As usual I had difficulty getting my head around said Budget but my son helped out. I doubt I’m any more bereft than the average punter so it would help if the media gave us some basic insight into how it all works. (For some excellent comment on the Budget see Gordon Campbell’s ‘Let them eat crumbs budget‘ at Scoop.) And paid more attention to revenue expectations. “Look, a surplus” isn’t far off crying “look, the holy grail” offered son. Whether this was his own insight I know not. Most of the media dutifully echoed the “look, a surplus” approach. A business commentator, Martin Hawes, supplied the paper-thin description.
The big thing I’m to remember, said son, is that the Budget applies to the coming year not the one passed. The surplus is forecast to increase. Up to about $3 billion in three years time. Had the rich not been granted reprieve from a high tax rate we would have had an extra billion plus annually over the last three years. Some time ago, I had been all too easily persuaded that the amount the rich contributed was insignificant. I don’t think a billion is insignificant.
What about revenue expectations? Adverse weather events, a slower than expected Chistchurch rebuild (snail’s pace to date) dairy industry returns falling off and a tax take below expectation could put paid to even a paper-thin surplus in future years. The rockstar economy bruited about the land earlier looks pretty trashed to me. The Government has borrowed $45-50 billion since the financial crisis taking total government debt to $65 billion overall. Gordon Campbell points out that the asset sales have not been invested, simply used to pay running costs. Not what was promised. (Private liabilities amount to $150 billion, we are still not paying our way and interest goes to overseas banks). The exchange rate remains stubbornly high.
A Campbell Live (not the same Campbell as above) story on the Christchurch CBD re-build was alarming. Apparently most building owners took their insurance and ran. Two who are rebuilding look to be facing losses. The area remains a wasteland and who wants an office or shop in a wasteland? There is a reported shortage of skilled workers. What seemed a good idea – encouraging beneficiaries to go there for work ($3,000 to assist in the move) didn’t thrill the builders. Not enough apprenticeships served over the last three years. Oh dear isn’t there a planning department in some ministry? I think the Ministry of Works did this sort of thing but Labour dumped it in favour of self-replicating consultants whose reports cost millions and seem only to build inertia. Where has head honcho of the earthquake recovery Gerry Brownlee gone to ground?
The budget will help working families. Beneficiary families are once again stigmatised as the undeserving poor. How many are desperately seeking work? All too many hover close to edge of starvation, lack of money for good nutrition. Nothing gives me gyp more than seeing doctors’ wives outside the supermarket raising money for the Malaghan Institute to fight cancer when the cost of fruit and vegetables is high. A leaf of lettuce won’t do it.
There is no money for getting people onto hospital waiting list because THERE ARE NO WAITING LISTS OVER FOUR MONTHS. They are not allowed to exist and were magicked away in a political swifty by, I think, Labour’s Annette King and happily taken advantage of by Tony Ryall. Both have basked in the admiration of our younger less rickety media impressed with their management skills. You have to be in some sort of extremis to get a joint replacement, a big issue for the elderly. GPs are helpless, angry, distressed for patients.
Housing problems don’t seem to be going away and an increase in immigration may exacerbate them (whatever other advantages it might bring).
All in all, a sorry state of affairs. Not for the bankers who caused the problems or the economists and politicians who let them loose. It’s wondrous how so many of the latter still enjoy the handsome perks of office at taxpayer expense.