Political promises, populist politics and fiscal reality

The promises of political leaders Chris Hipkins and Christopher Luxon (pictured) have little relation to the money to fund them. (Image: Getty)

Cameron Bagrie

Tue, 05 Sep 2023

Election promises are coming thick and fast, though in many instances, short on detail. Some context and reality are needed because populism-driven announcements chasing votes are rife.The fiscal accounts are worse.Tax revenue has dropped away sharply in 2023, down $6 billion on the Half-Year Update Projections and $2.5b below the revised lower budget estimates. This will likely flow through multiple years, which adds up. It is not just a weaker economy or slower growth in gross domestic product (GDP), which is the big driver of revenue and tax...

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