Key confirms borrow and hope policy
Mr Key wants to gamble to finance a higher level of tax cuts in the hope they would pay for themselves. It's a reckless, spend-your-way-to prosperity approach that risks the progress this government has made in improving the country's finances.
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National leader John Key has confirmed that a future National government would borrow to finance its tax cuts and spending plans, Finance Minister Michael Cullen warned today.
On Newstalk ZB this morning Mr Key said 'certainly under a National government net debt.will rise.'
"It is clear Mr Key is repeating his comments in the House last week when he indicated he would be prepared to borrow against the assets of the New Zealand Superannuation Fund.
"We are only in a positive net asset position because of the wise build up of assets in the New Zealand Superannuation Fund which National belatedly supported.
"The fact that we have the Super Fund is not a reason to increase debt.
That would wipe out the purpose of the fund, which is to meet future liabilities from our ageing population.
"If we have higher debt, government payments on interest will be higher,
restricting our ability to make investments today.
"Mr Key is clearly prepared to return to the risky, borrow and hope approach of other National governments which so tied the hands of the governments that followed.
"The real reason for Mr Key's borrowing plan is to finance tax cuts, not
infrastructure.
"The government is planning a modest level of borrowing to fund its infrastructure plans, but not so to as to lift gross or net debt as a proportion of national income.
"Mr Key wants to gamble to finance a higher level of tax cuts in the hope they would pay for themselves. It's a reckless, spend-your-way-to prosperity approach that risks the progress this government has made in improving the country's finances.
"This is precisely what Mr English has been denying is National's
policy approach.
"This exposes once again the difference between the conservative Mr
English and the short term, risk taking, money market speculator that is Mr Key."
Download the associated document file
http://www.beehive.govt.nz/Documents/Files/KeyNewstalkZB27May
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National leader John Key has confirmed that a future National government would borrow to finance its tax cuts and spending plans, Finance Minister Michael Cullen warned today.
On Newstalk ZB this morning Mr Key said 'certainly under a National government net debt.will rise.'
"It is clear Mr Key is repeating his comments in the House last week when he indicated he would be prepared to borrow against the assets of the New Zealand Superannuation Fund.
"We are only in a positive net asset position because of the wise build up of assets in the New Zealand Superannuation Fund which National belatedly supported.
"The fact that we have the Super Fund is not a reason to increase debt.
That would wipe out the purpose of the fund, which is to meet future liabilities from our ageing population.
"If we have higher debt, government payments on interest will be higher,
restricting our ability to make investments today.
"Mr Key is clearly prepared to return to the risky, borrow and hope approach of other National governments which so tied the hands of the governments that followed.
"The real reason for Mr Key's borrowing plan is to finance tax cuts, not
infrastructure.
"The government is planning a modest level of borrowing to fund its infrastructure plans, but not so to as to lift gross or net debt as a proportion of national income.
"Mr Key wants to gamble to finance a higher level of tax cuts in the hope they would pay for themselves. It's a reckless, spend-your-way-to prosperity approach that risks the progress this government has made in improving the country's finances.
"This is precisely what Mr English has been denying is National's
policy approach.
"This exposes once again the difference between the conservative Mr
English and the short term, risk taking, money market speculator that is Mr Key."
Download the associated document file
http://www.beehive.govt.nz/Documents/Files/KeyNewstalkZB27May