Labour’s fiscal strategy takes National’s projections and adds or subtracts money for its policies. The clever thing is they alter the Nats’ projections to remove all the dividend revenue from assets they want to sell. How much is taken off National doesn’t affect if Labour gets back to surplus in 2014 – but it makes National’s projections more accurate. The Nats are complaining.
It’s totally dishonest of the Nats to have booked the revenue from asset sales (which, by the way, they don’t have a mandate for) but not the lost dividends. By Labour’s sums, $800 million of returns would be lost in the first four years and $11 billion by 2026.
English is complaining it’s too much. He reckons it’s $400 million in the first four years.
Well, let him produce the real numbers. Because, so far, he has resolutely refused to be up front with Kiwis about the cost of selling our assets.
It’s interesting that the Nats are only disputing $400m out of four years worth of budgets that total $300 billion. And not disputing Labour’s own numbers but how much Labour has pinged National for over the loss of dividends.
Labour has fronted up and said ‘National would avoid $3.6 billion of borrowing over the next four years for capital investment by selling assets, but we’re not going to sell those assets – so, yup, we’ll have to borrow $3.6 billion more than them to pay for those schools and hospitals but we’ll keep our assets and, in the long run, we’ll be a lot better off as a result.’ All National is arguing that Labour would have to borrow $4 billion more, not $3.6 billion.
That’s a pretty far cry from the $17 billion (or was it $14 billion, or $18 billion, or $11 billion) that John Key was saying during the week.
National has conceded that Labour’s numbers and Labour’s path to surplus are solid. All the Nats are whining about is being called out on how dishonest they have been with New Zealanders about the cost of their own asset sale plans.
Labour has put up an impressive set of numbers. National’s one angle of attack is now blocked and their momentum is stopped.
Now, let’s see Labour go after National over exactly how much we stand to lose in dividends if National sells our assets.