Dawn Chorus: Bi-partisan borrowing support

Grant Robertson inspects a cyclone-damaged power substation: The government has reassured those affected that the Crown’s balance sheet is strong enough to borrow to fund the billions of dollars of repairs needed. Photo: Kerry Marshall/Getty Images

TLDR: Parliament resumed in earnest yesterday for the first time in this election year with a bi-partisan agreement on one of the key elements needed in the Government’s longer-term climate change response — the ability for the Crown to borrow to repair and rebuild, hopefully better than before Gabrielle and with more resilience.

PM Chris Hipkins and Opposition Leader Christopher Luxon agreed spending estimated at $10 billion should be funded with borrowing. This is well within the Government’s fiscal headroom under even its existing net debt limit of 30% of GDP, given it is now 21% and forecast to fall under 15% within four years. That leaves a potential $60 billion that could be used to ‘build back better’.

I include more detail and analysis of their comments in Parliament yesterday below the paywall fold and in the podcast above for paying subscribers, who support the work I do covering Aotearoa’s political economy on the issues of housing unaffordability, climate change inaction and poverty reduction.

Elsewhere in the news overnight and this morning