Read what else the economists said

Radio NZ reports:

Mr Joyce yesterday claimed Labour had mistakenly not accounted for rolling out operational allowances year on year.

Labour said the figures were robust and the claim was a cynical attempt to distract voters.

Mr Joyce insisted today that outside of laying down its spending on health and education, Labour had left no allocation for increased spending in any other area of government.

“Either they’ve mucked up the allowances and it’s an $11.7 billion hole, or they’ve just ignored the expenditure they’d have to make over the next four years – which is also an $11.7 billion hole.”

Now they quote a number of people saying there is no hole when it comes to the allowances such as:

The New Zealand Initiative – a libertarian think tank – said National appeared to have made a basic accounting error in its criticism.

Research fellow Sam Warburton said it looked like Mr Joyce had zeroed in on one line in Labour’s plan and ignored 16 other lines.

“When you take one part of the equation and don’t include the other part … you’re going to get the wrong answer.

“It’s not my position to say whether it’s a good or bad budget, but [the numbers] add up, they balance, and in that sense, they are sound.”

So the numbers add up. But are they in any sense realistic?

ANZ chief economist Cameron Bagrie also suggested Mr Joyce went too far in saying there was a “hole” and said that term was “too strong”.

I agree.

But he did say it would be a challenge for Labour to govern within its budget.

“They just haven’t left themselves any money in the kitty for the 2019 and 2020 budget.

“There is some leeway … quite a big uplift in health and education spending, but if you look beyond that – law and order, core government services – the working assumption is they are not going to get anything.”

So yes if you assume that a Labour Government would not announce any new spending in 2019 and 2020, then the numbers add up. But what most in the media are missing is that is a ridiculous, almost insane, assumption. Of course they will need money for the out years – that is what the operating allowances are for. And Labour have basically allocated them all already.

So calling it a “hole” was too strong but that doesn’t mean the fiscal plan is realistic or achievable.