An open letter to Grant Robertson
Many years ago, you and I both attended intermediate school and then university together. Although we didn’t know each other well, we moved within the same student left political milieu at the University of Otago. I also enjoyed speaking and catching up with you briefly at an event we both attended in Wellington some years ago while you were in opposition.
However, I write to you now as nurses and teachers prepare to strike, as still thousands shiver on the streets during another cold winter, as many non-government organisations struggle with the same funding they received while National was in office, and as many beneficiaries still continue to be mistreated by Work and Income.
All of this is completely unnecessary. In my view, much of this is down to the Labour-New Zealand First Government’s adherence to the Budget Responsibility Rules (BRR). Essentially, these rules constitute a continuation of the neo-liberal maxims that less government spending as a percentage of GDP is good for the economy; that surpluses are better than deficits; and that governments should reduce debt.
Admittedly, the Green Party as you know (of which I am a member) agreed to these rules in early 2017. Notwithstanding, it was a caucus majority which agreed to them and not the wider party itself. When I and other concerned members within the party heard about the BRR, we registered our displeasure. So, Grant, while I acknowledge that the anti-BRR message has been heard by current Green Party MPs (even though the party remains committed to the rules for this parliamentary term), I still feel that this same message has not been heard by you or the Labour Party.
Nevertheless, I recognise that your May 18 Budget did increase funding to a number of key areas which were cash-starved under National. I recognise the funding boosts given to health, education, housing and conservation in particular – and the support given through the Families Package announced before Christmas as well. These spending increases constituted a good start but, as is coming to be recognised, won’t go far enough to address the social and environmental deficits built up through nine years of Tory rule.
In saying all this I recognise, as you have stated, that it will take more than one Budget to resolve many of the issues left behind by the previous government. Yet I firmly believe that your first Budget could have been bolder in increasing spending to ensure that nurses and teachers got really decent pay rises, that more than the currently pledged 6500 state houses could be built, that core welfare benefit rates could be increased, and that non-government organisations could begin to repair their budget deficits.
All of these moves would have signalled that the new government was going to be as truly transformational as the Prime Minister said it would be.
And Grant, don’t be too persuaded by the need to assuage corporate business interests either. I read just this morning an article by none other than unionist-turned-corporate boss, Rob Campbell, in which he argued that negative business sentiment was overblown. Anyway, as you have noted in Parliament, such surveys have always marked Labour-led governments down more than National ones regardless of the prevailing economic conditions.
What it all comes down to is that big business doesn’t even like the smallest injection of any social democracy back into the system.
For all these reasons, I’m convinced that we wouldn’t be facing as many strikes as we are now if we didn’t have the BRR rules in the first place. Also, this means that we wouldn’t need to fund much-needed public transport and infrastructural projects through flat, regressive taxes such as regional fuel taxes.
That’s why it’s time to be brave and bold. It’s time to run smaller surpluses or even deficits. It’s time for government to borrow more again as it is cheap enough to do so on the financial markets. It’s time to increase taxes on our wealthiest individuals and corporates to fund the extra spending we need. You have taken some useful first steps in these areas (such as through agreeing to borrow more than the previous government did) but, as ever, more needs to be done.
Overall, I don’t want warmed-up Third Way Blairism from this government. I want a genuinely green, social democratic government committed to the ideals of equity, justice, fairness, ecological sustainability and decent public services.
Grant, I know you have great hopes and aspirations for a fairer, more just society too. The only thing that’s fully preventing this is the BRR. I say scrap the rules now.