Inflation has hit its highest annual rate in 30 years.

Consumer prices rose 1.4 per cent in the three months ended December, taking the annual inflation rate to 5.9 per cent.

The strongest rises were for fuel, household expenses, which were partly offset by cheaper food.

Pressure on prices is expected to continue for the next few months because of the pandemic and supply chain disruptions.

The strength of inflation is set to drive the Reserve Bank to raise interest rates which will flow through to housing and business borrowing rates.

Tauranga MP Simon Bridges.

National Party finance spokesperson and Tauranga MP Simon Bridges is calling on Finance Minister Grant Robertson to "rein in his spending to avoid adding more fuel to the inflationary fire".

"At 5.9 per cent for 2021, inflation is the highest it has been in three decades. It's a thief in New Zealanders' pockets, and it's the least well-off Kiwis who will be doing it the toughest," says Simon in a statement released this morning.

"Parents will have to put food back at the supermarket, workers will only be able to partly fill up at the petrol station, and there's even less hope for young people trying to buy their first home.

"With wage growth of only 2.4 per cent, well under half of inflation's growth, New Zealanders are going backward. At the same time, we've got rising interest rates and record amounts of government spending."

Simon says Grant Robertson's spending has been 40 per cent higher throughout his time as Finance Minister.

"This year he's planning to increase that to a staggering 68 per cent at $128 billion, with $6 billion in new spending.

"While elevated spending was appropriate through much of the pandemic, some easing off and greater focus on the quality of spending is now required."

Simon says the big spend increasingly won't achieve anything in a constrained economy where each public dollar is just competing with New Zealanders' investments in scarce resources and workers.

"Even worse, big spending now will simply push inflation higher, which will act as a double whammy, hitting New Zealanders in the pocket twice through the inflation effect and as the Reserve Bank is forced to continue hiking up interest rates, higher than would otherwise be necessary."

Simon says Grant needs to "act by focusing on the quality of his spending and reining it in so that everyday Kiwis don't keep getting burnt by price rises that far outstrip wage increases”.

ACT leader David Seymour. Photo: SunLive.

ACT leader David Seymour says 2022 is the year of the hangover.

"Today's inflation figure is effectively a 5.9 per cent Covid tax on everything you buy. If the Government put up GST by 5.9 per cent there would be an uproar. Inflation amounts to the same thing.

"Kiwis need tax relief and businesses need workers.

"Businesses can't get workers, so acute labour shortages are increasing their costs. We need to end MIQ in favour of home isolation for fully-vaccinated, negative tested travellers, so Kiwis can come home and businesses can get the skills they need.

"The cost of living for New Zealand families is through the roof. Rents are up, mortgage rates are on the rise, the cost of food is up, petrol is up, but wages aren't keeping up.

"Kiwi battlers are being squeezed from all directions and they need some tax relief."

-Additional reporting by RNZ.