Ryan Bridge: How much are political parties willing to borrow after a disaster?

Welcome to New Zealand... land of earthquakes, stormy weather, and absolute natural beauty. 

Another reminder overnight of how shaky these isles can be. 

Hope everyone's alright this morning. It's always a bit hard to get back to sleep after a decent jolt and it sounds like you had one. 

We've always had storms, and damage from storms, in this country. 

But of late we've had more, more often, doing more damage, according to the insurance companies. 

We've got a bird with the flu in Petone, though it's not yet clear how that situation will play out poultry-wise. 

But it's, again, another reminder of threats to industry that we can't control. 

Like Foot and Mouth, which, if it took hold here, would be devastating. 

All of this is to say that there are a lot of things can go wrong in this country, and do go wrong, and often enough that it's actually quite predictable. We're top 10 countries for quakes. 

So, we need a buffer... need headroom for borrowing.

With the election just around the corner, it's about time we heard from political parties on their debt limits. How much is too much? When will you get us back to surplus? What's your track record on actually doing that? 

Treasury tells us debt servicing is now the fourth-largest line item on the Government’s books. Our annual interest bill? It was $3.6 billion in 2014. Now it's nearing $9 billion.

If you look on a per household basis, it's tipped to be more than $5000 every year. In interest alone. 

Last night's quake, and the next storm, are nature's reminder of the need for fiscal discipline and plan to deal with them. 

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Episode Transcript

Speaker 1 (00:00):
Welcome to New Zealand, land of earthquakes, stormy weather, and
absolute natural beauty. Another reminder overnight of just how shaky
these aisles can be. I hope everyone's all right this morning.
It's always a bit hard to get back to sleep
after you get a decent jolt, and it sounds like
you had a decent jolt in the Deep South last night.
We've always had storms, of course damage from storms in
this country, but of late we've had more, often doing

(00:22):
more damage. That's according to the insurance companies. All right,
they came out and said that, and it's costing more.
We've got a bird sick and patoni and people are
freaking out. It's not yet clear how that sitution situation
is going to play out poultry wise, but it is
again another reminder of threats to industry that you cannot control,
like foot and mouth, which if it took hold here,

(00:43):
would be devastating. All of this is to say there
are a lot of things that can go wrong in
this country and do go wrong in this country, and
often enough that it's actually quite predictable. You know, we
are in the top ten countries for earthquakes around the world,
so it's not surprising, although it is still shocking when
it happens. So we need a buffer, we need headroom,
we need room for borrowing. And this comes to the

(01:04):
point about debt, and the political parties haven't yet told
us where they are at with debt. Okay, National has
set out the trajectory as part of a government. But
when are we going to hear from labor about their
borrowing limits? When are we going to hear from New
Zealand first about how much they think we can handle?
Because debt servicing, this is paying for the interest on

(01:27):
the debt is now the fourth largest line item on
the government's books according to Treasury, and the interest bill
has gone from three point six billion dollars a year
in twenty fourteen to now nearing ten billion dollars a year.
That's just servicing the interest. It's more than we pay

(01:48):
for police, for corrections, for Ministry of Justice, for customs,
and defense combined defense included. So I think it's high
time and last night was a good reminder that the
political parties come out and tell us exactly how much
they think we should be borrowing and when we should
be paying it back. For more from early edition with
Ryan Bridge. Listen live to news talks it'd be from

(02:11):
five am weekdays, or follow the podcast on iHeartRadio