Budget 2016 – F for Fail

Written By: - Date published: 8:15 am, May 27th, 2016 - 31 comments
Categories: budget 2016, class war, economy, national, poverty, spin - Tags: , , , , , ,

As MS has already noted, Deborah Russell has the best summary of the budget:

budget-quote

Russell’s piece is here:

Budget 2016 – How do we look after all New Zealanders?

Very quietly, a cut here and a decrease there, a failure to keep up with inflation in one place, and ignoring increasing population in another place, the Government is walking away from New Zealand’s longstanding social compact.

In his Budget speech, Bill English proudly says that government expenditure is down to less than 30 per cent of GDP, and that’s the way that it’s going to stay. But how is this retreat from the economy achieved? It happens by spending less on health and less on education, and not spending enough on housing for the least well off New Zealanders.

Health spending is going from $15.2 billion to $15.6 billion. That’s an increase of 2.6 per cent. But inflation is predicted to run at 2 per cent, and population growth is running at around 2 per cent. In real terms, the health spend per capita is going down.

It’s the same story in education. Operating expenditure is going from $13.9 billion to $14.2 billion, a 2.2 per cent increase. That’s not enough to keep up with the growth in school rolls. …

It is irritating to see this described by some as an “education budget” when schools – for the first time ever – have been hit with a freeze on operational funding:

Schools will look to parents’ pockets after a freeze on school operational funding

Parents and principals around the country will be scratching their heads wondering what on earth is going on after the Government froze school operational funding.

Schools are increasingly relying on donations to cover their costs – gone are the days of a free education. Schools unable to afford their own technology for students have even resorted to accepting donations from foreign buyers in exchange for land deals.

Before Finance Minister Bill English had even wrapped up his Budget speech, schools would have been brainstorming how to get parents to cough up the shortfall. It’s no wonder “surprise” and “shock” were the two most common words rolling off the tongues of those in the education sector and Opposition MPs. …

The extra funding allocated for disadvantaged kids amounts to $2 each, per week. Wheee! Speaking of kids:

Not the New Zealand we want

Child Poverty Action Group (CPAG) endorses the Government’s stated commitment to improve the lives of all vulnerable children. It has failed dismally with the 2016 Budget announcement today.

CPAG asked for meaningful policies for incomes in this budget but there is nothing in this budget for families with children. When so many New Zealand families are in crisis and children are bearing the brunt this budget does nothing. “All families need sufficient resources for their children to thrive,” says Professor Innes Asher, CPAG health and housing spokesperson.

On housing:

Lack of housing initiatives in Budget making Auckland ‘uninhabitable’ for young people

The Government is making Auckland “uninhabitable” for young people. So say the city’s youth, who are bitterly disappointed that Thursday’s Budget contained few measures to tackle the housing crisis.

The only Budget housing announcements were a plan to release another $100 million worth of surplus Crown land in Auckland for residential development and a $258m boost to social housing.

Annaliese Johnston is a 25-year-old lawyer who believes she will never be able to own a home in Auckland. The absence of new tools on Thursday showed a lack of meaningful structural change, she said. “I have kind of resigned myself to the fact I will be a renter, potentially for a long time,” she said.

On the budget’s “rosy” economic forecasts:

But the forecasts for the economy were based on Treasury assumptions, which quickly came under question, including the expectation of a strong rise in dairy prices over the next two years [yeah right]. Westpac chief economist Dominick Stephens was skeptical about the forecasts. “The Treasury’s forecast of large surpluses through to the end of the decade seem unrealistically optimistic to us.”

For a good summary see Grant Robertson: A Budget that lacks vision and courage to make life better.

As always Scoop has a comprehensive list of links to analysis and reaction. Go Scoop!

Effective cuts in health and education, nothing substantial to address the housing crisis, nothing addressing poverty, nothing on climate change. What a steaming load of fail.

31 comments on “Budget 2016 – F for Fail”

  1. save nz 1

    +100 – great summary.

  2. TC 2

    Granny shows its ankle deep analysis by drawing comparisons to the batchelor and replaying nat spin lines.

    • TC 2.1

      It’s the fish wrap / budgie cage liner / fire starter rendition FYI.

    • mauī 2.2

      The reporting of the budget on tv showed happy smily faces and barely any critical thinking applied. Everyone loves a rockstar giving away free shit I spose.

  3. ianmac 3

    So it is not all rosy. Under the gloss is a murky threat to most of us. Bad boy Bill!

  4. Enough is Enough 4

    This budget is going to hurt a lot of people.

    We will have families not only living in cars but on streets when the effects of this budget really begin to kick.

    New Zealand, get used to walking past children asleep on the footpath as you walk to work.

  5. Sabine 5

    Well
    Surplus?
    TaxCuts?
    Brighter Future?

  6. Enough is Enough 6

    r0b I think perspective is important when rating this budget.

    You seem to be under the misapprehension that National is failing. Try speaking to some of their rich mates though who will rate this as an A+++ budget.

    National is delivering on everything they stand for. Transferring the nation’s wealth to a small hand picked minority.

    If you stand back and think what does National represent, then the only conclusion you can come to is this budget was a success.

  7. Lanthanide 7

    In other words, this government borrowed and ran up the debt on unimportant things, and since they’ve made such a pile of debt they’re now putting self-imposed limits so that they “run a surplus” and don’t create any further debt. Meanwhile things that they should be funding – and therefore running up a debt for – go unfunded, and we slip further behind.

    To make it worse, this government is talking about further reckless spending in the form of tax cuts.

    I actually wonder if in 2017 they might go into the election with a new top tax rate – say 36% at $150,000 or over. Just like they stole the benefit increase in last year’s budget from the left, they could steal this other plank from the left to make themselves look more electable to middle NZ. That would let them have their tax cuts while also keeping their surplus (since there’s really no other way to do it than to raise more revenue).

  8. Halfcrown 8

    What really gets me about this budget is. The double dipping dickhead from Dipton who I would not trust with the local Boy Scouts Jamboree money let alone the country’s finances, can only give meager increases to essential services like health, but can spend a BILLION dollars on a not required 17 bridge in 22 Ks bypass of Hamilton for the trucking lobby.

    • Wayne 8.1

      Roading is basically paid for by roading charges and petrol tax.

      By the way try telling Aucklanders for instance that the current surge of motorway projects are not required, or that Hamiltonians should put up with heavy traffic going through the city.

      The “trucking lobby” is actually the sinews that connect or country, getting all sorts of goods around the country. If that dropped off that would mean the economy had tanked.

      It is a simple equation really, more goods being transported means a growing economy, less goods means a shrinking economy.

      • Psycho Milt 8.1.1

        If that dropped off that would mean the economy had tanked.

        Or, it would mean we were sending more freight by rail and thereby getting some of these annoying road-going obstacles off our highways. Which would be totally awesome, not to mention better for the roads and the environment.

      • Draco T Bastard 8.1.2

        By the way try telling Aucklanders for instance that the current surge of motorway projects are not required

        Why don’t you ask Aucklanders?

        Because we Aucklanders have been saying for decades that we don’t want more roads but decent public transport. We’ve had the more roads ideology forced on us since the 1950s by both local and central government and it’s never worked.

        The “trucking lobby” is actually the sinews that connect or country, getting all sorts of goods around the country.

        Trucks, like cars, are highly uneconomic compared to trains but the added expense allows higher profits. And trains are a natural monopoly so they have to be run by the state so as to prevent the price gouging that private monopolies always engage in – see Telecom since it’s sale.

        It is a simple equation really, more goods being transported means a growing economy, less goods means a shrinking economy.

        And the uneconomic means of trucking those goods means an economy that can’t develop as it should because that transportation is using excess resources. It’s especially using far too many people which the country would be far better off having in R&D.

      • Richard Christie 8.1.3

        ever heard of rail, Wayne?

  9. Chooky 9

    Good discussion here on the effects of this budget on state education which is being bleed in favour of finance for charter schools and private schools

    ‘Are tough times ahead for schools and parents?’

    http://www.radionz.co.nz/national/programmes/ninetonoon

    “The budget saw no increase in school operation funding which goes to pay for teacher development, learning support, power and water bills, technology and sports funding. Instead, the government announced a plan to provide 43 million dollars in extra funding for the children of long term beneficiaries.

    We discuss this with the PPTA General Secretary Michael Stevens and Sandy Pasley the President of the Secondary Principals’ Association.”

  10. whateva next? 10

    If the previous promises of National election “slogans” could be highlighted against their next slogans, it would show the people how empty their promises are, we cannot just keep barking at the next one.
    We knew this budget would deliver nothing, hardly worth a mention really, it’s just a distraction from the appalling legacy of the last budgets.

  11. esoteric pineapples 11

    Was there ever even the slightest chance that the budget would be anything else than a fail. This government is so committed to a philosophy of self interest for itself and its mates disguised as some sort of free market ideology that it will never make decisions that are good for New Zealand as a whole.

  12. Enough is Enough 12

    Why has Labour not produced an alternative budget?

    • AmaKiwi 12.1

      @ Enough is Enough

      “Why has Labour not produced an alternative budget?”

      Reading about the lead up to the Great Depression, the prevailing public mood today is (as in the late 1920’s) “balanced budgets and corporate profits are the good.”

      In the 1930’s it took a monumental economic collapse before the majority switched to the belief that “government intervention is the new “good” and that includes governments borrowing to alleviate suffering.”

      You and I may be ready for a Mickey Savage/FDR interventionist budget. But the majority are not there yet.

      • DoublePlusGood 12.1.1

        Well, Labour might as well go for broke and put out such a budget – right now, to give it a good spell to percolate in people’s minds before an election.

    • Sorrwerdna 12.2

      They are waiting for the fairies to drop a bunch of money from the money tree

      • AmaKiwi 12.2.1

        No, they are waiting for a Bernie Sanders or a NZ version of Paris today: riots.

  13. Observer Toke 13

    .
    . John Key & Billy English a failure ?
    .

    You are talking about Mutt and Jeff . You should have some respect for these chimps.

    After all, they are now getting rid of all the people who do not own a house in Auckland and sending them South in their thousands to where there is no work and little hope. It’s a master stroke of a budget.

    But seeing that the young men and women of Auckland cannot afford to even begin thinking about a house ….Auckland will very quickly become exactly what it wants to be:
    A Zimmer Frame slum. Bereft of vibrant Youth and creativity.

    By keeping wages so low, by not fostering employment, by increasing the cost of health and Education, Smut and Jeff will redouble their immigration of huge numbers of very wealthy, healthy and educated Asians and Britts, Ozzies and a few Americans and Germans.

    No need for Hospitals or Schools at all in Zimmer Frame Auckland.

    Toupe Super City, has achieved its Mission.

  14. Draco T Bastard 14

    For a good summary see Grant Robertson: A Budget that lacks vision and courage to make life better.

    This budget, like all National Party budgets, isn’t about making life better but about making the rich richer and more powerful. And they can only do that by making the poor poorer and less powerful.

    What a steaming load of fail.

    It’s a fail for the country but how well are National’s backers doing out of it?

  15. Health spending is going from $15.2 billion to $15.6 billion. That’s an increase of 2.6 per cent. But inflation is predicted to run at 2 per cent, and population growth is running at around 2 per cent.

    That was annoying the shit out of me watching the news reporting on it last night. “$300 million extra for education! $400 million extra for health! It’s a health and education budget!” And you sit there thinking “So is that increase above and beyond the inflation and population increase, or what?” You might well ask, because these guys aren’t going to tell you.

  16. Unicus 16

    The level of vtriol from regressives condemning Little”s speech can only mean one thing – it cut closer to the miserable bones of their government for comfort .

    Top job Andrew.

    • Heather Grimwood 16.1

      To Unicus at 16: Yes, ’tis patently obvious when watching their body language in the House, which I find even more illuminating than the blustering.
      To Anthony especially, but all who read this, I find the surreptitious cuts in Budget 2016 frightening, not for me so much but for those without houses, and/or sufficient resources to give their children the necessaries to ensure health and developed potential.

  17. Treetop 17

    Little, Shaw and Peters all gave excellent post budget speeches in the House yesterday. I really liked the “this is the get stuffed budget” repeatition from Peters.

    Tax cuts for middle NZ is a no brainer, there is no point robbing Peter to pay Paul.
    An increase of working for families for middle NZ would make more sense as less would be required. The remainder which would be saved from only targeting middle income children could be used for low income state housing.

    NZ Super has gone up 37% under the National government.

    The Key legacy will be the ruining of state housing, the increase of preventable child hospital admissions, the gap between the wealthy and the poor and being a hypocrite.

    I’m no fan of USA politics, at least the American constitution removes their leader after 8 years in office.

  18. Steve 18

    100% a scam, just like the last 7 delivered by National. How they can stand and applaud an appalling Budget is quite beyond me

  19. Jamie 19

    Lolz

    The title of your post should of been ‘National and Labour form tag team to gang bang the poor and working class’ ‘

    The Customs and Excise (Tobacco Products—Budget Measures) Amendment Bill has passed through all its stages under urgency.

    Ayes 109 (National 59, Labour 32, Greens 14, Maori Party 2, ACT 1, United Future 1)

    Noes 12 (NZ First 12)

    This bill amends the Customs and Excise Act 1996 to make four cumulative 10% increases to the duties on all tobacco products’

    ***Source***

    http://parliamenttoday.co.nz/2016/05/tobacco-tax-bill-passes-under-urgency/

    Watch all the wowsers and sanctimonious holier-than-thou-pricks justify this tax grab

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