Government's promises will require raising taxes - Chris Trotter

The AM Show 17/05/2018

The Government is being urged to honour the promises it made to those who voted it into power.

Finance Minister Grant Robertson will unveil his first Budget today, with Prime Minister Jacinda Ardern doing her best to dampen expectations.

"We've also had to balance priorities... There's been a number of competing ones that we've had to phase because we can't do everything at once," Ms Ardern said on Wednesday.

Left-leaning political commentator Chris Trotter says the Government appears keen to keep the business community onside, even if it means disappointing Labour, New Zealand and Green voters.

"With the greatest respect, the business community does not elect Labour Governments," he told The AM Show.

"Another whole group elects Labour Governments... those are the voters to whom you really do have to pay attention if you have fought a campaign on the politics of transformation and the politics of kindness."

Right-leaning commentator Trish Sherson agreed with Mr Trotter, saying the Government wants to be seen as "good economic managers".

"I was at a business lunch a couple of weeks ago where the Prime Minster spoke. What interested me, it wasn't so much about the Budget - it was actually a plea to business saying, 'Could you please like me?'"

The ANZ business confidence index turned negative the same month the new Government took over from National, and has stayed there ever since.

Grant Robertson's Budget will be released today.

"It's the burr under this Government's saddle. It's the little rip in their tights that's annoying them. They can see business confidence on the slide, and they want to be seen by business as good economic managers," said Ms Sherson.

"But I wonder if it's too much focus for them and it's making them lose sight of the stuff they actually want to get on and do."

Labour promised ahead of the election it wouldn't bring in any new taxes in its first term - but at the same time, complained massively of underfunding in areas like health and education. Mr Trotter said the no-tax promise was a mistake.

"A social democratic government that goes into office promising to spend but not to tax has got problems."

Ms Sherson doubts Labour will be able to keep two of its core constituencies - nurses and teachers - happy without raising taxes.

"Nurses these days are so seriously underpaid I'm not sure how you're going to make up that gap. If you think about nursing as a job these days, that should be $100,000, $120,000 job. It's a massive and important job."

Mr Trotter blamed the "self-imposed shackles" of the Budget Responsibility Rules, agreed to by Labour and the Greens early last year, which commit the Government to running surpluses and keeping debt down.

"I just want the Government to keep its promises to the people who put it into power."

Watch the full interview with Trish Sherson and Chris Totter above. 

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