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Don Brash - Source: ONE News -
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Act's new leader says National should be able to break its 2008 election promises for the sake of the country.
Don Brash today argued that the lingering effects of the global financial crisis are enough of a justification for cuts to KiwiSaver and changes to policies like interest-free student loans.
"When National came into office they found they were facing the worst economic crisis in three generations. Forget about the earthquake; that came later.
"(It was) the biggest international crisis in three generations. We simply could not afford to continue the wasteful spending which the Labour government instituted in their last term," he said on TVNZ's AMP Business programme.
Brash says Labour's leadership from 2004-2008 resulted in a 43% increase in government spending that was not sustainable.
"Now the tragedy is that National inherited that mess but has done nothing at all to fix it."
National is facing a record deficit of around $17 billion and has promised a "zero budget" that will spend around $800 million more on health and other areas but trim the same amount of spending elsewhere.
The new Act leader wants the government to go much further than that.
"Waiving interest on student loans is costing the government the thick end of $1billion a year. Has it increased the number of people in university education? Very, very little. It was a huge bribe and was described as such by Bill English when he was in opposition," Brash told AMP Business.
Brash supports removing the interest-free aspect of student loans and also the recent suggestion from Tertiary Education Minister Steven Joyce to restrict student loans to under-55s.
But AUT Vice-Chancellor Derek McCormack says restricting access to tertiary education would go against what almost every other developed country is doing, especially those facing ageing populations.
"If you're going to be working from 55 to 70, you are probably going to be working in areas that you weren't trained for as a young person so re-training might be a really smart idea and we are seeing this throughout the world," he told TVNZ.
The Green Party said today that Joyce's proposal is discriminatory against older people.
Brash's plans
Challenged on what he would do about the big deficit if he was in English's shoes on Budget day, Brash fell back on his 2025 Taskforce recommendations.
"It recommended getting government spending back to about the same share of the economy it was in 2005, about 29-30%, over a three or four-year period.
"I think that's a reasonable objective."
Brash has previously argued against the tax credits and kickstart incentive in the KiwiSaver scheme and said today that he still supports removing them.
He cited a University of Waikato study that he says showed KiwiSaver overall reduced national savings and remarked: "Hard to see how that helps us."
Green Party co-leader Russel Norman argued with the Act leader, saying the Treasury's own research showed a 40% uptick in savings as a result of the huge popularity of KiwiSaver.
Brash admitted that KiwiSaver "may" increase private saving but still insisted that national savings were "adversely affected" by the scheme.
Labour leader Phil Goff has today released his party's alternative Budget and said that any changes to KiwiSaver will be a "betrayal" of National's election promises.
The Budget announcement will screen live on ONE in the ONE News Budget Special at 2pm on Thursday. It will also livestream on tvnz.co.nz
