Gordon Campbell | Parliament TV | Parliament Today | News Video | Crime | Employers | Housing | Immigration | Legal | Local Govt. | Maori | Welfare | Unions | Youth | Search

 


Budget 2014: Where’s the magic?

Budget 2014: Where’s the magic?


Forecast economic growth rising as high as 4% in 2016, and strongly growing tax revenues has allowed the Government to present a Budget that achieves a surplus, while increasing Government spending significantly, and still reduces the size of the Government relative to GDP.

The Government will spend $73.1bn in 2015 rising to $81.5bn by 2018. Yet despite that increase, core Crown expenses will fall from 35% of GDP in 2011 to less than 30% in 2017. Relative to the economy, Government is getting smaller.

And despite that extra spending, the government will run growing surpluses and meet a debt reduction target of 20% of GDP by 2020.

So where’s the magic?

“The magic in Budget 2014 is the forecast growth of the economy, the trick is making sure the magic is real,” PwC Corporate Tax Leader, Geof Nightingale says.

“Economic growth drives higher tax revenues, and, now we will return to surplus, as long as spending increases are kept to less than tax revenue increases, surpluses will continue.

“Net debt as a percentage of GDP also improves, but not because it’s being repaid. From 2015 no more is borrowed, with net debt peaking at $65bn. The government plans to hold it there while the economy grows around it.

“Budget 2014 walks a finely balanced line of increasing Government spending, generating surpluses to protect the future and allowing our debt to reduce as a proportion of GDP. But it relies heavily on us achieving the magic of economic growth.

“However, the sensible fiscal management presented by Budget 2014 should help to create that magic,” concludes Mr Nightingale.

-ends-

© Scoop Media

 
 
 
 
 
Parliament Headlines | Politics Headlines | Regional Headlines

Gordon Campbell:
On Pharmac, Gough Whitlam And Sleater-Kinney

Ridiculous reported comments on RNZ this morning by Trade Minister Tim Groser, as he sought to dampen down concerns about the leaked draft of the IP chapter of ther Trans Pacific Partnership negotiations. According to Groser, ‘extreme’ positions are common at the outset of negotiations, and these get whittled down over the course of negotiations. Fine.

Except that we’re not at the outset of these negotiations. The outset was six years ago, and negotiators were hoping to have some sort of ‘framework’ deal finished in time for the APEC meeting in a few weeks’ time. These ‘extreme’ positions are what we’ve reached near the intended end of the negotiations.

Still, Groser did promise that the cost of medicines would not rise as a result of the TPP trade deal. Great. But this is not what politicians in other countries are saying. More>>

.

 
 

Parliament Today:

Aussie Investigation Dropped: Call On Minister McCully To Pursue The Case Of Balibo Five

West Papua Action is deeply concerned at the lack of any clear outcome from the Australian Federal Police inquiry into the 1975 deaths of the ‘Balibo Five’ including NZ journalist Gary Cunningham. More>>

ALSO:

'Feed The Kids' Bill: Metiria Turei To Lead Fight On Feeding Hungry Children

Green Party Co-leader Metiria Turei is urging all political parties to support the Feed the Kids Bill which she inherited today from Mana leader Hone Harawira. More>>

Parliament Today: State Opening Of Parliament

The House sat at 10.30am on Tuesday before MPs were summoned to hear the Speech from the Throne in the Legislative Council Chamber. More>>

ALSO:

Tertiary Education: Students Doing It Tough As Fees Rise Again

The Government is making it increasingly difficult for Kiwis to gain tertiary education as fees continue to rise and access to student support becomes even more restricted, Labour’s Tertiary Education spokesperson Chris Hipkins says. More>>

ALSO:

Housing, Iraq: PM Press Conference – 20 October 2014

Prime Minister John Key met with press today to discuss:
• Housing prices and redevelopment in Auckland
• Discussions with Tony Abbott on the governmental response to ISIS, and New Zealand’s election to the UN Security Council More>>

ALSO:

Labour: Review Team Named, Leadership Campaign Starts

Labour’s New Zealand Council has appointed Bryan Gould as Convenor of its post-General Election Review. He will be joined on the Review Team by Hon Margaret Wilson, Stacey Morrison and Brian Corban.

ALSO:

Roy Morgan Poll: National Slips, Labour Hits Lows

The first New Zealand Roy Morgan Poll since the NZ Election shows National 43.5% (down 3.54% since the September 20 Election). This isn’t unusual, National support has dropped after each of John Key’s Election victories... However, support for the main opposition Labour Party has crashed to 22.5% (down 2.63% and the lowest support for Labour since the 1914 NZ Election as United Labour). More>>

ALSO:

In On First Round: New Zealand Wins Security Council Seat

Prime Minister John Key has welcomed New Zealand securing a place on the United Nations Security Council for the 2015-16 term. More>>

ALSO:

Get More From Scoop

 

LATEST HEADLINES

 
 
 
 
 
 
 
 
Politics
Search Scoop  
 
 
Powered by Vodafone
NZ independent news