What’s the Govt’s economic vision?

Written By: - Date published: 10:37 am, May 10th, 2010 - 6 comments
Categories: Economy, jobs, overseas investment, tax - Tags: , ,

To build a brighter future for New Zealand we need to invest in it.

We need to build our national savings, so that we don’t need to borrow from overseas or sell our assets, sending the profits of Kiwi work to foreign capitalists.

We need to put money into R&D so that we don’t have to rely so heavily on hi-tech imports, so that we export more valuable goods overseas, get our economy on to an environmentally stable platform, and sell our knowledge to the world.

What has National done? Cancel the Cullen Fund contributions, gut Kiwisaver, kill the Fast Forward Fund, end the R&D tax credits, knee-cap the ETS, and make half a billion worth of tax cuts for the rich.

The Nats talk a big game about aspiration but it’s vague stuff. When it gets to detail we repeatedly hear from the Nats that New Zealand can’t do better, that we have to be reliant on foreigners for manufacturing and investment. Look at Steven Joyce’s dismissal of the railway workers’ proposal to build rail cars here.

National’s not about building a more sophisticated, productive economy – it’s just about doing the same and more of it. The Nats’ economic ‘plan’, if you can call it that is: dig up more stuff, turn more water and topsoil into milk.

Now, it looks like they’ve at least smartened up enough to put some more money into science in the Budget. But it’s clear the priority remains upper-end tax cuts, just another wealth transfer from working Kiwis to the rich – more short-termism, rather than investing in the future.

6 comments on “What’s the Govt’s economic vision? ”

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  1. Lanthanide 1
    10 May 2010 at 11:10 am

    I wouldn’t really say they “gut” kiwisaver. They capped employer contributions at 2%, and gave the option of 2% investment rate instead of 4%, which frankly Labour should have had anyway, because even saving at 2% is better than nothing and a lot more affordable for those on low incomes. They also scrapped the $40 fee subsidy per year, which was always chicken feed anyway (as fees are calculated on a % of the total value of the fund per year, so can easily be much more than $40).

    National didn’t touch the three largest government incentives with the scheme, the $1,000 kickstart, the $1042/year tax rebate and the $1,000 year up to $5k home subsidies.

    Given the economic climate, with lots of people not even getting payrises, the 2% employer cap probably wasn’t a bad call. But I would expect this figure to rise back to the original 4% once the worst of the recession has past – although I know that National would never do this. But I am judging National on what they have done, not on what they are likely to fail to do in the future.

  2. Draco T Bastard 2
    10 May 2010 at 3:52 pm

    gave the option of 2% investment rate instead of 4%, which frankly Labour should have had anyway,

    I believe that they looked at it but the costs of running the scheme would have been more than the return @ 2% investment rate, ergo, it would have been worse than nothing.

    • Lanthanide 2.1
      10 May 2010 at 4:11 pm

      “more than the return @ 2% investment rate”

      Return to whom? The government? Or are you saying that if average people invested 2% of their income into kiwisaver schemes, they would actually lose money, and only investing 4% or more of your income is worthwhile?

      If you mean return to the government, how exactly was the government getting returns from kiwisaver? They’re giving away money to private citizens through the tax credits and $1000 kickstart, they’re not looking to make a return on it.

      If you mean to private citizens, well that frankly doesn’t make sense.

      • Draco T Bastard 2.1.1
        10 May 2010 at 7:33 pm

        The administration costs (how much the banks charged) were greater than the rate of return to the investors (ie, the people paying into Kiwisaver) if the investment rate was less than 4% of the individuals income.

  3. Santi 3
    10 May 2010 at 7:20 pm

    Key has no vision whatsoever. He;s supported by the media and a legion of mercenaries and paid supporters, Farrar among them.

  4. Helen Kelly 4
    10 May 2010 at 8:09 pm

    You seem to have missed one important point about Nationals economic vision. I for one am reassured by this weekends National Party conference. I was worried that the closing of the pay and employment equity unit, the cuts in childcare subsidies, the appointment of 4 all male committees to look at such impt issues such as tax, infrastructure, ACC etc, the attacks on solo mums, night classes etc meant National didnt really care about women. But I was wrong! I understand they had a good represenatation of women at the conference in the form of a performance from TUI beer girls (http://www.kiwiblog.co.nz/2010/05/lni_regional_conference.html).

    I have obviously misjudged them and would like to publicly congratualte Pansy Wong for advancing the cause of women. Those who want to see how beer companies use women internationally to sell product could look here http://www.beergirls.org/