When public spending cuts precipitate a meltdown
Comment: Stand by for more blunt cuts to government agencies' staffing and spending in Thursday's Budget – and for potentially more of what a new Auditor-General report identifies as rushed, evidence-free, poor-practice changes to please ministers.
Finance Minister Nicola Willis has made clear her second Budget will need to mirror her first in finding savings in state spending to fund new initiatives no longer covered by a reduced operating allowance.
Indications are that those public service cuts will again need to be substantial to make her numbers work, for now.
Last year, one of the agencies that endured a flat 6.5 percent cut to its voted budget was Oranga Tamariki.
Its example in finding the necessary savings to meet the Cabinet's demand leading up the 2024 Budget is salutary for the next wave of spending reductions.
A new report from the Office of the Auditor-General into Oranga Tamariki's sudden changes to its contracts with external organisations providing prevention and care services for children would be one of the most scathing to emerge from that office in the past few decades.
The Auditor-General points to a cluster of poor practice, bad execution and near non-existent communication from the children's ministry in cutting around $60m in its contract spend, cancelling around 30 agencies' funding for 2024/25 and trying to strong-arm others by not paying its bills on time.
The 64-page inquiry report says Oranga Tamariki decision makers did not adequately establish what the changes would mean for the children needing care.
Worse, the agency simultaneously moved last year to accentuate a policy of grabbing back from some providers all money it said they underspent and had instead put into their reserves.
'Previously, Oranga Tamariki had generally allowed providers to retain funding even if they had not achieved 100 percent of all contracted measures,' the Auditor-General's office said. 'For example, providers could move funding from under-utilised services to over-utilised services to meet demand.'
The process of seeking full return, known as 'reconciliation', saw Children's Minister Karen Chhour publicly declare, without evidence found by the Auditor-General, that some community service providers had used the taxpayer as a 'cash cow' for too long.
And at the same time as the cuts to contract funding and the reconciliation demands, OT was also restructuring out about half the relevant staff, some of whom worked in regions liaising with the outside providers being cut.
Told it needed to find the 6.5 percent budget cut, it attempted all these changes at once.
The result, according to the Auditor-General report, was dire.
OT gave notice to providers that equated to a few working hours (not days or weeks) over Matariki weekend in 2024. It did not tell them why they were losing money, would not engage or explain and then it was forced to keep referring children to some of those same agencies for help.
It tried to make the agencies losing funding do the work of finding new services to refer children to.
It withheld payment to some organisations as a way to force agreement on either new contract arrangements or to enforce returns of the underspent monies from previous years.
The inquiry report says OT had no evidence where the money some organisations had in reserve might have come from – for example, other income streams, other government funding lines. It also would not let the agencies redirect the 'underspend' in areas where they had 'overspent' because of demand for care of children.
Organisations affected by the contract changes eventually had a reprieve six months later, when Chhour's office announced a delay to the changeover timeline for some funding until December this year.
Crucially, the savings programme aiming to cut contracts by $60m to $400m ended up finding just half that because OT had to keep paying transition costs, among other things.
Politically, all this was at arm's length. Chhour and the Government can claim the contract problems were operational decisions, as were the decisions to seek 'reconciliation' by taking back underspent monies and also to cut staff involved in managing the contracts.
But the defence is thin. A blunt demand for cuts of 6.5 percent spooked an apparently dysfunctional government agency to rush and botch funding changes, with unknown effects on wait times, service standards or service cuts for … children.
Chhour repeatedly told opposition MPs in Parliament there had been no change to 'frontline' OT services, but the Labour and Greens MPs retorted then that her definition of 'frontline' to mean OT's own staff working directly with kids was artifice.
The Auditor-General's report, so timely in the week before another Budget of expected cuts, cannot say so, but the evidence it lays out and the findings within clearly show the political direction was central to what resulted.
'Oranga Tamariki told us that it received a clear direction from the Minister for Children that Oranga Tamariki needed to focus on its core purpose.'
Chhour told the Auditor-General's inquirers that her instruction was not to find savings but to ensure funding went to outcomes sought and were connected to core purposes, without duplication.
Given what followed, and OT's focus for months on savings and dollars, that argument amounts to something of an out-of-body-experience.
The report says the OT failures 'have harmed trust and confidence' and 'public organisations need to actively demonstrate that they can act as a trusted partner'.
'The services provided under contract support some of New Zealand's most vulnerable children and their families. Therefore it is critical that Oranga Tamariki manages the contracts well.'
Something might have been learned between 2024 and the expected further cuts to public agency budgets for the 2025/26 financial year. The Auditor-General sure hopes so.
'The effects of decisions on children and their families are still not known. Given this is the core role of Oranga Tamariki, it is unacceptable for it to be in this situation.'
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RNZ News
13 hours ago
- RNZ News
Babies for sale: New Zealanders commissioning illegal surrogacy in Thailand
By Jeremy Wilkinson, Open Justice multimedia journalist of Oranga Tamariki has identified a trend where Kiwis are travelling to Thailand to commission illegal surrogacy arrangements. Photo: NZME / Paul Slater New Zealanders are travelling overseas to illegally commission surrogate babies from Thai women, and bringing them back home to adopt them despite opposition from Oranga Tamariki. It's a practice the agency has labelled a "concerning trend" and it said there had been five cases where surrogate parents have flouted international law to have children in recent years. In one of those cases a gay man paid a Thai fertility clinic worker to subvert the country's strict surrogacy laws, which prohibits foreigners from commissioning children from surrogate mothers. The man paid a "significant" sum of money, according to a Family Court ruling, to find a surrogate and then his sperm was used to fertilise a donor's egg. Once back in New Zealand, the man applied to the Family Court to adopt his son so he could be legally recognised as his father. Under the current legislation, which was written in 1955, every parent of a child born by surrogacy, whether the practice is illegal in the country of birth or not, must effectively adopt their own child even if they have a genetic link to them. This is because when the law was written more than 70 years ago lawmakers didn't foresee the advances in fertility medicine such as in vitro fertilisation. That legislation is currently before a select committee after the Improving Arrangements for Surrogacy Bill was first tabled before Parliament in 2022. The proposed law would effectively create a mechanism that accounts for these changes in science, technology and culture and mean that parents, lawyers and judges won't need to rely on a piece of legislation that was never intended to account for surrogacy. However, it's unlikely to change things for people who commission surrogacy arrangements in countries where it's illegal. They will still come under scrutiny from the courts when they attempt to bring their children back into New Zealand. It's a practice that Oranga Tamariki says is occurring more frequently, at least in Thailand, and there's a possibility New Zealanders desperate to have children will look further abroad to other countries as well. In the case of the gay man who paid a Thai surrogate, which made its way through the Family Court last year, Judge Belinda Pidwell noted that the law around surrogacy was complex and there was no statute in New Zealand to provide clarity. "A number of illegal steps or breaches of laws occurred in the creation of [the child]. However, he has now been born, and as a result, has the right to grow and thrive, to have a nationality, and the right to know and be cared for by his parent," her ruling reads. "The irregularities in his creation, or the sins of his father, should not be visited upon him." However, Oranga Tamariki objected to the adoption being granted by the courts, despite finding that the father was the only real parental option for the child and that, barring the illegal way in which the baby was created, he was an otherwise suitable parent. Lawyers for the agency tabled a report from a senior adviser in its Intercountry Adoption Team, which identified a "concerning trend where New Zealanders have engaged in surrogacy around involving Thai surrogates, despite the illegality". "The concern is if children born of illegal surrogacy arrangements are allowed entry into New Zealand, and their parentage is then endorsed by an adoption order, that could be seen as an endorsement of unlawful actions," the report read. Oranga Tamariki says the release of its report could cause diplomacy issues, but didn't give the courts any evidence about why. Photo: NZME / Supplied Oranga Tamariki refused to release the full report to NZME under the Official Information Act, and then opposed its release through the Family Court claiming that it could impact New Zealand's diplomatic relations with other countries. However, it didn't provide any evidence about that specific impact. Judge Pidwell recently released the full report to NZME, which outlines how there has been an increased demand for women to become surrogates, and this demand has caused an increase in the number of women being trafficked from countries where the practice has been banned. The report found that between 2015 and 2020 the agency wasn't aware of any evidence New Zealanders had been involved in these situations, but from 2020 it had encountered five cases where a commercial surrogacy arrangement had been commissioned by Kiwis involving Thai surrogates. Three of these cases have involved the transfer of the surrogate across international borders for the purpose of an embryo transfer. In the other two cases, the mothers were transferred to another country to give birth. "Not only do these emerging trends demonstrate New Zealanders are breaching and demonstrating disregard to Thailand's domestic laws, but there are also significant concerns about the risks these practices pose for the safety and wellbeing of surrogates and the children born via the arrangements," the report reads. "Whilst we have noticed these examples of illegal practices have occurred in Thailand, we are mindful to the possibility of surrogacies being commissioned in other countries where it is illegal and would place similar scrutiny on New Zealanders engaging in illegal surrogacy arrangements in any jurisdiction." In New Zealand there is currently no legal pathway for a surrogate child to obtain residency except via an exemption from the ministers of immigration or internal affairs, or through the antiquated Adoption Act. Oranga Tamariki receives referrals from commissioning parents, private lawyers or requests from the Family Court to complete reports under the Adoption Act, which assesses their suitability to adopt. Since international surrogacy was outlawed in Thailand in 2015, Oranga Tamariki as well as the Ministry of Social Development, Ministry of Foreign Affairs and Trade, Immigration New Zealand and the Department of Internal Affairs have all published advice for New Zealanders about the law change. Those agencies held a meeting in January 2024 to discuss the trend where New Zealand was flouting these rules. Then in May, Oranga Tamariki effected a policy to refuse to provide pre-court adoptive applicant assessments for people who commission surrogacy in a country where it is illegal. NZME asked Oranga Tamariki questions about whether it had liaised with the Thai Government about its concerns, about other countries where New Zealanders were commissioning illegal surrogacy and about its submissions to the new bill. New Zealand First MP and Children's Minister Karen Chhour says she hasn't received advice from Oranga Tamariki about the report. Photo: NZME / Mark Mitchell In an emailed statement the agency did not respond to those questions, instead noting that following an inter-agency meeting in 2024 Oranga Tamariki put in a formal policy to not support an immigration exemption for anyone commissioning an illegal surrogacy. "As outlined, we do not undertake any pre-court assessments of adoptive applicants who commission an international surrogacy in a country where it is illegal but will undertake such an assessment if we are required to do so by the court once an adoption application is received," the spokesperson said. "Oranga Tamariki has contributed along with other agencies to the review of surrogacy that has been led by the Ministry of Justice. "Through the course of that work, discussions were held about the issue of illegal surrogacy actions." A spokesperson for the Minister for Children, Karen Chhour, confirmed her office had not received any reports or advice from Oranga Tamariki about the illegal surrogacy its staff had identified. The Thai Embassy in Wellington did not respond to questions about whether it had seen the report, and was concerned by it. Domestic surrogacy, where someone volunteers to carry a baby for someone else, is legal in New Zealand, as long as no money changes hands. However, there's also no legal pathway to enforce this arrangement meaning that if the birth mother wants to keep the child, she can. If in vitro fertilisation needs to be done to get a surrogate pregnant then it has to be approved by the Ethics on Human Assisted Reproductive Technology committee (ECART). Oranga Tamariki will also assess the intended parents for their suitability. According to official information released by Oranga Tamariki there were 89 domestic surrogacy adoptions in New Zealand between 2020 and 2024, and over the same period there were 69 from international surrogacy arrangements. Barrister Margaret Casey, KC, says not much will change under proposed new legislation when it comes to illegal surrogacy. Photo: NZME / Supplied Margaret Casey, KC, is one of three legal experts who assist with surrogacy arrangements in New Zealand and told NZME under the new proposed surrogacy law, people would no longer have to adopt their own genetic children, rather it would become a parenting order. "The courts will still be juggling the same kinds of issues, it will just be through a different lens," she said. "Illegal surrogacies will still come before the court, and the court will still look at the background and make a decision about whether or not when you balance it all out it can make a parentage order." In terms of illegal surrogacy, Casey said not much would change under the new legislation, and there were already checks and balances in place that served to disincentivise people deliberately pursuing illegal arrangements. "You may not get to live where you want or with your child for a long time, you may have to give detailed evidence at a court hearing, be subject of further reports from Oranga Tamariki ... you will live in this state of uncertainty and probably panic for a long period of time," she said. In all five cases in recent years where New Zealanders have commissioned babies in Thailand, the New Zealanders who had paid a surrogate claimed that they didn't know it was illegal, despite clear advice from agencies in New Zealand to the contrary. Casey said this was likely born from optimism, rather than wilful blindness. "People are paying too much attention to the process of creating the baby and not concentrating on whether they can bring the child home and how long it will take, and is there anything I'm doing that will be a problem," she said. "Do your research and ask questions. If you don't do that and rely on an agency whose business is reproductive optimism, then you might not look as deeply as you should." Associate Minister for Justice Nicole McKee said the Improving Arrangements for Surrogacy Bill won't prevent people from seeking illegal surrogacies abroad. "It will expressly enable the Family Court to scrutinise these arrangements. The court will be able to consider whether it is in the surrogate-born child's best interests for the intended parents to become the child's legal parents," she said in a statement. Another expert in New Zealand surrogacy law is Jennifer Wademan, who agreed that in her experience there's nothing Machiavellian in parents seeking out illegal surrogacy. "I've never come across a case where someone has had the knowledge that it is illegal and still gone ahead. We simply point them in a direction where people can do it legally," she said. Wademan said she primarily gets two kinds of clients; those who work with her from the start, and those who only come to her once they realise their baby's foreign birth certificate won't get them through the border in New Zealand. "By the time these families are turning to international surrogacies they've been through hell and back and their desire to have a child is so great, it's optimism rather than deliberate avoidance of research," Wademan said. "I think for many it's putting the blinkers on. As human beings we can all understand that." As for Oranga Tamariki identifying cases of this happening, Wademan said that while the numbers might appear small, a spike of five is quite significant in the world of international surrogacy. "It's enough for me to go, hmm, I don't like that," she said. In terms of the proposed law change, Wademan doesn't see it changing much in the way of illegal surrogacy, but for domestic parents she predicts it will change the landscape altogether for an area of law that is particularly ad hoc. "Every day we get a new challenge," she said, "We're having to be innovative about legislative process about science and culture because our legislation doesn't provide for it. "The international landscape will always be more complex because we're dealing with another country's laws that we have no control over. "At the end of the day, these are overwhelmingly New Zealanders who just want to be parents so badly." -This story originally appeared in the New Zealand Herald .
Scoop
a day ago
- Scoop
Worsening Poverty And Social Misery In New Zealand
Press Release – Socialist Equality Group The government is seeking to solve the worsening economic crisis by ramping up the exploitation of the working class, while protecting the fortunes of the super-rich. Last week New Zealand's Treasury released a Child Poverty Report, which forecast that the proportion of children living in poverty will increase from 17.7 percent in 2024 to 18.4 percent in 2029. The report was released along with the National Party-led government's austerity budget, which starves public services, while cutting workers' wages, reducing government contributions to retirement savings and barring thousands of unemployed teenagers from welfare. The government is seeking to solve the worsening economic crisis by ramping up the exploitation of the working class, while protecting the fortunes of the super-rich. Asked by a TVNZ interviewer why the government had not done more in the budget to address child poverty, Finance Minister Nicola Willis declared: 'there is not actually a magic money tree that allows me to show such generosity that I can solve every problem at once.' Year after year, successive Labour and National Party governments have trotted out this refrain, even as they have handed tens of billions of dollars to the corporate elite through tax cuts, subsidies and bailouts, and spent billions on the armed forces. The National-led coalition government—with the support of the opposition Labour Party—will spend an extra $13 billion over the next four years as part of its plan to double the size of the military and integrate New Zealand further into US-led imperialist wars. Sarita Divis of the Child Poverty Action Group, a non-government organisation, pointed out in a New Zealand Herald column last month that the $3 billion annual increase in defence spending is exactly what the Treasury itself estimated it would cost to halve the level of child poverty by 2028. The government's Child Poverty Report actually understates the extent of child poverty. Its data is more than a year old, covering the period from July 2023 to June 2024. Over the past year, the number of people in full-time work has fallen by 45,000 as unemployment increased from 4 to 5.1 percent, and living costs have continued to rise while wages stagnated. Moreover, the government defines poverty as less than 50 percent of the median household income after paying for housing costs—an extremely low bar. While the percentage of children below this poverty line was unchanged in the year to June 2024, the number of children living in 'material hardship'—the poorest of the poor—increased by almost a third between 2022 and mid-2024, from 10.5 percent to 13.4 percent. 'Material hardship' is defined as lacking access to six or more 'essentials,' such as decent housing, heating, healthy food, warm clothes and shoes, etc. Another survey, by the Ministry of Health, found that last year 27 percent of children 'lived in households where food ran out often or sometimes,' up from 21 percent the year before. Numerous reports illustrate an increasingly severe social crisis. The Christchurch Press wrote on May 22: 'Some families have moved into one heated room to keep warm, while others are taking out loans to pay their power bills as costs rise and temperatures drop.' It noted that last year, 'Consumer NZ estimated 140,000 households had to take out a loan to pay their power bill, and a further 38,000 households had their power cut at least once as they couldn't pay their bill.' In Wellington, the Post reported on May 10 that 'Food charities are facing an unprecedented surge in demand from struggling middle income earners.' In February, one soup kitchen 'served 7930 meals, 1200 more than across the same month in 2024.' Nationwide 500,000 people, one tenth of the population, relies on food banks on a regular basis. Homelessness continues to become more visible in every major centre. The government has boasted about reducing the number of emergency housing places from 4,000 in September 2023 to around 500 in December 2024—despite the 2023 census finding that 112,496 people, or 2.3 percent of the population, are 'severely housing deprived' (up from 99,462 people in 2018). According to government data cited by the Press, 'the number of emergency housing special needs grants, which fund temporary accommodation for people in need, have dropped from 8873 in July 2023, to just 1338 in March 2025.' Growing social misery and hopelessness is reflected in an unprecedented surge in the use of dangerous drugs. In Northland, the poorest region, as well as Southland and Otago, wastewater testing shows methamphetamine use has tripled in the past year. Nationwide, the amount of meth consumed between October and December 2024 was 78 percent higher than the average over the previous 12 months. There is also a profound mental health crisis, particularly affecting young people. A May 14 report by UNICEF revealed that New Zealand had the worst youth suicide rate of the 36 countries in the OECD, with 17.1 suicides per 100,000 people aged 15 to 19 (based on data from 2018–20). UNICEF appealed to the government to increase welfare payments for families with children and to address food insecurity by expanding the provision of free school lunches. The government has made cruel cuts in both areas. The government has deflected blame for young people's poor mental health onto social media. It is seeking to ban under-16-year-olds from social media platforms. This has nothing to do with protecting children but is aimed at strengthening state control over the internet and stopping teenagers from accessing political material, especially socialist articles explaining the real causes of inequality, poverty and war. While the Labour Party has criticised the latest budget cuts, this is entirely hypocritical. Homelessness, child poverty and the cost of living all became worse during the 2017–2023 Labour government, which is why it lost the 2023 election in a landslide. Labour transferred tens of billions of dollars to the super-rich through corporate bailouts, subsidies and quantitative easing measures during the first year of the COVID-19 pandemic. Last year's National Business Review Rich List, profiling more than 100 of the country's richest individuals and families, showed that their collective wealth increased from $72.59 billion to $95.68 billion in just one year. More than half of this figure, over $50 billion, was held by just 10 billionaires. This enormous wealth, accumulated by exploiting the labour of working people, must be expropriated, along with the money being wasted on war, so that it can be used to eliminate poverty, expand schools and hospitals and meet all other social needs. The task facing workers and young people is to reject all capitalist parties, including Labour and the Greens, and the union bureaucracy which has suppressed any resistance from workers to the government's attacks, and to take up the fight for the socialist reorganisation of society. By Tom Peters, Socialist Equality Group 30 May 2025
Scoop
a day ago
- Scoop
NZ's Budget For Austerity And War
Article – Socialist Equality Group The money for war comes at the direct expense of the working class. Notably, the govt expects to save $12.8 billion over four years by cancelling 33 separate pay equity negotiations, which were to increase pay for hundreds of thousands of … The budget announced by New Zealand's right-wing coalition government on May 22 represents a major escalation in the assault on workers' wages, living standards and public services, in order to fund tax breaks for the rich and to build up the military in preparation for war. Finance Minister Nicola Willis asserted that the budget was 'not austerity—far from it,' saying that it contained 'much-needed investments' in health and education. This flies in the face of reality. The government slashed the budget's operating allowance (total increase in spending) to $1.3 billion—the lowest figure in a decade. Over the next four years it intends to reduce total spending from 32.9 to 30.9 percent of Gross Domestic Product (GDP). The government cited deepening economic turmoil as a result of the Trump administration's tariffs, which come on top of last year's recession in New Zealand. The country's economy shrank by 0.5 percent in 2024, and unemployment rose from 4 to 5.1 percent, with tens of thousands of workers sacked across the public sector and by private companies. There is a stark social crisis, with soaring living costs, an estimated 500,000 people (one in ten) relying on food banks and one in five children living in poverty—all of which will get worse as a result of the budget changes. The most significant new spending is on the military, in line with demands from the US, Australia and the NATO imperialist powers. The defence budget will rise from 1 to 2 percent of GDP over the next eight years, starting with an investment of nearly $13 billion over four years. Far-right ACT Party leader and government minister David Seymour warned in parliament that the 'the chances are higher than ever' that New Zealand will need to use its military. The increased spending, he said, 'allows us to be part of a network of like-minded democratic societies committed to defending our freedoms in an uncertain world.' In fact, as was made clear in last month's Defence Capability Plan, the aim is to integrate New Zealand into aggressive US-led military preparations targeting China. As a minor imperialist power, New Zealand is already contributing to the brutal war in Ukraine and the bombing of Yemen, which are part of the imperialist countries' efforts to solve their economic crisis by violently redividing the world. The opposition Labour Party supports this agenda: its leader Chris Hipkins did not mention the vast military spending boost in his response to the budget. His ally, Green Party co-leader Chlöe Swarbrick stated that the government 'think it's harder to feed the poor [than] to arm up for somebody else's war.' The Greens' alternative budget, however, is silent on the rearmament program. As part of the last Labour-led coalition government from 2017 to 2023, the Greens supported increased military spending and the decision to send troops to Britain to assist in training Ukrainian conscripts for war against Russia. The party has recently adopted the militarist slogan of making NZ 'a country worth fighting for.' The money for war comes at the direct expense of the working class. Notably, the government expects to 'save' $12.8 billion over four years by cancelling 33 separate pay equity negotiations, which were to increase pay for hundreds of thousands of workers in female-dominated roles, including teachers. Other attacks include: Reduced government contributions to KiwiSaver, a retirement savings scheme covering most workers. Currently, members of the scheme can get $521 a year from the state, but this has been halved to $260.72 in order to save the government $2.46 billion over four years. Around 9,000 unemployed 18- and 19-year-olds will be kicked off unemployment benefits 'if it is determined that their parents or caregivers can support them.' The move is particularly brutal given that 13.2 percent of under-25-year-olds are not employed or in education—more than double the overall unemployment rate. The Best Start tax credit, given to parents in the first year of their child's life, will be income-tested, which will lead to 'a reduction in income' for around 61,000 families, according to government officials. $1 billion will be cut over five years to emergency housing for the homeless, under conditions where 2.3 percent of the population is severely housing deprived. None of these cuts will be offset by the pitifully small 'relief' touted by the government, consisting of a $7-a-week increase in tax credits for some working families. The government's rhetoric about increased investment in health and education is likewise a sham. Total annual health spending has increased by just 4.77 percent ($1.37 billion)—not enough to address the crisis of unmet need and understaffing of public hospitals and medical centres. With inflation at 2.5 percent and annual population growth of 1.5 to 2 percent, Auckland University health policy professor Tim Tenbensel wrote in the Conversation that a 4–5 percent funding increase 'amounts to merely standing still.' Doctors, nurses and other healthcare workers have held strikes over the past year-and-a-half to protest below-inflation pay offers and a hiring freeze in public hospitals. Funding for public education is being cut in real terms. Radio NZ reports that school operations grants have received an increase of just 1.5 percent. Meanwhile government subsidies for private schools, including several elite institutions, will rise by 11 percent. The budget will increase subsidies for university tuition by 3 percent or 4.75 percent, depending on the subject. Tertiary education providers, which have had their funding slashed by successive governments, will be permitted to increase fees by 6 percent, driving up student debt, which reached a total of $15.6 billion at the end of 2024. The government anticipates that its austerity measures will fuel social opposition and conflict and is therefore strengthening the repressive arms of the state. There is $472 million over four years to expand prisons and hire 580 more Corrections staff, in addition to 685 funded in last year's budget. Some $33 million over four years is allocated to expand military-style boot camps for young offenders. Labour Party leader Hipkins denounced several cuts in the budget, as well as $200 million in subsidies for fossil fuels development at gas fields. 'More people are homeless, more children are going hungry and women are going to be paid less. That's what Nicola Willis and [Prime Minister] Christopher Luxon will be remembered for,' Hipkins said. Such statements are typical of Labour's blatant hypocrisy. The National-led coalition government is, in fact, building upon the attacks of the last Labour government. Labour lost the 2023 election in a landslide defeat, fuelled by mass anger over soaring living costs, the crisis in the health system, increased child poverty and homelessness, as well as Labour's support for Israel's genocidal assault on Gaza. The Public Service Association's Fleur Fitzsimons similarly denounced the budget as 'wage theft on a national scale against New Zealand women.' The PSA, the biggest union, has enforced thousands of job cuts across the public sector, while also openly supporting the multi-billion dollar increase in military spending. The budget's austerity and warmongering will accelerate the movement to the left by workers and young people, who will come into conflict not only with the government, but with the opposition parties and the pro-capitalist union apparatus. The crucial task facing the working class is to establish its political independence from all these organisations and to consciously take up the fight for the socialist reorganisation of society. This means joining and fighting to build the world Trotskyist movement, which in New Zealand is represented by the Socialist Equality Group. 26 May 2025
