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Budget 2020

Written By: - Date published: 3:37 pm, May 14th, 2020 - 89 comments
Categories: covid-19, Economy, grant robertson, Politics - Tags:

The budget site is up. I’ve reproduced some of it here.

Budget 2020 has also been released on the Budget website: https://budget.govt.nz.

A feature of the Budget website is that it organises the Estimates documents by Minister, by vote, by department and by sector.

Image from RNZ

Budget speech by Robertson

budget2020-speech

89 comments on “Budget 2020 ”

  1. ianmac 1

    Saw an interview with that chap Bagley and was not impressed. He said that just throwing money around was no good. We needed a STRATEGY. He said that three times so when asked for what sort of thing he would have expected, Bagley said, "Just throwing money around was no good. We needed a STRATEGY!"

    What a big help. As useful as Goldsmith's empty words.

    • @ianmac : If you mean Bagrie….. he's an economist maaaate formerly of ANZ..

      In a previous life we used to take bets on the accuracy of their predictions.Tony Alexander of BNZ likewise, and others.

      Statistically, throwing darts at a dart board (as we also did) produced better odds even though they're now the goto mainstream media's talking heads.

      But you know – they need to make an earn and last time I looked, prostitution was legal in Nu Zull

      • Tricledrown 1.1.1

        Never trust a Bank Economist,Banks have had $60 billion capital injection and yet can't help businesses.

    • Barfly 1.2

      Bagrie wanted asset sales and upping the age of entitlement to superannuation.

      Sucks to be him.

    • Chris 1.3

      It doesn't matter what's in the budget Bridges was always going to say it was wrong. I hope the media really presses him hard on what his 'strategy' would be.

      • Bg 1.3.1

        Can you please point me to any opposition leader (Labour or National) that hasn't? It's called doing his job

        • Kevin 1.3.1.1

          But he is moaning for moaning's sake. He is not providing a creditable alternative. Every utterance so far has pointed to their default position… austerity.

  2. Anno1701 2

    The poor fella looked like he was in the middle of having a stroke!

  3. A good start to the recovery budget and, with $20b still left to spend later on unannounced projects, plenty of room to add to it's effectiveness.

  4. Pat 4

    Think theres strategy there….theyve given the banks room and time to unwind some private debt, theyve signalled further downward pressure on property/rent levels with expanded state housing, theyve told tourism and education they need to adjust to the new normal, theyre providing trades training for young and not so young to provide employment opportunity and reduce the requirement to import labour, they are providing regional and environmental improvements….and crucially they are NOT engaging in austerity.(increased health, education and welfare provision)….that is not a strategy that National would even contemplate.

    whether the large infrastructure projects are transformational is yet to be seen.

    • Ad 4.1

      You will see another big list of infrastructure being pushed put their door in a few days.

      By the end of Labour's second term, in infrastructure terms you will see completed:

      – Several new water storage dams in Northland to increase drought resistance and improve productivity

      – City Rail Link3/4 done; getting into streetscaping and station fitout and signals testing.

      – Auckland's downtown areas massively pedestrianised

      – A cycleway system across the Harbour Bridge – in fact from Mission Bay to Downtown to the Akoranga Campus, and from downtown to Panmure

      – Auckland's CBD expanded by the size of the whole of Dunedin's CBD as the Wynyard Basin developments are complete, and further expansion up Wynyard Point

      – Auckland's AMETI busway from Botany to Panmure completed, and more stages to come

      – The Puhoi-Wakworth SH1 completed, together with the whole of the Waikato experssway

      – A second Auckland water pipeline from the Waikato underway

      – A fully electrified rail line from Auckland to Wellington

      – A rail passenger service from Hamilton to Auckland and back

      – A couple of new windfarms in the North Island centre

      – A dam that drought-proofs the Nelson-Richmond area

      – A brace of schools rebuilt and expanded

      – Five of the older weatherboard hospitals rebuilt, and the Dunedin one at 3/4 done

      That's just off the top of my head. If you're worried that the industry is going to need to import workers, you have no need to worry: we won't be able to get them, and we won't need them (apart from some engineering and infrastructure architect specialists).

  5. Enough is Enough 5

    An interesting budget. Massive increase in spending as expected, but no real hints that there is going to be any immediate reforms which I thought were coming.

    My hope is that we don't just continue on a business as usual path, but that's the sense I got. We will support workers in the short and medium term, but I'm not sure there was any indication that we will see the economy restructured to something more fair and equitable than the current neo liberal wet dream.

    Hopefully that will come next.

    A massive amount of unallocated spending, which will no doubt find a home during the election campaign.

  6. bill 6

    Extending the wage subsidy out for 12 weeks from June means a lot of people are going to discover what life on a basic income of ~ $240 per week feels like…but not until after the election.

    Nothing in terms of welfare payments. And before any twat starts up about the 20 odd dollars that was clawed back because of "supplementary" benefit payments, it would take about $150 per week being added to core benefits before being on a benefit becomes anything other then penury.

    And y'know, that might mean there was no need for 200 000 extra school meals (though for the life of me I can't understand why NZ hasn't had school meals for every school kid "since forever"ago).

    Maybe the government is trying to protect those jobs that come from administering food banks, and that's why welfare payments are staying "as is"? (Was it an extra $75 million went to that particular ambulance at the foot of the cliff?)

    • weka 6.1

      there are people running the line that Labour didn't need to include benefit rises in this budget because they did it in April: 'All beneficiaries got an extra $25/wk'. So I'm the twat that is pointing out this isn't true.

      • bill 6.1.1

        🙂 You saying I'm a twat for pointing that out in my comment? And if I'm a twat for highlighting that, are you a twat too?

        I was originally implying that anyone who might want to run the line you've also undermined as the ones who would be twats.

        But well….in the spirit of St Jacinda and those others who reckon we're "in this together", I see no reason why we can't all be twats 🙂

        • weka 6.1.1.1

          Would make a good post title 🙂

          I thought your first comment was talking about the people pointing out that… oh never mind.

          • Dukeofurl 6.1.1.1.1

            " 'All beneficiaries got an extra $25/wk'. So I'm the twat that is pointing out this isn't true."

            Thats right , the extra benefit paid over winter was doubled as well as the $25 increase in the basic benefit rate

            • weka 6.1.1.1.1.1

              Leaving aside the WEP for a minute, Labour says that the base benefits went up by $25/wk. This is true in accounting terms. What beneficiaries get in their bank account tells a different story. The formulas that are used to calculate TAS (and I think AS), as well as the abatement rates on income, mean that in real life, many didn't get a $25 raise at all.

              The reason the WEP is good is because it's an actual cash transfer, not messed with by how benefits are calculated for each beneficiary. That's what they should be doing when looking at increasing welfare. But they're not. We can speculate on that, but it's not like the Minister doesn't know that the people on hardship grants don't get the full amount. The government is saving money here.

              I haven't seen official figures on this, so don't know how it plays out in stats. Someone should do an OIA on this.

              • Chris

                It wouldn't be difficult to work out from the annual stats reports. It'd just be the numbers of people receiving a main benefit and TAS, broken down by the amount of each TAS payment. Just using the average TAS payment would get close to the answer.

                • weka

                  remind me which benefits will affect it? AS as well? What about DA?

                  • weka

                    Ok, there are 76,600 people getting TAS.

                    • weka

                      having trouble find the average amount paid though, any ideas?

                    • weka

                      "It'd just be the numbers of people receiving a main benefit and TAS"

                      having trouble finding that too, assuming that some TAS recipients aren't on a benefit? Otherwise 310,000 people on a benefit (excl Super), so TAS is 25% of that.

                    • Chris

                      It'd have to be people receiving a main benefit and TAS because those not receiving a main benefit don't receive the increased income.

                      I do remember seeing in a statistical report the numbers of TAS payments broken down into beneficiaries and non-beneficiaries. This is one breakdown needed. I've also seen figures on the average TAS payment. These two sets of numbers could give a back-of-the-envelope estimate?

                      If these sets of numbers aren't published now then I may have been a bit hasty saying that the information needed could be gleaned from the statistical report.

                    • Chris

                      Apologies are in order, weka. I've had a look at the regulations governing the temporary additional support and I see I'm wrong about the dollar for dollar loss of TAS payments as the main benefit increases. The regulations were changed in 2013 to make the deemed costs figure in the calculation that's compared to income 70% of the total sum of the main benefit when added to the family tax credit. Before the change it was a fixed amount. There's still an absorption of any increase to main benefits but it's less than dollar for dollar. The accommodation supplement also certainly decreases so the poorest still don't enjoy the actual increase, but it's not as horrendous as I'd outlined. I should've checked the regulations. Apologies again weka.

                    • weka

                      thanks Chris, do you have a link to the regs (or a specific reference)?

                      I'd quite like to put some figures through a mock assessment and see what they look like. I'll do this below, would you be able to check what I've done?

                    • Chris

                      Here are the regulations. The calculation is set out in schedules 1, 2 and 3, including definitions of income and standard costs. I'll do my best to check calculations.

                      http://www.legislation.govt.nz/regulation/public/2005/0334/latest/whole.html

                    • weka

                      ta. I'm just working my way through a mock assessment, had to put everything into a spreadsheet. I'm using the instructions and examples from MAP on the WINZ site. This is crazy complicated, beyond what many beneficiaries could do. Which makes me wonder how often someone's calculation gets checked.

                  • Chris

                    Any increase to main benefits affects the component of the AS calculation that is 25% of the basic benefit rate. CPI increases have this effect which are usually a reduction in AS by a dollar or so but the $25 increase reduced the AS significantly.

                    The TAS reduces any main benefit increase dollar-for-dollar. The TAS assessment comes in at the very end so the reduction in AS affects the income level used to arrive at the final TAS payment. So a person on a main benefit who also gets AS but no TAS would receive the extra $25 but lose a significant amount of AS.

                    This is assuming the level of rent a person pays attracts around or less than the maximum AS. People with accommodation costs that would attract more than the maximum AS may still receive the same AS because the calculation still produces a figure above or at the cap, so in those situations the AS is unchanged.

                    A lot of people receiving the maximum AS or close to it are often entitled to also receive the TAS which reduces dollar-for-dollar as income increases. The TAS absorbs any real increase. It's calculated at the end, so a drop in AS is assessed when determining income for TAS purposes at the same time as assessing the increase in income as a result of the increase to the main benefit.

                    The disability allowance is not affected itself by any increase to the main benefit. That's payable as long as there's entitlement to the main benefit. But it can be a variable that affects the person's overall income following an increase to the main benefit depending on whether or not there are disability costs a person has above the disability allowance maximum that go into the TAS assessment.

                    Overall there are a lot of variables like whether or not levels of rent paid attract AS close to the maximum, the variable maximums according to region and family size, whether the TAS is received, or whether TAS is not received but there is entitlement to receive etc, so it's not completely the same for everyone. But this is basically what happens when main benefits are increased.

                    It's the absorption by the TAS of increases to main benefits that's the kicker because it's the very poorest who don't get the full advantage of any main benefit increase.

              • Dukeofurl

                Clearly none of you know someone receiving a job seeker benefit, so I asked someone.

                Winz dont seem to itemise these things, so his benefit this week compared to what was granted last year has risen by $72.65 per week from $218.98.

                A Winz letter says the extra winter benefit is now $40.91 pw., thus the rise in the standard benefit received pw is $31.76

                • bill

                  There have been quite extensive comments explaining exactly why you are wrong Dukeofurl. And as someone who is in receipt of the Job Seeker entitlement, I can verify that in my case, and for the reasons outlined in a number of comments, the amount announced by the government was not the amount received.

                • weka

                  That's right, they don't itemise them, because why should beneficiaries be told what they're actually being paid?

                  You might want to ask yourself how his benefit rose by $31/wk when the govt announced rise was $25/wk. I know the answer to that, as does any number of commenters here who are beneficiaries or who work in the area. You don't know, so like Bill I suggest you go back and read the comments already made explaining this.

                • Chris

                  There can be any number of reasons for this and often MSD can't tell you straight away let alone the person receiving the benefit. Maybe a repayable advance has finally been paid off? -which can happen quickly these days especially when MSD regularly screws repayments of 40 or 50 bucks a week from people so when the advance has been repaid the weekly amount received increases by the amount of what had been deducted. Or maybe the person's been lucky and someone at MSD has taken the time to assess eligibility for temporary additional support? -in which case they should check to see if what MSD has taken into account is something they already knew about because then they can ask MSD to go back and pay arrears from the time that information came into their possession. Maybe the person's gone to the AAAP in Auckland for a tune up of their benefit payments?

                  There can be a stack of reasons explaining an increase in payments. That doesn't change the fact that the poorest generally don't fully enjoy increases to the main benefit in the same way as others might.

          • bill 6.1.1.1.2

            I thought your first comment was talking about …

            See above. 🙂

    • Ad 6.2

      Here's some stuff for poor people:

      – $833m for disability support. Largest ever.

      – $195m Pacifika recovery package

      – $900m Maori recovery package

      – $5b for transitional and public housing

      – $670m of income related rent subsidy

      – $55.6m extra for Pacifika countries in aid to recover

      – $79m for social service providers like food banks and community social providers

      – $36m in straight out grants for community groups

      – $15m for fruit in schools

      – $151m for big pay increase for lowest-paid teachers

      – 153,000 more surgeries and procedures: mostly it's poor people who are sick

      – Lifted benefits by $25 a week just 2 months ago

      – $18b on wage subsidies to keep people employed and companies alive

      – $1.6b for more trades apprentices

      – $121m for He Putama Rangitahi – resolving barriers to employment and training

      – Doubled winter energy payment in March. Yup most old people are poor.

      – $25 a week per child extra for Foster Care, Orphans, Unsupported Child benefit

      $203m funding against family violence

      There is need for all of it out there. You know it.

      No amount of tired cynicism from you will stop this being the largest shift in public capital we've every had, and it's all targeted to the workers, their families, and the damaged in society.

      And, of course, more money and initiatives to come.

      • weka 6.2.1

        I have some conflict, because I can see that there are indeed some really good things in this budget. That doesn't mean there aren't serious things to be critiqued here though, and the benefit one is a problem that just won't go away.

        The irony here is that of your list, very few of them apply to people in my or Bill's position. There is a whole section of the underclass that don't have kids and aren't engaged much with the mainstream NGO and state welfare services (or are and it's not good). We're off the radar. Which is why you and Duke both seem to think that all beneficiaries got an extra $25/wk. They didn't.

        So yes, that's a good list and I'm looking forward to seeing the details on the disability package and what the income related rent subsidy is about. But too much of it looks like ambulance at the bottom of the cliff stuff. I want them to be funding the ambulance, but we've been waiting a very long time for a NZ govt to turn around the welfare issue, and this isn't the budget to do it. I remain doubtful that the next round of funding will be much different although I expect Labour to keep on with the spending, which is a long way better than what National would have done.

        • Kevin 6.2.1.1

          If you are single and on a Jobseekers benefit, there has probably never been a better opportunity in this countries history to get off it with $1.6 billion directed to apprenticeship training.

          • weka 6.2.1.1.1

            This is a good opportunity for many for sure. Won't work for everyone, but I'm pleased to see this.

      • bill 6.2.2

        Here's the elephant in the room with regards to your list Ad.

        Most items on your list fail to put money into the pockets of poor people. Instead, the money goes to organisations and bureaucracies that are essentially charged with managing poor peoples' affairs.

        As an example, the tens of millions being given to organisations that manage food banks instead of to poor people so that they might be able to buy fucking food.

        I guess there will be some millions going to budget advice wallahs too – so they can continue to work out that 1 + 1 cannot be made to equal 3.

        I wonder how much money would be freed up if all the organisations doing "good works" for the "feckless" were wound up. What difference might be observed if the liberated monies were funneled directly to erstwhile clients of these "good works" organisations, instead of to logo-ed vehicles, leases, rents, salaries and pointless junkets?

        • weka 6.2.2.1

          The ticket clipping by some of those agencies is eye watering.

          • bill 6.2.2.1.1

            The ticket clipping by some of those agencies is eye watering.

            Hell, yes!

            And then there's that fairly prevalent mindset that sets out to 'save' people, as though the poor person is at fault for being poor, or the traumatised person exists in an “unfortunate” personal vacuum – and all the condescension and dismissal that goes along with that approach.

            I don't want to suggest there are no people employed across various agencies doing good things – there are. But they're in a minority and up against fairly awful organisational and societal cultures that often simply "other" those they should be working with in such a way that they simply wind up 'managing' them within existing and unquestioned frameworks of reference, instead of looking to explore the deeper systemic reasons as to why 'person A' finds themselves in the position they're in with an eye to challenging systemic drivers of trauma and misery.

      • KJT 6.2.3

        Anything but trust, "poor people" with a meaningful welfare increase.

  7. Fran 7

    This budget is big, not just with money but mindset. People are at the center not just the economy.

  8. Corey Humm 8

    Meh. What a waste of a parliamentary term as far as poverty and homelessness is concerned, we needed future looking visionary leadership and we got Helen Clark's govt redux but with incompetent ministers, in a time needing genuinely radical change and reform. Welfare payments need to be raised at minimum 30% I hope beneficiaries stay home this election as neither side gives a damn whether they live or die. Labour will win on middle class votes not the working class or poor. Just change your damn name to the liberal party already.

    I live in Auckland now so yay for the Auckland spending but boo for the lack of care for the south

    Just like the infrastructure Announcement in Feb bugger all for the south Last election chch became a strong hold for labour and they are at major risk of losing port hills, chch central not being a safe seat yet and Dunedin south may be unwinnable I expected some lollies for those cities especially since since chch and it's satellite towns are growing by ten k a year and Jacinda talks about chch Everytime she wants to sound compassionate… But meh… If Duncan Webb hadn't won his seat Labour would have 45 seats and national would be governing right now. Labour will win though I just hope people who are genuinely poor realize it's a party that doesn't care whether you live or die, slightly better than national who outright want you to die but not by much.

    • Grafton Gully 8.1

      The caring whether you live or die makes no difference to your living or dying unless you let it.

    • Chris 8.2

      Yes, people don't understand why the spending is necessary. There's a counter-intuitiveness to it that makes it easy to agree with the 'Labour is financially irresponsible' line. Labour fixes the economy, the nats come in and stuff it up again, Labour gets the blame. Labour's spin doctors will be saying that in times like these they need all the help they can get, and being nice to the poor doesn't do Labour any favours.

  9. adam 9

    I'm happy we have a budget which puts labour firmly into the camp of liberalism. Neo or otherwise – liberalism is the economic model which is killing the environment and creating the ever growing gap between haves and have nots.

    It's a interesting beast which can take a coat of lipstick to make itself look presentable on one hand – or it can beat people down, like is happening right across the western world.

    Socialism has no place in the NZ environment – all the so called left can offer is some little trinkets and baubles – borrowed on the back of our mokopuna.

    But most of all there was a hard core push to keep an unrealistic opulent lifestyle going in the face of a desperate need to change our economy.

    They had a chance, they chose not to do it. In a vain game of election politics and the desperate desire to hold onto power.

    • Ad 9.1

      Your labels are just so tired.

      Pull the cover over your head.

      • adam 9.1.1

        I guess sickening apologists can run off at the mouth all they want ah, but never any criticism for your cherished brand ah Ad.

    • patricia 9.2

      Hi Adam, there is a way between an Amish society and a completely Neo liberal one.

      Of course that requires compromise, which is a dirty word to some.

      We will have less instant gratification in the new order of things, so may have improved environmental outcomes.

      In six months our lives have changed in fundamental ways, and not all the changes are immediate, some will occur in waves of unexpected magnitude.

      All any good Government may do is protect the most vulnerable give support to business and protect our infrastructure keeping reserves for the unexpected.

      Some always want revolution others to use the crises for their own objectives, but with an election looming a mandate for further change is able to be sought.

      Your thinking is evident when you mention "lipstick". Further, I read what you wrote trying to find what improvements you wanted…. not one suggestion other than alluding to old time socialism.??

  10. adam 10

    The Peace Movement Aotearoa make a good point about military spending.

    https://www.facebook.com/notes/peace-movement-aotearoa/welfare-or-warfare-military-spending-in-budget-2020/2932383820142301

    Bottom line $88.8 million every week for the military, but no a cent more for the weakest in society.

    • Dukeofurl 10.1

      " not a cent more for the weakest in society. "

      Not so , you havent been paying attention as the benefit increases were announced back in March instead of at the Budget because of Covid

      "Beneficiaries and superannuitants will also get a cash bonus with a permanent increase to main benefit rates and a one-off doubling of the Winter Energy Payment this year…

      Beneficiaries will also get a permanent increase of $25 a week in the hand, and the Winter Energy Payment, which beneficiaries and superannuants receive, will be doubled this year.Together that will cost $2.8 billion …

      https://www.rnz.co.nz/news/covid-19/411951/coronavirus-government-unveils-12-point-1b-package-to-combat-covid-19-impact

    • Ad 10.2

      You just talk unmitigated fact-free crap.

      Go read the actual budget.

      There's a few highlights for the poor listed above.

      • adam 10.2.1

        And you'll notice if you understand the english language correctly I did not say poor.

        • Dukeofurl 10.2.1.1

          Since you dont know anyway on a benefit , I asked some one on a single rate.

          Its $31 extra pw PLUS the extra winter payment of $20

          The increase over the benefit granted last year is $72 pw extra

          Bill incorrect and you are just an idiot ( you said not a cent, at least he was splitting hairs over 'exactly' $25 pw)

          • bill 10.2.1.1.1

            No Dukeofurl. Bill is not incorrect. Bill lives on welfare entitlements and knows for a fact that he did not receive the $ amount announced by the government.

            As explained in my original comment (and reinforced by Weka) that's because the increase was rebated against other elements that may go to make up a person's weekly payments.

            • Dukeofurl 10.2.1.1.1.1

              My example of actual payment is $31 more per week outside the extra winter payment

              Are you trying to manage on $218 pw or were you getting higher payments of a different kind ?

              Actual amounts so people can compare would be good …like I did

          • Craig H 10.2.1.1.2

            The extra $25 was additional to the usual annual increase. My nephew is also on the job seeker in a state house (!) and has gone from being unable to make ends meet to being able to run his heat pump and feed and clothe himself properly.

    • Adrian 10.3

      In what will most likely be a lot more unstabilised world because of the virus, spending on Hercules that can service the Pacific in natural and man-made disasters makes a lot of sense.

      In the next biggie, maybe like the long awaited 9 quake a Herc is the only thing that can get in and out of short runways on the West Coast or Northland after a cyclone,

  11. RedBaronCV 11

    Yeh I can see them hanging onto funds and then allocating it where the need show up.

    I'm picking that tax increases will wait until after the election and that labour market reform ( more worker rights) and welfare reform will be signaled / underway around election time.

    • Ad 11.1

      Robertson has signalled pretty clearly with his spend that he would rather just go into more debt than raise taxes. He's got the headroom so he's using it.

      In terms of worker rights he’s got most of NZ businesses in a wage subsidy + tax refund chokehold for a while. Anyone who crosses him will get a reminder of how much they owe him.

    • Nic the NZer 11.2

      Raising taxes this year will likely result in so much damage to the economy that the tax take falls as a result. Probably the approach should not be to raise taxes at all and maintain the deficit until the economy recovers enough for the tax take to expand again with the economy.

      The not specifically allocated spending is a way to put off specific decisions about what to spend on, while anticipating that it will be spent. Regardless, the minister of finance mentioned that the economics of forecasting is more an art than a science so we should not get too hung up on the exact numbers given for the spending and taxation estimates. They will be off probably by a few billion and in a couple of years completely forgotten anyway and we will be facing a different situation as a country.

      • RedBaronCV 11.2.1

        I don't know that raising taxes at the high end would do that much damage. Quite the reverse. There is a managerial class out there who are hanging on like glue to their huge salaries whilst sacking everyone in sight. Our national income inequality is very high. Leaving money in those hands will just result in them accruing further assets. From memory the drop in high end tax rates in 2008 that Nact put in cost about $2 billion a year. I'm all for raising the high end rates even further plus a modest wealth tax. Even $5billion a year would go a long way towards keeping the $50 billion a year under control. I think we do need to redistribute away from the high income earners towards lower income earners and the government tax take. I'd also be for a "health & safety levy" of 15% say on jobs outsourced overseas (Don't know how practical that would be )

        • Nic the NZer 11.2.1.1

          Maybe, keeping that nuance in mind. But there would need to be a new bracket in that proposal like the 150k bracket (I think). Its not going to generate a huge amount of revenue (which is fine its about income inequality anyway). The important thing however is you dont want there to be any impact of this on median incomes or it was a poor choice.

          Fortunately the govt is not revenue constrained and can put this off as long as needed while still funding the economy.

          • RedBaronCV 11.2.1.1.1

            Yep there would need to be new brackets plus supporting measures so it couldn't be sidelined into companies or trusts as an avoidance measure. Personally I'd go for 45% and say 75%. Might persuade some executives to hand it out to staff rather than the IRD, But I still see this as post election. And a few economists need to dampen down their suggestions that redistribution be away from the young and the elderly instead of the rich.

  12. infused 12

    Extending the wage subsidy was good.

    Other stuff, not so sure – have to wait and see. The problem with this labour govt is they say things, not actually do them.

    Ok, we've got 8k social housing being built. Where's the plan? time frame etc? Or is it going to be kiwibuild 2.0?

    I think the aim of this budget was to get past the election and deal with the fallout then, which I expect to be great. I don't blame labour, national would have done the same thing.

    But what I am worried about, is no plan. I think national is correct. There needs to be a plan. I mean, my job now is strategy. where is the strategy here? I think the govt has been very reactive throughout this whole thing. It's time to actually lead.

    Don't get me started on the draconian law that was passed. I was appalled that the greens supported it. Anything for a few eco jobs yeah?

    • Dukeofurl 12.1

      The PLAN first required you to look at the website

      https://www.beehive.govt.nz/release/8000-more-public-houses-be-delivered

      This investment is in addition to the 6,400 public housing homes currently being built, in the pipeline or otherwise delivered, and the 1,000 transitional homes announced in February as part of the Homelessness Action Plan

    • KJT 12.2

      The draconian law that gives less powers, than the state of emergency over the last six weeks did. Making it clear what can and can't be done. With the 90 day review period.

      Unlike National's search and surveillance bill, and extension of police powers.

      Which seems to have slipped under the radar of those who are so exercised over civil liberties, now!

  13. Nic the NZer 13

    National makes it clear they would be considering penny pinching already, with austerity to follow as soon as practicable.

    https://i.stuff.co.nz/national/politics/121519825/this-budget-could-end-up-doing-more-harm-than-good

    If these guys get in this year it will be much worse than the 90s recession.

    • Kevin 13.1

      The last line in that story…

      * Matt Burgess was senior economic adviser to Bill English.

      In other words, a party political broadcast on behalf of the National party.

      • Nic the NZer 13.1.1

        Yep. Thats why I imputed it onto National, though Bridges is not man enough to tell us what he would do if elected.

      • aj 13.1.2

        a party political broadcast on behalf of the National party.

        I got more interested in the by-line as I read down and wasn't disappointed at the end no

  14. Marcus Morris 14

    Julius Vogel once borrowed ten million pounds, a staggering amount at that time, to revive a stagnant economy. It seemed to do the trick. I seem to recall that much of it was spent on infrastructure – things like railways!

    • RedBaronCV 14.1

      Yes I see some sense generally in spending this type of support money on long term lowish return community capital items. Essentially using support money paid today to create a long term return to the community. Sort of like planting trees so one day we have a forest to sell. Or building a better transport or communication system to improve overall productivity.

  15. dv 15

    Debt to GDP

    As 2019

    NZ is in bottom 20 at 19.2%

    Debt to GDP expected to rise to 26% with budget.

    Sort of like raising a mortgage of 25% of your income to buy your house.

    Compare to these debt to GDP
    Aus 44.8%

    Japan 238%

    Usa 107%

    Canada 89.7%

    Hardly a tsunami of debt that some would like you believe.

    https://tradingeconomics.com/country-list/government-debt-to-gdp

    • Nic the NZer 15.1

      Trying to analyse this via debt to GDP ratios is basically a poor idea. Basically all the countries which you suggest including New Zealand operate their own currencies via their own central banks and so are not constrained by borrowing in their spending at all.

      In fact the accumulated impact of the spending is also accumulated non-government sector savings, so Japan has consequentially a high savings rate and New Zealand a low one.

      But all this debt to GDP stuff is simply about the narrative. If the government wants to constrain its budget it talks about debt ratios and talks less about the actual reasons why it wants to sequester spending. If the worst hits and a real necessity arrives then that narrative is conveniently forgotten, because its not actually a constraint. If the government was really worried about the debt to GDP ratio they would have made it go away ages ago by doing some QE and then having the RBNZ write off the debt. This would have altered the debt to GDP ratio but of course writing off a debt you owe to yourself (and were going to repay to yourself) doesn't change anything.

  16. RedBaronCV 16

    BTW does anyone know the economic effect of approving the dope referendum and is it built into the budget? The income from taxes plus the lower compliance spend by the cops etc less the health departments nagging money?

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