Labour predicts $20 billion debt

Press, 27 April 1983, Page 3

Labour predicts $20 billion debt

PA Wellington The Labour Party’s finance spokesman, Mr Roger Douglas (Manurewa) has predicted a total public and private overseas debt of $2O billion before the end of next year. Inflation would probably stay higher then most of the country’s trading partners; unemployment would reach 130,000, including people in subsidised work schemes; and the Budget deficit was likely to top $3 billion next year, he said in an address to the Market Research Society in Wellington.

He said that 1984 would also see a balance-of-pay-ments deficit for more than $2 billion, possibly reaching $3 billion.

Mr Douglas said the Government would act in the rest of this year to control money supply but it would rise rapidly by the middle of next year, as would house and property values. He also predicted that the Government would hold down real wages until mid--1984 and then increase them, particularly for people on above-average wages where the National Party had “considerable support.” Private consumption would recover slowly by the end of this year and expand more rapidly by late next year, he said. Housing was likely to show some growth towards the end of 1983 and rise strongly in the second half of 1984 because of an easier availability of mortgage money.