Where are National’s costings?

Written By: - Date published: 9:52 am, September 16th, 2023 - 19 comments
Categories: Christopher Luxon, david seymour, election 2023, national, paul goldsmith, same old national, tax, treasury - Tags:

Three years ago I took great delight in writing a number of posts about National’s shambles of an alternative budget.  At one stage I said this:

It has been a complete and utter shambles.  A clusterf&*k of epic proportions.  A week in and they are still being hammered about it.  Because if there is one part of National’s reputation that needs to be defended at all costs it is the perception that they are competent financial managers and making multiple billion dollar mistakes in your alternative budget at election time is the one thing over all else that will hurt that part of your reputation.

The problems were numerous but included these:

So I thought that this time National would interrogate its figures mercilessly and repeatedly to make sure there were no problems.  How wrong I was.  National’s tax cut plan has as many holes as a large piece of swiss cheese.

Like the half billion overestimate of tax from the Foreign Exchange Buyer’s levy in the first year and by the looks of it every year after.  Independent economists including former Treasury Economist Michael Reddell have rubbished National’s figures.

Or National repeating Goldsmith’s mistake and not checking on the latest status of the various funds it wants to raid.  This time costing it a cool half a billion dollars after it reprioritised money in the Climate Emergency Response Fund that is no longer there.

Or the heroic assumptions about how much money can be raised by taxing internet gambling.  The best estimates available suggest that the amount of gambling that could be taxed is a quarter of the amount required to meet the target.

From Radio New Zealand:

[Labour Minister Barbara] Edmonds on Thursday told reporters at Parliament offshore online gambling operations were already subject to GST after a change brought in by National in 2016, and far more gamblers would be needed to cover National’s expected costs.

“Based on the estimates I’ve seen we believe that New Zealanders lose $350m offshore due to online gambling, that’s based on the GST count that we’re getting,” she said.

Her colleague Kieran McAnulty said the $350m figure was backed up by figures produces by the TAB and Lotto as part of the review of the Gambling Act.

“The TAB has been producing figures to demonstrate why there needs to be regulation of online gambling, Lotto have done the same. If they believed there was four times the amount of people gambling overseas they’d say so because it would strengthen their case.

The shortfall over four years could be in the vicinity of half a billion dollars.

And on the cuts side there is what appears to be another $100 million a year hole, this time from National using old data to calculate the cost of restoring interest deductibility for landlords.  It used the original estimates, formulated when interest rates were low, rather than up to date figures which it could have used the OIA to obtain.  It appears that National is capable of using questions to find out how much money was spent on budget engagement with Pasifeka communities so it could then mount racist attacks on the Government but it was incapable of doing the same to find out now much its policies would cost.

And National’s latest policy announcement, a cut and paste of a UK Conservative policy,  has the unfortunate feature of potentially reducing the numbers of foreigners having to pay tax.  National’s policy requires 1,700 eligible transactions at an average sale value of $2.9 million.  The latest policy allows for up to 250 successful applicants being granted Global Growth Tech Visas.  These are the people National wants to tax.  This new policy potentially significantly reduces the potential income from the tax, by up to $100 million a year.

Using my back of the envelope very rough calculations National has underfunded its policy by $3 billion over 4 years. Cuts on top of those already promised will be required to balance the books if National win.

And Act will put National’s cutting tendencies on steroids.  David Seymour wants to sack 15,000 public servants by Christmas and attack beneficiaries with drug problems.  Let that sink in.

The response from right wing supporters is indifference to the problem as long as they get a tax cut or a very public hope that cuts do occur.  For them competence does not matter.

But this goes to National’s claim to be competent with economic issues.  A couple more weeks of this will damage its desire to become Government.

The media is really focussed on this issue and it cannot be helping National.  If it does not find a way to deal with this issue then it could hemorrhage support all the way to the election.

19 comments on “Where are National’s costings? ”

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  1. Kat 1
    16 September 2023 at 10:55 am

    "In the battle of the modellers and assumptions it is not at all clear the public really cares………………….."

    https://www.thepost.co.nz/a/politics/350073688/election-all-over-bar-shouting-until-it-isnt?utm_source=stuff_website&utm_medium=stuff_referral&utm_campaign=mh_stuff&utm_id=mh_stuff

    The media may be focused but not necessarily in a helpful way…..they should be scrutinizing National in depth on its claim to be competent with economic issues….but they are not…… and the election debates with jessica@6pm.news are bound to be all bubbles and no punch…

  2. ianmac 2
    16 September 2023 at 10:56 am

    And there is the $100million lost from, "The National Party's plan to restore interest deductibility for residential landlords could cost as much as $100 million a year more than it anticipated due to rising mortgage rates."

    https://www.newsroom.co.nz/nationals-landlord-tax-break-could-cost-100m-more-a-year?utm_source=Newsroom&utm_campaign=daa045f384-Week+In+Review+16.09.2023&utm_medium=email&utm_term=0_71de5c4b35-daa045f384-95522477&mc_cid=daa045f384&mc_eid=88a3081e75

  3. Patricia Bremner 3
    16 September 2023 at 11:27 am

    Journalists asking for modelling has exposed the arrogance. "We have told you all you need to know."

    The Public response is muted, as the prefu showed overspend. "Figures are always wrong."

    So they shrug, not accepting their job could be a first tranche of job losses.

    They may be a victim of the ripple effect. 15000 stone in the public service pool becomes 30-40 thousand affected down stream.

    I hope people are beginning to ask questions and test policies for flaws. Their futures are at risk.

    • tc 3.1
      17 September 2023 at 10:42 am

      Journalists need to keep asking as it's clearly got gaping holes…but will they ?

      Luxons drawn the line, vote for us, get this, we don't really care about anyone else. His bottom feeders gaffe was the mask slipping.

      We are the chosen ones, we don't need to supply costings cos we are getting it back on 'track' i.e. selling out.

  4. bwaghorn 4
    16 September 2023 at 12:17 pm

    Nationals 1600 foreign buyers are going to all be hard-core internet gamblers who use legal tax paying companies!!

  5. Mike the Lefty 5
    16 September 2023 at 12:18 pm

    The political right's response to when their economic shamanic figures are exposed: nothing to see here – move on!

  6. Tricledrown 6
    16 September 2023 at 12:23 pm

    National are doing the Trump thing lying.After economists look at all the past sales of houses over $2 million then you add the 20% tax for overseas buyers no foreign buyer is going to waste money on taxes.National will just give them citizenship just like Theil.National just keep repeating the lie otherwise they would release the independent research.National have a hidden agenda as they want to slash govt spending to give to the very wealthy sucking in enough of the squeezed middle to succeed in their plan.

    • bwaghorn 6.1
      16 September 2023 at 12:34 pm

      DO these foreign buyers have to live in the houses or can they just be bachs,/investment properties.

      • Roy Cartland 6.1.1
        16 September 2023 at 12:56 pm

        If they have to live in them at all now, you can guarantee that law will get changed when ACT starts throwing its weight around. Investors will be grovelled to.

      • Belladonna 6.1.2
        17 September 2023 at 11:09 am

        I haven't seen a specific answer to this in the policy.
        But, I'd suspect not.
        Certainly mega-millionaire celebrities who have bought significant properties in the past (Shania Twain, Peter Thiel, etc.) have had no residency requirement.

        Of course, 'ordinary' foreign buyers (i.e. not multi-millionaires for whom a $5 million house is chump change) – would be much more likely to rent it out, if they are not themselves living there.

  7. adam 7
    16 September 2023 at 12:24 pm

    Sick and tired of the rich getting richer, whilst workers keep falling behind.

    We have had a massive transfer of wealth up over the last 40 years.

    This economy is not working for people, and the national party put up this bullshit.

    As for act, they are sucking off the corporate class and punching down. To many in this country now embrace their fear, hate and anger.

  8. georgecom 8
    16 September 2023 at 2:33 pm

    Bugger. I have been telling people this past week that the fiscal hole is $2 billion. I am now going to have to apologise and admit I was wrong and explain it could be as high as $3 billion

  9. Charlotte Rust 9
    16 September 2023 at 3:17 pm

    Nicola Willis has said she will resign if they don’t ‘deliver’ tax cuts. I take this to mean if they can’t deliver them using their ‘modelling’ that they will deliver some other way come hell or high water ie raising gst, freezing wages etc

  10. observer 10
    16 September 2023 at 6:23 pm

    Watching Luxon run away from these questions on Newshub tonight was entertaining. And a preview. The "mood for change" might see him become PM, but if he does he will be the weakest since Jenny Shipley (Nat or Lab), and that might even be unfair to Shipley.

    Win or lose, there's no way National MPs will stick with him post-election.

  11. AB 11
    16 September 2023 at 7:46 pm

    Oh the irony. Labour are obsessed with appearing fiscally responsible, to the point of not giving their base enough help. But they have a reputation as poor economic managers. National simply don't give a f**k, they give their base tax cuts and capital gains irrespective of the consequences. But they are supposedly economic geniuses.

    This is an infuriating inversion of the truth. A sort of deadly trap we need to destroy.

  12. Descendant Of Smith 12
    16 September 2023 at 11:43 pm

    National allow rich overseas people to come and have a bolthole home here so they will donate to the national party – not any more difficult to understand than that.

  13. Adrian 13
    17 September 2023 at 2:56 pm

    Seymour on QandA said those with addiction problems will be denied welfare and when pushed on how they get over addiction his reply was " volunteers " teaching them the right way to live. Fuckmedead, he is such an dangerous idiot.

    • SPC 13.1
      17 September 2023 at 3:03 pm

      We're a bit short of professional addiction services and they cost money etc. Despite this being quite important to successful rehabilitation pre or during parole.

      ACT would prefer to imprison these people, or have them join gangs, than provide housing for them (sans income support … )

      Of course the transition to higher levels of imprisonment would require more crime victims (doing time hard while recovering from an addiction).

    • Michael P 13.2
      18 September 2023 at 4:06 pm

      Begs a few questions am assuming the interviewer didn't ask. Does that mean he is saying people applying for benefits will be drug tested? Is there a list of 'acceptable' addictions? (eg alcohol). Will it apply to all benefits? (eg pensions). How will it be determined if they are addicted or not? etc.