Gordon Campbell | Parliament TV | Parliament Today | Video | Questions Of the Day | Search

 


Govt considers balanced quake policy response

Hon Bill English
Minister of Finance


6 March 2011 Media Statement

Govt considers balanced quake policy response

The Treasury’s preliminary assessment of the Christchurch earthquake’s economic impact confirms the need for the Government to carefully consider its priorities, Finance Minister Bill English says.

It also points out that economic growth was slower than forecast previously, even before the latest earthquake. This reflects soft domestic demand – as New Zealanders save more - despite exporters benefiting from higher commodity prices.

“At this early stage, our immediate focus is on getting good information about Christchurch’s requirements, and that will tell us more about the scope of the prioritising we need to do,” he says.

“Since being elected in 2008, the Government has taken the approach of protecting the most vulnerable and any spending changes we make will ensure that continues

“Paying for the earthquake will likely involve a balanced combination of a bit more borrowing in the short term and reconsidering our spending priorities, so we can provide the financial resources needed to help rebuild Christchurch and the Canterbury economy.

“And we’ll also press on with our broader economic programme to reduce New Zealand’s vulnerability to foreign lenders, get the Government’s finances in order and build faster growth based on higher national savings and exports.”

In its Monthly Economic Indicators issued today, the Treasury provides a preliminary assessment of two aspects of the earthquake:

• It estimates the total financial cost of damage from the earthquake at between $10 billion and $15 billion – two to three times the estimated $5 billion cost of the first earthquake last September. This will be shared between central government, insurers, local government and businesses.

• In addition, the wider economic impact of the earthquake, combined with already slower economic growth than forecast in the Half Year Update in December, could leave nominal GDP a cumulative $15 billion lower over the five years to 2015. That is equivalent to about 1.5 per cent of the total value of GDP over this period.

“We're still working through the potential impacts of the earthquake on GDP and the flow-through to tax revenue,” Mr English says. “But based on these early assumptions, the total loss of tax revenue from all of these factors could be in a range of $3 billion to $5 billion over the five years.

“This is manageable in the context of the Government’s revenue base of about $330 billion over the five years.

“It’s clear that the earthquake will have an impact on the Government’s finances – through both increased costs and reduced tax revenue.

“We will work through those issues carefully as we prepare for the Budget over coming months,” Mr English says.

The Treasury’s Monthly Economic Indicators publication, which includes its preliminary earthquake assessment, is available at:

http://www.treasury.govt.nz/economy/mei

ends

© Scoop Media

 
 
 
 
 
Parliament Headlines | Politics Headlines | Regional Headlines

 

Parliament Today:

The Kids: OECD Report Shows Huge Impact Of Poverty On Education

A new report from the OECD has again highlighted the negative effects of poverty, showing that disadvantaged children in New Zealand are more than six times more likely to underachieve in maths than children from wealthier homes. More>>

ALSO:

Pacific: NZ Pledges $500,000 To Help Address Zika

“With the Zika virus now confirmed in a number of Pacific countries, New Zealand is committed to helping limit the impact and spread of the virus in the region,” says Mr McCully. “New Zealand will provide $250,000 as a contribution to the WHO to implement the Pacific Zika Action Plan, and a further $250,000 to enable countries in the region to respond rapidly if required." More>>

ALSO:

Labour: Police Commissioner 'Doesn’t Get Force Needs'

The Police Commissioner has let down the public and his own force by insisting the police have what they need despite it taking a year to solve a burglary and overwhelming number of officers saying they are under-resourced, says Labour’s Police spokesman Stuart Nash. More>>

ALSO:

Gordon Campbell: On The US Pressure To Expand Our Role In Iraq

Foreign news services are being more forthcoming about what the “next 12 months” will entail – essentially, the defence ministers will be under US pressure to increase their “training” role preparatory to an assault on the city of Mosul in northern Iraq. More>>

ALSO:

Parliament Restarts: Prime Minister’s Statement

Our policy agenda and legislative programme will reflect the Government’s four priorities: • to responsibly manage the Government’s finances • to build a more competitive and productive economy • to deliver better public services to New Zealanders, an • to support the rebuilding of Christchurch. More>>

ALSO:

NZEI Survey Report: Special Needs Students Missing Out

The survey revealed that around 16 percent of students were on schools’ special needs registers, but nearly 90 percent of schools’ special needs coordinators did not believe there was adequate support for students and their learning... More>>

ALSO:

Interim Report: Waitangi Tribunal On Ture Whenua Legislation

Labour on Proposed changes to Maori land rules: “To have Treaty Negotiations Minister Chris Finlayson dismiss findings as ‘bizarre’ is totally disingenuous and disrespectful. What’s bizarre is Maori Development Minister Te Ururoa Flavell stubbornly pushing through this Bill before the Waitangi Tribunal has even completed its report..." More>>

ALSO:

Spy Update: Appointment Of GCSB Acting Director

GCSB Chief Legal Advisor Lisa Fong will become the Acting Director of the Government Communications Security Bureau (GCSB) from 15 February 2016, Minister Responsible for the GCSB Christopher Finlayson announced today. More>>

Get More From Scoop

 

LATEST HEADLINES

 
 
 
 
 
 
 
 
 
Parliament
Search Scoop  
 
 
Powered by Vodafone
NZ independent news