The Government is refusing to rule out more taxes, despite forecasts that its revenue grab will rise almost twice as fast as wages in the next two years, National’s Economic and Regional Development spokesperson Paul Goldsmith says.
“Not only has this Government refused to ease the tax burden on record-high fuel prices but it has left New Zealanders in a state of uncertainty over its tax ambitions, including a Capital Gains Tax.
“It isn’t even prepared to commit to a revenue-neutral tax package when it gets the final report of the Tax Working Group. That’s a worry from a Government with a track record of wasteful spending and which has played a role in driving up living costs for ordinary Kiwis.
“The Government reaped $80 billion in taxes in the 2018 year and Treasury forecasts that to rise to $89 billion in 2020, an increase of 11 per cent. In that same period, wages are forecast to rise 6 per cent.
“New Zealanders are rightfully angry at being whacked in the wallet when they fill up their vehicle, especially since more than half the price is taxes.
“They would’ve been better off under the last National Government’s tax cuts, which added up to $1,060 for the average worker. But this Government held on to the money for wasteful schemes like fees-free tertiary education.
“National believes New Zealanders should be able to keep more of what they earn and Government spending should be subject to rigorous scrutiny. National supports policies that drive economic growth and benefit all our communities.
A year under Labour has caused chaos and instability in the transport sector, National’s Transport spokesperson Paul Goldsmith says.
“There have been more strikes across the sector in one year than there was during nine years of a National Government.
“This has meant critical transport links have faced uncertainty, consumer and public transport users have seen delays, cost increases and even more congestion.
“Transport Minister Phil Twyford has said if there is no bus coming, why would people turn up to the bus stop. With the current strikes in Wellington, there are no buses turning up at the moment and the Minister blames everyone else. His party has explicitly encouraged union activity.
“The problems don’t end there. Kiwis are also facing record high prices when they fill up their cars. Since the Government took office petrol prices have risen over 40 cents. Motorists are forced to pay over $20 extra every time they fill up their cars.
“In light of these record high prices the Government’s solution is to commission an inquiry. This will take months and there are still two more four cent excise increases to come into force, increasing the pain for hard working New Zealanders.
“While the costs of transport continues to rise, the Government is also ensuring that less funding is available through our regions for major highway projects.
“The Government’s decision to axe $5.3 billion from state highways to fund a tram project in Auckland has resulted in projects like the Tauranga Northern Link, Otaki to Levin and Whangarei to Te Hana being stripped back and other major highway plans axed completely.
“One year into this Government’s term, New Zealanders are facing a transport system rife with strikes and delays, record high fuel prices and fewer roading projects.
“This is not a positive outlook for the transport sector.
“In contrast, National’s vision for transport would have seen sensible investment in public transport and rail, a major new plan for regional highway investment and a commitment to keep fuel taxes down.”
After a year of this Labour-led Government there have been 15 strikes in the transport sector compared to 12 under nine years of a National Government, National’s Transport spokesperson Paul Goldsmith says
“This Government has emboldened the union movement to the point of militancy and Auckland and Hamilton commuters today are the collateral damage. On Thursday it will be Wellington commuters.
“Aucklanders in particular are now facing a bus system on strike, record high fuel prices, new regional fuel taxes and no improvement to the city’s congestion.
“They are rightly frustrated with disruptions to their daily travel.
“The lack of leadership coming from this Labour-led Government is seriously undermining confidence in our public transport system.
“As Transport Minister Phil Twyford rightly said in Parliament today, the public won’t turn up to the bus stop if they don’t believe a bus will turn up.
“If we want public transport use to grow in order to ease congestion on our roads, it needs to be reliable.
“The Minister needs to talk with his colleague Workplace Relations Minister Iain Lees-Galloway, to dial back on industrial relations reforms, and to his friends in the unions, calling on them to show commuters respect.
“Mr Twyford needs to be showing some leadership in strengthening public confidence in our transport system.”
The Prime Minister and the Transport Minister can’t agree on the impact their fuel taxes are having on New Zealanders, National’s Transport spokesperson Paul Goldsmith says.
“Last week the Prime Minister tried to defend the impact the Government’s taxes were having on rising fuel prices when she claimed the taxes only accounted for 6.8 cents per litre.
“This 6.8 cents only included GST and an ETS change and left out both the Government’s 4 cents per litre excise tax and the Auckland Regional Fuel Tax of 11.5 cents per litre.
“But today in Parliament Transport Minister Phil Twyford used a different set of numbers, claiming a 3.5 cent excise tax and a 10 cent Regional Fuel Tax. This time the Minister failed to add GST to the total amount New Zealanders are paying at the pump.
“It is impossible to get a straight answer out of the Government.
“The Minister argues these taxes are vital for investing in infrastructure. Earlier this year the Government changed the rules so that it could use road taxes to fund its rail projects.
“National was able to fund rail projects through Crown contributions. Labour’s wasteful spending means it is not able to do the same.
“National’s ambitious transport and infrastructure plan saw record funding for public transport, rail and highways without needing any new taxes.
“This Government is focused on taxing New Zealanders more when it should be reining in its untargeted, low-quality spending.
“National is committed to relieving the burden hardworking New Zealanders are currently facing and are calling on the Government to axe its fuel taxes.”
The Finance Minister is refusing to rule out a tax grab on the retirement savings of hard-working New Zealanders, National’s Economic and Regional Development spokesperson Paul Goldsmith says.
“When asked directly in the House today if he could rule out putting more tax on Kiwi savings, Grant Robertson was unable to give a straight answer and was only prepared to say it was a work in progress.
“Taxing KiwiSaver more is the last thing we need. It won’t help Kiwis get ahead.
“There are now 2.87 million New Zealanders invested in Kiwisaver funds and their combined nest egg has grown to more than $50 billion. The Government should be re-assuring Kiwis that it won’t raid their long-term savings to bankroll its excessive spending plans.
“Currently the capital gains element of retirement savings isn’t taxed, which is an obvious part of the incentive to save.
“The working group has recommended a package of modest incentives to encourage low and middle-income people to save more for their retirement. But it would be disingenuous for the Government to appear to be giving with one hand while intent on taking much more with the other, via a tax on capital gains.
“Rather than devising ways to take more money from New Zealanders, the Government should be reining in its low-quality and untargeted spending.
“National believes New Zealanders should be able to keep more of what they earn. The tax system should encourage productive investment and savings, not penalise those who try to get ahead.”
The Prime Minister has given her second major speech in three weeks and bizarrely makes no mention of the key announcement of the first – her Business Partnership Agenda, National’s Economic and Regional Development spokesperson Paul Goldsmith says.
“Her address in Auckland had no more substance than last time. It is very strange that she trumpeted her Business Partnership Agenda in a keynote speech last month, saying it ‘brings together the strands of this Government’s economic strategy’ and now it doesn’t rate a mention.
“We are now all confused – three weeks ago her economic strategy was drawn together by the Business Partnership Agenda. Now it has disappeared without trace. It looks like the Government is flailing around, bouncing from slogan to slogan.
“She also failed to mention her Business Advisory Council headed by Air NZ chief Christopher Luxon.
“When the Prime Minister last spoke in Auckland she was attempting to fend off criticism that she hadn’t bothered to talk to business and that confidence was plunging.
“That’s still happening – business confidence is at nine-year lows and business says it was ignored on changes to employment law.
“No-one running a business is going to be reassured by the Government simply repackaging its old ideas for re-release like the Prime Minister did over the weekend. Governing is about more than just branding, slogans, acronyms and working groups.
“The previous National Government launched a wide-ranging Business Growth Agenda. This coalition appears to have removed ‘Growth’ and replaced it with ‘Partnership’ but now it looks like the whole idea has been quietly dropped.”
The Government’s notion that a 27 per cent rise in the minimum wage will seamlessly translate to productivity gains is wishful thinking and shows a government out of touch with business realities, National’s Economic Development spokesperson Paul Goldsmith says.
“When asked today in the House how increasing the minimum wage 27 per cent in three years would increase our international competitiveness, Finance Minister Grant Robertson burbled that it would lead to more productive businesses and workers.
“That is fantasy.
“A more productive business may be able to generate higher earnings so that it can afford to pay a 27 per cent increase in wages, but the reverse doesn’t automatically hold true.
“If our Finance Minister doesn’t understand that, it’s no wonder business confidence is so low.
“Scrambling for an answer, the Minister suggested a lift in wages would lead to more spending in the economy. That might be the case, but it doesn’t improve our productivity or our international competitiveness.
“Finally, when asked what he would say to an exporter whose products require a lot of labour and who doesn’t believe he or she can remain in business while increasing wages by 27 per cent, he said that was a hypothetical situation.
‘Well, it isn’t hypothetical, Mr Robertson, this is reality. Most businesses run on tight margins, and for many, labour is a major cost. A massive increase in labour costs, when not matched by productivity gains, will mean that some will go out of business.
“If governments could really legislate for massively higher wages, we’d all be earning $200,000 a year.”
Today’s roading announcement in Gisborne shows what damage Phil Twyford is doing to the transport sector, National’s Transport spokesperson Jami-Lee Ross says.
“As the Transport Minister taxes people more while sucking billions from the regions to fund Auckland trams, the Government scrambles to use special funds for what should be business as usual.
“The Government cut $5 billion from regional highway projects and is hiking taxes to fund trams in the Auckland CBD. Now it’s dipping into the Provincial Growth Fund (PGF) for $153 million of spending in the Gisborne region, most of which will go into roading.
“This is a shambolic approach to the management of taxpayers’ money. It is a giddy money-go-round.”
National’s Economic and Regional Development spokesperson Paul Goldsmith says while he supports regional investment, he’d expect the spending announced today to be part of normal transport funding.
“Instead the Government has shown that the PGF is an all-purpose funding vehicle with murky decision-making.
“The Government has been coy about how Shane Jones is running what amounts to a coalition slush fund. Funding decisions should be open and rigorous. Instead, the process is so opaque that it is hard to assess the quality of decision-making.”
The Prime Minister must act now to assert her leadership against the Regional Economic Development Minister, who is running amok and openly defying her, National’s Economic Development spokesman Paul Goldsmith says.
“This morning, Shane Jones doubled down on his criticism of Air New Zealand CEO Christopher Luxon, whom the Prime Minister has appointed to chair her Business Advisory Council.
“Yesterday Mr Jones refused to resile from his earlier attacks on Mr Luxon and today he went further, dismissing him as a celebrity and bizarrely finishing his interview with Radio New Zealand by saying he should not ‘covet the ass of his neighbour’.
“There’s no other explanation than to conclude that Mr Jones has given the middle finger to the Prime Minister, whose Business Council – yet another working group – is a desperate attempt to be seen to be doing something.
“The Government’s attempted charm offensive with a deeply concerned business community is now in tatters with one of the senior economic ministers at war with business leaders.
“Today he added banks to the long list of businesses to be subjected to his ill-considered clobbering tactics. He started with supermarkets, then Fonterra, then Air New Zealand and the Warehouse and now the banks.
“Nobody, it seems, can do a decent job other than Mr Jones himself.
“It’s well past time for the Prime Minister to assert her leadership and discipline Mr Jones. The fact that the Government is now at war with itself is only contributing to the uncertainty that lies behind low levels of business confidence.”
Revelations that the Provincial Growth Fund will fund all-weather tracks for the horse-racing industry, an uncosted plan already approved by Cabinet, show there are no limits for Shane Jones’ slush fund, National's economic development spokesman Paul Goldsmith says.
“Make no mistake, National supports the racing industry and recognises its economic contribution. That’s not the issue here - funding decisions should be open and rigorous. Instead, the process is opaque and murky so it's hard to disentangle the arguments.
“Mr Jones has revealed that $30 million of contingency funding in the PGF has been earmarked for pet projects including several all-weather tracks for horse racing, a Northland sports hub and Dunedin digital plan. He referred to the plans as ‘a coalition dividend’ that came out of the coalition negotiations.
“He says the projects will be subjected to rigorous scrutiny but papers released to National under the OIA from the PGF’s Independent Advisory Panel make a nonsense of that, showing ‘manifesto commitments’ won’t get a thorough assessment.
“On the sports hub in Kaitaia, for example, the panel says, ‘the application for the PGF to fund the Te Hiku Sports Hubs has been agreed as part of a manifesto commitment and does not require formal advice from the panel to the Minister’.
“This is the latest sign that the criteria for the PGF is ‘as loose and as billowing as the deep blue sea'. It’s an all-purpose political slush fund and you can fit anything into it.
“In this case, they're not even making an argument, they're just saying we're going to do it. Mr Jones has indicated he will use the fund in a brazenly political way and with a Northland skew.
“The price of Labour’s deal with NZ First keeps mounting – with the $3 billion Provincial Growth slush fund and $900 million for diplomats and aid. As spending pressures build elsewhere, such as in education and health, all this loose spending is looking increasingly unjustifiable.”