Labour’s Grant Robertson, National’s Nicola Willis, the Greens’ James Shaw and Act’s David Seymour scrapped at the ASB Great Debate in Queenstown moderated by Jack Tame on Thursday night, one of the bigger finance debates of the election.
In a day when National was accused of having a $2.1 billion hole in the costings of its tax policy, Willis came under pressure to release the modelling behind the plan, which National had not yet done.
Speaking to TVNZ’s Breakfast this morning, Willis said she would resign if a National Government couldn’t deliver on the tax cuts it’s promising.
”I would resign because we are making a commitment to the New Zealand people and we intend to keep it,” she said when pushed about whether the foreign buyers’ tax would work.
Last night Robertson, armed with a copy of the plan, waved it to Willis and the crowd, telling Willis there were no calculations on the foreign buyers’ ban page of her tax policy
“If you are so confident where are the actual costings?” Robertson said.
Willis also came under pressure over National’s policy to allow landlords to deduct interest costs from their tax bills. National thinks the policy will put downward pressure on rents, but Willis said she was unsure whether it would put up house prices.
“I don’t know what it will do to house prices,” Willis said.
Seymour, who also backs returning to the old system, did not think changing the rule back would affect house prices.
Robertson came under pressure for the growth in government spending this term. Willis was herself armed with a copy of Labour’s fiscal plan from last term which promised new operating spending of $2.625b in each Budget this term - a figure Labour has exceeded in each Budget.
Willis said she did not think it was okay that spending has increased 80 per cent under Labour but the only outcome that seemed to have increased was more ram raids.
Robertson shot back that the last National Government also changed its operating allowances to respond to economic conditions.
“The reason you have a Budget allowance is to plan to achieve your Budget goals. I hear a lot of professors of hindsight economics up here who seem to think we didn’t go through Covid,” Robertson said.
He noted National Finance Ministers Bill English and Steven Joyce both increased operating allowances above what they had signalled.
Shaw said that it was true the Government had injected a lot of money into the economy during the pandemic. He told the audience about a discussion he had with a business leader during the pandemic who told him the Government’s first duty was to protect its people and that if it protected people, it could clean up any economic mess it made later.
“We are now in the clean-up-the-mess later phase of the Covid recovery,” Shaw said.
Seymour has promised to cut back a large amount of the increase in spending that has occurred this term. He is currently reassessing this in light of the Prefu forecast.
Asked by Tame how many public sector jobs Act would cut, Seymour said he would reduce the total from 62,000 full-time workers to the 2017 total of 47,000.
”To be clear, you are going to make 15,000 people redundant immediately?” Tame asked.
“Yes,” Seymour replied.
Robertson said more than 70 per cent of the increase in spending this term was a result of cost pressures.
Climate change made an appearance in the debate, with Shaw venting frustration that Treasury did not adequately account for the cost of New Zealand’s international climate liabilities, which meant New Zealand was unable to trade these liabilities off against the cost of domestic emissions reductions.
Robertson noted the problem here was the volatility of these costs, making them difficult for Treasury to model.
The debate ended with a moment of consensus. A petition to Parliament had asked that the zoning of accommodation supplement benefits be looked at because they currently discriminated against people in regional areas of New Zealand - such as Queenstown.
The amount of supplement could change depending on where someone was living and how it was zoned, despite the cost of living in those areas being quite high. Seymour, Robertson and Shaw were more or less supportive of changing this rule in some way. Willis was somewhat supportive but more lukewarm than the rest.
Thomas Coughlan is Deputy Political Editor and covers politics from Parliament. He has worked for the Herald since 2021 and has worked in the press gallery since 2018.