Plain English No.14 - October 2013
Plain English No.14
I just thought I'd update you on how our economy is performing, and on some recent overseas trips I have made as Finance Minister to meet with business, investment, and political leaders.
Deficit halved, surplus within
Recently I was pleased to announce that we've halved the deficit for the second successive year and we're well on track for the return to surplus next year.
The Financial Statements for the year ended June 30, 2013, show the government's operating deficit before gains and losses was $4.4 billion in the past year, compared with a $9.2 billion deficit the previous year. The result is considerably better than the $7.9 billion deficit forecast by Treasury at the start of the financial year in Budget 2012.
Our prudent management has also resulted in lower government expenses and a stronger economy that has boosted tax revenue, driven largely by higher incomes and consumption.
Business confidence is now consistently up with the latest survey showing it is at its highest point for three years. Businesses are more optimistic, activity is rebounding and, importantly, this is being gradually realised in more jobs and profits.
Keeping an eye on the global situation
This week I am in the United States for the annual meetings of International Monetary Fund and World Bank governors.
I'm also meeting senior representatives of credit ratings agencies and the New York Stock Exchange in New York, and in Boston I'm speaking at the Harvard Kennedy Business School and meeting with investment and business leaders.
The meetings will provide another opportunity to assess latest global economic developments and their likely impact on New Zealand.
back for Parliament next week and will then be down in the
The US visit follows a trip last month to Vietnam and Singapore to meet a number of business, investment, and political leaders.
South East Asia is an important trade and investment partner for New Zealand and it's essential that we maintain close relationships with this region. The 10 countries of South East Asia took $4.3 billion of New Zealand exports in the year to June 2013.
New Zealand is fortunate to have a region on its doorstep which continues to show healthy growth - including Vietnam and Singapore - at a time when many other parts of the world are still struggling with little growth and high debt.
Finance Minister Bill English meets with Singapore PM Lee Hsien Loong.
I earlier visited Europe and the United Kingdom which gave me the opportunity to share ideas about public sector reform and financial markets, and also provided me with a first-hand insight into Europe's economic challenges, which are far from over.
These trips have confirmed for me that, here at home, we are on the right course by focusing on getting the Government's own books in order, while strengthening the wider economy. The consequences of too much government debt are all too clear in Europe and the United States where there have been cuts to public services and pensions, and higher tax rates.
We have escaped that owing to the
Government's careful management of the economy which is
seeing growth and confidence pick up. The IMF has this week
published its annual World Economic Outlook and it is
pleasing to see New Zealand forecast to be among the
strongest-growing advanced economies in the world in the
next two years.
Bill English MP for
MP for Clutha-Southland