Time to break the rules

Posted By TEU on May 24, 2018 |


Sandra Grey, national president of the Tertiary Education Union, reflects on last week’s Budget and calls on the Government to change its fiscal responsibility rules so we can better pool our nation’s resources to meet the needs of all New Zealanders.

When I was asked to give a movie-style star rating to the first instalment of Labour’s Budget trilogy, single measures seemed unfair, so I gave it five stars for the script, but a three for the final product.

The Budget did bring welcome relief from the language of austerity and markets-are-best for delivering health care, education, and housing – a narrative that dominated National Budgets of the last nine years.

Finance Minister Grant Robertson told Parliament the Government was “committed to being responsible – not just fiscally, but socially and environmentally.” He went on to say the Labour-led coalition will make sure “all New Zealanders have access to the high quality public services they need and deserve – such as health, education and housing.”

But the reality of the Budget fell well short of this vision.

Self-imposed, arbitrary rules do mean that the Government has been fiscally responsible. However, they also left little room to the deliver the raft of measures necessary to meet the needs of our families, communities, and public institutions.

Nine years of underfunding of health, education, public housing, and social services have left big holes in our public infrastructure and services. A strong economy means we should be tackling these issues now.

In our own sector, tertiary education, the difference between the cost of running the sector over the last decade and what governments have put into the system is $3.7 billion – that’s a massive hole.

The Labour-led Government’s operational spending is only 28.5 per cent of GDP, less than the share of GDP spent on public services under National. It also has decided not to increase borrowing at a level that will allow it to fix the leaky and mouldy buildings, crumbling IT infrastructure, and shortage of public housing, at the rate needed.

This can be put down to the Budget Responsibility Rules, which our Government set itself.

Of course we want governments to be careful with our money, to spend it well. The question is when tight fiscal responsibility is placed as being more important that social responsibility, have we got the balance right?

When children are living in poverty, nurses are overworked, polytechnic courses are being closed, there is a teacher shortage, university classes are over-crowded, and tertiary students are living in cars because of housing costs, have we really got the expenditure right?

The public showed in the way they voted in the 2017 election and more recently in a UMR poll that they want public services restored. Now is the time for the Labour-led Government to put more money on the table. It’s time for our tax payer contributions to be used to improve the lives of ordinary working Kiwis and their kids. It’s time to get rid of arbitrary rules that are part of a failed neo-liberal experiment that neuters a strong vision for building better foundations for all.

We can all do our bit by talking with politicians and other voters about the need to ensure we all contribute our fair share of taxes – and that they are spent to address social ills imposed on us by trickle-down economics.

Given the Finance Minister said the Budget was the start of a trilogy, we should show him that the second edition needs to go much further and earn the title “The Real Foundations for the Future: Putting people first.” This will only happen if we, the voters, show how much we want this change – so we can become a country that is socially, fiscally, and environmentally responsible.

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