WEBVTT - Growth or austerity? Unpacking Budget 2025 and what it means for you 0:00:05.760 --> 0:00:06.200 Kiota. 0:00:06.280 --> 0:00:09.520 I'm Chelsea Daniels and this is the Front Page, a 0:00:09.640 --> 0:00:16.440 daily podcast presented by the New Zealand Herald. The Coalition 0:00:16.600 --> 0:00:22.280 government has unveiled its second budget. Over twenty billion dollars 0:00:22.280 --> 0:00:25.279 in savings has been found over the next four years, 0:00:25.400 --> 0:00:28.960 more than half from the controversial changes to our pay 0:00:29.080 --> 0:00:32.000 equity scheme. There are changes to key we save a 0:00:32.120 --> 0:00:36.640 contributions means testing for support for parents, and a major 0:00:36.880 --> 0:00:41.440 new tax incentive for businesses. Finance Minister Nikola Willis has 0:00:41.479 --> 0:00:45.159 said that it is a responsible budget, while Labor has 0:00:45.200 --> 0:00:48.680 called it an austerity budget that leaves women out and 0:00:48.800 --> 0:00:51.880 is stealing from our kids. To break down what all 0:00:51.920 --> 0:00:54.520 of this means for you today on the Front Page, 0:00:54.560 --> 0:00:57.960 we're joined by Enzit Herald Business Editor at Large Liam 0:00:58.080 --> 0:01:04.800 dan So. Nikola Willis has called this a growth budget. 0:01:04.959 --> 0:01:09.040 Labour's gone with austerity. If you had to pick a pithy, 0:01:09.160 --> 0:01:12.200 one word descriptive of this budget, Liam, what would you 0:01:12.240 --> 0:01:12.560 go with? 0:01:12.680 --> 0:01:16.000 Oh, good question, sort of a tightrope balancing act, something 0:01:16.080 --> 0:01:18.280 like that. It's a little bit of austerity and a 0:01:18.280 --> 0:01:20.919 little bit of growth, some big cuts to some things 0:01:21.080 --> 0:01:23.800 and there's a big roll of the dice for example, 0:01:24.000 --> 0:01:26.480 in terms of hoping that business is going to really 0:01:26.480 --> 0:01:29.200 grab this tax cut and invest for growth. So that's 0:01:29.240 --> 0:01:31.559 probably it's probably where they really rolled the dice big 0:01:31.720 --> 0:01:33.600 on that one. You know, I was wondering, where's the 0:01:33.640 --> 0:01:35.800 growth coming from. They still had growth budget at the 0:01:35.800 --> 0:01:38.000 top of all the press releases, but you know, six 0:01:38.120 --> 0:01:41.200 six billion, six point four billion over four years. It's 0:01:41.240 --> 0:01:43.479 a significant break, especially if you think of a small 0:01:43.520 --> 0:01:47.200 business someone who's having to upgrade all their tools and 0:01:47.240 --> 0:01:49.400 you know, their transport and all that sort of stuff 0:01:49.880 --> 0:01:51.800 every five years or so. To get a twenty percent 0:01:51.920 --> 0:01:54.120 break when they do that, it could be quite a 0:01:54.160 --> 0:01:56.280 substantial amount of money for them. So it's an incentive 0:01:56.320 --> 0:01:59.200 to upgrade all the equipment earlier, you know, and make 0:01:59.240 --> 0:02:02.680 themselves more a fit and drive some productivity, which we're 0:02:02.720 --> 0:02:05.160 always talking about. So that's the that's the idea. The 0:02:05.160 --> 0:02:07.360 theory is that that will mean the businesses will invest 0:02:07.400 --> 0:02:11.360 more in up to date technology, latest equipment, and they'll 0:02:11.400 --> 0:02:14.000 be more efficient and workers will be more productive and 0:02:14.040 --> 0:02:16.600 the economy will benefit because of that. 0:02:16.760 --> 0:02:19.160 The key we saver changes are one of the big 0:02:19.280 --> 0:02:22.839 changes here. Hey, taxpayers will now get two hundred and 0:02:22.840 --> 0:02:26.200 sixty dollars and seventy two cents from the government, down 0:02:26.240 --> 0:02:29.920 from five hundred and twenty one. In return, employees and 0:02:29.960 --> 0:02:35.200 employers default contribution will rise to four percent from three percent, 0:02:35.240 --> 0:02:38.040 which is being phased in over the next three years. 0:02:38.120 --> 0:02:40.880 What sort of impact could that change have. 0:02:41.160 --> 0:02:44.040 Yeah, so the net outcome is that people would save 0:02:44.240 --> 0:02:46.799 more over the period of time. I mean the risk 0:02:46.840 --> 0:02:49.799 with cutting that tax break is so it's been cut 0:02:49.880 --> 0:02:52.160 by half, so you know, it was five hundred dollars 0:02:52.200 --> 0:02:55.480 a year. You can say, well, you've lost two hundred 0:02:55.480 --> 0:02:57.720 dollars a year, but you compound that over twenty years 0:02:57.720 --> 0:02:59.280 and you can do some maths and say that that's 0:02:59.280 --> 0:03:02.600 actually potential taking you know, twenty thousand or whatever out 0:03:02.639 --> 0:03:05.680 of people's long term retirement savings. But that is more 0:03:05.720 --> 0:03:09.440 than compensated for by the increase to the contributions, which 0:03:09.480 --> 0:03:12.840 will come out of the employee's pocket and the employer's pocket. 0:03:12.880 --> 0:03:15.040 But hopefully, you know, half a percent at a time 0:03:15.560 --> 0:03:17.720 won't be too onerous. So sort of a step in 0:03:17.760 --> 0:03:20.960 the right direction in terms of lifting those investment rates. 0:03:21.000 --> 0:03:23.280 In Australia, they're up to twelve percent or something. 0:03:23.080 --> 0:03:26.000 Well or thirteen now, Yeah. 0:03:25.280 --> 0:03:27.520 And obviously that would sound horrendous to suddenly take an 0:03:27.520 --> 0:03:29.760 extra nine or ten percent out of your pay and 0:03:29.840 --> 0:03:31.800 for employers to have to pay that. But if you 0:03:31.880 --> 0:03:34.000 if you step your way there, gradually you know they've 0:03:34.000 --> 0:03:37.160 got four trillion dollars in their superannuation scheme. And we 0:03:37.200 --> 0:03:39.000 look across the Tasman and say why are they richer 0:03:39.000 --> 0:03:40.840 than us? Well, it's because they've saved the money and 0:03:40.880 --> 0:03:42.200 they've got all this money. 0:03:44.840 --> 0:03:46.960 This is not authterity. 0:03:47.560 --> 0:03:52.960 In fact, it is what you do to avoid austerity 0:03:53.960 --> 0:03:59.360 because getting the books in shape ensures New Zealand has 0:03:59.440 --> 0:04:04.000 financial security and choices into the future. That's right, And 0:04:04.040 --> 0:04:06.720 as I am about to set out, savings in this 0:04:06.840 --> 0:04:13.680 budget have allowed us to make much needed investments in health, any, education, 0:04:14.160 --> 0:04:17.000 law and order and rebuilding our defense force. 0:04:17.240 --> 0:04:25.240 Yeah. Well New Zealanders are notoriously bad savers, and key 0:04:25.279 --> 0:04:28.200 we saver for a lot of us is our main investments. 0:04:28.240 --> 0:04:31.280 So is this government telling people to pull their bootstraps 0:04:31.360 --> 0:04:33.040 up and put some more evident in. 0:04:33.200 --> 0:04:35.600 Yeah, I guess a little bit. You know, it's it's 0:04:35.640 --> 0:04:36.960 a bit of that. I mean, there's there's a bit 0:04:37.000 --> 0:04:39.800 of that all through this budget. It's definitely to nature, 0:04:39.960 --> 0:04:42.719 to any Wellington Business editor said it called it the 0:04:42.720 --> 0:04:46.480 true blue budget. It is very much some ideological or 0:04:46.520 --> 0:04:49.400 political decisions. They are like no more dolls for the 0:04:49.440 --> 0:04:52.160 eighteen to nineteen year olds. Parents have to look after 0:04:52.240 --> 0:04:54.520 them or they have to have to go back to study. 0:04:54.520 --> 0:04:56.359 If you can't get a job, you've got to be studying, 0:04:56.480 --> 0:04:59.440 otherwise you're in the You're still responsibility of their parents 0:04:59.520 --> 0:05:02.080 to pay for It was quite a big change. 0:05:01.960 --> 0:05:04.240 If it was short sighted as well, because I mean 0:05:04.520 --> 0:05:07.880 going to UNI for some people immediately out of school 0:05:07.960 --> 0:05:10.599 that it isn't an option for some people, or in 0:05:10.640 --> 0:05:12.240 some people's minds it isn't. 0:05:12.640 --> 0:05:15.080 No I guess you know, there are other things you 0:05:15.080 --> 0:05:18.360 could be looking for apprenticeships or looking for more vocational 0:05:18.440 --> 0:05:20.160 training and things, but you know they have to make 0:05:20.160 --> 0:05:23.159 sure the pathways are there to do that. My concern 0:05:23.200 --> 0:05:25.440 would be for some of those communities where unemployment is 0:05:25.520 --> 0:05:27.920 endemic and mum and dad are unemployed. But I can 0:05:27.960 --> 0:05:29.680 see you know that that true blue bit is that 0:05:29.839 --> 0:05:32.280 I guess that from the right wing political perspective, it's 0:05:32.320 --> 0:05:34.720 to try and push people to get motivated and go 0:05:34.760 --> 0:05:36.560 and look after themselves. But it could be quite a 0:05:36.600 --> 0:05:38.520 shock in the short term for some people. 0:05:38.720 --> 0:05:41.840 The investment boost tax is a big one as well. 0:05:41.880 --> 0:05:44.960 You mentioned it before. Business is allowed to deduct twenty 0:05:45.000 --> 0:05:48.200 percent of the cost of new assets immediately from their 0:05:48.240 --> 0:05:51.640 tax will income on top of normal depreciation. Essentially, this 0:05:51.800 --> 0:05:54.440 means a lower tax bill and it's believed that over 0:05:54.520 --> 0:05:57.360 twenty years this could increase the level of GDP by 0:05:57.480 --> 0:06:01.560 one percent and wages by one point five percent. How 0:06:01.720 --> 0:06:05.200 big of a deal is this change, given how long 0:06:05.360 --> 0:06:06.960 term those benefits are. 0:06:07.200 --> 0:06:09.400 I was just talking with an economist, Christina Long from 0:06:09.480 --> 0:06:11.520 enzi Are, and she wasn't that impressed with it, like 0:06:11.560 --> 0:06:14.320 in terms of the overall transformative nature of it, But 0:06:14.480 --> 0:06:17.719 I think it is. It's sort of a move in 0:06:17.760 --> 0:06:21.080 the right direction to try and lift the productivity of 0:06:21.400 --> 0:06:24.159 New Zealand. So we have this reputation for being having 0:06:24.160 --> 0:06:26.880 a low productivity rate in the country, in this country, 0:06:27.200 --> 0:06:30.159 and there are many reasons, but one of the reasons 0:06:30.200 --> 0:06:32.640 that it has been identified is that we just don't 0:06:32.680 --> 0:06:37.800 invest to the same level in the latest technology, new equipment, 0:06:38.160 --> 0:06:40.799 the stuff that makes each worker be able to generate 0:06:40.839 --> 0:06:42.760 more output. You know, if you go to Germany then 0:06:42.760 --> 0:06:45.880 it's all robotic factories and all that sort of stuff, 0:06:45.960 --> 0:06:50.120 and so anything that incentivizes businesses to invest, it should 0:06:50.200 --> 0:06:53.640 incentivize them perhaps to take a risk, expand a bit more. 0:06:53.760 --> 0:06:55.480 That's what they want, That's what they talk about when 0:06:55.480 --> 0:06:57.960 they say going for growth. It will be interesting to 0:06:58.000 --> 0:07:01.000 see because the you know, Employees and Manufacturers Association, Business 0:07:01.080 --> 0:07:03.520 end Z, they've been lobbying for this for a long time. 0:07:03.600 --> 0:07:05.719 They've finally got it. I think businesses will kind of 0:07:05.720 --> 0:07:07.240 have to put their money where their mouth is now 0:07:07.279 --> 0:07:08.840 and get out there and do it. You'd hope, and 0:07:09.080 --> 0:07:11.720 you'd hope that it has some payoff it. It's also 0:07:12.120 --> 0:07:14.080 going to be you're going to get that twenty percent 0:07:14.120 --> 0:07:16.600 break on your new buying a new forklift anyway, where 0:07:16.600 --> 0:07:18.160 you get a twenty percent break on it, that is 0:07:18.240 --> 0:07:21.360 kind of a stimulus. So that's where people say this 0:07:21.400 --> 0:07:24.240 is an austerity budget or not arguing that that this 0:07:24.360 --> 0:07:26.200 is a little bit of stimulus into the economy. So 0:07:26.480 --> 0:07:29.280 you know, one point whatever billion a year over four years. 0:07:29.400 --> 0:07:31.880 Well, basically the people who are holding off buying that 0:07:31.960 --> 0:07:34.600 forklift now have an incentive to do so more so 0:07:34.800 --> 0:07:35.440 than before. 0:07:35.680 --> 0:07:37.960 Yeah, and the true blue bit, the sort of the 0:07:38.040 --> 0:07:40.520 right leaning bit is saying, well, the stimulatory part, the 0:07:40.520 --> 0:07:42.200 bit where we're putting a bit a bit cash back 0:07:42.200 --> 0:07:44.760 into the economy. You could put it in the pockets 0:07:44.760 --> 0:07:47.680 of consumers. Consumers might go out and just spend a 0:07:47.680 --> 0:07:49.680 little bit, They might drink and eat a little bit more, 0:07:49.720 --> 0:07:51.640 which is, you know, maybe good for the short term 0:07:51.760 --> 0:07:53.840 health of the economy and hospitality. But if you give 0:07:53.840 --> 0:07:56.480 it to the businesses and they invest in the machinery 0:07:56.520 --> 0:08:00.640 of the economy the business world, you know, that's positive 0:08:00.680 --> 0:08:03.280 long term. That means that they ultimately should be able 0:08:03.320 --> 0:08:06.960 to grow bigger, make more money, employ more people. You've 0:08:06.960 --> 0:08:08.840 got to believe, I mean, I'm trying to be a 0:08:08.840 --> 0:08:12.440 political here. You've got to believe that business and capitalism 0:08:12.560 --> 0:08:14.960 is going to do the job for you to back this, 0:08:15.240 --> 0:08:17.360 and obviously this government very clearly does. 0:08:26.560 --> 0:08:26.640 So. 0:08:26.680 --> 0:08:29.720 I reckon means testing is one of the themes of 0:08:29.760 --> 0:08:33.240 this budget. Hey, government, can we save a Contributions are 0:08:33.240 --> 0:08:35.240 now going to stop if you earn one hundred and 0:08:35.240 --> 0:08:38.440 eighty thousand dollars a year or more and for the 0:08:38.480 --> 0:08:42.360 best start tax credits that will become income tested. So 0:08:42.400 --> 0:08:45.840 starting at families on seventy nine thousand dollars a year. 0:08:46.000 --> 0:08:47.680 Is that a smart move from the government. 0:08:47.800 --> 0:08:51.120 Well, I mean, some people argue that it's difficult and complex. 0:08:51.160 --> 0:08:53.200 You know, you're adding another layer of complexity to have 0:08:53.240 --> 0:08:55.400 to means test everything. I guess it seems like a 0:08:55.400 --> 0:08:57.800 really a fairly generous bar one hundred and eighty thousand 0:08:57.840 --> 0:09:00.840 when you're talking about five hundred dollars or there. You know, 0:09:01.160 --> 0:09:03.360 I think if you could afford to top up your 0:09:03.360 --> 0:09:05.640 own key, we savior to some extent of it. That's 0:09:05.640 --> 0:09:06.040 the case. 0:09:06.400 --> 0:09:09.160 Rich people like getting more money, though. 0:09:09.600 --> 0:09:12.600 Everyone likes getting more money. Yeah, I wonder. I mean, 0:09:12.600 --> 0:09:15.200 it's interesting because they might get a bit better at 0:09:15.720 --> 0:09:18.599 you know, the machinery of means testing, and you know 0:09:18.640 --> 0:09:21.840 where does that lead. Well, maybe you know, they've talked 0:09:21.840 --> 0:09:26.080 about whether we should be means testing superannuation, so that 0:09:26.240 --> 0:09:29.720 if you're actually still learning while you're getting the retirement pension, 0:09:29.880 --> 0:09:32.600 you could be means tested, and that's considered quite difficult 0:09:32.600 --> 0:09:34.520 to do. Well, perhaps if for government's some getting better 0:09:34.559 --> 0:09:37.120 at means testing because they're doing it for some other things, 0:09:37.440 --> 0:09:40.760 it becomes part and parcel of what they do. But yeah, 0:09:40.800 --> 0:09:43.600 they means test already for student allowances and things like that. 0:09:43.679 --> 0:09:47.160 So I guess. I guess there is mechanisms in place. Yeah, 0:09:47.200 --> 0:09:50.360 I mean it's all about plowing back a little bit 0:09:50.360 --> 0:09:51.719 of money here and there, isn't it. I mean that's 0:09:52.200 --> 0:09:56.360 what the finance ministers had to do. They've clawed back 0:09:56.360 --> 0:09:59.920 a large chunk from the pay equity sort of reverse all, 0:10:00.840 --> 0:10:03.360 and then they're crawing back bits and pieces everywhere else 0:10:03.400 --> 0:10:05.120 to get a few billion here and a few billion there. 0:10:05.280 --> 0:10:07.880 Seventy nine thousand dollars a year for a family. Though 0:10:07.880 --> 0:10:08.920 that's quite low, isn't it. 0:10:09.320 --> 0:10:09.559 It is? 0:10:09.640 --> 0:10:12.200 The argument is with a real right when government would 0:10:12.200 --> 0:10:14.480 even want that benefit there in the first place. So 0:10:14.920 --> 0:10:17.000 they've put a means test in so it's really just 0:10:17.080 --> 0:10:19.599 the poorest people I guess that are going to get it. 0:10:19.840 --> 0:10:22.640 So last year's budget was all about putting more money 0:10:22.720 --> 0:10:25.839 into our wallets with tax cuts and other savings. Is 0:10:25.880 --> 0:10:28.480 there anything in this budget that looks like it will 0:10:28.640 --> 0:10:30.079 help ease the cost of living? 0:10:30.240 --> 0:10:32.400 Or have we moved on from that buzz term? 0:10:32.520 --> 0:10:35.840 Now there's support for working for families and supercar holders, 0:10:35.920 --> 0:10:38.800 but it doesn't feel like a massive support budget. 0:10:38.960 --> 0:10:40.720 No, this is not a support budget, and I don't 0:10:40.760 --> 0:10:42.720 know whether you'd call it austerity or not. It's probably 0:10:42.760 --> 0:10:46.079 depends on your political colors, but it's certainly from that 0:10:46.160 --> 0:10:48.200 point of view. You know, it was just that tax 0:10:48.280 --> 0:10:50.920 break for business, which may be a little bit stimulatory, 0:10:51.000 --> 0:10:54.720 but for ordinary consumers there isn't any stimulus and they 0:10:54.720 --> 0:10:56.719 don't want to kick start the inflation again. They don't 0:10:56.720 --> 0:10:58.760 want to get back growing the economy just by putting 0:10:58.840 --> 0:11:01.079 money into it, is what they're saying. Well, that's what 0:11:01.320 --> 0:11:03.560 the last government did. We're not doing that. We need 0:11:03.640 --> 0:11:05.240 it to come from the ground up, needs to come 0:11:05.280 --> 0:11:08.320 from business and export earnings and all that sort of stuff. 0:11:08.400 --> 0:11:11.040 So yeah, I don't think we expected much support for people. 0:11:11.320 --> 0:11:14.200 I'm sure the government would argue that inflation is more 0:11:14.280 --> 0:11:16.839 or less under control. I know right now everyone's panicking 0:11:16.880 --> 0:11:20.199 about the price of butter and there's some cheese. Yeah, yeah, 0:11:20.360 --> 0:11:24.320 don't forget cheese. But basically, you know, weirdly, when dairy 0:11:24.360 --> 0:11:26.280 products are going through the roof like that, that's good 0:11:26.360 --> 0:11:28.839 news for New Zealand. I mean, there's money coming into 0:11:28.880 --> 0:11:33.319 the countries and economists think that overall inflation will stay 0:11:33.720 --> 0:11:36.959 relatively subdued. A few of those key commodity products that 0:11:37.040 --> 0:11:39.439 are accepted, you know that are having a bit of 0:11:39.480 --> 0:11:42.320 a moment, but the core inflation in the economy because 0:11:42.400 --> 0:11:45.440 of higher unemployment wages coming off, it's expected to stay 0:11:45.480 --> 0:11:48.120 pretty subdued. So nobody's ever going to say, hey, the 0:11:48.240 --> 0:11:50.160 cost of living is great, but it shouldn't be the 0:11:50.240 --> 0:11:52.480 same sort of issue that it was. And I don't 0:11:52.520 --> 0:11:56.439 think national would ideologically support the kind of just payments 0:11:56.480 --> 0:11:58.240 to people to cope with it anyway, because they would 0:11:58.280 --> 0:12:00.600 argue that that would just exacerbate the inflation. 0:12:00.840 --> 0:12:04.199 Well, you mentioned the pay equity changes that's dominated the 0:12:04.240 --> 0:12:07.320 political discourse for a few weeks. Now, now that we've 0:12:07.400 --> 0:12:12.360 learned that nearly thirteen billion over four years has been saved, 0:12:12.559 --> 0:12:14.880 is it a win for the government to the average 0:12:14.920 --> 0:12:17.079 person on the street, that's a pretty big number to 0:12:17.200 --> 0:12:18.000 attach a saving. 0:12:18.080 --> 0:12:20.280 Two Yeah, Well, I mean, I guess you know, it 0:12:20.800 --> 0:12:23.640 has kind of opened up the budget for the government 0:12:23.880 --> 0:12:26.079 to do the things they wanted to do, So, you know, 0:12:26.120 --> 0:12:28.520 I think didn't David Seymour get in trouble for saying. 0:12:28.320 --> 0:12:31.400 That Brook van Velden saved the budget. Yeah, well, it 0:12:31.559 --> 0:12:32.040 kind of has. 0:12:32.160 --> 0:12:32.240 Right. 0:12:32.320 --> 0:12:34.000 Whether it's a win for the government, well, we'll have 0:12:34.080 --> 0:12:35.760 to wait and see, because I think it's going to 0:12:35.880 --> 0:12:38.200 be a hot topic for a while to come, because 0:12:38.240 --> 0:12:41.480 you know, just just at a superficial level politically, money 0:12:41.559 --> 0:12:45.480 for businesses, and it's coming out of the potential wage 0:12:45.559 --> 0:12:49.280 increases that could have gone to some of the poorest workers, 0:12:49.640 --> 0:12:53.160 female workers and female industries and often caring for the 0:12:53.200 --> 0:12:55.760 most vulnerable people in society. So you've got a pretty 0:12:56.120 --> 0:12:59.120 stark contrast there, and that's something for the opposition to 0:12:59.160 --> 0:13:01.160 work with and say, hey, you know, why are we 0:13:01.200 --> 0:13:03.480 giving this money to businesses. They're going to have to 0:13:03.520 --> 0:13:06.079 really sell this kind of productivity argument, and it's not 0:13:06.240 --> 0:13:09.000 not necessarily a simple simple sales job. So I think 0:13:09.080 --> 0:13:11.679 the government will still be up against it politically for 0:13:11.960 --> 0:13:13.760 a few more weeks. I think they're hoping that it'll 0:13:13.760 --> 0:13:15.640 all just roll on and that maybe by the time 0:13:15.679 --> 0:13:18.000 we get to an election, but I've spoken to a 0:13:18.040 --> 0:13:19.160 few women who think it might not. 0:13:22.520 --> 0:13:25.800 This House has no confidence in the government because it 0:13:25.840 --> 0:13:28.599 has chosen to pay for its budget by cutting the 0:13:28.720 --> 0:13:34.760 future wages of working women. Mister Speaker Niicola Willis's pre 0:13:34.920 --> 0:13:39.559 budget's been got it half right. This was a scramble 0:13:39.920 --> 0:13:40.880 without the lollies. 0:13:41.520 --> 0:13:44.200 A budget that has scrambled. 0:13:43.840 --> 0:13:47.040 The government's finances, tried a whole lot of smoke and 0:13:47.120 --> 0:13:51.000 mirrors to hide where their cuts are being made, and 0:13:51.120 --> 0:13:54.160 to try and confuse Use Islanders with the idea that 0:13:54.240 --> 0:13:56.199 they'll be better off when for a lot of key 0:13:56.200 --> 0:14:00.360 we families, this budget is nothing but bad use. 0:14:05.120 --> 0:14:09.199 Well, in terms of infrastructure, we've had some investments in 0:14:09.360 --> 0:14:14.280 rail military equipment, and billion dollars on hospitals upgrades and maintenance, 0:14:14.520 --> 0:14:17.600 just under a billion dollars of capital and operating spending 0:14:17.720 --> 0:14:21.240 on new classrooms, two hundred and nineteen million on recovery 0:14:21.320 --> 0:14:24.440 work on cyclone damaged roads. Does this feel like a 0:14:24.600 --> 0:14:28.720 good infrastructure spend? I ask this only because the Herald 0:14:28.840 --> 0:14:32.640 editorial on budget Day said that it is unacceptable for 0:14:32.800 --> 0:14:35.280 some of us to have seen our quality of life 0:14:35.360 --> 0:14:39.400 fall because of a lack of basic infrastructure. So if 0:14:39.440 --> 0:14:43.560 we're saving thirteen billion dollars, shouldn't we be getting something 0:14:43.640 --> 0:14:44.920 a bit more out of it? 0:14:45.120 --> 0:14:45.280 Yeah? 0:14:45.320 --> 0:14:48.600 I mean this is the spending is fairly basic. It's 0:14:48.680 --> 0:14:51.880 the kind of keeping things running, coping with the higher population, 0:14:52.680 --> 0:14:55.720 more people living in certain areas, needing the schools, making 0:14:55.760 --> 0:14:57.720 sure that the hospitals can cope, and I imagine it's 0:14:57.760 --> 0:14:59.400 still going to be plenty of people saying that this 0:14:59.520 --> 0:15:01.760 is still going to be an incredibly tight budget for 0:15:02.560 --> 0:15:05.400 health and education regardless. So this is where the government 0:15:05.520 --> 0:15:08.120 is caught on the spending front. They and the argument 0:15:08.120 --> 0:15:10.560 would come back to debt and borrowing because the tax 0:15:10.640 --> 0:15:13.360 takes down issues about how quickly it's going to come 0:15:13.400 --> 0:15:15.840 back and start putting more money into the government coffers 0:15:15.920 --> 0:15:17.800 they're up against it, and so what are the options, Well, 0:15:17.800 --> 0:15:20.480 you cut or you borrow, And of course the opposition 0:15:20.600 --> 0:15:22.840 is saying, well, we could afford to borrow more, and 0:15:23.040 --> 0:15:26.640 depends who you talk to, you know we could, but 0:15:26.760 --> 0:15:30.080 that might be taking a higher level of risk than 0:15:30.200 --> 0:15:32.040 some people feel like taking. At the moment, we could 0:15:32.040 --> 0:15:34.560 probably technically afford to borrow more. But I think one 0:15:34.600 --> 0:15:37.680 of the issues that politically holds this government back and 0:15:37.720 --> 0:15:39.360 a lot of people who voted for them, is the 0:15:39.480 --> 0:15:42.520 sense that governments can actually spend that money. Well, so 0:15:42.800 --> 0:15:45.200 after what we've been through with all the borrowing and 0:15:45.240 --> 0:15:47.680 spending to get through COVID, but then all sorts of 0:15:47.760 --> 0:15:50.560 other stuff that was planned on the infrastructure front and 0:15:51.000 --> 0:15:53.760 hasn't happened, people are skeptical about the the ability of 0:15:53.800 --> 0:15:56.520 governments to deliver if they borrow more money. So I 0:15:56.560 --> 0:15:58.920 think that's a big part of the debate around borrowing 0:15:59.000 --> 0:16:00.960 more you know, New Zealanders country that has to be 0:16:01.120 --> 0:16:04.200 ready for the next earthquake or the next major natural disaster, 0:16:04.480 --> 0:16:07.680 or the next big international shocks. So I'm kind of 0:16:07.880 --> 0:16:11.240 pleased to see Nikola Willis being prudent there and hopefully, 0:16:11.440 --> 0:16:14.320 you know, building for the future. I'm not as gloomy 0:16:14.400 --> 0:16:17.560 as some other commentators. If you've talked to Matthew Hooton 0:16:17.640 --> 0:16:18.960 or someone like that, they. 0:16:18.720 --> 0:16:21.600 Think it's pretty gloomy. They're all dar livestream. 0:16:21.680 --> 0:16:25.000 Yeah, until the government is prepared to cut superannuation and 0:16:25.080 --> 0:16:30.240 tertiary healthcare, basically this country is heading towards bankruptcy. None 0:16:30.280 --> 0:16:33.240 of this takes into account the problems that we've known 0:16:33.280 --> 0:16:36.280 about for thirty or forty years that chicken from twenty thirty. 0:16:36.760 --> 0:16:40.240 We're going to start that period about fifty percent of 0:16:40.320 --> 0:16:44.200 GDP worse than we expected at the end of the 0:16:44.560 --> 0:16:48.360 era of reform under the Bulger, Shipley and Clark governments. 0:16:49.360 --> 0:16:52.400 He would argue that we're in real trouble, say in 0:16:52.440 --> 0:16:54.520 the next ten years, if we don't take some really 0:16:54.600 --> 0:16:58.080 radical action and cut back even harder. So the alternative 0:16:58.160 --> 0:17:00.800 is to bet on the growth. So I think the 0:17:00.880 --> 0:17:03.560 government is rolling the dice, betting on business to grow 0:17:03.640 --> 0:17:06.800 this economy and betting, I guess, or hoping that you 0:17:06.880 --> 0:17:09.040 know that the boom and the primary sector keeps going, 0:17:09.119 --> 0:17:11.280 they can get tourism back. Yeah, those are the things 0:17:11.320 --> 0:17:12.040 that need to happen. 0:17:12.200 --> 0:17:14.560 Well, ultimately, Liam, do you think this budget is going 0:17:14.600 --> 0:17:16.080 to be a winner with voters or is it a 0:17:16.119 --> 0:17:17.280 bit too middle of the road. 0:17:17.600 --> 0:17:19.879 Yeah, it could, It could be a difficult cell. But 0:17:20.000 --> 0:17:21.639 it is the middle budget, you know, so that the 0:17:21.720 --> 0:17:23.919 first budget in power in a three year term. You've 0:17:24.000 --> 0:17:26.000 kind of got to deliver all these promises that you made, 0:17:26.119 --> 0:17:28.639 so that's pretty costly. Second budget is the one that 0:17:28.720 --> 0:17:30.960 might as well be the most unpopular budget, and it's 0:17:30.960 --> 0:17:33.200 the one that people might forget because you've got another 0:17:33.280 --> 0:17:36.280 one coming up in election year where you can maybe 0:17:36.400 --> 0:17:39.960 put something a little bit more like whatever. For Nicholais 0:17:40.000 --> 0:17:41.760 said no lolly scramble this year. I'm not sure that 0:17:41.840 --> 0:17:43.960 budgets are meant to be a lolly scramble, but a 0:17:44.080 --> 0:17:46.439 lolly or two. Yeah, I think I think this budget 0:17:46.480 --> 0:17:48.439 probably is quite a hard sell. I mean, the business 0:17:48.480 --> 0:17:51.480 community will be quite happy and they'll be excited about it, 0:17:51.520 --> 0:17:53.720 and there'll be lots of discussion about growth and maybe 0:17:53.800 --> 0:17:55.920 maybe it's you know, from a confidence point of view, 0:17:56.800 --> 0:17:59.040 that will be quite good. But for the wider public, 0:17:59.080 --> 0:18:00.400 I think it's probably tough. 0:18:00.440 --> 0:18:06.720 Sel Thanks for joining us, Liam, cheers. That's it for 0:18:06.800 --> 0:18:09.880 this episode of the Front Page. You can read more 0:18:09.920 --> 0:18:14.520 about today's stories and extensive news coverage at enzdherld dot 0:18:14.640 --> 0:18:18.280 co dot MZ. The Front Page is produced by Ethan 0:18:18.440 --> 0:18:22.160 Sills and Richard Martin, who is also our sound engineer. 0:18:22.680 --> 0:18:27.080 I'm Chelsea Daniels. Subscribe to The Front Page on iHeartRadio 0:18:27.320 --> 0:18:30.240 or wherever you get your podcasts, and tune in on 0:18:30.520 --> 0:18:33.520 Monday for another look behind the headlines.