The Nat’s misguided austerity program is stiffling prospects of recovery. The tax take is down, there’s no money, and they made the last election all about getting back into surplus by 2013/14. Put it all together and it adds up to another “zero budget”. Vernon Small reckons that’s brave:
Zero Budget political and extraordinary
Like it or loathe it, delivering a second “zero Budget” will be an extraordinary achievement if Finance Minister Bill English pulls it off.
It was not so long ago that a new spending allowance of about $1.5 billion was considered tight given the insatiable appetite of the health budget alone, which could swallow $750 million extra a year without any trouble at all.
But as the years of austerity have dragged on, it seems the big-spending ministers and the public servants who report to them have come to accept the message Mr English has been hammering since the global financial crisis hit; that restraint is a permanent state of fiscal affairs.
Hunkering down and waiting for the wheel to turn back in favour of extra spending was not an option.
Even so, consecutive Budgets with no new spending – and more to the point, no major revolt by voters (yet) – is a considerable coup. …
Make no mistake, the zero Budget is far more a political promise than a necessary economic goal. But it will be an extraordinary achievement all the same.
With all due respect to Vernon, I beg to differ, The zero budget isn’t brave or extraordinary. It’s the only option left to a bunch of incompetents who have painted both themselves, and the economy, in to a corner.