Cabinet minister Phil Twyford’s revelation that the government has no limit on the amount of debt it might run up makes a mockery of Grant Robertson’s fiscal responsibility rules, National’s finance spokesperson Amy Adams says.
“Twyford’s confession that the Government won’t control ‘off-balance sheet’ debt shows how poorly Labour budgeted for their promises before the election. They’ve already raised $6 billion in debt that doesn’t register in the Core Crown accounts since the election.
“We warned the Government before the election that their numbers didn’t add up. Since then we’ve seen them needing to substantially increase debt levels.
“Now Twyford is indicating debt could increase even further. Off-the-balance-sheet debt is like having a separate credit card your partner doesn’t know about. But whether the debt is Core Crown or hidden away in Crown Entities, taxpayers will still ultimately foot the bill.
“If the Government’s pledge was designed to reassure the public that they intended to be fiscally responsible rather than reckless it hasn’t worked. The strategy has been shown up as duplicitous. Meanwhile, uncertainty reigns.
“On top of the $6 billion in off-balance-sheet debt, the Government needed to increase its operating and capital allowances by more than $5 billion in Budget 2018. So far, that’s over $11 billion more money than allowed for in Labour’s pre-election fiscal plan.
“All this is against a backdrop of a Government that has made downplaying negative economic indicators a full-time job as they continue to pile up. The ASB Investor Confidence Survey today shows confidence at its lowest level in almost two years.
“The Government is realising too late that the New Zealand economy requires responsible leadership and both business and ordinary Kiwis need certainty, not theories exhumed from Labour administrations of yesteryear.”