Prudence is going to have to underpin the next Government’s approach towards managing the economy if getting the books back in surplus is a priority.
The Treasury’s latest set of economic forecasts show fulfilling pledges already committed to, without borrowing more or increasing taxes, will require the economy ticking along relatively well over the next few years.
Undertaking ambitious spending commitments, or responding to another crisis, would require serious trade-offs.
The Government’s books are in worse shape than they were in May, when Finance Minister Grant Robertson released the Budget and the Treasury published its last set of forecasts.
Grant has saved the PREFU from a total collapse.
China’s slow down has impacted revenue which has impacted tax take but thanks to cleaver accounting tricks and and enormous amount of hope, we won’t have financial armageddon.
Grant has studied the ship enough to make bold claims that the Right can’t undermine.
Yes Labour borrowed a huge amount of money to save 6000 lives over Covid, but the resilience saving those lives has meant the economy has stabilised.
It’s a remarkable achievement for Labour, but for many it will still feel like armageddon.
Food inflation is still ‘sticky’ we are very open to new global shockwaves and Banks are threatening another
Thanks to mass immigration, rebuilding from catastrophic climate change events and the Housing Ponzi scheme, the NZ Economy lives for another day.
1 more geopolitical shock, earthquake or climate event however and we are really fucked.
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