National softening public up for 7th successive deficit

Finance Minister Bill English is softening the public up for an announcement that National is going to fail in even its very limited goal of achieving a budget surplus, the Green Party said today.

“No finance minister in a generation has racked up seven consecutive deficits,” Green Party Co-leader Dr Russel Norman said today.

“They have tried to paint themselves as good economic managers but National has, in just over six years, racked up $55 billion in extra debt, equivalent to over $14,000 for every New Zealander.

“Bill English warned today that achieving his long promised surplus this year, would be a ‘challenge’.

“He is on track to beat the appalling fiscal record held by the Muldoon National Government of 1966-1972 for successive deficits.

“Bill English is using the excuse that milk powder prices have dropped, but no financial manager in their right mind would bank on commodity prices staying at historic highs?

“His other excuse is low inflation. Which other finance minister has used that excuse for poor budget management?

“Clearly the Global Financial Crisis and the Canterbury earthquakes were budget challenges, but the 2010 tax cuts for the top 10 percent exacerbated the position.

“National castigated other parties for their promises during the election, but their fiscal track record is woeful.

“Even worse, they dangled unrealistic and irresponsible tax cuts in front of the electorate, knowing there was no prospect of following through,” Dr Norman said.

Treasury’s Pre-election Fiscal and  Economic Update predicted the Government’s budget forecast of a $372 million surplus would only be $292 million. Bill English warned next month’s fiscal update may not forecast a surplus.

“During National’s six years in office, export prices have been the highest for 40 years. It’s time for National to stop blaming circumstances and take responsibility,” Dr Norman said.

“National has simplified and hollowed out the economy by betting the farm on the farm. Instead of pushing commodities, it should lead moves to diversify the economy via value added industries.”