The Labour Party must explain where the money is in its fiscal plan for increases in government expenditure outside education and health, National Party Finance spokesman Steven Joyce says.

"In maintaining the fiction yesterday that their operating allowances are correct, Labour would be left with basically no allocation for increased spending in any area of government outside of health and education for two budgets. That’s literally a two year budget freeze for most of the Government,” Mr Joyce says.

"That’s no new money for wage increases for police, social workers and DOC conservation rangers, for pay equity settlements, for the Ministry of Vulnerable Children, and no money for science and innovation, defence, or law and order.

"That is simply not credible. Anyone with any experience knows that there is a myriad of investments governments have to make every year to provide public services for New Zealanders and keep the country running.

“In Budget 2017 the current government voted new spending of $842 million per annum or $3.7 billion over four years outside health and education plus the care and support workers settlement of $1.54 billion over four years, while in Budget 16 those numbers were $1.1 billion and $3.7 billion.

“On average around half of the new spend a government allocates each year is outside of education and health.

“Labour is saying that in Budget 18 there would be no new money for anything else besides education and health and zero again in Budget 19. Then they say they are only putting aside $590 million for Budget 20. That's a multi-billion hole each year.

“This is not semantics or a definitional issue. This is real money which Kiwis would have to front up for in terms of higher taxes or increased debt and interest rates.

“So Labour either have their budget allowances wrong or they've simply left out billions and billions of dollars of government spending in future years from their plan.

“One of these things must be true and either way they have an $11.7 billion fiscal hole. Their plan is fatally flawed and would lead to billions and billions of extra taxes or debt.”

A re-elected National-led government will introduce new fit-for-purpose urban planning laws separate from the Resource Management Act to encourage more responsive planning, faster development, and better protection for the environment in our growing cities, Infrastructure spokesperson Steven Joyce and Environment spokesperson Nick Smith say. 

“New Zealand is growing strongly and we want to make it easier to build the housing and infrastructure for that growth while still ensuring our urban environments are some of the most liveable in the world,” Mr Joyce says.

“To do that we need to give our cities the ability to adapt and develop faster, while respecting and improving the urban environment - and the current planning system is not allowing that.

“The RMA’s one-size-fits-all approach has restrained the development of our cities, dragged on their economic performance, and restricted the supply of much-needed housing and infrastructure.

“So National will establish a fit-for-purpose planning system that allows our cities to evolve in a way that improves the quality of the local environment, and makes them great places to live and work.”

Dr Smith says the new planning legislation will have clear and separate objectives for regulating urban and natural environments.

“Over the past nine years we’ve simplified the RMA and made it easier to build but the RMA is only one part of the planning system, and we have reached the end of what can be done by making incremental changes to the Act,” Dr Smith says.

“We agree with a number of stakeholders that it is time to develop fit-for-purpose planning legislation dedicated to urban environments that includes the relevant parts of the Local Government Act and the Land Transport Management Act in one piece of legislation.

“So we will set up separate planning and environmental regulations specifically designed to encourage growth while tackling the environmental challenges found in cities, such as air pollution and storm water surges,” Dr Smith says.

“This new legislation will work in parallel with our plan to put in place urban development authorities to redevelop specific brownfields areas in our cities to allow for more housing – the work for which is already underway.

“While the focus of this reform will be on urban planning we will keep a close eye on what changes may also be applicable to non-urban and rural areas through the existing RMA. National will start its urban planning reform process by consulting with key stakeholders, local government, iwi, experts, and the public to develop fit-for-purpose legislation that works for cities.

“The successful Auckland Unitary Plan and the Independent Hearings Panel review process shows we can put sensible rules in place that work for everyone. We want to use the same collaborative formula to create an urban planning system that enables growth, gives businesses the confidence to invest, and adapts to the changing needs of cities,” Dr Smith says.

The Labour Party has an $11.7 billion hole in its fiscal plan that blows its debt out and breaks its own budget responsibility pledge, National’s Finance spokesperson Steven Joyce says. 

"These are significant errors that raise questions about Labour's whole spending approach and their fiscal competence," Mr Joyce says. "Their spending numbers were already high and this makes them a lot worse.

“Labour’s recipe would lead to more debt, higher interest rates and a slower economy – not to mention the host of extra and unexplained taxes they would impose on households and businesses.

“All of this would cost jobs and eat into family budgets.”

The five errors are as follows, over four years:

• Failing to roll out their operating allowances for each year into subsequent years ($9.4 billion).
• Failing to allow for any increase in paid parental leave in their Family Incomes package despite saying they have included it ($567 million).
• Counting additional BEPs multinational tax revenue when Treasury has already counted it in the PREFU update ($902 million).
• Only including costs of their Family Package from 1 July 2018 when they said it would begin on 1 April 2018 ($289 million).
• Further finance costs associated with extra borrowing ($580 million).

“The biggest error is their failure to continue each year’s operating allowances for additional expenditure into subsequent years. When operating expenditure is added, for example an increase in wages for police, that expenditure continues into following years. Labour’s operating allowances don’t allow for that.

"Once corrected, Labour’s spending plans result in net debt increasing by nearly $20 billion from current levels of $60.6 billion to $79.3 billion over four years.

"Labour was already increasing debt by $7 billion from current levels by their own admission, but this takes it to nearly $20 billion. This would be an irresponsible level of debt increase at this stage of the economic cycle. New Zealand should be reducing debt now, not increasing it, so we are ready for the next rainy day.

"They also would break their fiscal responsibility rules as net debt would not fall below 23.5 per cent of GDP by the end of the forecast period, in fact it would be higher than it is now, and get nowhere near their own plan to reduce debt to 20 per cent of GDP by 2022.

“That level of spending and increased debt can only lead to one thing – higher interest rates for Kiwi mortgage holders. 

"Labour’s true spending plans as revealed in this analysis confirms that behind the leadership change we are dealing with the same old irresponsible tax, borrow and spend Labour Party.

“Labour needs to withdraw its fiscal plan and re-work its proposals.”  

The Labour Party is being completely disingenuous in its claims about New Zealand’s productivity and ways to lift it, National Party Campaign Chair Steven Joyce says.

“Labour is again showing it is no friend of Kiwi businesses by talking down the hard work of companies to lift productivity and grow our economy,” Mr Joyce says.

“Labour is cherry-picking the statistics to suit its negative views,” Mr Joyce says.

“On one of the key measures of productivity, GDP per hours worked, New Zealand’s productivity has lifted nearly 10 per cent since National came into office. That’s a faster rate than the UK, Canada, the US, the EU, the G7 and the average across the whole OECD.

“This increase has helped lift the average annual wage by $13,000 over that period, more than twice the rate of inflation."

“The last time Labour was in office, it was the reverse. Our productivity growth was 5.5 per cent over eight years and much slower than all those other economies.

“Businesses lift productivity by having the confidence to invest in new equipment, new markets, and new people.

“Governments can help confidence by running the economy well and making available new markets, key infrastructure and access to skills. That is what National is doing.

“What you don’t do is knock businesses’ confidence with an agenda of:

• Vague new taxes on productive businesses like a capital gains tax and water taxes
• Arbitrary restrictions on access to skilled workers so they can’t grow
• Going backwards on trade deals like the TPP
• Unnecessary central wage bargaining proposals that send New Zealand back to the 70s

“New Zealand is a nation of small and medium-sized businesses. It's challenging enough taking on the world and winning from a New Zealand base, without putting artificial barriers in their way.

“National is working with New Zealand businesses and not against them. And that’s how you lift productivity.”

The National Party will turbocharge the Government’s $32.5 billion infrastructure investment by creating a new National Infrastructure Commission to lead more public-private partnership (PPP) projects and ensure Kiwis get faster access to new schools, hospitals and roading.

“National has a great track record of delivering transformative infrastructure investments, like the Roads of National Significance, the electrification of Auckland’s commuter rail network, Ultra-Fast Broadband, and the Waterview Tunnel,” National Party Infrastructure spokesperson Steven Joyce says. “We know how vital quality infrastructure is to the economy and people’s lives.

“PPPs are very effective at getting quality long-lasting infrastructure built more quickly and using private capital to stretch the country’s capital budget so we get more built,” Mr Joyce says. “The National Infrastructure Commission will be responsible for expanding the number of PPPs so we can grow our $32.5 billion investment and have more new hospitals, schools and transport projects sooner.

National will merge two units from the Treasury to form the core of the Commission, with an additional $2.5 million a year in funding to operate it.

“PPPs can provide new facilities at a lower whole of life cost than traditional development models,” Mr Joyce says. “The Commission’s job will be to make sure the innovation and savings PPPs bring are applied to all parts of government, regardless of whether the project is a major hospital development, a school or a new road.”

Initial projects to be considered as a PPP include:

• The $50 million rebuild of Whangarei Boys High School as part of a larger school development package

• Defence Estate Refresh: a $1.7 billion project to modernise and upgrade defence  bases throughout the country

• The recently announced $1.4 billion re-development of Dunedin Hospital

• East West Link: $1.9 billion project linking State Highway 20 and
  State Highway 1 in Auckland

• Penlink: Construction of a new local road linking the middle of the Whangaparaoa Peninsula with State Highway 2 at Redvale

• Waikeria Prison: A new 1,500 bed facility due to commence procurement this year

“The Commission will work alongside our new investment company Crown Infrastructure Partners which will jointly invest with councils and private companies in non-government owned infrastructure like local roads, water networks and the Ultra-Fast Broadband programme,” Mr Joyce says.

The Commission’s other major role will be to collate and promote New Zealand’s national and regional infrastructure pipelines to major local and international construction firms so they can further gear up to meet the country’s infrastructure demand.

“Construction companies need clear visibility of the full pipeline so they can invest in innovation and skills to gear up and meet the challenge,” Mr Joyce says. “As well as the $32.5 billion to be invested over the next four years, we need to plan further spending in the order of another $40 billion over the following four years.  

“The NIC will be a clearing place for that pipeline so the construction industry can have the confidence to keep investing and growing.

“We already have about $2 billion of PPP projects included within our $32.5 billion capital investment, including the Transmission Gully and Puhoi to Warkworth roading developments, and a number of school building projects. The new Commission will be charged with ramping the number of projects up significantly so we can extend the $32.5 billion further.

“New Zealand is growing confidently and quickly. The National Infrastructure Commission will ensure we have the capacity to maintain that growth and deliver the quality infrastructure New Zealanders need.”

The National Party has today released a summary of its 2017 election campaign announcements to date and their impact on future budgeted expenditure.

“The announcements we have made since 12 August have a total effect on the Government’s operating budget of $264 million in 2018/19 rising to $299 million in out years”, National Party Finance Spokesman Steven Joyce says.

“This compares with an annual operating allowance of $1.7 billion available in Budget 2018. Or in short, we have allocated a total of 15-17 per cent of the available Budget 2018 allowance, and nothing from subsequent years.

“On the capital side we have allocated $412 million of projects during the election campaign to date, compared with $4 billion of reserved capital funding which was unallocated in the Budget 2017 documents.

“It is clear from these figures that the National Party in government would have considerable funding available for further investment in public services and infrastructure while also both reducing debt and boosting family incomes from 1 April next year with the Family Incomes Package.

“We will continue to update this summary through the remainder of the election campaign.” 

The summary of announcements is attached here.

It’s very surprising that Labour’s fiscal plan came out yesterday with absolutely no mention of their proposal to lift the amount of paid parental leave, National Party Campaign Chair Steven Joyce says.

“Our team has been through the numbers at length, and despite a desire to increase government spending by a massive $31 billion over the next four years, there is no mention of any money earmarked for more paid parental leave,” Mr Joyce says.

“Given how enthusiastic Labour has been about it, and how negative they were about National’s announcement yesterday – surely there must be some money put aside? 

“Labour said on social media that they had hidden it in their families package, but there is no money identified in the cost calculations for that package.

“The only mention of paid parental leave was when a bullet point referring to it was added to their webpage online yesterday afternoon once it was raised with them.

“It can’t be in the new budget allowance because there is virtually nothing set aside for the next three years as there is.

“Maybe Grant Robertson and BERL have it stashed away somewhere and they might be able to point it out. Or perhaps they could get a working group together to find it. In the meantime it seems it’s the case of the missing paid parental leave.”

Labour is once again proving they’re the same old Labour Party with plans for big increases in both government spending and debt over the next four years, National Party Campaign Chair Steven Joyce says.

“In their fiscal plan released this morning, Labour has committed to $13.7 billion in additional spending over the next four years funded by cancelling tax changes for Kiwi families and increasing debt,” Mr Joyce says.

“This nearly doubles the additional expenditure of $17 billion over four years already allowed for in the pre-election fiscal update. All up Labour is proposing to add more than $30 billion in new operating spending over the next four years. And then there’s additional capital spending as well.

“All this flows through into increased debt. Again by their own numbers, Labour will increase debt by $11 billion over four years compared with the pre-election fiscal update. This is not the stage of the economic cycle to be increasing debt. We should be reducing debt and putting money aside for the next rainy day.

“Labour’s tertiary policy announced today alone has an additional $3.4 billion over four years in expenditure in just one announcement.

“And the ink had hardly dried on their fiscal plan when they made another commitment to fund 26 weeks paid parental leave, which isn’t listed anywhere in the document.

“Labour also has some questions to answer about how their numbers add together. For example, their remaining annual operating allowances don’t seem to be cumulative.

“Big increases in expenditure and debt can only flow through into higher interest rates, and that would be bad for Kiwi businesses and homeowners. That’s before you even get in to Labour’s extra taxes.

“We need to keep the country moving in the right direction and Labour’s approach to spending and debt would only slow the country down and put up costs for consumers.”

Another day on the campaign trail and the Labour Party has announced yet another tax, National Party Campaign Chair Steven Joyce says.

“Today we have more evidence that Labour would make a big change in economic direction that would slow down the New Zealand economy,” Mr Joyce says.

“Labour’s new tourism tax is on top of their regional fuel tax, their water tax, their capital gains tax, and their plan to cancel the tax threshold changes. That’s five more taxes before we even get to sugar tax and land taxes.

“The great irony is that you don’t need to add more taxes if you run the economy well and get back into surplus. And new taxes only slow the economy down.

“National has allocated $102 million for new tourism infrastructure in Budget 2017 without adding a new tax - which is four years of the amount Labour are saying they would allocate.

“We’ve also added $76 million for conservation infrastructure without going to a new tax.

“And once again Labour are very light on the details. They say it would be linked to the Border Clearance Levy but that’s paid by everyone that crosses the border. Will they need to set up another bureaucracy to identify the visitors from everyone else? Or maybe a working group to work it out?”

“New Zealand’s tourism industry operates in a competitive world environment. We are just 0.3 per cent of world tourism so we need to be careful about our cost structure. Already the latest international survey says visitors see us as a high-cost destination.

“New Zealand is heading in the right direction. Five new taxes can only slow our economy down just when we are making good progress. We need to keep the country moving forward so we can keep delivering for all New Zealanders.”

The Labour Party’s announcement on GP visits is just another “me too” idea following on from their Dunedin Hospital announcement yesterday, National Party Campaign Chair Steven Joyce says.

“They have literally copied National’s announcement from last week targeting low income New Zealanders, and tacked on a $10 universal subsidy over the top,” Mr Joyce says. “That’s the level of thought they’ve put in.

“Targeting low-income New Zealanders is a good idea, which is why we announced it. But for every other New Zealander, it’s a poor exchange.

“Labour would take $26 a week off New Zealand families by cancelling the Family Incomes package, and give them back $10 for a doctor’s visit.

“If Labour committed to National’s Family Incomes Package, families would put some of the money towards a doctor’s visit one week, and something else they need the next week. Why can’t they trust people to take more of their own decisions?

“Labour acknowledges how little work they have put in to this proposal by immediately saying they would review it if and when they get into government.

“However it’s amazing that they propose to spend over $1 billion in four years on a policy and then set up another working group to look at it.

“Once again, it’s a policy done on the fly, proving again we are all dealing with the same old Labour Party.”