18 May 2018

Does the 2018 Budget measure up? Commentators have their say

8:57 am on 18 May 2018

Watch - With a panel of four commentators, Morning Report's Guyon Espiner is talking over the effects of Labour's "bread and butter" Budget.

Health was the big winner in Grant Robertson's first Budget.

More than half a million people will get cheaper doctors visits and more children will get them for free.

Joining Espiner will be our panel of commentators:

  • Herald columnist Fran O'Sullivan
  • Former TV3 political reporter Scott Campbell, who is now a consultant in Tauranga working mostly with iwi and Māori organisations
  • Former Green MP Sue Bradford who is now a workers and unemployed rights activist and academic
  • and Newsroom managing editor Bernard Hickey
The view from Grant Robertson's seat as he delivers his first Budget to Parliament.

The view from Grant Robertson's seat as he delivers his first Budget to Parliament. Photo: RNZ / Richard Tindiller

So what did these commentators think of the 2018 Budget?

Fran O'Sullivan: "It wasn't bold and it wasn't boring."

"I think there was an element of business as usual. Part of it I think was some $5bn more for Working for Families, basically announced last year.

"In a sense the big-ticket items had already been pocketed.

"I think it was quite smart in that it's given them time to do a bit more thinking and a bit more policy planning... I'm quite pleased they haven't done it all in one cut.

Scott Campbell: "It was very Cullenesque."

"It has a lot of shades of Michael Cullen in there ... as Fran said he [Grant Robertson] is leaving himself a bit of room for the following years.

"As long as they can probably manage some of the potential fallout - teachers, doctors, nurses potentially walking out not very happy - if they can manage that they can probably get through the next couple of years and be in a good place politically.

"Having a Budget that hasn't caused any major troubles is not a bad thing.

Sue Bradford: "This budget is Grant Robertson and Labour, Greens and New Zealand First continuing the neo-liberal capitalist agenda of National."

"This budget is a far cry from anything that we would have expected under National and that's a huge relief.

"[But] there's no move to go past that which is a huge disappointment when we're facing critical levels of homelessness and poverty."

Bernard Hickey: "Grant Robertson and Jacinda Ardern have plenty of money there."

"You could argue maybe they're holding some in reserve for the next couple of Budgets but the fundamental problems, the transformation that they talked about, is not delivered."

"New Zealand could have borrowed tens of billions of dollars, yesterday, at 2.83 percent. That's how much our 10-year bonds are trading at. That's actually less than it costs the American government to borrow money."

KiwiBuild and the housing crisis

Construction starts on the Kiwibuild project

A KiwiBuild house under construction. Photo: RNZ/ Sophia Duckor-Jones

Fran O'Sullivan:

"They've fallen down on KiwiBuild ... they've just had to admit they're just not going to be able to build as much as they projected."

"They really do need to get some big thinking there and look at how they can actually get a programme of action [to fix the housing crisis] ... that's really what business was looking for as much as anyone else."

"I would just personally do what the Japanese did after the tsunami and just import houses at scale and put them up.

"But you've got to get the land and that's one of the big issues, and in some ways they might have to be quite draconian to access land in Auckland at an affordable price. In other words just set a price, get rid of the land bankers."

Scott Campbell:

"If they don't manage it, it's the issue that'll drag them down at the next election. We're six months in and not one home has been built yet."

"You've got people sitting there saying 'we want to be a part of this' and [the government is] not connecting with them.

Sue Bradford:

"It's just a drop in the bucket ... they're promising to build 1600 houses a year over four years. If they built those houses by magic today it simply doesn't compute, they wouldn't meet the state housing list needs right now, much less in four years time.

"Low and even to middle earners can't get into the Auckland housing market so the affordability of the KiwiBuild and the lack of social housing of any sort is just not being addressed.

"I think Phil Twyford is probably very disappointed with what's happened here."

Bernard Hickey:

"Sue's right, it is a crisis. I walked here this morning for 10 minutes, I passed 15 people sleeping in doorways.

"We've got 68,000 people a year coming to this country and we're not building the houses fast enough.

"Business in New Zealand, particularly in Auckland is now screaming out for workers who can live somewhere close to where they're going to work."

"This is a crisis in the same way that Canterbury's earthquake was a crisis. We dropped our debt targets and addressed that crisis with real urgency in 2011 and 2013."

"They could have gone from 20 percent of GDP [debt] to 30 percent of GDP overnight and no bond market would blink an eye.

Māori and Whānau Ora

whanau ora sign

Photo: RNZ / Mihingarangi Forbes

Scott Campbell:

"When you're looking at things like economic development the Māori economy is one of the ones that is growing the fastest, and it's almost as if the government is saying 'well, carry on and just keep going, we'll just have confidence that you'll keep going".

"They would have been looking for more in this Budget"

"Kelvin Davis said $20m for Whānau Ora and that's not there... Not surprising given it was a Māori Party policy and Winston Peters doesn't like it.

"I think it'll be a kick in the guts, I think the Whānau Ora one in particular will upset a lot of people.

"I think that's probably code for 'it's on its way out at some point'. Winston Peters has never liked it."

Fran O'Sullivan:

Agreed Winston Peters' influence was all over the Budget.

"He is against dependency in Māoridom, and I think it's actually not a bad thing when you do look at the growth of the Māori economy now, the corporations and so forth who still all have fairly beneficial tax rates."

Poverty and welfare

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Photo: 123rf.com

Sue Bradford:

"This is tiny compared to what's needed in terms of raising welfare levels: changing the whole culture of work and Income, training people properly in culture and respect."

"There's so much good stuff they could do in welfare, some of it not costing very much and yet there's nothing here.

"You see $100m for the America's Cup, you see over $3bn in the surplus. They're boasting about it and not seeming to understand at all what's happening for people's real lives."

Bernard Hickey:

"One of the big surprises out of this Budget is how little unemployment drops in the next four years even with what seems like a lot of spending."

"They've ticked all the boxes on fiscal responsibility, in terms of spending forecasts ... they're not pushing hard enough on the accelerator."

Politics and business

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Parliament's debating chamber. Photo: VNP / Phil Smith

Fran O'Sullivan:

"I think he [Grant Robertson] should be looking to them [businesses] to try and embrace them and bring them into a programme of action.

Scott Campbell:

"For me it was a Budget of lost opportunities really. There's probably a lot of people out there thinking 'I would have expected more from this'.

"Grant Robertson talked about it being transformational, I don't think it is. It's the blame Budget, 'who else can we blame'."

Bernard Hickey:

"This is the biggest missed opportunity in a generation. It will take a decade to get this infrastructure going to solve our problems and they're now going to waste two or three years earning the right to get to the next election to say 'this is what we need to do'. It should have been done this year."

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