Pitched as a plan to balance the books without shrinking the economy, Labour's fiscal plan says every election promise is costed and paid for within the same yearly limit on new spending that the current government set at Budget 2026.

📋 Labour: Fiscal Plan, October 2026 →

What it does

• Returns the Government's books to an operating surplus before gains and losses (OBEGAL) in 2028/29, using the standard OBEGAL measure rather than the OBEGALx measure the current government introduced.
• Brings net debt down below 20% of GDP over time.
• Keeps the operating allowance for new spending at $2.4 billion per Budget. Labour says its capital commitments of about $4.1 billion fit within $12 billion of future capital allowances, and that almost $10.5 billion of future operating allowances is unallocated.
• Adds $15.5 billion of health funding over the forecast period, with every dollar from Labour's proposed capital gains tax going to health.
• Reverses half of the extra public service cuts planned for the next Budget and fully reverses cuts planned for later Budgets. Chris Hipkins also said Labour would scrap the Ministry for Regulation, with most of the savings shared among other agencies.
• Labour commissioned accounting firm Hall Chadwick to review the plan. Labour says the review found the estimates reasonable, conditional on each policy's assumptions.

The debate

Finance spokesperson Barbara Edmonds released the plan on 4 October 2026, saying every commitment is fully costed and funded. National's finance spokesperson Nicola Willis called the plan fraudulent. She argued it leaves out the full cost of restoring pay equity (National cites a Treasury estimate of $11 billion), the cost of Labour's three-year fuel tax freeze, which she puts at $3.1 billion, and a $2.8 billion loss of dividends from state companies that would move into Labour's Future Fund. Labour said the fuel tax freeze and fare cap would be paid from the National Land Transport Fund, which Edmonds said is not usually part of party fiscal plans, and that it would not put a figure on pay equity so as not to undermine negotiations. Independent economist Cameron Bagrie said every party's plan would have gaps and complicated trade-offs. The government's own pre-election fiscal update also forecast a return to surplus by 2028/29.