The political parties have been waiting for Prefu for weeks - now that it's out, how will it shake up their fiscal and economic plans?

The Herald's Wellington business editor Jenee Tibshraeny joins On the Campaign, our daily election podcast, to run through what this means for the party's election promises. 

The left bloc of Labour, the Greens and Te Pāti Māori have just a one in 20 (5.4 per cent) chance of forming a government after electionday, according to the Herald’s poll of polls.

If the election were held this weekend, its odds would be even worse - just 1 per cent.

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Prime Minister Chris Hipkins and Minister of Health Dr Ayesha Verrall opened the Canterbury Cancer Centre in Christchurch today.

The Government contributed $6.5 million as a shovel-ready post-Covid project in 2020. The centre offers 50 rooms for patients and families of the South Island, and is a space for organisations providing cancer services to co-locate and collaborate from.

“It will be a home away from home for many who are going through a tough time,” Verrall said.

“Labour stands by its record in supporting those with cancer. We set up the Cancer Control Agency, rolled out a nationwide bowel screening programme and purchased more linear accelerator machines. We’re also paying the staff who look after those patients better and building the hospitals that are needed.”

Verrall said Labour had also increased Pharmac’s funding since coming into Government by over 40 per cent. Pharmac’s budget for 2023/24 would be about $1.3 billion.

In contrast, National had frozen it for three years prior to Labour.

“The increase in funding means that since 2017 they have made 214 funding decisions, including 76 new listings and the widening of access to 138 treatments,” Verrall said.

Work was underway to assess whether a bowel cancer screening programme could be expanded in a similar way to cervical cancer screening, which was included in Labour's policy today.

She challenged National on its promises in the health space, pointing out it promised health funding would increase each year but not committing to in line with inflation.

Verrall said Labour took its costings very seriously because if that wasn't done, the health system would be underfunded.

“We've had to address capital infrastructure… There were two years when the National government contributed nothing to capital infrastructure. That's malpractice.”

Overall, Verrall said she didn’t accept things were getting worse in the health space. They had come through Covid-19 “exceptionally well” compared to other countries and made major investments across the board, including in the workforce.

“I understand that it is not yet enough. So we that's why we have to keep going.”

Finance spokesperson Nicola Willis said the Treasury's forecasts painted a concerning picture of the economy and the Government's books. "Labour has left the cupboard bare."

She said Kiwis getting ahead have had a handbrake put on them by Labour.

She claimed today's update was Grant Robertson's best-case scenario. "Grant Robertson has never stuck to his pending limits in the past and he is not about to start."

Government spending would be up $23b more than it was expected to be at the pre-election update in 2020, Willis claimed.

Willis re-committed to tax relief already announced which would offer some New Zealanders $250-extra a fortnight. She also committed that every dollar in tax would be "spent wisely."

Asked if Prefu changed National's tax plan, Luxon said "absolutely not".

Willis said revenues raised through the ETS should go towards tax reduction and cited some variability in the forecasts today, when challenged that today's documents showed one aspect of National's costings were out $500 million.

"There is nothing to be proud about here," Luxon said, saying the country would experience "slow, anaemic" growth out of its current technical recession.

Luxon said he was confident National could deliver on the policies announced thus far, alongside its tax plan.

"We're confident we'll be able to find our way," Luxon said in reference to his tax plan.

Willis said National had committed to protecting frontline services and not raiding health or education funding. 

She added that a fiscal plan could be developed which would deliver on all of those promises.

 Willis countered questions on a $500m hole in National's tax plan by claiming there was a $13b hole in the documents released today. Asked to elaborate, Willis said debt was forecast to rise by $13b in 2027 more than earlier forecasts.

"We will not be needing to spend more money than Labour," Willis said.

Luxon said it was disappointing to see 40,000 people had left the country. he said National's migration target would vary depending on need and ensure it linked with infrastructure and economic shortages.

National would increase health and education budgets each year, but he wouldn't elaborate on how much the increases would be, saying they would be revealed in National's soon-to-be-released fiscal plan. 

He wouldn't confirm whether the budgets would be boosted by the rate of inflation.

On Labour's cervical screening policy, Luxon said he was open to looking further into making cancer screening more accessible.

National Party leader Christopher Luxon said it was clear the economy isn't working for Kiwis.

He referenced higher interest rates, food prices and rents in criticising Labour's poor economic management.

"Make no mistake Labour's excessive spending is driving this economic pain," Luxon said, referencing the delay in returning to surplus

"Kiwis deserve much better than this."

He said the economic downturn was set to last until the end of next year when inflation returned below three per cent.

Luxon said it was more than just about numbers, speaking about Kiwi families having to stop swimming lessons to buy groceries, or parents taking up more jobs to pay the bills.

"Life shouldn't be this tough," he said while committing to fixing the economy under a National Government.

He cited the continuing spending increase since the Covid-19 pandemic but claimed there hadn't been the outcomes from that spending boost.

Labour has actively made it harder to get the economy working again, Luxon claimed.

Labour leader Chris Hipkins said Prefu showed the economy was turning a corner and New Zealand was "winning the battle against inflation".

Hipkins said the Government's "careful management" would see the books return to surplus, albeit a year later than forecast in the Budget.

"Overall, I'm pretty pleased with the picture the [Prefu] is showing."

On last night's poll, Hipkins said he took responsibility for that as Labour leader, like he said this morning.

Asked how he would win an election when people wanted change, Hipkins claimed Labour was also offering change by "getting back to basics" and focusing on the cost of living.

"Forecasts can be wrong," Hipkins said of the poll result. He didn't address whether he would need a miracle to win.

"There's still plenty of campaigning ahead," Hipkins said when asked whether there were any weaknesses of National's Christopher Luxon he wanted to exploit.

The cost of living crisis would be over when inflation was back down, wages were growing and New Zealanders could get ahead, Hipkins said.

Labour's fiscal plan would feature "relatively modest" offerings which were paid for.

"We are winning the battle against inflation."

He warned National's tax plan would exacerbate inflation.

On the Greens calling for a wealth tax, Hipkins said there were too many risks associated with a wealth tax.

On migration, Hipkins said it was expected to see a spike after Covid. New Zealand was returning to more normal migration patterns, he said.

He wouldn't go into Labour's migration policy but said the country needed to grow sustainably.

Labour health spokesperson Dr Ayesha Verrall said work was underway to assess whether a bowel cancer screening programme could be expanded in a similar way to cervical cancer screening, which was included in Labour's policy today.

"Politics can be tough business sometimes," Hipkins said when asked about his dropping preferred PM ratings.

He said like with any campaign, there would be "teething issues" but he was feeling buoyant and positive with how it was going so far.

"Hard work is required" was the Hipkins' first reaction to last night's poll that had a very poor result for Labour.

Verrall said Labour took its costings very seriously because if that wasn't done, the health system would be underfunded.

Hipkins said the Labour caucus was feeling "very resolved" following last night's poll.

Deteriorating finances mean next Government will have very little spending wiggle room.

Earlier, Hipkins visited the bustling Riverside Market in central Christchurch.

It was a largely warm reception, aside from some protesters who were calling for stronger action on climate change. They were moved away by police after complaints from business owners that they were blocking shopfronts and walkways.

But many members of the called out positive words of encouragement for Hipkins, one even giving him a hug, some referencing the recent poor run in the polls.

“You’re doing a great job, Chippy,” one person called out. The Herald can confirm some of those stopping to shake his hand and call out words of support in front of cameras were Labour Party volunteers. Some could be seen with Labour Party campaign t-shirts on underneath their jackets.

However, many were also simply members of the public supportive of the Labour leader.

Hipkins posed for photos with dozens of people, many excited to meet the current Prime Minister.

Hipkins also met a few Australians, including a couple on a snowboard trip in the South Island who had got engaged the day before in Wānaka.

“Congratulations!” he said to them.

To others he simply wanted to get their advice on what to get for lunch.

“So many options,” he remarked to one couple.

In the end, from the dozens of eateries with food from across the planet - delicious dumplings to tacos and burgers - Hipkins opted for his old staple of a steak and cheese pie from the Butcher’s Pie Shop.

“Pretty good,” remarked Hipkins, but adding it would not be “diplomatic” to compare it to his local Upper Hutt bakery.

The Herald understands a souvlaki from Christchurch institution Dimitri’s was in the shortlist, but unfortunately it was closed.

Shortly after Hipkins ran into Anthony “Harries” Carroll from the TV show Bondi Rescue, who argued Hipkins had in fact chosen a “good old Aussie meat pie”.

Treasury reckons the economy will grow, and the books will get to surplus - eventually.

Hipkins will be hoping the election pans out a little more like his effort at Rollickin Gelato Cafe today than recent polls, tying with Christopher Luxon in the great scoop off.

Hipkins delivered eight scoops in 60 seconds, matching Luxon's effort last week. But he still paled in comparison to the staff member Verity he was up against who scooped 14 cones.

The visit also included the unveiling of Hipkins' own specialty flavour - Orange Chic Chippy, a pun on the Labour leader's nickname and hair colour.

Hipkins also had a jab at rival Luxon's flavour, Blueberry Lux, saying it sounded "overly sweet".

Photo / George Heard