11 Aug 2011

ACT plan to cap spending unlikely to succeed

8:00 am on 11 August 2011

An ACT party initiative to cap public spending will be debated in Parliament before the election but its chances of becoming law look slim.

The Spending Cap (People's Veto) Bill would prevent the Government from increasing spending faster than the rate of inflation and population growth unless it had the backing of a public referendum.

National has agreed to back the bill at its first vote but is not guaranteeing its support beyond that.

The Minister for Regulatory Reform, former ACT leader Rodney Hide, says the Bill would help the country live within its means.

National is understood to have concerns about how the legislation would work in practice and is unlikely to support the Bill beyond the select committee stage.