Willie Jackson proud of Labour Government despite country falling into recession

  • 22/03/2024

Willie Jackson said despite the current economic situation, he is proud of the previous Labour Government's decision to put people's lives and jobs first during the COVID-19 pandemic.

However, it came with a cost to the economy, with Jackson admitting on AM that New Zealand is in an "economic crisis".

Figures announced on Thursday found Gross Domestic Product (GDP) fell by 0.1 percent in the December 2023 quarter. This is following a 0.3 percent decline in the September quarter, meaning the country is now in a "technical recession".

Appearing alongside National's Paul Goldsmith, Jackson defended the previous Government.

"We don't apologise for saving people's lives," Jackson said.

He said they were faced with a once-in-a-lifetime pandemic and had to put so much funding into the COVID-19 response. 

"We are in a bit of a crisis but what are they doing Lloyd? They are looking for every way they can find money for their mates," Jackson told co-host Lloyd Burr.

"… We weren't spending willy-nilly, we saved nearly 20,000 people's lives. I'm proud of what we did as a Government."

In response, Goldsmith said his Government is looking right across the board to try and restore discipline to government spending.

"One of the reasons why we've got a cost of living crisis and we've had inflation is because the [previous] government has been so ill-disciplined in its spending that it's been stoking inflation," he said.

He said the Government does need to make cuts to the public service so it is sustainable because it increased massively over the past years. The public service workforce has increased by 2736 full-time equivalent roles or 4.5 percent to 63,117 in the year to June 30, 2023.  

The ACT Party campaigned on returning the public service to 2017 levels, saving it about $1.2 billion per year. This would lead to a reduction in about 15,000 jobs.

On Thursday it was revealed MPI has proposed to cut 384 positions. Meanwhile, the Ministry of Health is proposing changes that could affect just over a quarter of its positions.

It's in response to the Government demanding departments to identify savings options of either 6.5 or 7.5 percent.

"We've had two sectors now where the country's been in a recession… and so we need to have growth plan," Goldsmith said.

"The basis of that is about encouraging investment, it's about ensuring that we've got good quality infrastructure so that economy can hum."

Watch the video above.