Wednesday, November 29, 2023

Point of Order: NZ has a chance to rise again...... our new government gets spending under control

New Zealand has a chance to rise again. Under the previous government, the number of New Zealanders below the poverty line was increasing year by year. The Luxon-led government must reverse that trend – and set about stabilising the pillars of the economy.

After the mismanagement of the outgoing government created huge deficits and an inflationary burst, the new economic team first must cut government spending. Then it must find ways to get the economy growing once more.

In his first statements as PM, Luxon acknowledges the task confronting ministers.

The government’s “number one job” was to fix the economy, he said.

“We have to reduce the cost of living, get inflation under control.

“A lot of our focus is on tackling the underlying causes of inflation and that does mean a series of things, of making sure that we’re generating savings out of the public service and public spending is being prudent, but equally, making sure we do things like get the Reserve Bank focused on a single target.”

He said in addition to getting inflation under control, the government would be focused on “restoring law and order, and making sure we deliver, ultimately, better public services”.

“We need to go to work and we need to make sure we’ve got the right people on the right assignments and we’ve thought very deeply about who’s best to lead that work.”

Finance Minister Nicola Willis has the key role in all this. She has emphasised that her mini-budget before Xmas will be quite limited, with the tax cuts earlier signalled not coming until next July.

Willis says she is working to re-prioritise some of the planned spending.

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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