web analytics

NRT: So much for the surplus

Written By: - Date published: 1:21 pm, July 8th, 2014 - 40 comments
Categories: debt / deficit, Economy, jobs, treasury, wages - Tags: ,

Reposted from No Right Turn.

Back in May, National promised to balance the books next year. Now it looks like that won’t be happening:

The Budget deficit was tracking $332 million worse than forecast for the 11 months to the end of May, throwing doubt on the forecast 2014/15 Budget surplus.

Treasury said the budget deficit excluding gains and losses (Obegal) was $1.1 billion against $770m forecast in the May 15 Budget update, due to softer than expected GST and corporate tax returns.

Officials said it was too early to know the likely impact of these results “on the current and future financial years as both downside and upside risks exist “.

The Government has been promising to deliver a Budget surplus, and the May Budget forecast a surplus for the 2014-15 year of $372 million, well ahead of the paper-thin $86m tipped in December.

So, I guess we can expect some arbitrary cuts so National can claim its victory. What’ll it be? School maintenance? Maybe they’ll kick the poor some more. But the one thing they won’t be doing is fixing the revenue side of the budget by increasing taxes on the rich – that apparently is unthinkable.

40 comments on “NRT: So much for the surplus”

  1. dv 1

    But the one thing they won’t be doing is fixing the revenue side of the budget by increasing taxes on the rich – that apparently is unthinkable.

    Nope raise GST to 20%

  2. mickysavage 2

    And business confidence, although still high, is falling.

    From Radio NZ (http://www.radionz.co.nz/news/business/249220/business-confidence-falls):

    The Institute of Economic Research’s June quarterly survey of business opinion found a net 33 percent of firms expect economic conditions to improve, compared with a net 52 percent in the previous period.
    Trading activity, which the Institute said closely mirrors economic growth, eased back, and indicates annual economic growth of 2.8 percent.
    Activity overall remains robust, but momentum has eased in some rural regions and Auckland, which the Institute attributes to the impact of falling dairy prices on rural incomes, and slowing growth in Auckland’s housing market.

    Although it is still relatively healthy there is nothing more likely to hit a government’s popularity than a drop in confidence.

    • Colonial Viper 2.1

      Business people are optimists, inherently. The key thing however is that even at what has been seen as solid levels of business optimism – it’s not that solid: in most parts of the country it has not flowed into additional capital investment and increasing headcount. More of a “wait and see” attitude.

  3. Jrobin 3

    Good news, also house prices are slumping in Auckland which though actually a good thing, will demoralise those who bought at the top of the cycle. Interest rate rises, power price rises, no surplus, falling dairy prices. Not really a rock star at all.

    • Lanthanide 3.1

      It was a Beiber-economy, not a Jagger-economy.

    • Tracey 3.2

      slumping is a bit of an overstatement

      from QV

      The Auckland market has increased 12.3% year on year and values are up 31.4% since 2007.  When adjusted for inflation values are up 10.6% over the past year and are 12.8% above the 2007 peak.

       
      Andrea Rush QV National Spokesperson said, “The nationwide index is still increasing but the picture around the country is mixed.”

      “Residential property values in Auckland and Christchurch are still increasing at a similar rate to what they were in June last year.”

      “While values in Wellington and Dunedin are showing a downward trend this month, as are a number of other provincial centres around the country.”

      “Sales volumes and home loan approvals (new and existing) are also down considerably at between 15-20% less than at this time last year.”  

       

      Auckland

      The Auckland region as a whole has increased 2.7% over the past three months and 12.3% year on year.  Manukau East is up the most with values increasing 4.3% over the past three months. Followed by the North Shore – North Harbour where values have risen 4.2%. While in Waitakere City values rose 2.3% over the same period.

      QV Valuer Bruce Wiggins said, “We are seeing a gradual reduction in the rate of growth in property values in some areas and more sellers opting to put on an asking price or sell by negotiation.

      “However, sale by auction remains popular in high value areas or where there are special characteristics.”

      “The gradual reduction in growth  is particularly noticeable in ‘hot spots’ such as Waitakere, which was up more than 17% year on year a few months ago and is now showing a 15.2% increase year on year and Papakura, where values are also flattening off.”

      “Land-banking remains popular in North-West Auckland where there are a number of new subdivisions currently being undertaken and more are planned.”

      “Within Flat Bush there appears to be a flattening of prices in recent times. This may be due to a number of builders/developers who bought land on terms at around the same time completing construction with the new builds appearing on the market at similar times.  This can create an over-supply and may affect values somewhat there.”

      • ropata 3.2.1

        yes it’s a two-tier economy. property owners / investors/ developers vs everyone else.
        it is indicated by year on year price increases exceeding the median wage
        it is a bubble, sustained by speculators and wealthy immigrants
        and it’s forcing the poor/young out of the market

        Australian houses are more affordable(!), because they have effective unions, capital gains tax and controls on foreign ownership

      • vto 3.2.2

        Tracey, the number to watch is sales numbers, not prices.

        The things you quote above refer optimistically to various price and value increases but the giveaway sentence, just the one, is this one …

        “Sales volumes and home loan approvals (new and existing) are also down considerably at between 15-20% less than at this time last year.”

        Sales volume is the one to watch.

        • mickysavage 3.2.2.1

          Yep volume decrease precedes price decrease. It is the first sign the bubble may be popping.

  4. Paul 4

    well, ole’ Johnny’s confident, as reported by his slavish propaganda machine aka. the NZ press…..http://www.stuff.co.nz/national/politics/10243719/Key-confident-about-surplus

    • Paul 4.1

      Just imagine what the headline would have been had Labour or Green been in power….

    • Hanswurst 4.2

      Yes, why do all journalists seem to report the reality according to John Key? How about a headline along the lines of “Key a Complete Stupid Dick – Successful Businessman”? I mean, surely they don’t have to look too hard to find some businessman somewhere who thinks our PM’s an embarrassment, just like they found some random mother of two the other day who was lukewarm on Labour’s education policy. They could even provide a bit of balance a couple of lines from the bottom of the article with a single sentence pointing out that said businessman supports all of Key’s policies, and that his being a dick is mainly on account of not being able to speak properly, and making naff jokes that he practises for hours in front of the mirror, but that even your least favourite uncle would be ashamed of.

  5. Sable 5

    Yes well that’s what happens when NZ journalists take the opinion of HSBC financial analysts and report it as unquestionable “fact”. The NZ economy is stuffed and its getting worse whilst Australia seems to be getting better (assuming Abbott doesn’t stuff it up which is very likely).

  6. bad12 6

    All part of the ‘swindle’ is how i see it,

    The back in black hype of English’s 2014 budget was just that ‘Hype’ with a capital H and a large serving of complicity from the media,

    When you look back a bit, 2013, you see stories of public debt ‘peaking’ in years 2016/17,

    http://www.stuff.co.nz/national/politics/…/public-debt-climbs-by-27m-a-day

    That suggests that English knew the borrowing would continue way past the ”books back in black” bullshit of this years budget,

    Even the Herald says the same in this years budget coverage, in the one breath its ”the balanced budget”, turn the face the other way, and a couple of paragraphs later we have the same ”debt will peak in years 2016/17”

    http://www.nzherald.co.nz/business/news/article.cfm?c_id=3...

    It’s a swindle, one of those card tricks done right in front of everyone’s face, the headline yells ”books back in surplus” the rest either doesn’t sink in or the people don’t bother to read the whole story…

    • One Anonymous Bloke 6.1

      A swindle? It’s a Sex Pistols economy.

      • bad12 6.1.1

        i am assuming that English and Slippery are gambling lots on a third term, the fiscal gap would be plugged with a drip feed from the asset sales cash and an empty bank account dripping in red ink will be the legacy…

  7. the economy is great if you happen to be a hollywood mogul, or chinese/russion oligarch, or multinational corporation looking for a small country to buy

  8. Jepenseque 8

    Gee fair bit of negativity here! You get the sense those on the left would love a good bit of failure for little old NZ! Fact is that tax reciepts are notoriously volatile, there are swings and roundabouts but the trend is clear. Tax up 4.6% year on year. Well done all the workers and business owners out there. Cheers

    • One Anonymous Bloke 8.1

      Nine years of surpluses means the left has the ground from which to criticise, not to mention the economic competence and lowest unemployment rate in NZ history. Cheers.

    • Tracey 8.2

      gee you havent known negativity until you were online during year after year of labour surpluses, the right could still see the sky falling

  9. Tamaki 9

    Socialism is a philosophy of failure, the creed of ignorance, and the gospel of envy, its inherent virtue is the equal sharing of misery.

  10. Deemac 10

    Maybe rock star economy because there are a few very rich people at the top while the masses can only watch?

  11. dave 11

    Log and milk powder prices tumbling interest rate on the rise ,housing bubble yes this rock star is past it used by date i wonder if there will be a credit down grade you would have to think so

Recent Comments

Recent Posts

  • Labour calls for state of emergency on homelessness
    Labour’s housing spokesperson Phil Twyford is calling on the Government to declare a state of emergency over the nation’s homelessness crisis. “There are 42,000 people homeless and living in severe housing stress while the National Government behaves like a possum ...
    24 hours ago
  • Labour calls for state of emergency on homelessness
    Labour’s housing spokesperson Phil Twyford is calling on the Government to declare a state of emergency over the nation’s homelessness crisis. “There are 42,000 people homeless and living in severe housing stress while the National Government behaves like a possum ...
    24 hours ago
  • Government must review state sector retirement investment
    The State Sector Retirement Savings Scheme has no business investing in companies which manufacture cluster bombs, anti-personnel mines and nuclear weapons, Labour MP and Parliamentarians for Global Action executive member Su’a William Sio says. “I endorse the call made by the ...
    2 days ago
  • Councils shouldn’t rush into Easter Trading
    City and district councils must ensure they don’t rush into trading on Easter Sunday ahead of local body elections next month, Labour’s Pacific Islands Affairs spokesperson Su’a William Sio says. “This decision must be taken seriously and only after extensive ...
    2 days ago
  • Minister can’t wash hands of illegal KiwiSaver investments
    The Minister responsible for appointing default KiwiSaver providers should take responsibility for ensuring they act legally, Labour’s Finance spokesperson Grant Robertson says. “The National Government has now had confirmed what they were told more than a week ago – that ...
    2 days ago
  • Fixing our broken economy
    Globally, the “neo-liberal” consensus is rapidly vanishing (I use quotation marks because there are some in Aotearoa who deny such a thing as neo-liberalism exists). Regardless of the debate around its meaning, neo-liberal is a useful descriptor for the general ...
    GreensBy Julie Anne Genter
    3 days ago
  • Fixing our broken economy
    Globally, the “neo-liberal” consensus is rapidly vanishing (I use quotation marks because there are some in Aotearoa who deny such a thing as neo-liberalism exists). Regardless of the debate around its meaning, neo-liberal is a useful descriptor for the general ...
    GreensBy Julie Anne Genter
    3 days ago
  • Government railroading Maori Land Bill through
    Maori Development Minister Te Ururoa Flavell seems determined to railroad his Te Ture Whenua Maori Bill through despite the large number of submitters in opposition to the bill, says MP Meka Whaitiri, whose Ikaroa-Rāwhiti electorate contains nearly 30 per cent ...
    3 days ago
  • A national day to commemorate NZ land wars
    It’s fantastic that the government has agreed to a hold a national day commemorating the New Zealand land wars. Announced at Kingi Tūheitia’s 10th koroneihana celebrations, alongside the return of Rangiriri Pā to the Kingitanga, the news marked a significant ...
    GreensBy Marama Davidson
    3 days ago
  • A national day to commemorate NZ land wars
    It’s fantastic that the government has agreed to a hold a national day commemorating the New Zealand land wars. Announced at Kingi Tūheitia’s 10th koroneihana celebrations, alongside the return of Rangiriri Pā to the Kingitanga, the news marked a significant ...
    GreensBy Marama Davidson
    3 days ago
  • Government turns a blind eye to struggling sole parents
    Social Development Minister Anne Tolley’s claims that her Government’s work with sole parents is her biggest success are in tatters after a major increase in homelessness amongst that group, says Labour’s Social Development spokesperson Carmel Sepuloni. “Anne Tolley is seriously ...
    3 days ago
  • Time has come for state apology on abuse
    Labour is today calling on the Government to issue an apology for historic abuse in state institutions. Speaking after the launch of Elizabeth Stanley’s book “The Road to Hell; state violence against Children in Post-war New Zealand”, Labour’s Justice spokesperson ...
    3 days ago
  • It’s OK to have a few slaves, just not too many? Minimum wage loophole hasn’t gone away
    New Zealand still needs legislation to ensure adult New Zealanders are not exploited by being taken on as contractors for less than the equivalent of the minimum wage, says Labour list MP David Parker.  “My Minimum Wage (Contractor Remuneration) Amendment ...
    3 days ago
  • Lessons from the Future of Work Commission: Building Wealth from the Ground Up
    Good morning, and thank you for attending today’s Future of Work Seminar here in Wellington. I want to particularly acknowledge Beth Houston who has spent many hours pulling together the programme for today’s event, and to Olivier and the staff ...
    3 days ago
  • Cooking 4 Change at the Auckland City Mission
    On Tuesday evening I participated in the launch of the ‘Cooking 4 Change’ recipe book, which Metiria and I both contributed our favourite recipes to. Along with Dick Frizzell, Trelise Cooper, Tiki Taane, Erin Simpson, Jono & Ben, Colin Mathura-Jeffree, a couple ...
    GreensBy James Shaw
    4 days ago
  • Cooking 4 Change at the Auckland City Mission
    On Tuesday evening I participated in the launch of the ‘Cooking 4 Change’ recipe book, which Metiria and I both contributed our favourite recipes to. Along with Dick Frizzell, Trelise Cooper, Tiki Taane, Erin Simpson, Jono & Ben, Colin Mathura-Jeffree, a couple ...
    GreensBy James Shaw
    4 days ago
  • Backbencher Matt’s Bill is a Doocey
    The latest National Member’s Bill pulled from the ballot is yet another waste of Parliament’s time and shows the Government’s contempt for the House and the public with much more important issues needing debate, says Labour’s Shadow Leader of the ...
    4 days ago
  • Gun laws creaking under the strain
     Questions have to be asked  after surprising revelations at the Law and Order Select Committee about the police and their ability to manage the gun problem in New Zealand, says Labour’s Police spokesperson Stuart Nash.  “The lack of resources is ...
    4 days ago
  • Most homeless are working poor – Otago Uni
    The finding by Otago University researcher Dr Kate Amore that most homeless people are in work or study is one of the most shocking aspects of the housing crisis, says Labour’s Housing spokesperson Phil Twyford. “Social service agencies report many ...
    4 days ago
  • Māori seats entrenched by Tirikatene Bill
    National and the Māori Party need to support my member’s Bill which is designed to entrench the Māori electorate seats in Parliament, Labour’s Te Tai Tonga MP Rino Tirikatene says. “Under the Electoral Act the provisions establishing the general electorates ...
    4 days ago
  • Trade dumping bill could hurt NZ industries
    The Commerce Select Committee is currently hearing submissions on the Trade (Anti-dumping and Countervailing Duties) Amendment Bill. This bill worries me. I flagged some major concerns during its first reading.   I am now reading submissions from NZ Steel, ...
    GreensBy Mojo Mathers
    5 days ago
  • Just 8 per cent of work visas for skills shortages
    Just 16,000 – or 8 per cent – of the 209,000 work visas issued last year were for occupations for which there is an identified skills shortage, says Labour Immigration spokesperson Iain Lees-Galloway. “The overwhelming majority of the record number ...
    5 days ago
  • Hard won agreement shouldn’t be thrown away
    The Government should ignore talk across the Tasman about doing away with the labelling of GM free products, says Labour’s Health spokesperson Annette King. “Labelling of genetically modified products was a hard won agreement in 2001 by Australian and the ...
    5 days ago
  • National’s privatisation Trojan horse
     The National government is using the need to modernise the school system as a Trojan horse for privatisation and an end to free public education as we know it, Labour’s Education spokesperson Chris Hipkins says.  “There is no doubt that ...
    5 days ago
  • Shameless land-banking ads show need for crackdown
    The fact that more than 300 sections are shamelessly being advertised on Trade Me as land-banking opportunities during a housing crisis shows the need for a crackdown on property speculators, Leader of the Opposition Andrew Little says. “Of the 328 ...
    5 days ago
  • Standard and Poor’s warning of housing crisis impact on banks
    The National Government’s failure to address the housing crisis is leading to dire warnings from ratings agency Standard and Poor’s about the impact on the strength of the economy and New Zealand banks, says Labour’s Finance spokesperson Grant Robertson. “Standard ...
    5 days ago
  • Ihumatao needs action not sympathy
    The Petition of Save Our Unique Landscape (SOUL) calling on Parliament to revoke Special Housing Area 62 in order to protect the Ihumatao Peninsula and Stonefields, has fallen on deaf ears, says the Labour MP for Mangere Su’a William Sio.  ...
    5 days ago
  • Another delay to justice system reform for victims of sexual violence
    I believe most, if not all, New Zealanders would expect our court system to uphold the dignity of complainants, hold perpetrators to account for crimes including sexual and domestic violence and uphold the crucial right to a fair trial. Yet ...
    GreensBy Jan Logie
    5 days ago
  • Another delay to justice system reform for victims of sexual violence
    I believe most, if not all, New Zealanders would expect our court system to uphold the dignity of complainants, hold perpetrators to account for crimes including sexual and domestic violence and uphold the crucial right to a fair trial. Yet ...
    GreensBy Jan Logie
    5 days ago
  • Student visa fraud & exploitation must stop
    The Government must act immediately to end fraud and exploitation of international students that threatens to damage New Zealand’s reputation, Leader of the Opposition Andrew Little says. ...
    6 days ago
  • Government needs to show leadership in reviewing monetary policy
    The Reserve Bank’s struggles to meet its inflation target, the rising exchange rate and the continued housing crisis shows current monetary policy needs to be reviewed - with amendments to the policy targets agreement a bare minimum, says Labour’s Finance ...
    6 days ago
  • Local democracy under threat
    The National Government is in the process of gutting our local democracy through it’s Local Government Act 2002 Amendment Bill (No 2). We’ve been hearing submissions from councils, and a few community members, all around the country who are deeply ...
    GreensBy Jan Logie
    6 days ago
  • Local democracy under threat
    The National Government is in the process of gutting our local democracy through it’s Local Government Act 2002 Amendment Bill (No 2). We’ve been hearing submissions from councils, and a few community members, all around the country who are deeply ...
    GreensBy Jan Logie
    6 days ago
  • Slash and burn of special education support
    Slashing the support for school age children with special needs is no way to fund earlier intervention, Labour’s Education Spokesperson Chris Hipkins says.  “National’s latest plan to slash funding for children with special needs over the age of 7 in ...
    1 week ago
  • National’s Pasifika MPs must have free vote
      Pacific people will not take kindly to the Government whipping their Pacific MPs to vote in favour of a  Bill that will allow Sunday trading  at Easter, says Labour’s Pacific Island Affairs spokesperson Su’a William Sio.  “We are seeing ...
    1 week ago
  • Maritime Crimes Bill – balancing security and free speech
    Parliament is currently considering the Maritime Crimes Amendment Bill, which would bring New Zealand up to date with current international rules about maritime security. The debate around the Bill reflects two valid issues: legitimate counter-terrorism measures and the right to ...
    GreensBy Kennedy Graham
    1 week ago
  • Rio Olympics captioning – setting the record straight
    In the House on Thursday, my colleague, Labour Party spokesperson on Disability Issues, Poto Williams asked a great question. After which the Minister, Nicky Wagner, stood up and finally publicly acknowledged the National Foundation for the Deaf for funding the ...
    GreensBy Mojo Mathers
    1 week ago
  • Rio Olympics captioning – setting the record straight
    In the House on Thursday, my colleague, Labour Party spokesperson on Disability Issues, Poto Williams asked a great question. After which the Minister, Nicky Wagner, stood up and finally publicly acknowledged the National Foundation for the Deaf for funding the ...
    GreensBy Mojo Mathers
    1 week ago
  • Teachers’ low wages at the centre of shortages
      Figures that show teachers’ wages have grown the slowest of all occupations is at the heart of the current teacher shortage, says Labour’s Education Spokesperson Chris Hipkins.  In the latest Labour Cost Index, education professionals saw their wages grow ...
    1 week ago
  • Government’s Tax Law undermines common law principles
    A tax amendment being snuck in under the radar allows changes to tax issues to be driven through by the Government without Parliamentary scrutiny, says Labour’s Revenue spokesman Stuart Nash. “The amendment allows any part of the Tax Administration Act ...
    1 week ago
  • Government slippery about caption funding
      The Government has refused to apologise for taking the credit for funding Olympic Games captioning when the National Foundation for the Deaf  was responsible, says Labour’s spokesperson on Disability Issues Poto Williams.  “This shameful act of grandstanding by Ministers ...
    2 weeks ago
  • Default KiwiSaver investments should be reviewed
    The investments of the default KiwiSaver providers should be reviewed to make sure they are in line with New Zealanders’ values and expectations, says Labour’s Finance spokesperson Grant Robertson. “Most New Zealanders would be appalled that their KiwiSaver funds are ...
    2 weeks ago
  • New ministry should look after all children
    The Government has today shunned well founded pleas by experts not to call its new agency the Ministry for Vulnerable Children, Labour’s Spokesperson for Children Jacinda Ardern says.  “Well respected organisations and individuals such as Children's Commissioner Judge Andrew Becroft ...
    2 weeks ago
  • Triclosan – nasty chemical will be reassessed
    Last week my campaign for this chemical to be reassessed by the Environmental Protection Authority (EPA) took another step forward. After many months of waiting, the EPA have agreed that triclosan needs to be reassessed. Triclosan is an ingredient in many ...
    GreensBy Catherine Delahunty
    2 weeks ago
  • Triclosan – nasty chemical will be reassessed
    Last week my campaign for this chemical to be reassessed by the Environmental Protection Authority (EPA) took another step forward. After many months of waiting, the EPA have agreed that triclosan needs to be reassessed. Triclosan is an ingredient in many ...
    GreensBy Catherine Delahunty
    2 weeks ago
  • Ratification okay but we need action
    Today’s decision to ratify the Paris agreement on Climate Change by the end of the year is all well and good but where is the plan, says Labour’s Climate Change spokesperson Megan Woods.  “The Government’s failure to plan is planning ...
    2 weeks ago
  • Stats changes can’t hide unemployment reality
    Today’s minor drop in unemployment numbers is nothing to celebrate given the changes made to the official numbers that cut thousands of people looking for work out of the jobless rate, says Labour’s Employment spokesperson Grant Robertson. “Making any comparisons ...
    2 weeks ago
  • Stats changes can’t hide unemployment reality
    Today’s minor drop in unemployment numbers is nothing to celebrate given the changes made to the official numbers that cut thousands of people looking for work out of the jobless rate, says Labour’s Employment spokesperson Grant Robertson. “Making any comparisons ...
    2 weeks ago
  • Auckland’s affordable homes plummet 72% under National
    Comprehensive new data from CoreLogic has found the number of homes in Auckland valued at under $600,000 has plummeted by 72 per cent since National took office, Leader of the Opposition Andrew Little says. “This data tracks the changes in ...
    2 weeks ago
  • Govt should face the facts not skew the facts
    National appears to be actively massaging official unemployment statistics by changing the measure for joblessness to exclude those looking online, says Labour’s Employment spokesperson Grant Robertson. “The Household Labour Force Survey, released tomorrow, no longer regards people job hunting on ...
    2 weeks ago

Public service advertisements by The Standard

Current CO2 level in the atmosphere