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Deficit blows out to $18bn as EQC kitty falls $1.1bn short

Deficit blows out to $18bn as EQC kitty falls $1.1bn short

by Pattrick Smellie

Aug 30 (BusinessDesk) – The Earthquake Commission faces Canterbury earthquake claims of up to $7.1 billion, close to double the $4 billion in claims originally estimated, and $1.1 billion more than its $6 billion Natural Disaster Fund.

The new estimate adds an immediate $1.1 billion to the Budget deficit for the financial year to June 30, pushing it close to $18 billion, and to 8.8% of Gross Domestic Product.

The only silver lining is that tax receipts from a recovering economy may slightly offset the quake-related cost increase.

Finance Minister Bill English and Earthquake Recovery Minister Gerry Brownlee revealed the new figures at a press conference this morning.

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