7 Sep 2017

VIDEO: Finance Debate - National vs Labour

9:35 am on 7 September 2017

National Party finance spokesperson Steven Joyce has been challenged to name one person who agrees with his accusation of an $11.7 billion fiscal hole in Labour's alternative budget.

Mr Joyce doubled down this week on his attack on Labour's budget, despite a series of economists saying he was wrong in Monday's claim of an "$11.7bn black hole".

He later adjusted his accusation, saying Labour had failed to leave room for increased spending in areas beyond health and education.

This morning, during Morning Report's finance debate with Labour's Grant Robertson, Mr Joyce said there were "lots of people" who backed his initial claim, but declined to name anyone.

Mr Joyce defended his claim and said Labour had now adjusted its figures.

"They're saying they'll run zero budgets - which is entirely unbelievable - and as a result there's a bunch of people who say it could be made to add up if they run zero [budgets]."

Mr Robertson said it was a disgraceful allegation that "not one person in New Zealand" has backed up.

"You have damaged democracy by what you have done. This is fake news."

New Zealanders had learned they could not trust Mr Joyce as the minister of finance, he said.

"It is a disgraceful situation and you owe New Zealanders an apology ... You threw this on the table to try to get the reaction you got."

The New Zealand Initiative - a libertarian think tank - has said National appeared to have made a basic accounting error in its initial criticism.

ANZ chief economist Cameron Bagrie also suggested Mr Joyce went too far in saying there was a "hole" and said that term was "too strong". But he did say it would be a challenge for Labour to govern within its budget.

Independent consultancy BERL, which Labour employed to check its books, stood by its work.

Labour pushed to give more details of tax plan

The pair clashed during this debate over the parties' tax plans, with Mr Joyce saying Labour was not being upfront with New Zealand on what its tax working group would propose, including on capital gains tax or land tax.

Mr Robertson said the working group would be no different to the one National set up after it was elected in 2008.

The party was not proposing a land tax, but its working group was given a mandate to consider one.

"What would be the point of setting up an expert group if we weren't prepared to listen to them?

"The mandate we've given them is leave the family home alone, find a better balance so that hardworking New Zealanders who are paying tax on every dollar they earn can see in the system that people who are making money from property speculation actually pay the right tax."

Mr Robertson said New Zealand was the only country in the OECD without a proper capital gains tax.

Mr Joyce said it was fair that property or business owners did not pay a capital gains tax, as that was different to a wage-earner paying tax on their income.

"If you sell your business, the thing that you get paid for is the future profits on that business, where tax is already deducted."

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