John MacDonald: As John McEnroe would say... episode artwork

EPISODE · Aug 29, 2023 · 8 MIN

John MacDonald: As John McEnroe would say...

from Best of Business · host Newstalk ZB

I’m channelling my inner John McEnroe today. If there is such a thing.  This $4 billion cut to public service spending over the next four years that the Government has announced six weeks out from the election.  There’s only one response to it, isn’t there? And this is where tennis legend John McEnroe comes into it.  You cannot be serious!  You cannot be serious Grant Robertson. You cannot be serious Chris Hipkins. If you expect us to believe that this is anything other than a desperate attempt to cook the books and make life more difficult for whoever is running the country’s finances after October 14.  Except it’s more of a 'microwave' cooking of the books, isn’t it? On the table in no time because there’s no time to fiddle around with the slow cooker when we’re just six weeks out from an election.  Programmes like the Covid-19 Emergency Response have been cut or have had 'underspends' returned to till because they’re no longer needed. But the biggest cuts are being made to government department and agency budgets.  Not surprisingly, National and Act are saying it’s too little, too late. That’s because they’ve been banging on for a long time now about public sector spending. And they're right. It is too little, too late.  National’s already said that, if it forms the next government, the big consultancy firms can expect an end to the gravy train. And that seems to be one area where the Government has suddenly discovered it can turn the tap off. It’s announced it’s cutting spending on consultants and contractors by $165 million a year.  So that’s Labour trying to beat National at its own game.  Other cuts include $110 million from MBIE’s budget. It's is one of the government departments that Act wants to downsize. So, that’s Labour trying to steal the march on Act, as well.  MBIE’s budget cut is the biggest. Followed by the Ministry of Education, which is going to have just under $70 million less.  This will all be happening after Barry Soper reported a few weeks back that the Finance Minister had called all the Government department honchos into a meeting to demand cost cuts.  So, they’ve obviously all gone away from that meeting and have come back to him saying ‘here’s what we can do’.  The Government’s also taken the knife to the operating allowance for the 2025 and 2026 budgets.  This is the amount of new money a government can allocate in its annual Budget.  So, by doing this, the Finance Minister is doing what he can to make it difficult for other parties to pay for their election promises if they find themselves in government after the election.  Which, as far as I’m concerned anyway, makes this whole exercise reek of desperation.  As National’s Finance spokesperson Nicola Willis puts it: “Grant Robertson has reached peak Labour. After six years of spending New Zealanders’ money with reckless abandon, he’s now finally admitted he has a problem - six weeks out from an election."  A problem Grant Robertson somehow thinks he can fix - or at least try and make look a little bit better - in time for when the Government opens its books for the final time before we vote.  This is the pre-election fiscal update, which is going to be happening on September the 12 - two weeks from today.  And, by all accounts, it’s not going to be pretty. Not pretty for Labour and not necessarily pretty, either, for the other parties because it will probably raise questions about big-spending promises.  But there’s only one way to respond to this cynical move by the Government.  You cannot be serious. See omnystudio.com/listener for privacy information.

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I’m channelling my inner John McEnroe today. If there is such a thing.  This $4 billion cut to public service spending over the next four years that the Government has announced six weeks out from the election.  There’s only one response to it,...

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