Luxon Isn’t Focused On The Cost Of Living Crisis

When the National Party came to power in 2023, they promised to have a laser-like focus on New Zealand’s cost of living crisis. Their pledge was seductive: tax cuts, streamlined spending, and relief for the “squeezed middle.” Yet, two years into their coalition with ACT and NZ First (the coalition of chaos), and the numbers paint a grim picture. Far from easing the burden, National’s policies have exacerbated the crisis, with their handling of pay equity claims being the latest fiasco that will hit Kiwi wallets hard. Let’s dissect the coalition’s rhetoric against the cold, hard stats and expose the disconnect.

Before National took the reins, the cost of living was already biting. Stats NZ reported a 7.2% increase in household living costs for the average household from June 2022 to June 2023, driven by soaring food prices (12.3% annually) and rising housing costs. Median weekly rent hit $620, and mortgage payments devoured 49% of household income. Inflation, at a three-decade high, was punishing. Labour’s measures, like free prescriptions, half-priced public transport and small benefit increases, offered little relief, but at least they were something. 

Fast forward to 2025, and projected inflation was meant to be 2.1%, but has (accounting for Stats NZ mistake of not counting car registrations) climbed to 2.6%, mainly because of National’s economic mismanagement. 0.5% might not seem like a lot, but when you’re already strapped for cash, it can be the difference between paying the rent or ending up on the street. New Zealanders are feeling the pinch now more than ever, and we’re still awaiting the impacts of National’s latest round of socially damaging policies and Trump’s idiotic tariffs, which the coalition of chaos have simply chosen to ignore.

I'm such a fan of your work. Not only have you tamed inflation in NZ, but your incredible efforts have wrestled inflation to the ground in the US, UK. Ireland (and, well, everywhere) pic.twitter.com/vGpIBEKzUr

— Musical Chairs (@MusicalChairs14) October 16, 2024

Then there’s National’s flagship tax cuts, which were meant to put money back into people’s pockets. Instead, they’ve been a complete flop. Their 2023 plan promised $1,600 annually for a dual-income family on average wages. But with bracket creep unaddressed for most, stagnate wage growth and inflation eroding purchasing power, the real value of these cuts, which didn’t deliver anywhere near what was promised, is negligible. Worse, National scrapped Labour’s public transport subsidies, jacking up costs for low-income Kiwis.

 

A family relying on buses now faces double the fares while their incomes have barely budged. Add to that National’s restoration of interest deductibility for landlords, which has fueled housing costs and rent hikes of 9.7%. Median weekly rent hit a whopping $680 in mid 2024. No cause evictions are also back, meaning that if a landlord needs a new car or another holiday, they can simply evict tenants to find someone who can pay more. The annual evictions in New Zealand in order to increase rents are now a feature of most real estate agents schedules, and along with the government's lack of proper support, are ensuring that homelessness numbers have more than doubled in some areas.

But if that wasn't bad enough, the pay equity claims debacle is the coalition’s latest middle finger to struggling workers. Once again the government’s rhetoric of fiscal prudence has clashed spectacularly with their mishandling of public sector pay disputes. In 2024, unresolved pay equity claims for nurses and teachers resulted in strike actions. The government’s delay in settling these disputes, coupled with a welfare reform package that punishes jobseekers, has squeezed public servants and beneficiaries alike.

 

Meanwhile, their decision to axe Fair Pay Agreements has weakened workers’ bargaining power, leaving wage growth largely non-existent, particularly when you compare it against things like a 9.7% rise in food prices from 2023 to 2024. Despite these additional costs, Kiwis are still waiting for the government to do anything about the supermarket duopoly. But all we get is another worthless announcement from a worthless Minister.

National’s spin machine claims they’re taming inflation, but their policies…favouring wealthy property speculators and corporations, have only increased costs and deepened inequality. Kiwis aren’t buying the “relief is coming” line when rents, food and power bills keep climbing and climbing. The coalition’s laser focus? More like a smokescreen for austerity that is hitting the poorest hardest. It’s time to call out this charade and demand accountability for a crisis Christopher Luxon has only worsened.