In this blog the New Democratic Party share their thinking on the key policy issues of our time.
The last month has been a busy time in politics. We saw an attempted leadership coup in the National Party; a reversal of government policy in regards to the accommodation and broader bank levies under the slogan "No New Taxes".
Presumably the National Caucus decided that the disadvantages of a leadership change this close to an election outweighed any benefit a new leader might provide. Unfortunately an able Cabinet Minister, Hon. Chris Penk, paid the price for being the "numbers man" for the attempted change.
To change the narrative National introduced the slogan No New Taxes. These were missed opportunities to help local government cover the cost of infrastructure caused by increased numbers of tourists. It also meant the chance to take a slice of the mega profits being shipped offshore by large banks also went missing.
Labour and National also both scrapped plans to introduce more user pays into road maintenance. By ruling out an increase in roading levies the cost of road maintenance will now have to be covered by the taxpayer, borrowed or not done at all.
In this space, we share our thoughts on current news and issues.
For all its importance to the modern economy the amount of research on how money is created is surprisingly sparse. Positive Money UK has produced a series of videos which debunk several myths. https://www.youtube.com/watch?v=bE8i-4HpKlM&list=PLyl80QTKi0gPBcb32paMvXxcq7UUeJskV
Some key facts emerge from even a brief study of credit creation.
Most of the money supply ( 97%) is digital credit created by commercial banks in the process of making loans to customers. Less than 3% of money is notes and coins issued by the Reserve Bank of New Zealand.
Bank loans become deposits in other bank accounts. Banks use a few computer keystrokes to credit the borrowers account and thereby create money. Mortgages and business loans are key ways such money is created.
Most central banks now acknowledge that loans are not based on recycling deposits. They also acknowledge that the money multiplier theory taught in text books is no longer true. https://www.bankofengland.co.uk/-/media/boe/files/quarterly-bulletin/2014/money-creation-in-the-modern-economy
The underlying question is whether a sovereign country should contract out the provision of the nation's money supply to commercial banks, or whether there is a better way. Would the advantages of using public credit (rather than privately manufactured credit) outweigh any disadvantages?
Positive Money NZ advocates for use of direct monetary financing of long term infrastructure investment as a way of promoting productivity and GDP growth. https://www.youtube.com/watch?v=GnswC4mbjiQ
New Democrats urges the Parliamentary Finance & Expenditure Committee to change its mind and investigate whether Direct Monetary Financing might be a useful additional tool in the toolkit of the government for long term infrastructure projects.
Season of change: The 21st June marked the shortest day this year. Since then daylight hours have been increasing and the darkness has been receding. On 27th September we will formally recognise the approach of summer with the introduction of daylight saving. The weeks of constant rain have given way, today at least, to a bright sunny day with blue skies. But it's not just in nature that we begin to see signs of hope.
Progress on housing: Against the backdrop of a national housing shortage more than 100 families have expressed interest in six new Habitat for Humanity homes being built in Dunedin. People will “rent to own” the three-bedroom, terraced houses and the first families will move in before Christmas.
As the cost of living increases, the Dunedin Curtain Bank is providing more free, upcycled curtains than ever before to householders in need. “A lot of people are finding it really tough out there,” says Manager Belinda Le Lievre. “People are looking for ways to save money and so having decent curtains means that you’re not going to spend as much money heating.” Locals donate clean, unwanted or unused curtains and the curtain bank upcycles them, usually lining and altering them to fit clients’ window sizes.
The charitable trust has been running at least 13 years and used to provide an average of 400 sets of curtains a year. However, in the year to March 2026, it provided 864 sets to people in need in the community, following a trend of the last two years. ( https://dailyencourager.co.nz/ )
These community initiatives are positive and welcome. But we also need an acceleration of social housing construction with government as partner to the private sector and the NGO sector.
India Free Trade Agreement: The Indian FTA is being touted by the National, Labour and ACT parties as an incredible win for New Zealand opening up a market of billions of middle class Indians for kiwi exporters. NZ First is expressing concerns about a commitment to invest in India. (National says the commitment is to simply promote investment). Time will tell but in the meantime kiwi companies should be investigating new opportunities and partnerships for new trade. New Democrats will continue to monitor this agreement to ensure it upholds genuine trade opportunities and has minimal impact on national sovereignty. https://www.rnz.co.nz/news/politics/707689/todd-mcclay-insists-india-fta-very-clear-after-one-clause-raised-questions
And finally, ....Joke of the day: Did you hear about the wig thief who escaped from prison? Police are combing the area to find him.
Budget 2026 introduced to Parliament by Finance Minister, Nicola Willis, was long on restraint and short on hope. Cuts to the student "fees free" program breached a 2023 National Party election promise to fund tertiary students.
Too many New Zealanders feel that there is no party to represent them anymore. National seems more concerned about helping their Big Business mates while Labour forgot about working people in the 1980s and these days seems more concerned about woke ideas that are out of touch with most New Zealanders. The New Democratic Party represents a new beginning for those kiwis who are fed up with the politics of the two old parties and who want politics to be concerned with the same things they are concerned with- decent well-paid jobs, affordable housing, a health system that works, law & order, and a clean green environment that we and future generations can enjoy.
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