The budget does nothing to tackle the two-speed economy that National is creating, says Labour’s Finance spokesperson David Parker.
“National’s two-speed economy is creating winners and losers. The winners are a few well, connected elites. The losers are the rest of us.
“We have two economic speeds, where exporters and manufacturers struggle, while speculators flourish.
“We have two speeds in a fairness sense, with incomes and wealth ever more concentrated in the hands of the few.
With less than 24 hours to go before the budget Bill English has shown he’s not on top of the numbers, making an embarrassing error on manufacturing figures, says Labour’s Finance spokesperson David Parker.
“Manufacturing is in serious trouble in this country, especially non-primary manufactured exports. That’s why we are holding a Parliamentary Inquiry into Manufacturing to support the sector.
“Someone should tell Bill English the facts because he clearly doesn’t know. He said today in Parliament – in his prepared response to the primary question – that in the December quarter ‘manufacturing showed growth’.
“He was wrong. According to Statistics New Zealand ‘Manufacturing activity decreased 0.5 per cent, after a 0.6 per cent fall in the September 2012 quarter’.
“The problems in the manufacturing sector are contributing to our $10 billion current account deficit which is the worst in the developed world, and will remain so for the next five years.
“How on earth can Bill English be expected to solve this major issue for our economy when he gets the basics wrong?
“It is no wonder the Government is failing to rebalance the economy and this budget will do little to help,” says David Parker.
15th may 2013 Media Statement
The relentless pressure from exporters, manufacturers, unions and opposition parties has pushed the Reserve Bank Governor to acknowledge the damaging impact of the high dollar, yet nothing of substance has been done to protect jobs and exports, says Labour’s Finance spokesperson David Parker.
“Reserve Bank Governor Graeme Wheeler has tentatively responded to pressure on the exchange rate in his Monetary Policy Statement today.
“He said: All other things equal, a higher exchange rate relative to the baseline, in the absence of a corresponding relative strengthening of New Zealand’s economic outlook, would warrant lower interest rates’.
“But still, acting under his current inflation-first mandate, and despite massive pressure on manufacturers and exporters, a huge current account deficit and the loss of thousands of jobs, nothing substantial has been done to lower the overvalued dollar. That’s because, under this Government, the Bank’s out of date mandate is stuck in the past.
“Exports are suffering, jobs are being cut and our current account deficit is getting lower and New Zealand poorer as a result.
“The Reserve Bank has a tunnel-vision mandate from the 1980s that requires it to give primacy to inflation. If the inflation forecast changes for the worse then hopeful exporters can kiss goodbye to any OCR cut.
How to work a four-day week? Move to Australia
The wage gap with Australia is now so large that Kiwis across the ditch earn a New Zealander’s weekly pay in just four days, says Labour’s Finance spokesperson David Parker
“The median weekly wage gap with Australia has ballooned by $60 to $180 per week under John Key’s leadership, despite National’s promise to close the gap.
“In Australia the median wage is $1067, in New Zealand it’s $887, according to the latest statistics. To make up the difference Kiwis need to work another full day and another hour on top of that. It’s no surprise 182,000 Kiwis have left under National.
“Kiwis who left for Australia only need to work a four day week to get what they were earning here. What a luxury. Of course they are leaving in droves, with a record 54,000 buying a one-way ticket last year.
National’s anaemic economy is funnelling the meagre proceeds of growth into the hands of a minority of New Zealanders who were already best-off, while ordinary New Zealand families struggle to meet the bills and unemployment is over 7%, says Labour’s Finance spokesperson David Parker.
“At 0.2%, growth in the last quarter was closer to 0 than 1%. The vast majority of New Zealanders are no better off. That’s because National is creating the highest inequality levels ever.
National’s economic plan is plainly failing, with its own forecasts showing an external deficit of over -$10 billion for each year for four years, rising to -$17 billion by 2017 says Labour’s Finance spokesperson David Parker.
“National wants us to focus on the government deficit, and to ignore the external deficit.
“Why? Because they want to forget their promise to rebalance the economy. But we must not ignore our $10 billion a year (and rising) deficit. Economists call it the Current Account Deficit. I call it The New Zealand Deficit.