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Scoop
9 hours ago
- Business
- 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
Scoop
12 hours ago
- Business
- 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. By Tom Peters, Socialist Equality Group 26 May 2025
Scoop
13 hours ago
- Business
- Scoop
NZ's Budget For Austerity And War
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. By Tom Peters, Socialist Equality Group 26 May 2025
Yahoo
23-05-2025
- Business
- Yahoo
New Zealand eyes cargo planes, helicopters, Javelins in new budget
WELLINGTON, New Zealand — New Zealand's 2025 Budget, released this week, is slated to bring defense spending to NZ$4.2 billion (US$2.4 bn), Defence Minister Judith Collins announced. 'To achieve this, the government has allocated $2.7 billion of capital and $563 million of operating funding for priority projects identified in the Defence Capability Plan we released last month,' she said. Spending priorities include replacing the Royal New Zealand Air Force's only strategic airlifters, two Boeing 757s-2K2, acquired second-hand in 2003 and updated in 2007. Replacing the fleet of eight Seasprite SH-2G(I) maritime helicopters is also on the docket. Operated since 2015, only five remain operational, with three now used for parts as they near the end of their service life, Collins recently stated. Also on the shopping list: New versions of the Javelin anti-armor missile, encrypted radios to provide deployed Army units with secure voice communication, and a counter-drone system. Officials also want to upgrade Devonport Naval Base, invest in homes for defense families, modernize the defense vehicle fleet and grow digital and information management projects. The Ministry of Defence, with roughly 200 staff, receives nearly $26 million. New Zealand's defense spending is scheduled to reach 2% of GDP by 2032/33. That level of military spending was last achieved in 1982.
Otago Daily Times
22-05-2025
- Business
- Otago Daily Times
Defence Force could get more 'killer drones'
By Phil Pennington of RNZ The Budget shows the Defence Force's growing push into the drone warfare will focus first on "counter-drone" systems. This is one of about a dozen initiatives in the Budget signalled already in the Defence Capability Plan last month. All up, there is $4.2 billion in capital and operating funding for the initiatives, most of it being spent over four years, although, in many cases, just how this is divvied up is withheld due to commercial sensitivities. The government already signalled the NZDF could get more 'killer' drones, to add to its existing small stable of surveillance drones. However, the Budget documents referred instead to a counter-uncrewed aerial system that "can be set up in fixed locations and is able to disable drones". Companies in Australia have been working on these, and they have become a fixture in the Ukraine-Russia war. The projects under the Defence Capability Plan dominate the Budget: The biggest capital spend over the four years, as signalled, is to replace eight old maritime helicopters with five new ones - no new details are forthcoming on that. An upgrade of anti-armour Javelin weapons and replacing the two old 757s that are routinely experiencing embarrassing breakdowns, make the list. The Javelins would allow defence to engage tanks "at longer ranges". However, there is no mention of other new missile strike capability, though both the DCP and Defence Minister Judith Collins have repeatedly referred to getting new missiles. There is also no mention of spending on space capabilities, which the DCP had envisaged hundreds of millions going towards. Large sums are set aside with $60 million a year for maintaining the air force's capability, $50 million for the army and $39 million for the navy. Defence Minister Judith Collins said earlier a key constraint on the extra spending is having the personnel to handle that. The Budget provides $8 million for pay rises per year for civilian personnel, and $38 million a year for military allowances (these range up to about $100 a day for uniformed staff in the field or at sea). Savings include $13 million from 2024-27 on the army's new Bushmasters getting high-tech communications installed. These vehicles would likely be crucial for any peacekeeping in Ukraine. The project had been rephased, the Budget said, but it is not clear what that means. There is $16 million across four years for the project to fix many leaky and substandard homes for personnel; and $25 million to planning and design to revamp the Devonport Naval base. Unlike the UK that slashed its international aid budget to fund more defence spending, the Budget maintains the foreign aid budget at about what it was - $1 billion a year. The Budget halves the amount that had been going into a special climate aid fund, reducing it from $200 million a year to $100 million, and also expands what that money can be spent on. This fund had faced a cut-off in January.
