Bill English National Finance Spokesman

14 June 2001

Growth forecasts take another drop down

The latest NZIER forecasts confirm National's prediction that the Government's growth and fiscal view is more optimistic than its policies can deliver, National's Finance spokesman Bill English said today.

"For some time now I have been predicting that economists would start revising down their growth and operating balance forecasts, and revising up their debt forecasts. Here's the evidence.

"Growth for 2002, picked at 3.5 percent in the 2000 Budget and revised down to 2.6 percent by Treasury, has taken a further hit, down to 2.3 percent in the NZIER forecast. This reflects the likelihood of slowing world demand, with domestic growth just managing to pick up the slack from weaker exports.

"NZIER is forecasting that the surpluses over the next three years will be $2.4 billion lower than Treasury was picking.

"The result of those lower surpluses is that NZIER is forecasting net debt to be at 20 percent of GDP by 2005, compared to Treasury's forecast of 18 percent.

"The lower forecast growth profile would also mean a smaller improvement in the current account deficit. Treasury was picking 3.5 percent of GDP; NZIER is forecasting 5.3%.

"Every time these forecasts are revised downwards, so is Dr Cullen's credibility as a prudent fiscal manager.

"The Budget revealed Dr Cullen is going to ioncrease Government debt. This forecast signals that the increase in Government debt is likely to be substantial" Bill English said.

Ends

© Scoop Media

Gordon Campbell: On the Sony cyber attack

Given the layers of meta-irony involved, the saga of the Sony cyber attack seemed at the outset more like a snarky European art film than a popcorn entry at the multiplex.

Yet now with (a) President Barack Obama weighing in on the side of artistic freedom and calling for the US to make a ‘proportionate response’quickly followed by (b) North Korea’s entire Internet service going down, and with both these events being followed by (c) Sony deciding to backtrack and release The Interview film that had made it a target for the dastardly North Koreans in the first place, then ay caramba…the whole world will now be watching how this affair pans out. More>>