Govt books getting worse as economy slows

National’s economic credibility is under serious scrutiny with its search for surplus becoming harder due to an economy far too reliant on the dairy industry, says Labour’s Finance spokesperson David Parker.

“National promised New Zealanders would get into surplus by improving the economy. It has been six years in government and more than three years since the financial crisis ended and they still haven’t run a surplus.

“National is running out of excuses.

“The drop in GST and the warning of a fall in total tax take shows what happens when the economy is unbalanced – typical New Zealanders can’t get ahead. At the same time the huge salary increases of the power companies’ chief executives – arrogantly defended by the Government – are completely out of whack with the meagre pay rises of most Kiwis.

“The true reason the Government is struggling to make surplus is its poor economic management. The Government put all its eggs in the dairy industry basket and hoped the Christchurch rebuild would gloss over the shortcomings of the rest of the economy.

“With dairy prices slashed in half this year and the rebuild only supporting Canterbury, the failings of National’s economic management are harder to hide. The struggle for surplus shows the storm clouds are gathering on the horizon,” says David Parker.