Monday, May 19, 2008


In the Dominion-Post this morning, Tracy Watkins reports that National is set to offer $50 per week to the "average" worker. What's "average" according to National?

Mr English made it clear that them priority would be workers earning $60,000-plus - in particular those pushed into the top 39 per cent tax bracket by wage rises.

‘‘We need to keep faith with those people, that's our top priority,'' he told TV1's Agenda yesterday.

But those people aren't "average". According to Treasury's 2007 income-distribution figures (which will no doubt be superseded on Thursday), only 14% of taxpayers earn $60,000 or more. National isn't offering tax cuts for ordinary, working New Zealanders; they are instead offering their usual programme of tax cuts for the rich.

As for the cost, giving each of the 456,000 taxpayers who earn $60,000 a year or more $50 a week would cost $1.186 billion a year. That's the minimum cost, and given the facts of income distribution and Key's promise that the actual amount will be higher, it is likely to be much greater - almost certainly approaching the $1.5 billion required for the speculated social dividend ($60 a week would make the cost just about even). So, that's the choice we are facing this election in a nutshell: between a party who distributes wealth for the benefit of the many, or a party which distributes wealth for the benefit of the few.