Austerity-lite budget risks recession

24 May

Press Release: New Zealand Council of Trade Unions, 24 May 2012

CTU President Helen kelly speaking to Affco workers

Commenting on today’s Budget, CTU Economist Bill Rosenberg says “today’s Budget may be ‘austerity-lite’ but it’s the same failed logic that is being rejected in Europe. With danger signals in Europe and falling agricultural export prices, the zero budget poses a real risk of sending us back into recession. The forecasts include falling export income in 2012/13."

“We’ve seen high GDP growth forecasts time and again, but they have never actually showed up. Instead we have seen unemployment exceeding forecasts, lasting longer and affecting more people.”

Bill Rosenberg said “the tax changes targeting smokers, school children and the family batch announced today will only raise $289 million in 2012/13, and won’t address the loss of revenue and inequalities caused by the tax changes of 2010 which gave tax cuts to high income earners while hitting low income families with GST hikes.”

"We have too many New Zealanders earning low wages or looking for work. The forecasts show working people getting a falling share of the income in the economy. The government should have been putting money into assisting high value industries that create good jobs and exports, and stimulating growth in job-rich areas. The investment in the Advanced Technology Institute is positive, but the industry we need won’t just grow on its own and needs much more attention," said Bill Rosenberg.

Bill Rosenberg said "you can’t have growth and austerity, it just doesn’t work. With government debt still among the lowest in the OECD, it had room to move with real investment in job creation, economic growth, and looking after those who are most vulnerable."

“This government is still hiding behind the economic crisis and its self imposed timeframe for getting back to surplus to mask that they are making choices that will not help create jobs and economic growth. We do need to be careful about government debt levels, but an inflexible and rushed approach to debt reduction will hurt the economy more than it helps, and cuts in public sector jobs will only increase already high unemployment levels.”

“Despite being one of the least hard hit in the OECD by the 2008-09 global financial crisis, and maintaining one of the lowest government debt levels throughout the period 2004-2012, we are now 12th lowest in the OECD for unemployment whereas in 2004 we were 3rd lowest,” said Bill Rosenberg.

CTU Report on the 2012 Budget http://dl.dropbox.com/u/18076151/CTU%20Report%20on%20Budget%202012.pdf

Unite National Director Mike Treen speaks to students at Auckland University protesting budget cuts

OTHER BUDGET NEWS

Cambell Live: Mr and Mrs Middle New Zealand: Median NZ household income falls http://www.3news.co.nz/Mr-and-Mrs-Middle-New-Zealand-Median-NZ-household-income-falls/tabid/367/articleID/255039/Default.aspx

Mana: Just Another Neo-Liberal Failure http://www.scoop.co.nz/stories/PO1205/S00345/just-another-neo-liberal-failure.htm

Students protest ‘black’ budget http://www.scoop.co.nz/stories/PO1205/S00374/students-protest-black-budget.htm

Student protesters end street blockade http://www.stuff.co.nz/business/budget-2012/6979244/Students-take-to-the-streets-against-Budget-cuts

Budget protest: Students call for ‘no education cuts’ http://tvnz.co.nz/national-news/budget-protest-students-call-no-education-cuts-4899789

Why the poor are becoming poorer – MANA Leader Hone Harawira http://www.scoop.co.nz/stories/PA1205/S00372/why-the-poor-are-becoming-poorer.htm

Investment Approach for welfare loses sight of social goals – Child Poverty Action Group http://www.scoop.co.nz/stories/PO1205/S00299/investment-approach-for-welfare-loses-sight-of-social-goals.htm

FURTHER PROTESTS PLANNED

Friday, May 25, 7am, Waipuna Hotel & Convention Centre, 58 Waipuna Rd, Mt Wellington & 11.30am – Langham Hotel, 83 Symonds St
POST BUDGET ACTION AGAINST POVERTY: Kia ora koutou, Since we contacted you a few days ago about our picket of John Key and the National Party planned for 7.00am Friday 25 May, we learned that the PM will also be speaking about the Budget at a business lunch the same day. We’ve decided the best thing would be to organise two pickets, turning 25 May into a full scale Post-Budget Day of Action. We hope you will be able to come along to at least one of the pickets, and that you’ll also be willing to help us get this info out to people in your networks. Core details are: Post Budget Day of Action Friday 25 May – Auckland Action Against Poverty. Picket: 7.00am – John Key speaks to the National Party Waipuna Hotel & Conference Centre, 58 Waipuna Rd, Mt Wellington. Picket: 11.30am – John Key speaks to Business Forum Langham Hotel, 83 Symonds St. Decent jobs for the unemployed – not vindictive harassment of beneficiaries! Free quality education for all – no state interference in women’s reproductive lives! Please get back to us if you have any queries or would like to offer any particular help. Look forward to seeing you soon – best wishes, Sue Bradford & Chris Zack (for AAAP). AACP Picket leaflet http://dl.dropbox.com/u/18076151/AAAP_Picketv02%20%281%29.pdf AAAP Leaflet http://dl.dropbox.com/u/18076151/AAAP_Leafletv02%20%281%29.pdf

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