Finance Minister Michael Cullen today welcomed Standard and Poor's decision to put New Zealand back on a stable credit outlook saying it reflected confidence in the Government's fiscal stance.

"It also puts us back on par with Australia, in this if not on the cricket pitch," he said.

Both countries were on AA+, the second highest rating S&P gives. But since 1998, New Zealand had been on negative outlook.

"The main reason S&P gives for the promotion is that it is confident the Government will maintain the budget in structural surplus.

"Other reasons are the independence of the Reserve Bank in the operation of monetary policy and the resilience of the economy with flexible labour and product markets.

"Clearly S&P has had an opportunity to assess the Employment Relations Act and is satisfied that it does not introduce rigidities into the labour market," Dr Cullen said.

"S&P quotes the current high levels of private sector debt as a constraint on our currency rating. The Government has long identified the need to raise national savings rates as a top priority and is developing policies to achieve this.

"They include the proposed New Zealand Superannuation Fund and measures to make private pension funds more attractive as a savings instrument," Dr Cullen said.

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