Cunliffe pledges surpluses and to get unemployment to 4% by end of first term

Labour Party leader David Cunliffe has pledged to reduce the unemployment rate to 4 percent by the end of his first term, if elected, from 6 percent currently, saying the Opposition would create 20,000 more jobs than National is projecting.

Cunliffe said a Labour government would also remain committed to running budget surpluses "unless there's another international downturn or domestic disaster that necessitates a counter-cyclical policy."

Labour would drive jobs growth through a combination of policies including more government buying of Kiwi-made products, stimulating production of higher-value wood products to boost forestry jobs, and create jobs in the construction sector via its 'KiwiBuild' plan to build 100,000 affordable homes over 10 years.

He also said Labour's policies of imposing a capital gains tax would shift more investment into the productive sector, while its plan to establish a central electricity buying agency to bring down power prices would cut costs to business and households.

Labour's plan to amend the central bank's monetary policy to include a lever over retirement savings would contribute to jobs growth easing interest rates and the kiwi dollar, making exports more competitive and increasing household disposable income, he said.

"This programme to drive economic growth and improve the lives of New Zealanders will be built on solid fiscal foundations," Cunliffe said in a statement. "This is in keeping with our record of running consistent surpluses and paying down debt."

Cunliffe's policy announcement comes before Thursday's annual Budget, where Finance Minister Bill English is expected to upgrade the government's forecasts for economic growth, giving it room for modest new spending while building on a return to fiscal surpluses from the 2014/15 year.

The Green Party is to launch an alternative budget statement tomorrow, and the ACT party announced a flat tax policy over the weekend.

Across the Tasman, the newly elected conservative Coalition government of Prime Minister Tony Abbott will publish its first Budget, which is expected to include major cuts to government agencies, welfare programmes, and corporate support.

(BusinessDesk)

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