required was for Key and English to start taking the axe to some of Labour's sacred cows, urgently review some major spending programmes, and get serious about setting measurable goals to turn this economy around.
No one is underestimating the political difficulties in making such substantial change. But unless substantial change is made, New Zealand will not catch Australia. Ever.
The 29% goal is not politically possible by 2012, but that is no reason not to have it as a longer term target. Or to have a slightly higher target. Or something. What is not acceptable is having no target. I want both National and Labour to say what their target is for spending as a % of GDP, and for them to offer different targets so we have a choice.
A factor which English seemed to concede yesterday by saying the 2025 goal was merely “aspirational”.
Aspirational means they did not mean it.
Problem is the top Government duo reckons its options are constrained because they don't want to break National's 2008 election pledge to keep Labour's own big-ticket election bribes such as interest-free student loans and the expansion of Working for Families which Key had demonised as “communism by stealth”(before the 2005 election).
And I accept no breaking of election promises. But that doesn't mean the other recommendations can't be implemented, and it also doesn't rule out National having a more flexible set of policies for 2011.