ACT Party proposes $12.4b debt cut and public service spending reductions

The ACT Party has released a fully-costed fiscal plan aimed at reducing New Zealand's government debt by $12.4 billion over four years without introducing new taxes. Led by David Seymour, the plan proposes cutting approximately $10 billion from public service spending over the next four years.

The proposal seeks to return non-frontline government spending to 2017 levels, adjusted for inflation and population growth. Seymour specified that spending on essential services—including health, education, police, defence, and the Ministry for Children—would be protected from these cuts. The plan also aims to increase the Operating Balance Before Gains and Losses (OBEGAL) surplus to $13.6 billion.

While the plan avoids broad-based tax cuts, it includes several strategic measures, such as removing taxes on KiwiSaver investment earnings and implementing cuts to encourage cryptocurrency adoption and charitable giving. Seymour stated that reducing debt would provide the country with more financial flexibility to respond to future crises, such as pandemics or natural disasters.