Jacinda Ardern defends Labour's plan to borrow billions

Jacinda Ardern has defended her party's plan to borrow more money, if it wins the upcoming election.

Labour says it'll borrow $3 billion to fund policies like Best Start and KiwiBuild, as well as paying more into the Super Fund.

It'll also slow down payments on New Zealand's debt, which currently costs the country $10 million a day in interest.

"We cannot sit by while children live in cars," the Labour deputy told The Nation on Saturday.

"We are not willing to have a country where we can get debt down at the same rate as the Government, but people suffer. So we will borrow... but that's the kind of borrowing that we need, that is justified."

The Super Fund, she says, has a return on investment of about 10 percent - much more than the cost of servicing the Government's borrowing.

Ms Ardern says the debt was mostly clocked up by National anyway.

"We will not be lectured by Steven Joyce when it comes to debt. We left in office after Labour net Crown debt around 10 percent - now we're up around what, 25 percent?"

New Zealand's public debt is small by international standards. According to business site Trading Economics, it dropped as low as 5.4 percent in 2008, before climbing to more than 25 percent by 2013, in the wake of the global financial crisis and the Canterbury earthquakes.

It has since dropped to around 24 percent.

Cut immigration, cut GDP growth?

Ms Ardern also defended the party's call to cut immigration. Treasury says a large chunk of New Zealand's projected 3 percent GDP growth will be thanks to immigration, which hit a new record high this month.

"We've got a plan around economic development that isn't simply reliant on population growth," said Ms Ardern.

She also suggested Labour's modest target of reducing unemployment to 4 percent was only temporary.

"Our target is as long there is anyone who is unable to work because they cannot find employment... we will not be satisfied," she said.

"I would love to see Steven Joyce say the same thing."

Both economists BERL and the Taxpayers' Union said Labour's alternative budget numbers add up.