Are New Zealanders Really Living Beyond Our Means?

The National-led government has been banging the drum of fiscal restraint again, claiming New Zealanders have been “living beyond our means” in another Luxon hates "wet and whiny New Zealanders" standup that is likely to tank his approval rating even further. Yet, the Coalition of Chaos' actions tell a different story than their unending rhetoric of fiscal restraint: a reckless spree of costly policies that funnel wealth to the privileged while gutting public services under the guise of austerity. Let’s tally the costs, and expose where the money’s really going.


Yesterday, Stuff reported:

NZ ‘has been living beyond its means’, Luxon says in pre-Budget speech

Prime Minister Christopher Luxon says New Zealand “has been living beyond its means” ahead of the Budget later this month, which is expected to be tight after the finance minister cut about $1 billion from the operating allowance.

Citing an increase in debt relative to GDP, from 21.6% in 2017 to around 43% today, Luxon said government spending had “come at a significant cost”, pointing to the doubling of the cost of servicing that debt over the past eight years.

Well duh! Of course debt to GDP is going to increase when you gut the economy and cause growth to tank.

First off, the coalition’s tax cuts for landlords. Restoring interest deductibility for rental properties has ballooned to a $2.9 billion cost over four years, up from an initial $2.1 billion estimate. This is a windfall for property speculators, propping up a housing market that’s already out of reach for most Kiwis. Meanwhile, the coalition scrapped Labour’s foreign buyer tax, which was meant to fund broader tax relief, leaving a revenue hole that Finance Minister Nicola Willis refuses to explain.

Then there’s the ferry debacle. The coalition axed Labour’s well researched plan to replace the ageing Interislander ferry fleet, citing cost overruns. But their “cheaper” alternative? Non-existent. The grounding of the Aratere ferry exposed their failure to plan, risking a $1 billion economic hit if the Cook Strait link fails before 2029. This isn’t savings...it’s negligence, offloading costs onto future governments and taxpayers.

The coalition’s tough-on-crime posturing is equally profligate. Military-style boot camps for youth offenders, launched as a pilot in 2024, are a flashy $20 million distraction with no evidence of reducing reoffending. Their push for more prisons and 500 new police officers adds hundreds of millions to the tab, despite 43% of prisoners languishing unsentenced due to court delays…a problem the coalition’s cutting of legal aid and court resources only worsens.

Then there's David Seymour’s school lunch programme (a pale shadow of Labour’s), which delivers skimpy, low-nutrition meals that are largely inedible. Costing $100 million less annually, it’s a false economy as food grant applications soar, with 20,000 more Kiwis needing emergency help in 2024 alone. In a nation earning $50 billion yearly from food exports that feed 40 million people globally, the coalition’s choice to starve our kids’ potential while prioritising tax breaks for the wealthy is a shameful betrayal.

Let’s not forget the billion dollar boost to the defence budget, including new frigates and cyber capabilities, while the government guts social housing initiatives and homelessness spirals. Pouring money into military hardware while families sleep in cars or on park benches isn’t just tone-deaf, it’s a deliberate choice to prioritise geopolitics over people. Austerity for the vulnerable, largesse for the elite.

Most galling however is the governments repeal of Labour’s world-leading smokefree laws. Scrapping the tobacco sales ban for future generations is projected to cost the health system $1.3 billion over 20 years while boosting tobacco company profits. Willis claims the tax revenue from tobacco sales will fund tax cuts, a cynical trade-off that prioritises corporate interests over Māori and Pasifika health outcomes.

So, where’s the money coming from? Austerity, of course. The coalition’s slashed 6,500 public service jobs, targeting “back-office” roles that often support frontline healthcare and education. Health NZ faces cuts so severe that tea and Milo for staff were briefly on the chopping block. School lunches, disability support, and welfare entitlements have been pared back, hitting the most vulnerable hardest.

The coalition’s “living beyond our means” mantra is a sham. They’re not tightening belts—they’re redirecting wealth to landlords, tobacco giants, and their law-and-order pet projects while starving public services. This isn’t fiscal discipline; it’s a calculated heist, dressed up as necessity. New Zealand deserves better than this chaotic, costly betrayal.