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Our Take

Key points
• The government has made a bold step forward in incorporating wellbeing measures. The change must be respected. It’s a long road ahead, however, and time is needed to succeed.
• Spending has been boosted across the Government’s key initiatives, taking from future (forecast) surpluses. The impact on net debt and gross debt issuance is small. The government stuck to the self-imposed fiscal responsibility objectives. These restraints need to be removed.
• The forecast fiscal impulse had disappointed this year, so was watered down and spread across the next two years. Government activities provide the lion’s share of forecast growth for the nation.
• Treasury’s forecasts were fair and easily defendable. They’re not too dissimilar from our own, or the RBNZ’s.

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Summary

Grant Robertson proudly delivered his first well-being budget. A budget designed to encourage collaboration across Government departments, and refocus our attention of measurues that matter to our wellbeing. It is a very bold, interesting first step. A step that requires a few more, and needs time to cultivate success.
The key initatives in the budget were admirable. Tackling child poverty, and mental health are desperately needed. The focus on Māori and Pasifika development is important in lifting the standard of living for all Kiwis. The social side of the budget was well done. The overaching plan to transform and build a more productive economy lacks a little detail. But the examples of funding into rail and the regions showed promise.
The Finance Minister’s “whole of government”, “intergenerational” approach, using wellbeing measures to focus and measure success, is a big ask. Only time will tell, and we fear they may be tested in time. Moving the dial, meaningfully, on Kiwi wellbeing may take 5-10 years, and they’ll be quizzed every budget. The aspirations in the budget are grand, and respected. But it’s all about long-term execution in a short-sighted political world.
To read more, please click here or open the pdf below.

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