(ACT media release)
“Chris Hipkins obviously has a different opinion of what ‘bread and butter’ is to most Kiwis, His Government has announced they’re doling out millions in corporate welfare to a distillery and film studio,” says ACT Deputy Leader Brooke van Velden.
“This week the Government announced $2.9 million for Scapegrace Distillery and $4.5 million for Silverlight film studio.
“Since there’s apparently millions of dollars lying around to spend on alcohol and film subsidies you would think that the health system isn’t collapsing, food prices aren’t going through the roof, mortgages and rents aren’t increasing, frontline workers aren’t protesting in the streets. Nope, this is just Labour’s priorities.
“Every dollar spent on subsidies and corporate welfare is a dollar that can’t be spent elsewhere. We would be better off scrapping corporate welfare and allowing taxpayers to keep the money.
“The Labour-National corporate welfare gravy train, which left the station under Steven Joyce, and grew under NZ First, must end in 2023.
“It’s easy to be kind when you’re spending other people’s money. But ultimately everything the government spends needs to be taxed from productive Kiwis. Giving billions in corporate welfare has meant that we can’t get taxes under control.
“A successful economy is one in which resources flow to their most valuable uses. Taxing successful businesses and giving it to unsuccessful businesses only makes us poorer.
“No one spends money as carefully as the person who earned it. Voters need to ask: Do I want to keep more of what I earn, or do I want to give it to politicians to buy votes? ACT proposes to end corporate welfare and return the money to taxpayers in the form of tax cuts.”
ACT proposes to end corporate welfare and return the money to taxpayers in the form of tax cuts, but should that be done at the expense of stifling regional development and curtailing greater exports? The government loan to Scapegrace Distillery will be used to help build a new distillery and temporary hospitality facility, creating 218 jobs during construction and eventually 24 permanent roles and increase the exports of its products from 65% to 80%.
ACT’s Brooke van Velden tries to classify the loan as a subsidy or welfare; a loan needs to be repaid, but a subsidy is a grant (usually matching other expenditure), a small but significant difference. Far from being “welfare” the money will be returned to the taxpayer at a future date. It is part of government initiatives to help the region diversify beyond its reliance on tourism. Unfortunately the misrepresentation of government policies and actions is becoming the hallmark of ACT’s media releases, but that is the nature of opposition politics.
Loans do have to be repaid but when they are made without due dilligence they can become grants. We’ve seen that with the $500 K loan the KCDC made to Air Chathams. KCDC have now ‘provisioned’ the loan in their accounts.