19 May 2023

Watch: National Party leader Christopher Luxon gives post-Budget speech

11:58 am on 19 May 2023

Watch Luxon speaking here:

National Party leader Christopher Luxon says the party remains committed to yearly increases to education and health spending, and has clarified comments about bringing the $5 prescription fee back.

At a business breakfast in Auckland the day after the government's "no frills" Budget, Luxon on Friday retreaded familiar criticisms of the Labour government in a speech which offered no new promises or policies.

Answering reporters' questions afterwards, he was keen to clarify the party's position on bringing back the $5 fee for prescriptions scrapped by Labour the day before.

He and his deputy Nicola Willis had talked on Thursday about bringing that fee back in a targeted way, and this morning he offered more insight into what that might look like.

"I want to be quite clear about that, what we don't support is universal prescriptions, I don't think it makes a lot of sense that someone like me gets the benefit of that, but I do think there is need for targeted support to those that most desperately need it," he said.

"I think targeting it to people with community services cards for example, targeting it to people with SuperGold cards, would actually be the way we would go about doing it."

People like him who could afford the payment should make it, he said, and giving them the discount was money wasted.

"We've got major challenges in our healthcare system, we've got huge priorities and there's a range of things that we would love to do and it's about how we get the best delivery and the best outcomes and do the things that would make the biggest and the most difference to the most amount of people as quickly as possible with the money that we've got."

He had criticised this year's Budget for massive overspends, but was confident National could achieve its tax cuts alongside reining in spending - and also re-committed to yearly increases to education and health spending.

"We've been really clear that Nicola and I want to make sure that we continue to increase investment in health and education every single year, that's really important to us," he said.

"My point's really clear which is you don't just focus on the dollars being spent and the spending, it's the quality of the spending and the value that it's delivering.

"I was talking to Bill English last night. In that period of time (during the last National government) you had much much better, tighter financial management and economic management and as a result actually health and education outcomes were much stronger than what we have today as well. So there's a different way of doing things to make sure that you actually putting money behind programmes that are working that are really making a difference to people."

The biggest single item of spending in the Budget was $71 billion earmarked for infrastructure. Luxon was supportive of infrastructure investment, but said it needed to be done in the right way.

In his speech, he had largely stuck to the criticisms he aired yesterday - overspending with little to show for it.

"I've said that New Zealand can't afford a Labour government for another three years. But there are New Zealanders out there - in fact there is half of us - who now worry about money on a daily basis. There is 430,000 New Zealanders who actually have debt arrears and sadly there is 20,000 families who are behind on their mortgage payments because they can't afford those increases in interest rates," he said.

"What was in the Budget for those people? Well if you have a kid under the age of 13 he or she can catch a bus now or a train - it'll probably be the most expensive wet bus ticket in the country, but let's hope that the bus even shows up would be quite good I would say to you as well.

"What would have helped people would have been some serious tax relief," he said, saying only a National government would deliver that.

He said what Labour had labelled as a "no frills" Budget had "no ideas and it had absolutely no fiscal responsibility, and perhaps that should be no surprise".

The result was an overheated economy, falling real incomes, slowing growth and rising interest rates, Luxon said, with little to show for it.

"In 2017 our net debt was actually $16 billion, this year it's actually $71b, and in 2026 it'll be $95b - it's an 80 percent growth under this government, it's a huge amount of debt.

"The question you have to ask as I said before is have we actually seen an 80 percent improvement in our public services here in New Zealand."

He pointed to three mistakes he said Labour had made.

"First, monetary policy was way too loose for too long, the Reserve Bank was operating with a very muddled mandate and an indemnity from Grant Robertson that pumped too much money into the economy and as a result the inflation genie came out of the bottle.

"Secondly Labour actively created or made bottlenecks in the economy even worse. And it's no surprise that our food prices are actually up over 28 percent because there was a lot of produce actually rotting on the ground because businesses couldn't get the staff to actually pick those fruit and vegetables that we so desperately needed. And when businesses up and down the country are crying out for workers, there are almost 50,000 more people on unemployment benefit today and yet we have huge opportunities to get people from welfare and into work, and Labour refuses to sanction people's benefit if they won't work as a result.

"The third mistake is the spending that I've talked about was huge and unprecedented, and that's contributed to it. So between the monetary policy, shutting the joint down, restricting immigration, and spending lots, that's what's contributed to pumping domestic inflation."

He said the question was what National would do differently, "and I have to promise you that the picture will be very very different".

There were two pillars to getting the country back on track, he said: a plan to drive economic growth, and fiscal discipline. He continued to offer general statements of support for businesses and previously announced policies, but no new details.

"National's going to be pro-growth, we're going to be pro-innovation, we're going to be pro-investment, because that's what's going to create a stronger economy.

"National's going to say yes to growing skills and yes to high-tech manufacturing and value-added agriculture. National's going to streamline consenting rules so that we can double renewable energy in a generation. National will invest in infrastructure to make sure that it lifts productivity and reduced congestion.

"National will reduce costs on small businesses so that we have a better chance of small businesses becoming big businesses and we'll cut the regulatory burden on farmers so they can get back to what they do best which is producing sustainable food and fibre for the world. And we're going to make the education system work again."

He said children were missing out, which was a long-term social and economic failure to teach the basics to children so they were set up to succeed.

On fiscal responsibility, he pointed to the three policies released last week.

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