- Date published:
8:13 am, September 6th, 2017 - 16 comments
Categories: accountability, economy, national, Steven Joyce, useless - Tags: clutching at straws, economic genius, joyce's hole, liar, steven joyce, zero budget
Steven Joyce accused Labour of a basic accounting error, failing to carry forward extra spending commitments, an $11.7bn “hole”. This is a thoroughly debunked lie.
So now he’s trying, in a series of desperate interviews, to shift the goalposts and say that what he really meant is that Labour hasn’t left enough room – outside health and education – for extra spending. Two supposed “zero budgets” projected. Here for example (transcribed from audio at 1:58):
“What Labour are saying is … outside of education and health zero budgets – that’s what they’re saying – for two years, which is just completely untenable”
Interviewer John Campbell correctly calls him on this “reinvention” of his argument. Joyce is quibbling about room for future growth when he claimed a massive accounting error.
So what about these zero budgets? The Herald’s Brian Fellow gave them the attention they deserved several days before Joyce’s brain fart:
It is election season, so National likes to portray Labour as the fiscally profligate tax-and-spend party, while Labour likes to picture National as a tightfisted Scrooge, cruelly underfunding public services at every turn.
But when you compare National’s plans for the next four years – as announced in May’s Budget and carried forward in the pre-election economic and fiscal update (Prefu) last week – with Labour’s alternative Budget updated this week, the differences are pretty marginal in the great scheme of things.
Labour’s fiscal plan commits it to spend $14.5 billion more than the present Government has budgeted over the four years to June 2021. … The bulk of it is in the three big-ticket items in any Budget: $4.7b more for health; $3.8b more for social security and welfare; and $3.7b more for education, including the tertiary education package it announced this week. Because it has a slightly higher debt track, it also has to allow for $600 million more in interest costs over the next four years.
So where is the extra $15.1b to come from? Nearly half of it ($7.4b) comes from a higher revenue track, 85 per cent of which is the result of scrapping the tax threshold adjustments that Finance Minister Steven Joyce announced in May and which are scheduled to kick in on April 1 next year. … Most of the rest ($7.2b) of the higher committed spending is scooped out of a line item in the Budget called the operating allowance. This is the provision for new spending (or revenue-reducing) initiatives in future Budgets.
That is pretty tight, especially if the wish lists of coalition or support partners have to be accommodated. But it is worth remembering that in the wake of the global financial crisis, we had a couple of zero Budgets, when there was no such allowance: in effect, Bill English told the public sector there would be no new money for them and any new initiatives would have to be funded by “reprioritising” within their existing budgets. [my emph]
Assuming, perhaps generously, that Labour can live with the tighter unallocated operating allowances its fiscal plan includes, its budgeted operating expenditure over the four years to June 2021 would be just $8b, or 2.3 per cent, higher than National plans.
Its revenue would be $7.4b, or 1.6 per cent higher. That does not look like an increase under the weight of which the economy would crumple. …
It’s an excellent piece, well worth reading in full in the context of the current circus.
So yes, the “zero budgets” that desperate Steven Joyce has latched on to as his revised line of attack are nothing to get excited about. There is allowance for extra spending. National had “zero budgets” twice in 2011 and 2012, and National are themselves now working off the same PREFU figures as Labour. Treasury projections being what they are, all the numbers that precise and that far out are highly variable anyway.
In short, exposed liar Joyce is clutching at straws.
ON NOW: Steven Joyce says the economists disputing his claims re $11b hole are wrong "because you can't have 0 budgets two years in a row".
— Checkpoint (@CheckpointRNZ) September 5, 2017
.@stevenljoyce that was a spirited attempt at creating "alternative facts" Steven you did a hit on Jacinda on eve of a debate.
— Selwyn Pellett (@SelwynPellett) September 5, 2017
Joyce has gone from claiming a massive accounting error in Labour's books to arguing $7b of unallocated money (same as he has) isn't enough
— Clint Smith (@ClintVSmith) September 5, 2017
The real location of the fiscal hole is discovered – cartoon on Steven Joyce's fiscal allegations by Chicane in today's Southland Times: pic.twitter.com/ceSgn8ZBAS
— Bryce Edwards (@bryce_edwards) September 5, 2017
— Elephant in the room (@LetsfixthisNZ) September 5, 2017