National's brushing off concerns it has a reputational problem over debt - as it lays out new fiscal responsibility rules.
The party's promising a surplus by 2028/29 and Government spending below 30% of GDP - while ruling out new taxes on working people and small businesses.
Leader Chris Luxon told Mike Hosking that there's a choice between austerity and stimulation, but he believes it's years of government stimulus that has the country in its current mess.
He says they've plotted a third way, prioritising discipline around spending.
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Episode Transcript
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Speaker 1 (00:00):
The Prime Minister, Christopher Luxe is with us. Good morning,
Good morning, Mike. Hundred years of zed B this week
I hear. Isn't that exciting? Is it an amazing Monday?
I'd love to hear that first broadcast. Actually, it must
be quite something, crankling.
Speaker 2 (00:10):
Over the wild and we're celebrating this Friday night having
a function. Hoo is it? What does a holy look
like that? Be a hell of a party?
Speaker 3 (00:19):
Wouldn't you're speaking?
Speaker 2 (00:21):
You're there, so.
Speaker 3 (00:22):
Okay, I'll keep it.
Speaker 1 (00:23):
That's where I've done all my great reveals over the
last five years on do some.
Speaker 2 (00:28):
Policy, do a little bit of policy on a Friday.
Speaker 3 (00:30):
And talk about the budget rules? I think the that thing.
Speaker 2 (00:33):
Yeah, the budget rules, let me start with that. In
your guard rails and all of that stuff. Do you
reputationally have a problem in the sense that you have
not gone to surplus and you have increased the debt,
and yet you still talk about doing the opposite.
Speaker 1 (00:47):
No, No, I think we've done. You know, Look, there's
two choices, right, you push me hard and you'll always say, oh, Chris,
you know you should go much harder.
Speaker 3 (00:55):
In the last two and a half.
Speaker 1 (00:55):
Years, that's what we call austerity. You see that around
the world. That would have required the country to go
into a hard reverse and a big sort of recession.
The other alternative is stimulation, which is what the other
side wall keeps saying, we've got to do more of
I'm telling it, that's what got us into the problem
with the spend more, tax more, borrow more. We've plotted
a third way through, which is just to say daily practice,
religious practices, just be discipline responsible about it.
Speaker 3 (01:19):
Yeah. Actually key in English.
Speaker 1 (01:20):
If you look at twenty ten, they had like a
thirty four percent of GDP to spending and then they
just cranked that up, just stuck to their operating allowances. Discipline,
didn't go to do stupid stuff, got it down to
twenty eight percent I think over six seventy year period.
Speaker 3 (01:34):
So the evidence globally, when you look at it, yeah,
it's very attractive.
Speaker 1 (01:37):
Say let's just chuck it in reverse and go to
a massive cut job through the whole show. That's not
what we've done. But equally we can't carry on the
way labor was doing it either.
Speaker 2 (01:46):
Problem with yesterday is when Nikola goes, we're not going
to be taxing working people more, which immediately leads you
to the question, which is who are you taxing more?
Speaker 1 (01:55):
Well, No, what she's saying is no new taxes for
working people. And that's really because I don't want new
Zealanders worried about tax thresholds are coming down, tech, income
tax rates are going up, gsts going up.
Speaker 3 (02:06):
It's none of that stuff.
Speaker 1 (02:08):
But you know, when you look at the alternative, you've
got opposition parties proposing eight new taxes and quite serious
radical reform stuff, right, I mean, capital gains, wealth tax,
land tax, inheritance gift tax, you know, the whole nine yards,
increasing income tax rates and keep increasing corporate taxes. We're
not doing any of that stuff obnostly.
Speaker 2 (02:26):
But what are you doing?
Speaker 1 (02:27):
Because when a couple of those of you to know
new taxes, there's two examples for so two new taxes. Yeah,
So like in government, you know, you've actually got this
thing called fuel excise, you know, which goes We've actually
not increased it since twenty twenty, and we made a
conscious choice not to do it in the.
Speaker 3 (02:42):
First three years because we said lot cost of living
challenging for people.
Speaker 1 (02:46):
You've heard us say, actually, it's highly unlikely we'll actually
go back to the legislative increases that we are legislated
to do under legislation on the first of January. We'll
probably delay that, but somewhere in that term we'll have
to deal with increasing fuel excise just because that's actually
how we fund the road programs. Right, So that's an
obvious one.
Speaker 3 (03:04):
A new text.
Speaker 1 (03:05):
Well, I tell you that's why, you know, because I
tell you what will happen is the opposition will say
that's increasing taxes, and you go, it's not a new text.
Speaker 3 (03:12):
Though it's not. It's not a new tax.
Speaker 1 (03:16):
The second thing could be if you think about the
Auckland City Regional Dealer, it's the big text, the accommodation levy.
Speaker 3 (03:22):
We've said, look, we'll look at that.
Speaker 1 (03:24):
In twenty twenty seven. Could be a bunch of ways
through that problem that we're trying to solve for But
that's what I mean, that's why I.
Speaker 2 (03:33):
Only just make it nice and simple. So we'll be
going back to the excise plus's bit text coming.
Speaker 1 (03:37):
Well, yeah, and there might be other ways to tackle
the bit accommodation levy, which you know we're like, well, well,
there's a range of options that will give me a
couple now, well, I mean what people have talked about.
You've got this, you know, tourism, visitor levy stuff. Whether
you play with that or whether you actually do it
accommodation levy like you see in other cities.
Speaker 3 (03:57):
That's of a pin.
Speaker 2 (04:00):
But the touristly.
Speaker 3 (04:04):
Is not a new text either. No, I get it.
Speaker 1 (04:06):
But I'm just saying to you in the world of
how you see opposition parties will make a run and
say oh lux and saying, you know, no new taxes
for working people. But oh, here we go, he's increasing
a putting an accommodation levy in, or he's actually increasing
fuel excise. Well, I'm just saying to you they are
well established existing mechanisms. But what we're sure is hell,
what we're not doing is going off bananas on a
wealth tax or a capital gains tax, which will just
(04:28):
absolutely absolutely wreck the economy. Okay, So outside of the
big text, which would be new no matter which way
you work your way through it, there are no more
new taxes apart from those two things. That's another too,
I can come to that. I think Well, in fact,
you've heard Nicola and the lead up to I think
you've raised this the lead up to the last budget
she talked about our bank tax and looking at making
(04:48):
sure we've got our banks tax settings right.
Speaker 3 (04:50):
To say, Australia, so there's a bank tax.
Speaker 1 (04:52):
Can No, No, No, I'm not saying that at all. No,
because this is the game, right you get into this game,
which is what's coming all I'm saying, I'm trying to
be honest with you and say we've talked to about
that and the lead up to the budget to say, look,
you've got it. You know, we've got some work underway
looking at bank taxes.
Speaker 3 (05:06):
Have we got that right?
Speaker 1 (05:07):
You know, that's a legitimately good question to ask. But
that's all work that's happening in the context of the
government I can think of in the last two and
a half years. But you know that's why we're saying,
you know, no new new taxes for working people. It's
pretty you know, because you've got evidence for it. We're
the first government to lower taxes for working people in
fourteen years by adjusting those tax thresholds. My real disappointment
(05:32):
Mike is that you know, if you think about labor,
I supposely working for working people when I said this
is some unionists the other day is like, honestly, why
didn't you guys come out and support us when we
lifted tax thresholds after a period of high inflation? Like
that's not ideological, Like that genuinely isn't, but it does
speak to the fact that they just are so locked
into the addiction to spending and taxes and borrowing. So,
(05:53):
I mean, nobody asked enough questions the other day of
the Global Party killing your tax boost thing either because
that's one point six billion dollars, it's uster six and nine.
Where's the five billion?
Speaker 3 (06:03):
Correct?
Speaker 1 (06:04):
So they've got an eighteen billion dollar hidden bill. For
all the commitments they've made, they've got to find eighteen
billion dollars. And what they did I think last week,
which was egregious, was that they ended up saying we're
going to go kill investment boosts and take five billion
dollars out of that. Now, I'm telling you, when you
go up and down this country and you talk to
businesses small or medium or large, that has been the
(06:24):
single biggest thing that's actually it made them invest in capital.
I was in this amazing family run company called coll
Pack and christ Church just out in Selwyn. They do,
like you think about all the products being produced in
the South Island. They built a massive investment in warehousing,
state of the art technology, incredible facility, purely because that
investment boosts moved the attractiveness of that financial case forward
(06:45):
for them. So for anyone listening, whether you're a tradee
or whether you're a medium sized business, you can write
off twenty percent of that new asset in the first
year in addition to the normal amortization or depreciation you get.
So that's encouraging our businesses to invest in plant and
capital and equipment and technology so they can become more efficient,
to make more money, to drive wages and growth. And
(07:07):
I just think, you know, that's five billion of the
eighteen billion. That's how they plan to do it. You know.
Speaker 3 (07:12):
The other three is are capital gainsteps.
Speaker 2 (07:13):
So just to be clear, there's a bid tax coming
in some way shape or ford.
Speaker 3 (07:17):
No, we said we'll explore it. So I just want
to be clear about it. I just want to I
just want to get right.
Speaker 1 (07:22):
I mean excite fuel ex size fuel ex accommodation levy, yes,
and some exploratory work around bank tax settings to ensure
they are aligned with Australia as what you know, as work,
but we are nowhere. We've made no decisions on the
bank tax. Just want to be clear about it and
that's it, and that's that's it.
Speaker 2 (07:39):
Council of Algamation. How many of the councils who haven't
got to it are taking the piss versus how many
are genuine and just haven't got there because they can't
make up their mind.
Speaker 1 (07:53):
They all submitted them, I think on Sunday or off
maybe on Friday. I think it was we've got to
go through and digest and when some are voted, they're
not going to So how this.
Speaker 3 (08:03):
Started was, Look, we said we're in tishing in RMA.
Speaker 1 (08:06):
We want forty five percent less consense. The companion piece,
in my mind very clearly as you've got to go
knock off the regional councils across the country and simplify
a layer of government and take one out, because otherwise
you just got bureaucracy crazy, which is what we've got today.
So we take the council regional councils out.
Speaker 3 (08:21):
We said, look, there's a way there will.
Speaker 1 (08:22):
Be some genuinely subregional things you got to discuss. We
think you as mayors can come together and what we
call a combined territory board or conversation on the genuine
subregional stuff where two or three district councils have to
make decisions about some things. They said to us, Heyle,
some MEAs came to us, said, look, we've got actually
a communities that actually want to merge with their district
councils next door. We've worked on three waters, we've worked
on these city regional deals. We'd actually like to do
(08:43):
some stuff and think about a different way. We said, Okay, you've.
Speaker 3 (08:46):
Got a limited time.
Speaker 1 (08:48):
We're not doing endless years of who we and discussion
and debate some making decision yep. Now and then they've
submitted their submissions in and if you don't make a
submission for that, well then we'll.
Speaker 2 (08:56):
When do we get the details on that next book,
which is the backstop? You tell them what they're.
Speaker 1 (09:00):
Going, Well, we've told them, we've already foreshadowed that that
the backstop is there and that's what they will work
to if they haven't got an alternative plan that we've approved,
And now.
Speaker 2 (09:08):
Will you tell them that in terms of this is
it and you will do this? When do they find
that bit out?
Speaker 1 (09:13):
Well, we've got the they've all submitted it and on
as I said, I think on Friday was the cut
off date. Our team will go through those proposals and
try and confirm some as quickly as we possibly can.
Speaker 3 (09:23):
Stay right, get going, uh.
Speaker 1 (09:25):
And otherwise, when the RMA legislation comes into law, which
will be this month, you know, in the next month
that and that will be the new RMA system. That
will be where the backstop will be kicked in from there.
Speaker 2 (09:36):
All right, see you Friday night, The Big the Big Party,
the Big Wholey.
Speaker 1 (09:41):
For more from the Mic Asking Breakfast, listen live to
news talks that'd be from six am weekdays, or follow
the podcast on iHeartRadio
The Prime Minister, Christopher Luxe is with us. Good morning,
Good morning, Mike. Hundred years of zed B this week
I hear. Isn't that exciting? Is it an amazing Monday?
I'd love to hear that first broadcast. Actually, it must
be quite something, crankling.
Speaker 2 (00:10):
Over the wild and we're celebrating this Friday night having
a function. Hoo is it? What does a holy look
like that? Be a hell of a party?
Speaker 3 (00:19):
Wouldn't you're speaking?
Speaker 2 (00:21):
You're there, so.
Speaker 3 (00:22):
Okay, I'll keep it.
Speaker 1 (00:23):
That's where I've done all my great reveals over the
last five years on do some.
Speaker 2 (00:28):
Policy, do a little bit of policy on a Friday.
Speaker 3 (00:30):
And talk about the budget rules? I think the that thing.
Speaker 2 (00:33):
Yeah, the budget rules, let me start with that. In
your guard rails and all of that stuff. Do you
reputationally have a problem in the sense that you have
not gone to surplus and you have increased the debt,
and yet you still talk about doing the opposite.
Speaker 1 (00:47):
No, No, I think we've done. You know, Look, there's
two choices, right, you push me hard and you'll always say, oh, Chris,
you know you should go much harder.
Speaker 3 (00:55):
In the last two and a half.
Speaker 1 (00:55):
Years, that's what we call austerity. You see that around
the world. That would have required the country to go
into a hard reverse and a big sort of recession.
The other alternative is stimulation, which is what the other
side wall keeps saying, we've got to do more of
I'm telling it, that's what got us into the problem
with the spend more, tax more, borrow more. We've plotted
a third way through, which is just to say daily practice,
religious practices, just be discipline responsible about it.
Speaker 3 (01:19):
Yeah. Actually key in English.
Speaker 1 (01:20):
If you look at twenty ten, they had like a
thirty four percent of GDP to spending and then they
just cranked that up, just stuck to their operating allowances. Discipline,
didn't go to do stupid stuff, got it down to
twenty eight percent I think over six seventy year period.
Speaker 3 (01:34):
So the evidence globally, when you look at it, yeah,
it's very attractive.
Speaker 1 (01:37):
Say let's just chuck it in reverse and go to
a massive cut job through the whole show. That's not
what we've done. But equally we can't carry on the
way labor was doing it either.
Speaker 2 (01:46):
Problem with yesterday is when Nikola goes, we're not going
to be taxing working people more, which immediately leads you
to the question, which is who are you taxing more?
Speaker 1 (01:55):
Well, No, what she's saying is no new taxes for
working people. And that's really because I don't want new
Zealanders worried about tax thresholds are coming down, tech, income
tax rates are going up, gsts going up.
Speaker 3 (02:06):
It's none of that stuff.
Speaker 1 (02:08):
But you know, when you look at the alternative, you've
got opposition parties proposing eight new taxes and quite serious
radical reform stuff, right, I mean, capital gains, wealth tax,
land tax, inheritance gift tax, you know, the whole nine yards,
increasing income tax rates and keep increasing corporate taxes. We're
not doing any of that stuff obnostly.
Speaker 2 (02:26):
But what are you doing?
Speaker 1 (02:27):
Because when a couple of those of you to know
new taxes, there's two examples for so two new taxes. Yeah,
So like in government, you know, you've actually got this
thing called fuel excise, you know, which goes We've actually
not increased it since twenty twenty, and we made a
conscious choice not to do it in the.
Speaker 3 (02:42):
First three years because we said lot cost of living
challenging for people.
Speaker 1 (02:46):
You've heard us say, actually, it's highly unlikely we'll actually
go back to the legislative increases that we are legislated
to do under legislation on the first of January. We'll
probably delay that, but somewhere in that term we'll have
to deal with increasing fuel excise just because that's actually
how we fund the road programs. Right, So that's an
obvious one.
Speaker 3 (03:04):
A new text.
Speaker 1 (03:05):
Well, I tell you that's why, you know, because I
tell you what will happen is the opposition will say
that's increasing taxes, and you go, it's not a new text.
Speaker 3 (03:12):
Though it's not. It's not a new tax.
Speaker 1 (03:16):
The second thing could be if you think about the
Auckland City Regional Dealer, it's the big text, the accommodation levy.
Speaker 3 (03:22):
We've said, look, we'll look at that.
Speaker 1 (03:24):
In twenty twenty seven. Could be a bunch of ways
through that problem that we're trying to solve for But
that's what I mean, that's why I.
Speaker 2 (03:33):
Only just make it nice and simple. So we'll be
going back to the excise plus's bit text coming.
Speaker 1 (03:37):
Well, yeah, and there might be other ways to tackle
the bit accommodation levy, which you know we're like, well, well,
there's a range of options that will give me a
couple now, well, I mean what people have talked about.
You've got this, you know, tourism, visitor levy stuff. Whether
you play with that or whether you actually do it
accommodation levy like you see in other cities.
Speaker 3 (03:57):
That's of a pin.
Speaker 2 (04:00):
But the touristly.
Speaker 3 (04:04):
Is not a new text either. No, I get it.
Speaker 1 (04:06):
But I'm just saying to you in the world of
how you see opposition parties will make a run and
say oh lux and saying, you know, no new taxes
for working people. But oh, here we go, he's increasing
a putting an accommodation levy in, or he's actually increasing
fuel excise. Well, I'm just saying to you they are
well established existing mechanisms. But what we're sure is hell,
what we're not doing is going off bananas on a
wealth tax or a capital gains tax, which will just
(04:28):
absolutely absolutely wreck the economy. Okay, So outside of the
big text, which would be new no matter which way
you work your way through it, there are no more
new taxes apart from those two things. That's another too,
I can come to that. I think Well, in fact,
you've heard Nicola and the lead up to I think
you've raised this the lead up to the last budget
she talked about our bank tax and looking at making
(04:48):
sure we've got our banks tax settings right.
Speaker 3 (04:50):
To say, Australia, so there's a bank tax.
Speaker 1 (04:52):
Can No, No, No, I'm not saying that at all. No,
because this is the game, right you get into this game,
which is what's coming all I'm saying, I'm trying to
be honest with you and say we've talked to about
that and the lead up to the budget to say, look,
you've got it. You know, we've got some work underway
looking at bank taxes.
Speaker 3 (05:06):
Have we got that right?
Speaker 1 (05:07):
You know, that's a legitimately good question to ask. But
that's all work that's happening in the context of the
government I can think of in the last two and
a half years. But you know that's why we're saying,
you know, no new new taxes for working people. It's
pretty you know, because you've got evidence for it. We're
the first government to lower taxes for working people in
fourteen years by adjusting those tax thresholds. My real disappointment
(05:32):
Mike is that you know, if you think about labor,
I supposely working for working people when I said this
is some unionists the other day is like, honestly, why
didn't you guys come out and support us when we
lifted tax thresholds after a period of high inflation? Like
that's not ideological, Like that genuinely isn't, but it does
speak to the fact that they just are so locked
into the addiction to spending and taxes and borrowing. So,
(05:53):
I mean, nobody asked enough questions the other day of
the Global Party killing your tax boost thing either because
that's one point six billion dollars, it's uster six and nine.
Where's the five billion?
Speaker 3 (06:03):
Correct?
Speaker 1 (06:04):
So they've got an eighteen billion dollar hidden bill. For
all the commitments they've made, they've got to find eighteen
billion dollars. And what they did I think last week,
which was egregious, was that they ended up saying we're
going to go kill investment boosts and take five billion
dollars out of that. Now, I'm telling you, when you
go up and down this country and you talk to
businesses small or medium or large, that has been the
(06:24):
single biggest thing that's actually it made them invest in capital.
I was in this amazing family run company called coll
Pack and christ Church just out in Selwyn. They do,
like you think about all the products being produced in
the South Island. They built a massive investment in warehousing,
state of the art technology, incredible facility, purely because that
investment boosts moved the attractiveness of that financial case forward
(06:45):
for them. So for anyone listening, whether you're a tradee
or whether you're a medium sized business, you can write
off twenty percent of that new asset in the first
year in addition to the normal amortization or depreciation you get.
So that's encouraging our businesses to invest in plant and
capital and equipment and technology so they can become more efficient,
to make more money, to drive wages and growth. And
(07:07):
I just think, you know, that's five billion of the
eighteen billion. That's how they plan to do it. You know.
Speaker 3 (07:12):
The other three is are capital gainsteps.
Speaker 2 (07:13):
So just to be clear, there's a bid tax coming
in some way shape or ford.
Speaker 3 (07:17):
No, we said we'll explore it. So I just want
to be clear about it. I just want to I
just want to get right.
Speaker 1 (07:22):
I mean excite fuel ex size fuel ex accommodation levy, yes,
and some exploratory work around bank tax settings to ensure
they are aligned with Australia as what you know, as work,
but we are nowhere. We've made no decisions on the
bank tax. Just want to be clear about it and
that's it, and that's that's it.
Speaker 2 (07:39):
Council of Algamation. How many of the councils who haven't
got to it are taking the piss versus how many
are genuine and just haven't got there because they can't
make up their mind.
Speaker 1 (07:53):
They all submitted them, I think on Sunday or off
maybe on Friday. I think it was we've got to
go through and digest and when some are voted, they're
not going to So how this.
Speaker 3 (08:03):
Started was, Look, we said we're in tishing in RMA.
Speaker 1 (08:06):
We want forty five percent less consense. The companion piece,
in my mind very clearly as you've got to go
knock off the regional councils across the country and simplify
a layer of government and take one out, because otherwise
you just got bureaucracy crazy, which is what we've got today.
So we take the council regional councils out.
Speaker 3 (08:21):
We said, look, there's a way there will.
Speaker 1 (08:22):
Be some genuinely subregional things you got to discuss. We
think you as mayors can come together and what we
call a combined territory board or conversation on the genuine
subregional stuff where two or three district councils have to
make decisions about some things. They said to us, Heyle,
some MEAs came to us, said, look, we've got actually
a communities that actually want to merge with their district
councils next door. We've worked on three waters, we've worked
on these city regional deals. We'd actually like to do
(08:43):
some stuff and think about a different way. We said, Okay, you've.
Speaker 3 (08:46):
Got a limited time.
Speaker 1 (08:48):
We're not doing endless years of who we and discussion
and debate some making decision yep. Now and then they've
submitted their submissions in and if you don't make a
submission for that, well then we'll.
Speaker 2 (08:56):
When do we get the details on that next book,
which is the backstop? You tell them what they're.
Speaker 1 (09:00):
Going, Well, we've told them, we've already foreshadowed that that
the backstop is there and that's what they will work
to if they haven't got an alternative plan that we've approved,
And now.
Speaker 2 (09:08):
Will you tell them that in terms of this is
it and you will do this? When do they find
that bit out?
Speaker 1 (09:13):
Well, we've got the they've all submitted it and on
as I said, I think on Friday was the cut
off date. Our team will go through those proposals and
try and confirm some as quickly as we possibly can.
Speaker 3 (09:23):
Stay right, get going, uh.
Speaker 1 (09:25):
And otherwise, when the RMA legislation comes into law, which
will be this month, you know, in the next month
that and that will be the new RMA system. That
will be where the backstop will be kicked in from there.
Speaker 2 (09:36):
All right, see you Friday night, The Big the Big Party,
the Big Wholey.
Speaker 1 (09:41):
For more from the Mic Asking Breakfast, listen live to
news talks that'd be from six am weekdays, or follow
the podcast on iHeartRadio
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