Prime Minister Christopher Luxon is positioning the Government's already-signalled reforms to KiwiSaver, the education system and resource management as the centre piece of its re-election campaign.
And in his 2026 State of the Nation address in Auckland on Monday he warned there would be "no room for extravagant election promises".
Contrary to some expectations ahead of the speech, the Prime Minister made no new policy announcements, nor did he name the election date.
But he focused heavily on positioning the Government as a responsible one that was fixing up the country.
And in what appeared a clear, pre-emptive strike against opposition parties, Luxon said: "Any party that wants to ramp up spending is being economically irresponsible".
"Because the only way to spend more money is to borrow it or to raise taxes," he said.
"Borrowing more would lift our debt to dangerous levels, while raising taxes would snuff out the recovery and send Kiwis overseas.
"So, National is going to campaign on being responsible managers of the economy, who make the right decisions to fix the basics and build our future," Luxon said.
And he said if the country is serious about building the future we need "serious reform".
"That includes reform in three big areas – KiwiSaver, NCEA and the RMA.
"We need to be more ambitious for retirement savings. That’s why our Government is lifting the default rate of KiwiSaver contributions for employers and employees from 3% to 4% by 1 April 2028. But National will campaign on going even further, gradually increasing employer and employee contributions to 6% each by 2032 for a combined contribution of 12%.
“Building the future means equipping the next generation with the knowledge and skills they need to be successful as individuals and to contribute to our success as a country. That is why we are replacing NCEA with a new qualification with clearer grades and high standards for literacy and numeracy.
“Reforming New Zealand’s planning system to make it easier to build houses and other critical infrastructure like roads, energy projects, hospitals and schools is also key to building the future. We’ve done a lot in two years to unlock growth and development through things like Fast Track, but our replacement of the Resource Management Act will be the real gamechanger in the long term.
“National is focused on our plan to fix the basics and build the future for all New Zealanders. That plan is working and we need to stick with it so that all New Zealanders can get ahead and have the opportunities they deserve.”
Luxon talked up the "tight budgets" that "have become standard practice for this government".
"In just the last two years, our Minister of Finance, Nicola Willis, has delivered savings of around $11 billion per annum, equivalent to around $5,000 for every single household in the country.
"I know generating those savings hasn’t been easy, but they have provided the necessary headroom to deliver tax relief, invest in the frontline services Kiwis rely on and maintain a path back to surplus over the forecast period.
"New Zealand simply has to get its finances in order if it is to achieve a long-term improvement in its economic prospects.
"That’s why there will be more savings in this year’s Budget and no room for extravagant election promises."
13 Comments
no more sugar rush
no more property boom
investment in productivity vs speculation
Not productivity - that's just an energy-in/energy out ratio.
You mean production.
Which requires input in front, and output behind. Both of which are why the global geopolitical situation is disintegrating.
I have trouble differentiating people like out PM, from clowns.
And I have trouble differentiating the current crop of journalists, from clown-touts. The reconciliation - combine forward bets vs remaining planet - is near. Likely this year, certainly within the next four. The Great Pumpkin help us being 'led' by this lot through that bottleneck.
The tax cuts were eaten up within a few weeks of COL increases. Just as poorly times as the Ardern gov't 'cost of living' payment which was unnecessary amongst the almighty spend they committed the country to in approving national healthcare reform, knowing full well they would likely not have to deal with the overall costs while holding a majority govt.
For those others that recognise it, Luxon is taking from the John Key playbook and his speech before elected late 2008 in the face of the GFC, noting we needed to go 'back to basics' and come together as a nation understanding that we will have to suffer for a while until things get better. Too bad he already promised the world last election and has spent the better part of 3 years without delivering good on it. Most will only hold faith for so long before finally proclaiming the emperor has no clothes.
We're not particularly efficient in the way we do pretty well anything, so there's a lot of room for productivity improvement.
No, there isn't.
Reducing EROEI is a global problem, and from here on in, will outpace any efficiency you care to name.
So reducing waste in a system or process doesn't constitute an improvement in efficiency.
Interesting point of view.
Quite a logical one.
Name me a year where we used less energy than the year before? (And don't fudge one type for another).
There ain't one; GDP and energy-use have moved in lockstep forever.
Jevons Paradox - note the date...
"Because the only way to spend more money is to borrow it or to raise taxes,"
He gets away with this because this is what people believe.
The only way to spend more, is to have more to spend it on.
That is the global dilemma.
Governments - that issue their own currency do not borrow or tax to spend. Governments create new money through the reserve bank any time they spend. Tax and bonds happen after this to remove money from circulation as an inflation control.
That reminds me of what Keynes said - "if we can do it we can afford it." In other words if there is spare capacity in the economy - rising unemployment and falling business output - then the government can increase the money supply - via deficit spending - to utilize available resources.
Agreed - I cringe whenever this is said by economists and politicians. Labour's Barbara Edmonds used the classic "household budget" analogy recently, to describe the governments books and I wanted to cry.
zzzzzzz
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