3 Nov 2010

Warning income gap with Australia will widen

7:36 pm on 3 November 2010

The taskforce looking at ways of closing the income gap with Australia has warned the National-led Government the gap will widen under its policies.

In its second report, the 2025 Taskforce repeats many of the recommendations it made last year about cutting taxes and government spending and slashing regulations, which were rejected by Prime Minister John Key.

The taskforce says that under present policies, the income gap between New Zealand and Australia could blow out from 35% to 42% in 15 years.

Taskforce chair and former National Party leader, Don Brash, is blunt that the Government is not doing enough to close the gap.

On Wednesday he brushed off suggestions the taskforce should present more politically palatable recommendations.

Dr Brash says the taskforce has not been asked to take political factors into consideration and if it had, it might recommend that the goal be dropped altogether.

However, if the gap does not narrow, more and more New Zealanders will shift to Australia, he warned.