Friday, April 28, 2023

Point of Order: While an economist predicts govt will be lifting its borrowing.....

.....the PM and his Housing Minister welcome the results of spending

There was nothing fresh on the government’s official website when Point of Order checked this morning on the doings of our hard-working ministers of the Crown.

This was no surprise, we reasoned. They will be busy finding someone willing to lend them the billions they need to plug the deficit in the Budget books.

This reasoning was based on RNZ’s report of economist Cameron Bagrie predicting Labour could end up borrowing more than it planned for this year’s Budget given the “immense competing interests” it is facing.

This prediction was made in the wake of the PM delivering a speech in Auckland in which he described next month’s Budget as a “no frills” affair with no major tax changes.

Bagrie told RNZ the government had a “real balancing act” on its hands and some “big considerations” beyond the election.

Labour needed to dial back spending to try reduce inflation, Bagrie said, while also responding to the intense pressure to provide cost-of-living support, increase public sector wages, and drive the cyclone recovery.

“How the hell are they going balance that up? Obviously you don’t want to increase taxes in an election year. No one really wants to cut back on spending – it’s difficult.

“Maybe the sacrificial lamb here – in regard to what gives a little – is borrowing a little bit more over the next couple of years.”

Treasury has estimated the repair bill from Cyclone Gabrielle and the Auckland floods will add up to between $9 and $14.5 billion, although a dubious Bagrie said that figure was “decidedly light” when taking into account the overall challenges of managed retreat and inadequate infrastructure.

Point of Order’s visit to the government website this afternoon showed we were wrong to suppose the PM and his team were looking for lenders.

To the contrary, he and his Housing Minister were celebrating a spending exercise – the continued delivery of “the biggest public housing programme in a generation”.

They delighted in noting that Christchurch has eight new warm, dry public homes, thanks to this spending.

The other statement suggests more money will be spent, this time to extend the Ministerial Inquiry into woody debris (including forestry slash) and sediment on the East Coast.

Neither statement gave an indication of whatever costs were being incurred.

Latest from the Beehive

Christchurch has eight new warm, dry public homes, as the Government’s delivery of the biggest public housing programme in a generation, continues.

A 12-day extension has been approved to the 30 April deadline for the Ministerial Inquiry into woody debris (including forestry slash) and sediment in Tairāwhiti/Gisborne and Wairoa.

In their statement, Chris Hipkins and Housing Minister Dr Megan Woods said they visited the new homes in Riccarton today.

“It’s always a great thrill to see yet more 21st Century public housing completed, ready for people and families to move into,” Megan Woods said.

“These are but a handful of the nearly 12 thousand additional public homes, and four thousand transitional homes our Government has delivered, since we came into Government.

“Here in Christchurch City, there are nearly 1,821 additional public homes. That follows a net loss of 341 homes under the previous National Government.

“So, as we turn around the housing crisis we inherited, we can proudly say the public housing sector that was decimated under National, is thriving.”

Stand by for the riposte from National, which is bound to challenge Woods’ figures.

In their statement, Environment Minister David Parker and Forestry Minister Peeni Henare said the three-member panel for the Ministerial Inquiry, chaired by Hekia Parata, sought the extension due to the number and substance of the submissions received.

The panel advised they received 313 submissions, many of them fulsome and comprehensive, Parker said.

A short extension will ensure the submissions are fully considered, helping ensure a more comprehensive and fulsome report.

Point of Order is a blog focused on politics and the economy run by veteran newspaper reporters Bob Edlin and Ian Templeton

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