Urgent action needed to soften inflation blow for low income NZers

The Green Party says urgent action is needed to soften the blow of inflation for New Zealanders on the lowest incomes.

“High inflation is not experienced equally, and for people on the lowest incomes this means struggling to pay the rent and put food on the table,” says Julie Anne Genter, Finance spokesperson for the Green Party.

“Those with the least experience inflation at a much higher rate than those with the most. The latest benefit stats, also out today, show the value of hardship assistance is rising, especially the value of special needs grants and benefit advance payments.”

The Green Party says that if the Government is concerned about fiscal stimulus, the best approach would be to broaden the tax base to cover untaxed capital gains or wealth of the richest New Zealanders.

“Not only would broadening our tax base help to dampen down aggregate demand and inflation in the short-term, it is essential to having a fairer, stronger tax system,” says Julie Anne Genter.

Alongside broadening our tax base, the Green Party proposes a suite of policies.

“The Green Party solution to cost-of-living pressures on low income households is to ensure everyone has a liveable income by lifting benefits and Working for Families, make rent increases reasonable by introducing rent controls, make public transport fares free, and breakup the supermarket duopoly to stop huge corporate profiteering from people buying the essentials to live,” Julie Anne Genter says.

The Green Party urges the Government not to buckle to pressure from National and ACT parties to cut taxes and reduce essential government spending.

“It would be a huge mistake to turn the short-run problem of global inflation into a long-term problem in New Zealand. The Government can, and must, continue to invest to tackle long-term challenges: taking effective climate action, reducing inequality, and making sure our health system can respond to the current and next pandemic. The austerity of the last National and ACT Government created an infrastructure deficit, and a social and environmental deficit.

“National and ACT’s promise to give tax cuts focussed on high income New Zealanders is a predictable appeal to their base, and would be entirely economically counterproductive because it would put more inflationary pressures in our system and create a less progressive, less fair tax system.”

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