Last week marked six months in office for the coalition Government. It has been a mixture of bad, ugly, and missed opportunities. This week, Free Press sums it all up.
The bad and the ugly
The Government has committed itself to policies that sounded great on the campaign trail, but which will leave hardworking Kiwis worse off.
Closing charter schools
“The verdict is in: charter schools are improving engagement, innovation, and achievement for 1500 disadvantaged students. The Government plans to strip away their educational opportunities just so they can keep a promise to their union mates.
Ending oil and gas exploration
“As revealed by ACT, the Government will end offshore oil and gas exploration without a cost-benefit analysis, consultation, or estimates of whether emissions will fall as a result. This economically vandalous policy will gut an industry that pays $500 million in royalties and taxes and employs 11,000 workers at peak times.
Raising the minimum wage
“Officials have told the Government that raising the minimum wage would destroy 3,000 jobs. These jobs would have been performed by young, unskilled Kiwis who need employment opportunities. The Government would rather they sat at home on a benefit. The job losses will eventually be even greater as the minimum wage is raised to $20 by 2021.
“ACT’s successful policy of 90-day trial periods has given thousands a start in the labour market when employers mightn’t have otherwise taken a chance on them. The Government’s changes to the policy will make hiring staff more risky, leading to fewer jobs overall.
“A $275 million subsidy for generally well-off kids who would have gone to university anyway and who will earn much more over their lives than non-graduates. ACT revealed last month that the first-year drop-out rate of 14 per cent will mean New Zealanders can except $38 million of their taxes to deliver exactly nothing.
Foreign buyer ban
“An unworkable disaster of a bill. There’s no evidence house prices will fall as a result of this ban. The bill will restrict new construction by making foreign-owned construction companies jump through regulatory hoops. As Eric Crampton has pointed out, the bill doesn’t just target overseas speculators – a British doctor moving to Greymouth on a work visa would not be able to buy a house. The bill further harms our reputation as a place to do business.”
The missed opportunities
Sadly, the Government hasn’t pursued some sensible policies that would make a real difference to people’s lives. Here are six missed opportunities.
Resource Management Act reform
“In Auckland, land use regulation could be responsible for up to 56 per cent, or $530,000, of the cost of an average home. But Cabinet hasn’t yet considered whether to reform it. The Resource Management Act is the worst law on our books. It should be at the top of the Cabinet’s agenda.
“Phil Twyford has also missed an opportunity to both incentivise more housing consents and provide funding to councils for infrastructure.
ACT would share a portion of GST revenue collected from the construction of new housing with the local council. The shared revenue would help cover the cost of infrastructure which councils must build to support new development. The cost of infrastructure currently disincentivises the approval of new houses.
Rewarding self-improvement in prison
“Given the Government’s goal of reducing the prison population by 30%, it is deeply disappointing that Kelvin Davis hasn’t picked up ACT’s policy of rewarding prisoners who complete literacy programs and driver licensing tests with reduced sentences.
Under ACT’s proposal, eligible inmates would be able to earn up to a maximum of six weeks for every year of their term, but final decisions on release would be left with the Parole Board.
Prisoners need positive incentives to become productive, law-abiding citizens. 70 per cent are functionally illiterate, lacking the skills to lead normal, productive lives. It’s no wonder they return to crime after leaving prison.
Tax bracket indexation
“The previous National Government collected an extra $2.1 billion in tax as a result on the non-indexation of tax brackets. Grant Robertson’s Families Package allowed new benefits to rise in line with inflation, but kept tax brackets at their current levels, which will push many middle income New Zealanders into the highest bracket.
The Government voted against my amendment which would have allowed the Minister of Finance to index tax brackets to the rate of inflation.
“Superannuation is a ticking fiscal time bomb. At $11 billion a year and growing, it is completely unsustainable. Grant Robertson, like Bill English before him, is unwilling to face up to this reality.
ACT would raise the age of entitlement to Super from 65 to 67, at a rate of two months per year, finishing in 2032, saving $58 billion over 20 years. ACT is the only party advocating for future generations of taxpayers.
“ACT has given Grant Robertson an opportunity to tell us whether he plans to cut corporate welfare. Sadly, it appears he will continue National’s approach of handing out billions to ‘Most Favoured Industries’.
Mr Robertson should adopt ACT’s position – cut corporate welfare and use it to reduce the tax burden faced by hardworking Kiwis.”